Empirical Test of the Research Model
A large-scale survey among top executives of manufacturing firms was used to analyze the relationships between isolating mechanisms, the capabilities and resources identified above, firms’ abilities to adapt to and create change and finally the effect on firm performance. Thus, while the unit of analysis is the firm, data for the empirical analysis was provided by individuals. This approach is widely used in strategic management research if “objective” (i.e., based on records/systems), comparable data is not available for all firms, and has shown to yield reliable results.419 As most of the firms addressed in the survey are not publicly listed, this was the case in the sample at hand. Also, one could argue that the solicitation of primary, perceptual data by surveying managers is particularly appropriate in the case at hand given the nature of the variables of interest. The existence and quality of isolating mechanisms, for instance, would be hard if not impossible to measure from an external perspective and thus requires the individual judgment of a well-informed firm member.
KeywordsPartial Little Square Structural Equation Model Firm Performance Research Model Path Coefficient
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