ADDRESSING THE CONTINGENT EFFECTS OF BUSINESS UNIT STRATEGIC ORIENTATION ON RELATIONSHIPS BETWEEN ORGANIZATIONAL CONTEXT AND BUSINESS UNIT PERFORMANCE

The authors propose and test hypotheses examining the moderating role of strategic orientation on relationships between organizational conte xt variables and measures of business unit performance. Using cluster analysis, the researchers initially provide empirical evidence of stra tegic clusters indicative of Porter's (1980) primary generic strategie s. Results of a series of regression analyses conducted within each st rategic cluster indicate that the sharing of resources and programs am ong business units positively influences performance in low-cost firms . Sharing did not affect the performance of firms in differentiation-b ased strategic clusters. A strategy of granting business units substan tial decision-making autonomy was found to negatively affect performan ce for low-cost firms, but positively affect performance for those fir ms pursuing differentiation-based strategies.