Evaluation of business strategies based on the financial performance of the corporation and investors' behavior using D-CRITIC and fuzzy MULTI-MOORA techniques: A real case study

Abstract

Revealing the complex relationship between corporation-chosen strategies and financial performance is crucial in navigating today's dynamic business landscape. This research delves into the profound impact of business strategies on both corporation performance and investors' behavior, seeking to identify the strategy that yields the highest returns and efficiency for the corporation and its beneficiaries (investors, loan-holders, and stock-holders). This study proposes a multi-criteria decision-making (MCDM) model that integrates the distance correlation-based criteria importance through inter-criteria correlation (D-CRITIC) weighting method with multi-objective optimization on the basis of ratio analysis plus full multiplicative form (MULTI-MOORA) technique to evaluate the business strategies of corporations (i.e., defenders, analyzers, reactors, and prospectors). Notably, fuzzy MULTI-MOORA methodology is employed to account for uncertainty, addressing vague, imprecise, and ambiguous input and knowledge. This study is implemented on a real case of the Tehran Stock Exchange on a sample of eighty companies from 2017 to 2021. The study's results underscore the medium analyzers strategy as the optimal alternative among various business strategies, assuming the maximization of benefits for all beneficiaries, and simultaneously specify a prevalent preference for analyzer strategies within Iran's economic landscape. To validate the proposed method, the findings are compared to the other MCDM techniques such as technique for order performance by similarity to ideal solution (TOPSIS), multi-objective optimization on the basis of simple ratio analysis (MOOSRA), simple additive weighting (SAW), viekriterijumsko kompromisno rangiranje (VIKOR), and Taxonomy. Additionally, applying principal component analysis (PCA) as a visualization approach demonstrates the satisfactory performance of the proposed framework. Beyond its scientific contributions, this research holds practical managerial applicability, providing actionable insights for informed decision-making across various fields.