Antecedents and outcome of diversification-control alignment: Longitudinal evidence from top 100 business groups in Taiwan

Abstract

This paper offers an empirical examination of the strategic and structural development of business groups in Taiwan, and discusses how the alignment between strategy and structure affects performance. According to Chandler, alignment adds value to performance. However, the argument has not been tested in emerging economies, in which institutional environments are different from mature markets. This article makes the first step. In addition, it is not known why some organizations can maintain a good alignment between strategy and structure, while others cannot. Therefore, another objective of this paper is to identify antecedents that can help to explain the alignment. The analyses for this study are based on a longitudinal data for the 100 largest business groups in Taiwan between 1981 and 1998.