The Operating Performance of High Performance Companies during a Period of Financial Crisis: Risks and Opportunities

By Belverd E. Needles, Anton Shigaev, Marian Powers and Mark L. Frigo.

Published by The Global Studies Journal

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Article: Print $US10.00
Article: Electronic $US5.00

The global financial crisis of 2007–2009 presented a challenge to all companies around the globe. This study analyzes whether companies that exhibited high performance characteristics in the pre-financial crisis period can maintain their high performance in the post-financial crisis period, and if so, what operating characteristics are most important in managing a company through such a period.
The study empirically investigates 1,480 companies in the United States and 22 other countries (MSCI index) over the periods 1998–2007 (benchmark) and 2008–2009 (period of financial crisis) to identify HPC from the former period that exited, maintained, or entered HPC status in the latter period including: (1) the operating characteristics of those companies that were able to sustain high performance from 1998–2007 into 2008–2009; (2) the operating characteristics (performance drivers and performance measures) and associated risk factors which were most critical for companies that exited HPC status in 2008–2009; and (3) the operating characteristics which were most critical for companies that emerged to HPC status in the post-financial crisis period. The results provide direction for management of companies that aspire to HPC status and to maintain HPC status, particularly in times of global financial stress.

Keywords: Strategy, Financial Analysis, Ratio Analysis, Performance Measurement, Financial Crisis

Global Studies Journal, Volume 5, Issue 2, pp.67-102. Article: Print (Spiral Bound). Article: Electronic (PDF File; 997.091KB).

Dr. Belverd E. Needles

Ernst and Young Distinguished Professor, School of Accountancy and MIS, DePaul University, Chicago, Illinois, USA

Dr. Anton Shigaev

Associate Professor, School of Management Accounting and Controlling, Institute of Economics and Finance, Kazan (Volga Region) Federal University, Kazan, Russian Federation

Dr. Marian Powers

Adjunct Associate Professor, Kellogg School of Management, Northwestern University, Chicago, Illinois, USA

Dr. Mark L. Frigo

Director, Ledger, Quill Alumni Foundation Distinguished Professor of Strategy and Leadership, Center for Strategy, Execution, and Valuation, Strategic Risk Management Lab, School of Accountancy and MIS, DePaul University, Chicago, Illinois, USA


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