Product Quality, Cost Position and Business Performance: A Test of Some Key Hypotheses

This study uses a causal modelling methodology to examine competing methodological and theoretical hypotheses concerning the effects of product quality on direct costs and business unit return on investment (ROI). Results show that the PIMS’ measures under study exhibit high reliability across all samples. The findings fail to support the widely held view that a high relative quality position is incompatible with achieving a low relative cost position in an industry.

[1]  D. Ravenscraft.  Structure-Profit Relationships at the Line of Business and Industry Level , 1983 .

[2]  Ben S. Branch,et al.  Concentration versus Market Share: Which Determines Performance and Why Does it Matter? , 1982, The Antitrust Bulletin.

[3]  L. Phillips.  Assessing Measurement Error in Key Informant Reports: A Methodological Note on Organizational Analysis in Marketing , 1981 .

[4]  R. Bagozzi.  Attitudes, intentions, and behavior: A test of some key hypotheses. , 1981 .

[5]  R. Bagozzi.  An Examination Of The Validity Of Two Models Of Attitude. , 1981, Multivariate behavioral research.

[6]  C. Fornell,et al.  Evaluating structural equation models with unobservable variables and measurement error. , 1981 .

[7]  D. Mclagan,et al.  Market share: Key to profitability? , 1981 .

[8]  William R. Darden,et al.  Causal Models in Marketing , 1980 .

[9]  R. Wensley.  Strategic Marketing: Betas, Boxes, Or Basics , 1981 .

[10]  R. D. Buzzell,et al.  Modelling changes in market share: A cross‐sectional analysis , 1981 .

[11]  P. Bentler,et al.  Significance Tests and Goodness of Fit in the Analysis of Covariance Structures , 1980 .

[12]  D. Schendel,et al.  Heterogeneity within an Industry: Firm Conduct in the U.S. Brewing Industry, 1952-71 , 1977 .

[13]  J. Pennings.  Measures of Organizational Structure: A Methodological Note , 1973, American Journal of Sociology.

[14]  C. F. Phillips.  Industrial Market Structure and Economic Performance , 1971 .

[15]  J. F. Shapiro.  QUALITY CONTROL AND LEARNING IN PRODUCTIVE SYSTEMS by , .