Fitness map: a classification of internal strategic fit in service organisations

Purpose - The purpose of this paper is to investigate the relationship between internal strategic fit and business performance, propose six classifications of internal fit using the "strategic map" managerial framework and identify how firms should best move from one classification to another and the impact that these changes will have on business performance. Design/methodology/approach - Empirical research was conducted in 12 service organisations. Based on these findings, two fit-performance relationships were identified and the "fitness map" framework was developed showing six classifications of fit. Findings - The alignment of operations strategy within an organisation is significantly and positively related to market share, whereas, the alignment of the service delivery system is significantly and positively related to return on sales. However, neither the alignment of the operations strategy nor the service delivery system appears to have a relationship with return on investment. Six classifications of internal strategic fit emerged: poorly aligned organisations are either "understanding processes" or "understanding markets", medium-fit companies are "managing processes" or "developing service offerings" and well-aligned firms are "leveraging services and process capabilities" or "leveraging markets and design capabilities". Practical implications - The fit-performance relationships show how changes in the alignment of operations strategy and delivery system impact business performance differently. Using this knowledge, practitioners can use the "strategic map" framework to identify their classification of fit and understand how it has been created, benchmark their level of fit against other businesses, understand how to move from one level of fit to another and how these decisions will impact business performance. Originality/value - The paper's findings start to address the gap in the literature on internal strategic fit within service organisations and meet the need for more management tools to help businesses develop strategies, understand the level of fit they create and how they can impact business performance.