Performance
Following the performance measurement categories used throughout this study, we
measure performance of the manufacturing department along the four dimensions shown
in Table 2: financial, operating, employee-oriented, and customer-oriented. All four performance
categories are highly positively correlated (p 0.01), and factor analysis holds
all four items together on one factor with high loadings (Table 2). Hence, we construct an
overall performance index (ALLPERF) by arithmetically averaging the individual item
scores ( 3.67, 0.64, Cronbach 0.74).
R