Abstract
This study examines the performance implications of fit between the product-market strategy of a firm and its structure. The theoretical fit relationships between strategy and structure are developed on the basis of the Miles and Snow strategy framework (Organizational Strategy, Structure and Process. New York: McGraw Hill, Inc.) The study utilizes a novel measurement procedure that not only evaluates the match of several organizational structure elements for a given strategy, but also allows for aggregation of these matches. The procedure involves development of measurement scales that help identify the strategic orientation of a firm on each of its structural elements. Using a sample of 148 firms from the banking industry, the study provides evidence for the impact of strategy-structure fit on firm performance.
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