Methods for measuring the effects of strategies on firm performance

[Ayrton Da Silva]

Hello and happy holidays Statalisters,

I have a slightly different question for the forum, and would be highly appreciative for any pointers or ideas you may have.

I have financial performance firm-year panel data for a population of firms for many years. I am looking to see how different strategic approaches can affect the growth and sustainability of nascent firms over time. This may involve the change in different variables, like say, revenue growth or EBIT margin, over time. Some firms may choose to grow their EBIT margin, for example, while others may focus on revenue growth. But some other variables may well be important, too.

I have a very large dataset - 8GB - which makes exploratory analysis challenging. I would like to try and identify groups of firms which have a similar behaviour over time, and compare the different implied strategies, in terms of performance and survival rate. I am however, struggling to identify a methodology or technique which is able to identify these clusters of firms in panel data, and then compare their performance.

If you have any suggestions or interesting readings which may be helpful - I would be sincerely appreciative.

Thank you for your time.

Kind regards
Ayrton

[Carlo Lazzaro]

Ayrton:
a trivial suggestion rests on seeing what others in your research field did in the past when presented with the very same research goal.

[Ayrton Da Silva]

Hi Carlo,

Thank you so much for your response.

I have struggled to find other papers which are trying to achieve the same goal in my field. Yes, of course there are many papers assessing the broader determinants of firm performance, but I cannot seem to find any which are considering the differences in behaviours between different groups of firms. The groups being determined by similar changes in some variables over time.

Perhaps I should just continue at the literature and hope something arises, I was just hoping that perhaps someone would have used a similar technique or methodology.

Thank you, again, for your response!

Ayrton

[Carlo Lazzaro]

Ayrton:
unfortunately, my tenuous relationship with corporate strategy broke off about 30 years ago.
That said, maybe you can classify firms according to a set of strategic items as aggressive, proactive, reactive or whatever else.