Section Fiveaverage sales over a five-year period, and a composite or
overall performance measure. The study did not use actual
accounting data but instead asked respondents to report profit,
profit growth, and sales growth in terms of percentage ranges.
Nonetheless, these measures correlated highly with accounting
data obtained for a subsample of over 60 of the firms in the
survey.^70
The results of the study provide strong evidence that
these selection tools can have a positive impact on firm
performance, particularly in certain industries. The study’s
failure to find uniform positive effects across all industries, even
for such well-grounded selection practices such as these,
indicates that the effectiveness of a particular selection practice
depends, to a certain extent, on the firm’s industry. The
influence of industry also emphasizes the importance of the
contingency perspective that will be addressed later. Not
surprisingly, the study found that larger firms are more likely to
use better selection practices. (It is possible that more positive
relationships may have been found with more precise controls
for different industries. Because profitability is affected by many
influences, a more extensive set of control variables also may
have produced even stronger evidence of the impact of these
practices.)^71