In recent years, corporate strategy has drawn a lot of attention in the academic an practice. However, there are fewer literatures on how to put these ideas into practice, that is, how to quantify the interrelationships between the three key elements in strategic management¡Ðperformance, strategies, and environments, and how to judge and measure the opportunities and threats (O & T) when the environments change. This study is an attempt to answer these questions.
The theoretical method developed incorporates a dynamic simultaneous equations model to express the interrelationship between these three elements. The method requires the identification of O & T in a three-step procedure. Step 1 relates the strategic components to the performance measures by the management¡¦s concept of business and philosophy of resource depolyment. Step 2 points out the suitable (unsuitable) environment circumstances for each of the scope and resource deployment elements. In Step 3, we link the results of Step 1 and Step 2 to identify and measure O & T.
The above methodology is applied to the case of Cathy Financial Holding Company, a Taiwan largest listed financial holding company, over the period 2002Q2-2007Q3. We use the Instrument Variables Three Stage Least Square Method (IV-3SLS) to estimate them. In addition, we also use some tests to ascertain the validity of the selected instrument variables in order to obtain the more reliable results. Our empirical results indicate that both the firm strategies and the environments play significant roles in influencing the firm¡¦s performance. More specifically, whereas the diversification of products, and the debt allowance reservation rate are negatively associated with the cost/income ratio and positively associated with adjusted ROE and Tobin¡¦s Q. Additionally, the managers also can increase the investment efficiency by adjusting the content of the asset allocation, especially with regard to the holding of bonds. We also extract some major environment factors such as unemployment rate that affect the firm¡¦s performance and use the estimated results to identify and measure O & T.
| Identifer | oai:union.ndltd.org:NSYSU/oai:NSYSU:etd-0114109-095224 |
| Date | 14 January 2009 |
| Creators | Wang, Tzu-wei |
| Contributors | Lee, chingnun, Ming-Chi, Cheng, David So-De Shyu, Chen, Yueh H., Shao-Chi Chang, Lia, Li-Hua |
| Publisher | NSYSU |
| Source Sets | NSYSU Electronic Thesis and Dissertation Archive |
| Language | Cholon |
| Detected Language | English |
| Type | text |
| Format | application/pdf |
| Source | http://etd.lib.nsysu.edu.tw/ETD-db/ETD-search/view_etd?URN=etd-0114109-095224 |
| Rights | withheld, Copyright information available at source archive |
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