Planned patterns of strategic behavior and their relationship to business‐unit performance

Planned patterns of strategic behavior and their relationship to business‐unit performance This study examined the moderating role of planning sophistication on the strategy‐performance relationship in 97 manufacturing firms representing 60 different industries. Cluster analysis was used to group the firms according to their strategic orientation. Five groups emerged. Significant differences in performance across selected groups were found establishing a ‘baseline’ strategy‐performance relationship. Strategic orientations emphasizing product innovation or those incorporating ‘efficiency’ and ‘differentiation’ patterns of strategic behavior were associated with significantly higher performance levels than two other groups. The nature of each firm's planning process was then introduced via a two‐way ANOVA procedure to determine if ‘process sophistication’ moderated the strategy‐performance ‘baseline’. Level of planning sophistication was found to significantly moderate the previously established strategy‐performance baseline. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Strategic Management Journal Wiley

Planned patterns of strategic behavior and their relationship to business‐unit performance

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Publisher
Wiley
Copyright
Copyright © 1988 John Wiley & Sons, Ltd.
ISSN
0143-2095
eISSN
1097-0266
DOI
10.1002/smj.4250090105
Publisher site
See Article on Publisher Site

Abstract

This study examined the moderating role of planning sophistication on the strategy‐performance relationship in 97 manufacturing firms representing 60 different industries. Cluster analysis was used to group the firms according to their strategic orientation. Five groups emerged. Significant differences in performance across selected groups were found establishing a ‘baseline’ strategy‐performance relationship. Strategic orientations emphasizing product innovation or those incorporating ‘efficiency’ and ‘differentiation’ patterns of strategic behavior were associated with significantly higher performance levels than two other groups. The nature of each firm's planning process was then introduced via a two‐way ANOVA procedure to determine if ‘process sophistication’ moderated the strategy‐performance ‘baseline’. Level of planning sophistication was found to significantly moderate the previously established strategy‐performance baseline.

Journal

Strategic Management JournalWiley

Published: Jan 1, 1988

References

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