Year: 2017
Type: dissertation
Abstract: Which goal orientation results in better performance? A profit orientation or a customer \norientation? To date, researchers have presented opposing arguments with respect to this \nimportant issue, stating that both orientations lead to above average returns. Therefore this \npapers seeks to address this issue. This paper aims to contribute to quantitative research \nconducted in the Strategic Management field because the results have significant implications \nfor decision making procedures of firm strategies. \nTo address this debate, the researcher empirically tests the reported financial results of firms \ncharacterised under each strategic orientation. Coding of CEO letters and letters to \nshareholders provided the two groups of companies tested and literature provided the \ncategorisations. The results show that a customer orientation leads to better financial \nperformance than a profit orientation over a 15 year timeframe in terms of two measure of \nprofitability, the internal accounting measure of Return on Equity (ROE) and market related \nmeasure of Share Price Appreciation. The results have significant implication for decision \nmakers and strategy theory as empirical tests over the 15 year period clearly demonstrate the \nsuperiority of a customer orientation over a profit orientation in attaining superior financial \nperformance.
Author: Christabel Ziyambi
Language: English
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W2915185452