Buzzell, Robert D.
January 1990
Marketing Science;Winter90, Vol. 9 Issue 1, p86
Academic Journal
In this article the author comments on a research about business performance conducted by Robert Jacobson. The author suggests that in order to explain the differences in average rates of return among businesses, the PAR ROl model performs very well. This approach helps most business executives and planning specialists to estimate the expected results of a strategy in terms of average performance over a planning period. The transitory factors affects results in any individual year these factors include general business cycles, temporary supply-demand imbalances, labor management disputes and many others. Many important questions about the relative importance of the relationship between Rate of lnvestment and strategic factor, market share, is considered largely spurious. The failure to control for the effects of these unobservable factors leads to overstated estimates of the importance of strategic factors. The author is of the opinion that the estimates of the effects of strategic factors have been exaggerated and are also biased.


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