The impacts of Value-based Management Systems on firm performance. The moderating role of hybrid strategy and environmental turbulence
Abstract
This paper contributes to the Value-based Management (VBM) literature by providing empirical evidence on the performance effects that arise from the adop-tion of value-based management systems. Through the analysis of two contingen-cy factors – strategy, measured by the firm’s hybrid strategic positioning, and en-vironment, analyzed by the degree of environmental uncertainty – the present study tries to explain if and how the adoption of VBMS impacts on firm perfor-mance.
Focusing on 367 non-financial firms indexed in the MSCI Europe index during the period 2013-2018, the paper represents the first effort to investigate the role of the firm’s strategic positioning and environmental turbulence in affecting the relationship between VBM systems and firm performance.
In particular, the study highlights how VBM can become a powerful tool for man-aging the need of flexibility that arise from internal and external contextual fac-tors, thus enhancing firm performance.
Keywords: Value-based Management Systems, Hybrid strategy, Differentiation, Cost leadership, Environmental Turbulence, Residual Income, VBM performance effects
