Research Article
Strategy-Environment Fit and Firm Performance
Published: January 1993 · Vol. 23, No. 1 · pp. 149-172
Full Text
Abstract
This study investigated how the degree of fit between strategy and environmental uncertainty affects firm performance in the Korean textile industry, according to technological background. The results revealed that in the new technology sector, where technological change is rapid and technology transfer from abroad is difficult, strategy-environment fit has a significant effect on firm performance. In contrast, in the traditional technology sector, where technology is stagnant and technology transfer is relatively easy, no significant correlation between strategy-environment fit and firm performance was observed. These findings imply that strategic contingency theory is better applied to the new technology sector than to the traditional technology sector in Korean industry, and suggest that organizational and strategic theories developed in advanced countries should be applied selectively by sector rather than indiscriminately.
