The relationship of internal versus external orientations to financial measures of strategic performance
Version of Record online: 7 NOV 2006
Copyright © 1983 John Wiley & Sons, Ltd.
Strategic Management Journal
Volume 4, Issue 4, pages 297–306, October/December 1983
How to Cite
Pearce, J. A. (1983), The relationship of internal versus external orientations to financial measures of strategic performance. Strat. Mgmt. J., 4: 297–306. doi: 10.1002/smj.4250040402
- Issue online: 7 NOV 2006
- Version of Record online: 7 NOV 2006
- Manuscript Revised: 8 APR 1982
- Manuscript Received: 9 SEP 1981
Field research involving 137 respondents in eight organizations was conducted to study the relationship between alternative measures of the internal/external orientations of sociometrically identified dominant coalition members and their firms' financial performance. Results showed that attitudinal measures were more often correlated with financial measures of strategic performance than were traditional ‘insider’ to ‘outsider’ measures based on descriptive categorizations. The significant findings were related to four performance indicators of company profitability, namely, profit margin, return on average assets, net interest spread, and return on average equity.