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This study examines the direct effect of internal factors within a business organization, including business strategy, operational efficiency, and ownership structure, on manufacturing performance. It also analyzes how these internal factors influence manufacturing performance when interacting with external factors, namely market uncertainty and competition intensity. The study compares firms with proactive and defensive strategies regarding operational efficiency and manufacturing performance differences. It also compares manufacturing performance differences between firms with foreign and domestic ownership. The sample for this study includes manufacturing firms listed on the Indonesia Stock Exchange between 2014 and 2021. The findings indicate that business strategy, operational efficiency, and ownership structure positively and significantly affect manufacturing performance. Operational efficiency is higher in manufacturing when business competition increases. Under intense business competition, manufacturing firms with foreign ownership tend to have more competitive advantages than domestic ownership. Manufacturing firms that adopt proactive business strategies (prospectors and analyzers) perform significantly better than those with defensive strategies (defenders and reactors).
Handoyo et al. (Wed,) studied this question.