The Performance Effect of Strategy-Measurement Alignment
Hypothesis 2 posits that firms pursuing more of a quality-based manufacturing strategy
will rely more on objective and subjective nonfinancial performance measures. Table 4,
Panel A, shows positive and significant correlations between quality strategy and the number
of all types of measures, although the strongest correlations appear to be between quality
strategy and nonfinancial and subjective measures, respectively. Our categorical diversity
measure is also positively and significantly correlated with quality strategy. To provide a