Early work by strategy content scholars tended to focus on identifying factors that appeared to influence the profitability of M&As. The goal of this research was to identify what distinguishes good from bad acquisitions. Ansoff et al. (1971, p. 39) refered to such studies as the “correlates of success” stream. Correlates are myriad; the following are indicative of the stream’s scope:
Some of the correlates, particularly the degree of industry relatedness, have proved difficult to measure, and their relationships to financial indicators of performance remain elusive (Datta et al., 1992; Rumelt, 1982). Work on them continues along traditional “correlates of success” lines. Various combinations of the correlates, however, can be used to help a firm set objectives for an M&A effor or to highlight potential problem areas, or they can be translated into criteria for screening and ranking sectors or candidates. Otherwise put, they constitute a large part of the content of strategy.