Corporate Performance Interpretation and Measuring Problems

Abstract

Corporate performance, though a term commonly used both in business practice and by academics, provides a field for wider discussion due to its ambiguity and information capacity. One of the starting points for considering the meaning of corporate performance could be the theory of industrial organisation. Along with the progress of knowledge, as well as the economic and social development, many specific disciplines, also known as the applied sciences, have appeared and are still growing in the economic sciences. One of them is the industrial organisation or industrial economics, which aims at researching production system and strategies of entities operating within this system. The discipline comprises a number of research streams concentrating on corporate strategies, performance results, production structures and government intervention (Rainelli, 1996, p. 7). The traditional paradigm of industrial organisation deals with exploring the relations between industrial structure, conduct (strategy) and corporate performance, particularly focusing on the factors and effects of the market force of firms (Scherer & Ross, 1990).