One of the distinctive features of strategic management research has been an underlying interest in the measurement of firm performancean orientation that is normally not shared by other strands of economic research. Hence, measurement of performance is an essential perquisite of strategic management researchers. However, unfortunately there exists no consensus among researchers about how best to conceptualize performance of firms. Some researchers have used accounting as basis of performance, while others used share price based measure of performance. Some researchers have also tried to qualitatively measure firm performance using case study approach.

Researchers have also tried to include a measure of risk in their studies of measuring firm performance. This is because there is sufficient evidence from agency theory that one of the primary motives for firm's managers is to reduce risk in their business even if it maybe at the cost of the firm's profitability and shareholder's return. Risk can be measured both, from an accounting based perspective and a market based perspective.

However, some researchers find these two dimensions of firm performance alongwith risk and return to be incomplete. There are also other dimensions of performance such as, operational efficiency, human resources and innovational efficiency that need to be considered for measuring firm performance. The first paper in this issue, "Implementing Balance Scorecard for Performance Measurement", by Ashu Sharma, is an attempt to incorporate multiple dimensions of firm performance using a balanced scorecard. The balanced scorecard was developed by Kaplan and Norton in order to include multiple measures of firm performance. Besides the financial perspective, the balanced scorecard includes other perspectives, such as, customer perspective, innovation perspective and internal operations perspective. The paper suggests that these measures need to be relooked at in the present scenario in order to measure firm performance in a better way.

The second paper in the issue, "Strategic Elements of Software Product Business", by Surajit Ghosh Dastidar, investigates the strategic elements of software product business. The phenomenal success of the Indian IT industry has been primarily attributed to software services. Indian companies leveraging on their high quality, low-cost proposition have carved out a competitive advantage for themselves. But, the software business is still considered to be a risky business, and thus, in order to be successful in this business, research needs to be done in order to find out the long-term competitiveness in this industry. This paper assumes additional significance with the current imbroglio in one of the top software companies in India today. The study is a case study based research with i-flex as the nodal company. Different elements of business are considered and its relation to strategic orientation is investigated in order to come up with a model that help firms in this industry achieve long-term competitiveness.

The third paper of this issue, "Product Development Strategies for Skype Phone in Indian Semi-Urban Markets", by Bharti Keswani and Sumeet Gupta, discuss product marketing strategies for Skype phones in Indian semi-urban markets. The study was conducted in Bhilai and Durg, twin-cities of Chattisgarh state. The paper finds a 40% market share for Skype in Bhilai and Durg. Such kind of analysis is important for large telecom companies who would be better able to serve the market if they were aware of competition. The paper used survey methodology and cluster analysis to determine what Skype features were important to a customer. The paper finds that there are two clusters, one with ages between 30-40 years and the other between 20-30 years, in the sample studied. Both the clusters place importance on different features. The first cluster gives importance to cheap international calling over Wi-Fi, video conferencing and credit facility, while the second cluster gives importance to cheap international calls and credit facility, but a relatively lower importance to video conferencing.

The fourth paper in this issue, "Tata Group: Transforming the Sleeping Elephant", by Subir Sen, compares the leadership styles of JRD Tata and Ratan Tata and the pressures existing in the Tata group during the change in leadership. The case focuses on the 1991 strategic plan which was unfolded by Ratan Tata and compares it with the earlier strategic plan of 1983. The paper also discusses the problems of having an umbrella like Tata Brand for companies such as Indian Hotels and the royalty it paid to the holding company. This created problems that ultimately resulted in the resignation of the CEO of Indian Hotels. The paper raises an important issue regarding the amount of control a holding company should exercise on its affiliated firms and the effect it has on the performance of its affiliated firms.

The fifth paper in this issue is a case study, "The BHP Billiton-Rio Tinto Merger", by Jacob Chandy, that compares the performance of firm pre- and post-merger. BHP Billiton and Rio Tinton are the two largest iron-ore mining companies in the world. The merger of both these companies was considered a logical and compelling opportunity as both have large, low costs fixed assets that are totally synergistic. This merger created value by exploiting synergies in economies in scale and optimization in coal operations which would result in costs savings to the tune of 1.7 billion per annum and an EBITDA improvement of US$2 bn. However, creation of such a huge conglomerate resulted in anti-competitive practices which resulted in huge legal and social problems for the merged entity. The case discusses the ways and the means by which mergers can avoid these problems.

-- Saptarshi Purkayastha
Consulting Editor