Making strategy work: strategic coalignment and structural fit in multibusiness firms

Purpose Multibusiness firms face increasing pressure to act cohesively across diverse business units in complex and volatile environments. This study aims to investigate how strategic orientations and organizational structure jointly influence firm performance. It integrates the extended resource-based view with behavioral theory and systematically compares four perspectives of strategic fit: covariation, moderation, mediation and profile deviation. Design/methodology/approach Based on data from 253 multibusiness firms, this study uses structural equation modeling and regression analyses to test competing fit models. Strategic coalignment, conceptualized here as strategic orientation coalignment, is modeled as a higher-order construct composed of entrepreneurial, market, learning and innovation orientations. Organizational structure is operationalized through coordination, formalization and centralization. Findings Strategic orientation coalignment is positively associated with firm performance, supporting fit as covariation. It fully mediates the coordination–performance relationship, while formalization and centralization show partial mediation. In contrast, moderation effects are not supported. Profile deviation analysis reveals a characteristic structural-strategic configuration among top-performing firms. Firms that closely match this empirically derived ideal profile achieve significantly higher performance than those that deviate from it. Originality/value This study contributes to strategic management and organization design research by clarifying how structure affects performance indirectly through strategic orientation coalignment. It introduces strategic orientation coalignment as a firm-level capability and demonstrates the value of testing competing theoretical models within a single empirical setting.