The US semiconductor industry in the 1990s: strategies and outcomes

Abstract

The semiconductor industry was one of the chief beneficiaries and drivers of globalization in the 1990s. The competitive environment of that decade provided opportunities for multinational enterprises (MNEs) and domestic firms operating in the US marketplace. The purpose of this paper is to identify whether there are relationships between certain business-level strategies and firm-level performance in the US semiconductor sector. Also, we investigate whether MNEs outperform their domestic-oriented rivals. Using objective measures, we uncover that a low-cost strategy is associated with performance, while focus and differentiation strategies have negative relationships with performance. Also, firm size is strongly related to performance. Our study contributes to our understanding of business-level strategies with its development of new objective measures, while our findings question whether being a MNE is necessarily an advantage in the semiconductor industry. Copyright (C) 2009 John Wiley & Sons, Ltd.