What difference does your industry make?

The industry in which an organisation finds itself may have an impact not only on the performance which is possible but also on the nature of the drivers of that performance. Data from 240 UK manufacturing organisations in five tightly controlled industry sectors over the period 1979-1987 have been analysed to determine the industry effects on performance and the performance-driver relationship. Several different measures of performance have been used and while there are no significant differences in return on investment, differences can be identified and explained at lower levels of decomposition. The drivers of labour efficiency and employment efficiency are reported in detail. Employee flexibility and skills are consistent performance drivers across all industries, but generally tend to be offset by the cost of these factors, Size, capital intensity and growth are also significant drivers in some industries but cannot be assumed to have universal applicability. Margin is the least significant factor of those tested, even though it is the most widely assumed cause of performance difference.