A note on the dimensionality of the firm financial performance construct using accounting, market, and subjective measures

Most research in strategic management operationalizes firm financial perfor mance by using either accounting-or market-based measures. Recently, some h ave suggested that subjective measures may be useful in. assessing a F-nr's financial performance. We argue that there is a theoretical basis for view ing firm financial performance as having a higher order structure consistin g of three separate yet distiller dimensions. Using second-order confirmato ry factor analysis, we found that while differences exist among accounting, market, and subjective measures of firm financial performance there is evi dence to support the concept of a single underlying construct. While our fi ndings are statistically significant and thus support our hypotheses, the s ubstantive nature of our results suggests that much more research is needed before rye fully understand the dimensionality of firm financial performan ce.