Analysis of the configuration of strategically significant organizational functions within particular categories of grand corporate strategy that are predictive of company performance

Abstract

Scope and Method of Study: This study was designed for the purpose of testing the difference in strategic mixes of functions for a particular grand corporate strategy when firms are categorized by performance. The data consists of managerial perceptions of three separate variable sets collected by survey instrument (grand corporate strategy, relative strategic significance of organizational functions, industry) and performance data obtained from the Standard and Poor's Compustat data file. The objective of this study is to examine the nature of influence different grand corporate strategies have on the interrelationships between the relative strategic importance of different functional tasks and the performance of the organization. The data were analyzed using multiple moderated regression analysis and Pearson correlation analysis.

Findings and Conclusions: The results of this study revealed 1) that grand corporate strategy and industry were significant moderators of the relationship between strategic significance of organizational functions and performance in a sample of 93 large industrial firms in the United States and 2) the results of this study limit us in making generalizations that conclude that certain functional mixes are most appropriate for a particular grand corporate strategy due to small sample cell sizes. Within particular strategy/industry cells the interrelationships discussed can lead us to conclude that certain functional mixes are appropriate within a particular strategy industry environment.