Strategy-structure-performance in transnational corporations: A longitudinal study of the United States automobile industry: 1960-1987

Filip Caeldries, Purdue University

Abstract

In this study, an attempt is made to identify and explain the differences between the multidomestic and global time periods with respect to: (i) four research constructs, and (ii) the relationships between these constructs. The four research constructs are: environment, strategy, structure, and performance. Each of the four research constructs is defined and operationalized around the concept of environmental interdependence. The difference in the degree of environmental interdependence is presented as the singlemost important condition separating the multidomestic from the global time period. The global time period is characterized by a higher degree of environmental interdependence. The proposed definitions and operationalizations of the four research constructs highlight a number of deficiencies of the theory base underlying the research approach adopted in previous studies. Five deficiencies (or implicit assumptions as they will be called) are identified, critiqued and relaxed. Following the relaxation of the five implicit assumptions, a new research approach is adopted. The principal characteristics of the new research approach are: (i) a longitudinal research design, (ii) an extended interpretation of the structure construct to include interorganizational relationships, (iii) an explicit modeling of environmental effects, (iv) and an explicit focus on the determinants of economic performance. The major findings of this study are: (i) the multidomestic and global time periods differ substantially with respect to the operational content of the four research constructs (specifically, the observed differences between environment, strategy, structure, and performance are consistent with the interpretation that the global time period is characterized by a higher degree of environmental interdependence), (ii) the multidomestic and global time periods have different determinants of economic performance, (iii) the importance of environmental, strategic, and structure variables as a determinant of economic performance is state-dependent. Specifically, the environment is a much stronger determinant of economic performance in the global time period. Conversely, strategy/structure variables are a much stronger determinant of economic performance in the multidomestic time period. At the theoretical level, the empirical results support the hypothesis that the relevance of the strategic choice and ecology theory paradigms is state-dependent. The principal contributions of this study are: (i) the development of a consistent theory base for strategy-structure-performance studies, (ii) the adoption of a research design that is empirical, formal, and systematic, (iii) the longitudinal study of the relationships between strategy, structure, and performance in a single industry, (iv) an explicit study of both the multidomestic and global time periods, and (v) an explicit study of the determinants of economic performance in the multidomestic and global time periods.

Degree

Ph.D.

Advisors

Schendel, Purdue University.

Subject Area

Management

COinS