An Empirical Test of Strategic Groups: Predicting Organizational Performance Kenneth M. York Cynthia E. Miree Author’s Note Kenneth M. York, School of Business Administration, Oakland University; Cynthia E. Miree, School of Business Administration, Oakland University. Correspondence concerning this article should be addressed to Kenneth M. York, School of Business Administration, Oakland University, Rochester, MI 48309, Tel: (248) 370- 3272, Fax: (248) 370-4275, E-mail:
[email protected] Abstract The concept of strategic groups was tested using payroll data to classify NFL teams into four strategic groups and multiple measures of on-the-field and financial performance data. These groups were then examined to see whether spending on player talent was related to organizational performance as measured by winning percentage, points, and yards, and to financial performance as measured by revenues, operating income, and current value. The results show that strategic groups based on talent investment, do exist. Strategic groups were only a moderate predictor of on-the-field performance, but were a significant predictor of financial performance. Keywords: Strategic Groups, Organizational Performance, Financial Performance Introduction The term strategic groups has been used in the strategic management literature to describe sub-groupings of firms within a single industry that pursue similar or identical strategies as it relates to relevant distinguishing variables such as product diversification, vertical integration, product differentiation,