Measuring Organizational Performance: Towards Methodological Best Practice

PJ Richard, TM Devinney, GS Yip, G Johnson

Research output: Contribution to journalArticleAcademicpeer-review

827 Citations (Scopus)

Abstract

Organizational performance is one of the most important constructs in management research. Reviewing past studies reveals a multidimensional conceptualization of organizational performance related predominately to stakeholders, heterogeneous product market circumstances, and time. A review of the operationalization of performance highlights the limited effectiveness of commonly accepted measurement practices in tapping this multidimensionality. Addressing these findings requires researchers to (a) possess a strong theoretical rationale on the nature of performance (i.e., theory establishing which measures are appropriate to the research context) and (b) rely on strong theory as to the nature of measures (i.e., theory establishing which measures should be combined and the method for doing so). All management research on performance should explicitly address these two requirements. The authors conclude with a call for research that examines triangulation using multiple measures, longitudinal data and alternative methodological formulations as methods of appropriately aligning research contexts with the measurement of organizational performance. [ABSTRACT FROM AUTHOR]
Original languageEnglish
Pages (from-to)718-804
Number of pages87
JournalJournal of Management
Volume35
Issue number3
DOIs
Publication statusPublished - 2009

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