The effect of strategic fit on firm's financial performance: A research on BİST manufacturing firms

There is an ongoing debate in organization theory and strategic management whether organizations' performances increase as they achieve the fit between organizational factors and their environment. In this study it is aimed to examine whether the factors of strategy, organization structure and environment have an effect on companies' financial performances when taken bivariate (strategy-organizatonal structure fit, strategy-environment fit and organizational structure-environment fit) and together on a multivariate strategic fit (strategy-envrionment-organization structure). To do this, data obtained from 111 manufacturing companies currently traded in Borsa İstanbul have been examined from different strategic fit approaches and moderated multiple regression analysis, profile deviation analysis and cluster analysis have been run on data at hand. Findings indicated that the fit between business strategy, organizational structure and environment is positively associated with financial firm performance. Keywords: Strategic fit, strategy, environment, organizational structure, contingency theory, configuration theory, financial performance, moderated multiple regression, profile deviation analysis, gestalt.