Literature review of strategy implementation and strategy process frameworks Introduction Great strategies are worth nothing if they

cannot be implemented (Okumus and Roper 1999). It can be e tended to say that better to implement effecti!ely a second grade strategy than to ruin a first class strategy by ineffecti!e implementation. "ess than #$% of formulated strategies get implemented (&int'berg 199() &iller *$$*) +ambrick and ,anella 19-9). .!ery failure of implementation is a failure of formulation. /he utility of any tool lies in its effecti!e usage and so is the case with strategy. 0trategy is the instrument through which a firm attempts to e ploit opportunities a!ailable in the business en!ironment. /he performance of a firm is a function of how effecti!e it is in con!erting a plan into action and e ecuting it. /hus implementation is the key to performance1 gi!en an appropriate strategy. In literature1 implementation has been defined as 2the process by which strategies and policies are put into action through the de!elopment of programs1 budgets and procedures3 (4heelan and +unger pp1#). /his in!ol!es the design or ad5ustment of the organisation through which the administration of the enterprise occurs. /his includes changes to e isting roles of people1 their reporting relationships1 their e!aluation and control mechanisms and the actual flow of data and information through the communication channels which support the enterprise (,handler 196*) +rebiniak and 7oyce *$$#). Evolution /he field of 0trategic management has grown in the last thirty fi!e years de!eloping into a discipline in its own right. 8orrowing e tensi!ely from .conomics and 0ocial sciences1 it is still fragmented by the presence of number of distinct schools of thought1 di!ersity in underlying theoretical dimensions and lack of disciplined methodology. /he fragmentation is due to high degree of task uncertainty and lack of coordination in research 9a result of lack of uniformity and focus between the strategy field1 its base disciplines and practitioners (.lfring and :oelberda *$$1 pp 11). 0trategy as a field of en;uiry de!eloped from a practical need to understand reasons for success and failure among organi'ations. /his led to a focus on o!erall performance and on the top management. /he works of ,handler (196*) and <ndrews (19=1) created a !iew that strategy is made at the top and e ecuted at the bottom1 further reinforcing the fields focus on the top management while implementation was seen as secondary (>loyd and 4oolridge 1996) /he emergence of corporate planning in the 19=$s further heightened the disconnect between formulation and implementation1 as operating decisions were made as if plans did not e ist. ?ey insight was that plans were ineffecti!e and line managers needed to be in!ol!ed in the process (>loyd and 4oolridge *$$$)./he de!elopment of analytical tools like 8,G1 @I&0 further reinforced the notion that strategy was an e clusi!e top management function. /he de!elopment of the strategic management paradigm delineated the formulation and implementation components of strategy1 identified roles for all mangers e cept the lowest operating le!el in the formulation process. Implementation was design of standards1 measures1 incenti!es1 rewards1 penalties1 and controls (>loyd and 4oolridge 1996). &anagers were thought to be more as obstacles. It 1

was &int'berg and 4aters (19-#) whose !iew that strategy is a pattern in a stream of decisions1 that e panded the role of other than the top management in strategy making since strategies could be emergent. 8urgelman (19-A) integrated both the top down and bottom up !iew of strategy by introducing the concept of autonomous de!elopment of strategy in addition to the normal intended strategy1 reinforcing the obser!ations of 8ower(19=$) who stated that the top management had little control on what pro5ects get pushed for appro!al. Bespite these studies) till the 199$Cs strategy formulation and implementation were seen as separate items1 with a distinct focus on strategi'ing (achie!ing the fit between the en!ironment and the plan) while effecti!e implementation of it was taken as granted. ,ontent research dominated. /he works of &int'berg (19=-) &iller and >rieson (19-$)1 @ettigrew (19-#) brought into focus the gaps between formulation and implementation. /his brought into prominence the research stream concentrating on study of change. /his also challenged the paradigm of e plicit formulation and implementation1 as strategies could now be emergent1 unreali'ed. It also strengthened the tiny but growing band of process researchers who were looking at the role of power1 culture as shapers of strategy outcomes. Research on strategy implementation1 though neglected1 was taken by few researchers in form of de!elopment of frameworks (+rebiniak and 7oyce *$$#) 8ourgeois and 8rodwin 19-() 0ki!ington and Baft 1991) &iller 199=) Okumus *$$1) 7oyce and +rebiniak *$$#) and in the form of e!aluation of indi!idual factors affecting the implementation process likeD the interests of middle managers (Guth and &acmillan 19-6) or the usage of implementation tactics (Eutt 19-=). /he present conte t for strategic management has been described as hypercompetiti!e (BCa!eni 199() which ensures that sustained ad!antage is transitory. Fnder these circumstances1 strategy and form of organi'ation need to be continuously assessed for appropriateness. /hus fast paced change makes strategy dynamic in character. "earning has become a key attribute along with organi'ing of knowledge resources. Fnder such circumstances1 strategy formulation and implementation are !iewed as intertwined sub processes in the strategy process. 0trategy research has also undergone changes paralleling these changes. 0tarting with longitudinal process oriented studies of &arch and 0imon (19#-) chandler (196*)1 bower (19=$)1 and mint'berg (19=-)1 it shifted to use of ;uantitati!e methods which were cross sectional in nature. <s the legitimacy of the field grew1 and with ad!ances in research methods along with liberal inter5ections from social sciences1 the re emphasis on processual studies has emerged (@ettigrew et al *$$*). /he de!elopment of the now in !ogue G strategy process research9can be traced to .urope1 where attention was drawn to the role of power as an influence on strategy outcomes (@ettigrew 19=A). /he role of culture was probed and later the combined effects of culture and power were studied (@ettigrew 19-#). < series of large scale empirical studies (@ettigrew and whipp 19911 @ettigrew et al 199*) de!eloped a process approach which combined the content1 process1 conte t of change with longitudinal data collected at multiple le!els of analysis1 thereby introducing the element of time into the study and allowing for multiple le!els of analysis but integrated. /hus process research has opened up the firmCs internal processes for study1 and gi!en an impetus to the role of time and

dynamics in addressing issues of strategic choice and change. @rocess research has been fragmented1 characteri'ed by limited theory building and empirical testing( @ettigrew et al *$$*). /he e!olution can be succinctly summari'ed as gi!en below in the table Descriptor Environme nt Dominant paradigm of strategy content 1950s and 1960s 0table Growth1 large corporations 1 control and coordination 1 production 19 0s Bynamic 1 comple 0trategy as direction of company1 production orientation 19!0s Bynamic comple ,ore businesses1 competiti!e ad!antage1 production orientation >actors along with structure leading to efficiency ,ross sectional1 ;uantitati!e1 :ale based planning 1990s +ighly dynamic ,ore competencies1 production1 ser!ices orientation +ow structures are created1 ad5usted and made to workH @rocessual "ongitudinal Be!elopment capabilities1 learning1 "1st century +yper competiti!e 0er!ices orientation1 learning1

>it structure #ey to with implementa strategy and tion conte t $esearc% &asis of corporate value added 'trategy logic @rocessual 1 longitudinal case studies 0kills of general manager

Resource allocation ,ross sectional1 ;uantitati!e1 @ortfolio planning

+ow structures are created1 ad5usted and made to workH @rocessual "ongitudinal "earning and knowledge creation

4hat .conomies ,ompete on .conomies of @ortfolio business to of scale and strengths1 scope management be in efficiency synergy &ased on (ettigrew et al )"00"*+ ,%ittington )"00"*+ -ould and .amp/ell )1990* /hus it can be seen that the e!olution of research on strategy implementation is directly linked with the e!olution of strategy research and the emphasis on implementation has been seen to be dependent on the dominant approach (perspecti!e) guiding a researcher. 'trategic decision process /he core of the strategy process (including implementation) in!ol!es decisions and actions. Becision making is the rational application of knowledge to a choice problem (0imon 19=6). It in!ol!es seeking answers to ;uestions such as what are the alternati!es1 what are the conse;uences of each alternati!e1 how desirable are the conse;uences and what criteria to apply to e!aluate the alternati!es. 0uch rationality is possible with highly structured problems but with highly unstructured problemsD strategic decisions9it is not possible to get all the information and specify all the set of alternati!es.

In e!ent of highly unstructured problems1 humans are boundedly rational. /he search in this case is local1 limited and attempt is to find a satisfying solution (,yert and &arch 196A). /hus strategy process would consist of decisions and the actions that are dri!en by these decisions. /he actions are a larger set and many actions are not a result of the strategic decisions and thus mere study of the decision making process does not co!er the strategy process. Becision making under conditions of uncertainty or ambiguity can be achie!ed by a political process1 especially in conditions where multiple groups e ist with each ha!ing their own legitimate !iews of organisational interests (absence of shared goals). In such instances power is e ercised in the broader interests of the organisation and not for ser!ing self interests not in line with organisational interests (pfeffer 19-1). Literature review 0trategic management has de!eloped by contributions from researchers from the fields of economics) organisational beha!ior) sociology) psychology) and public administration. Researchers from each field addressed strategic management from a perspecti!e which dominated that field for e.g.I researchers from the field of economics used the rational perspecti!e while researchers from the field of organisational beha!ior used the humanistic perspecti!e. /hus research on strategy implementation has been dependent on the dominant approach (perspecti!e) guiding a researcher. <pproaches to strategy ha!e been classified !aryingly by different authors. /he better known classifications areI ,hafeeCs ( 19-#) linear1 adapti!e and interpreti!e schools &int'berg et al (199-) ten schools of thought. >aulkner and ,ampbellCs (*$$*) G rational1 logical incremental1 e!olutionary and cultural schools of thought. >a5ourn ( *$$$)D mechanistic and organic +ut'schenreuter and kleindienst (*$$6)9rationalD mechanistic1 cogniti!e1 upper echelon1 middle management1 organic and micro perspecti!es. ,hafee (19-#) based his classification on the main focus which each type is built upon. /he linear model has planning as the key focus point. Its emphasis on methodical1 se;uential1 and directed action indicates a rational decision making process) stable en!ironment and a more simplistic !iew of strategy with a predominant role for the top management. /ime is !iewed as static. /he adapti!e modelCs focus is on the continuous e!aluation of the en!ironment and subse;uent organisational adaptation. .n!ironment is more dynamic) emphasis is more on means and goals are more nebulous and the role of the other le!els of management is considered more significant. /he interpreti!e model looks at an organisation as a collection of social contracts and strategy is an organisation wide acti!ity dri!en by shared !alues and beliefs. Becision making appear truly consensual1 tending to a political process. &int'bergCs classification (199-)1 the most famous) is based on what strategy is !isuali'ed as for e.g. in the design school strategy is seen as a conception while in the entrepreneurial school it is seen more as a !ision. /hey can be grouped together into three broad classesI

1. /he first three schools are prescripti!e in nature. /hey are concerned with how strategies should be formulated. /hey thus tell about ideal strategic beha!ior. /hese concentrate on the beha!ior of the strategist as an indi!idual. *. /he ne t si consider specific aspects of the strategy formation process. /hey describe how strategies get made. /hey concentrate on role of factors beyond the indi!idual. A. /he last school is a combination of all the abo!e schools1 it seeks to be integrati!e. It tries to cluster the strategy making process1 the content1 organisational structures and their conte ts into distinct stages. >aulknerCs classification (*$$*) and +ut'schenreuter and kleindienst (*$$6) are a more abridged !ariants of &int'bergCs classification. >a5ourn (*$$$) takes a much more conceptual !iew of the strategy process and classifies all approaches into two main based on how time is treated) how is the flow of e!ents looked at and finally the ;uality of constructs and models. /he mechanistic approach looks at time as discreet) with the flow of e!ents being linear1 se;uential1 directional and static and the constructs and models are well de!eloped1 differentiated and emphasis is more on construct than on the relationships among the constructs. /he organic !iew treats time as incessant and continuous with the flow of e!ents being non linear1 interactional and dynamic and emphasis on the relationships between constructs which are integrati!e in nature. It can be seen that the key parameters on which the approaches differ is the type of strategic decision process1 the locus of decision making and analysis and the !iew of strategic change. >a5ournCs (*$$$) classification allows all the approaches to be distinctly placed in either of the class1 whereby one class (mechanistic) is prescripti!e and concentrates on the role of top indi!idual as the strategist and therefore the locus of analysis is an indi!idual1 the locus of analysis can be an indi!idual or a group but restricted to top management and !iews strategic change as episodic. /hus strategy is more a static1 episodic acti!ity and therefore is not !iewed as a process but more as an e!ent. It also distinctly segregates formulation from implementation. /he other class (organic) focuses on a more inclusi!e role for other le!els of management1 !iewing participation as necessary for management of en!ironmental dynamism) treats strategy as a process. /herefore the locus of decision making can !ary from an indi!idual to a group) locus of analysis is a group and change is seen more as incremental. /he implications for the strategic decision making process now is dependent on the re;uirement of en!ironmental sensing mechanisms and the organisational integrati!e mechanisms ( such as meetings1 committees1 task forces1 feed back mechanisms etc) which are put in place in line with the percei!ed en!ironmental dynamism. /he type of decision making process is not as significant as much as the patterns and utili'ation of en!ironmental sensing and organisational integrati!e mechanisms. .;uifinality is possible based on !arious combinations of participation (from mere information pro!ision to consultation to acti!e discussion to finally a stake in decision making) in decision making and the management of en!ironmental dynamism. "iterature on implementation of strategy can be categori'ed asI

1. 0tream of literature where the predominant focus has been on content such as literature on di!ersification1 inno!ation1 mergers and ac;uisitions and collaborati!e strategies and their link to performance. *. 0tream which deals with organisational structure as pro y for implementation !ariables A. "iterature on strategic consensus and role of middle le!el managers (. 0tream which has attempted to de!elop frameworks for implementation of strategy #. /he resource allocation process literature Implementation has to be !iewed along with strategy content. 0trategy content literature can be grouped as those dealing with di!ersification1 mergers and ac;uisitions1 collaborati!e strategies1 competiti!e strategies1 and inno!ations dri!en strategies. Implementation of innovations1 Inno!ation has been defined as the adoption of an internally generated or purchased de!ice1 system1 policy1 program1 process1 product or ser!ice that is new to the adapting organisation (Baft 19-*). Inno!ati!eness is adoption of multiple inno!ations (Bamanpour 1991). <doption of inno!ation encompasses generation1 de!elopment and implementation. < &eta analysis of studies on inno!ations (Bamanpour 1991) has shown that speciali'ation (?imberly and .!anisko 19-1)1 functional differentiation (representing di!ersity of knowledge (8alridge and 8urnham 19=#))1 professionalism (@ierce and Belbecc; 19==)1 managerial attitude towards change1 technical knowledge resources (Bewar and Button 19-6)1 administrati!e intensity( Bamanpour 19-=)1 slack resources( Rosner 196-)1 and e ternal and internal communication (&iller and >riesen 19-*) ha!e a positi!e effect on adoption of inno!ations in organisations. ,entrali'ation (/hompson 196=) has a negati!e effect on adoption of inno!ations. >ormali'ation1 managerial tenure1 and !ertical differentiation were found to ha!e no effect. 4hile formali'ation and managerial tenure did not ha!e any effect on both the initiation and implementation of inno!ations1 !ertical differentiation ( which represents differential of power) had a positi!e effect on administrati!e inno!ations and a negati!e effect on technical inno!ations( Bamanpour 1991). &echanistic organisations were found to be less conduci!e for generating inno!ations than organic organisations. /he archetypes of these two types of organisations can be put at the ends of an 2no inno!ati!e G continually inno!ati!e) continuum1 on which most of the organisations would tend to fall within the length of the continuum. Organisations which are more mechanistic are more appropriate for administrati!e inno!ations while organic form is more appropriate for technical inno!ations. "iterature on adoption of inno!ations has concentrated on indi!idual !ariables affecting the process of adoption by way of bi!ariate relationships both at indi!idual and organisational le!el (dobni *$$6) Diversification strategies1 Bi!ersification means associated changes in administrati!e mechanism (ramanu5am and !aradra5an 19-9). Research on di!ersification has concentrated on the concept of

relatedness) international di!ersification) mechanisms of strategy and effects of strategy on performance (8ergh in hand book of strategic management *$$19hitt et al). /he link between di!ersification and performance is perhaps the most researched link in the strategic management literature (palich et al *$$$). Bespite ($ years of research1 the field has yet to show consistent findings and thus consensus on key relationships is elusi!e1 which lea!es the field as yet to mature (Gary *$$#). Bespite a large number of studies on the di!ersification Gperformance link1 the results are less clear now (palich) cardinal and miller *$$$). /he empirical studies start with that of chandler (196*) who stated that structure has to be aligned to strategy for ensuring effecti!e performance. It was rumeltCs (19=() study that related constrained businesses show the best performance which set the trend of research on di!ersification. . amining rumeltCs results1 betis (19-*) concluded that the o!errepresentation of an industry in the sample may be the cause) ,hristiansen and &ontgomery (19-1) concluded that market share e plained the greater part of the results while &ontgomery (19-#) found insignificant results after controlling for industry structure factors. >urther stimpert and dubhan (199#) showed that low profitability led to increased di!ersification. It can be seen that the research on di!ersification is focused on content rather than implementation issue despite calls for such research (hoskisson and hitt 199$). /his conclusion is further corroborated when we look at the basis for undertaking di!ersification o!er the period 19#$Cs till *$$$ <B. In the 19#$Cs and 196$Cs the basis for di!ersification was abundance of general management skills in a firm and implementation was taken for granted as it was belie!ed that ha!ing general management skills ensured implementation. +owe!er the performance during these decades was below a!erage. In the 19=$Cs) the basis was portfolio management and focus on strategies of the firm with little focus on implementation. /he performance was still found to be below a!erage. /he 19-$Cs saw a shift to !alue based planning and reduce di!ersification while in the 199$Cs the emphasis was on creation of synergies) e ploitation of core competencies portfolio based on management style. 0uccess was found to be linked to sticking to similar businesses (Gould and hicks *$$1Do ford hand book of strategy). /he lack of focus on implementation is e!ident and indirectly gets pro!ed when we see that performance is the best in di!ersification to related businesses only. /his further gets supported from the empirical finding that in highly di!ersified companies there was a tendency to spin off the unrelated businesses into independent units1 after which there was found to be an impro!ement n performance of those units (0adler et al 199=). Of late there has been a reali'ation that implementation may hold the key to di!ersification and performance link (Gary *$$#) /he di!ersification studies can be categori'ed into two streams9one which look at di!ersification and performance link and the other which looks at relation between di!ersification and performance using organisational structure( & form) as inter!ening !ariable( 4hittington *$$*). /he first stream does not include implementation !ariables in their study while the other stream tried to look at only one form of organisation as pro y for implementation !ariables. /his only highlights the fact what researchers in strategic management ha!e been lamenting about non use of organisational and implementation !ariables in strategy performance link studies (Bess et al 199#) hoskisson

and hitt 199$) Ginsberg and :enkatraman 19-#) although they e plain twice as much !ariance as other factors (+ansen and 4ernerfelt 19-9). 2ergers and ac3uisitions1 &ergers and ac;uisitions continue to be used as a ma5or strategy for growth by firms o!er the years despite e!idence that more than =$% of these do not impro!e the firmCs performance(+itt1 Ireland and +arrison *$$*) +itt 1 +arrison and Ireland *$$1). /he factors cited for such a result are sluggish integration1 illusionary synergies1 managerial hubris (barfield199-). Bi!erse cultures1 structures and operating systems (haspeslagh and 7emison 1991) make integration of firms ac;uired or intending mergers e tremely difficult1 duly highlighting the added significance of effecti!e implementation of strategies in the strategy G performance link ("arson and finkelstien 1999) Gary *$$#). Integration in mergers and ac;uisitions is facilitated when both the firms ha!e similar management processes1 cultures1 systems and structures (+arrison and 0t 7ohn 199-) ,artwright and 0choenberg *$$6). 'trategic alliances1 ,ollaboration between companies has grown at a significant rate in recent years. /hey are important ways to supplement a firms competencies and addressing competition (+arrigan 19--). 0trategic alliances are the most common form of such collaborati!e strategies. 0trategic alliances are !oluntary arrangements between firms in!ol!ing e change1 sharing1 or co de!elopment of products1 technologies1 or ser!ices. /hey can occur as a result of a wide range of moti!es and goals1 take a !ariety of forms1 and occur across !ertical and hori'ontal boundaries (Gulati1 199-). /he failure rates in alliances ha!e been !ery high. Researchers ha!e attributed lack of cooperation) conflict) poor information e change and opportunistic beha!ior as causes for a relati!ely high rate of failure in alliances (Bas and /eng 199-1 *$$#) Inkpen *$$11 kauser and 0haw *$$A). Researchers ha!e tried to e plain alliance success by looking at trust1 control and risk inherent in alliance outcomes. @artner cooperation1 which is the resultant beha!ior of these antecedents1 determines the alliance performance. <s can be seen the success of alliances is a function of management of interorganisational coordination which effecti!ely links it to implementation. $esearc% on organisational structure1 0tructures are essential part of strategy implementation (4hittington *$$*) .mpirical studies of the strategy GstructureDperformance ha!e gi!en unclear or e;ui!ocal results. /hese studies ha!e focused on the formal structure in organisations for e.g. hoskisson (19-9) showed that relation between unrelated di!ersification and mDform of organisational structure is positi!e while it is negati!e for !ertical integration strategies and e;ui!ocal for related di!ersification. It was khandwala (19=A) who showed that congruence between structure1 processes and systems is more important for performance (sufficient condition) than organisational fit with en!ironment (necessary condition) and reinforced in the study by miles and snow(19=-) where organisations following successful prospector strategies where found to ha!e organic organisational forms. /he study by miller (19-6) was the first to emphasi'e the configurational elements when he

showed that it is essential to ha!e congruence between strategyDstructure and other systems which was reinforced by @ettigrew et al (*$$*) who !iewed the elements to represent complementariness. Organisations need to be configured as a whole and not treat structural elements as isolated factors (?eats and o neill *$$* hand book of strategy). /he role of managers in achie!ing this configurational congruence is due to the fact that managers are the first to notice salient differences in organisational performance) can also anticipate changes) strategi'e and plan structural changes and finally implement these changes. Research on strategy Gstructure which started with chandlerCs monumental work (196*) !iewing structure as a policy shifted and got obsessed with the &Dform and di!ersification and did not look at other structural configurations1 with changes in strategies as time passed by. /his obsession led to structure being !iewed more conser!ati!ely than what chandler had defined (Gould and luchs 199A)1 resulting in structure being !iewed as a pro y for implementation. 4ith waning interest1 due to increasingly di!erse topics holding researchers interest1 structure was treated as peripheral construct as part of studies on change1 culture or control. Research on structure then graduated to finding out how structures are created and adapted. /hus structure was treated as an instrument in practice (4hittington *$$*) 4hile literature in the business policy area got obsessed with one type of structure (mD form) and one type of strategy (di!ersification) 4hittington *$$*)) the organisational beha!ior literature looked at en!ironmentDstructure adaptation lea!ing out its link to performance(Ginsberg and :enkatraman 19-#). Research on content of strategies has either looked at strategy contentDperformance link without considering the organisation !ariables which represent the implementation process (Ginsberg and :enkatraman 19-#) Bess et al 199#) or ha!e tended to concentrate on !ariables of specific interest such as trust (in case of strategic alliances)) culture( in mergers and ac;uisitions) or structural forms( in di!ersification) or concentrate on a list of !ariables at the indi!idual le!el( as in inno!ations) due to a predominant emphasis on content. 'trategic consensus /he literature on strategic consensus1 started as an attempt to look at factors affecting strategy formulation at the top management le!el. 4hile ma5ority of the studies ha!e concentrated on consensus at the top management le!el) there has been a reali'ation that consensus needs to be looked at all le!els of managers in an organisation to e plain the link between strategic consensus and performance (4oolridge and >loyd 199$) >loyd and 4oolridge 199*) Booley1 >ry ell and 7udge *$$$) &arkoc'y *$$1) ?ellermanns et al *$$(). +owe!er empirical testing of consensusDperformance link is besieged with methodological problems and has tended to be in form of bi!ariate relationships (?ellermanns et al *$$(). /he importance of the strategic consensus is repeatedly stressed for de!elopment of theory about the strategy process (8ourgeois 19-#) @riem 199$) @riem and Bess 199#).

'trategy implementation frame works and models < sur!ey of literature (see okumus 1999 for a re!iew) allowed identification of 16 frameworks or models which ha!e e clusi!ely looked at the strategy process or strategy implementation. < summary of the salient findings of these papers is placed as anne ure. /he frameworks or models can be classified based on three ;uestions 1. whether their orientation is content or process *. whether their focus is on a partial set of !ariables Jprocess or on full set of !ariablesJ process A. 4hether their approach is top down1 prescripti!e and rational process of decision making or it is bottom up1 descripti!e and participati!e process of decision making. 8ased on answers to these three ;uestions1 = studies look at content while 9 studies look at the process. Out of the se!en studies looking at content1 two are conceptual (bourgeois and brodwin 19-() 4aterman1 @eters and @hilips 19-$)) while fi!e studies are empirical. One study (7oyce and hrebiniak *$$#) looks at the complete set of !ariables1 is more a prescripti!e model1 taking a top down approach) and the four look at a partial set of !ariables such as unit capabilities and manager e pertise (Roth and &orrison 199*)) matching locus of control and control mechanisms with strategy (go!indara5an 19-()) implementation tactics (nutt 19-=) or fit between indi!idual !alues and !alues of inno!ation (?lein and sorro 199*). Of the studies which look at process1 - are empirical and one is a conceptual (hart 199*) which looks at the formulation part of the strategy process only. Of the eight empirical studies1 four look at the entire process. Of the other four studies ) argyris( 19-9) looks at learning from mistakes made during implementation of strategies) ski!ington and daft ( 1991) look at structure1 market related e penditures) communication and sanctions) miller ( 199=) looks at implementation of strategic decisions and feurer(199#) looks at the strategic planning system of hoshin kanri in +ewlett @ackard. In effect it can be seen that these four studies ha!e not dealt with the entire process or set of !ariables. /he four studies which ha!e looked at the full process of strategy implementation) two studies are based on one (hambrick and canella 19-9) or two case studies (okumus *$$1)) one is a cross sectional study (bromiley 199A)) and the other one is a fully de!eloped model. /he resource allocation process model (bower and Gilbert *$$#) has been de!eloped o!er the last thirty years through a series of empirical case studies although literature does not consider it to be a strategy process model (okumus *$$A). /he list of !ariables that get generated fro the frame works areI .n!ironment1 structure1 powerJ participation1 incenti!esJ rewards1 control1 alignment of sub goals1 detailed planning1 resource allocation1 e!aluation1 competenciesJ e perience1 learningJ training1 communication and e ternal partners. /he literature on the implementation frame works while listing out the !ariables affecting the implementation process1 has not looked at how these !ariables interact and influence other !ariables and how these interaction effects affect the o!erall implementation process and the outcome (Okumus *$$A).

1$

$esource allocation process model /he stream of literature dealing with the resource allocation process looks at the process of resource allocation as a pro y for implementation of strategy (8ower 19=$). Resource has been defined in this literature as assets tied semiDpermanently to firms and includes tangibles and intangibles (4ernerfelt 19-(). /he central proposition is that the way the resources are allocated in the firm shapes the reali'ed strategy of the firm. Fnderstanding the resource allocation process allows one to understand how strategy is made. /he processes that lead to strategic outcomes are remarkably stable e!en as en!ironments change. Bespite the comple ity of the process1 many of the forces can be managed if they are understood. /he process of resource allocation is intimately connected to strategy. /his process is a comple 1 simultaneous1 dynamic1 multile!el and multirole phenomenon. ,apital allocation decisions were made as a part of this comple process by managers who may ha!e conflicting roles and often are at the middle le!el of the organisational hierarchy. It also showed that structural conte t shaped the strategy (8ower 19=$). /he process of resource allocation is also influenced by the strategic conte t (8urgelman 19-A). Resource allocation is an iterati!e process (Eoda and bower 1996) and is a bottom up process. 8ounded rationality pre!ents any single indi!idual from collecting and processing all rele!ant knowledge for an optimal decision (0imon 19(=). 8ottom up process relie!es the top management of the need to collect all information and processing it to make a decision. /his is done by distributing the decision rights to managers who possess the rele!ant specific knowledge. >urther these managers ha!e the incenti!e to define and support successful pro5ects to the e tent they are in line with their incenti!es and rewards. /he persistence of the process produces a conser!ati!e bias which e plains the inertia built up. /he customers and shareholders could influence the resource allocation process thereby influencing the selection of proposals for in!estment (,hristensen 199=). Inno!ations that fit the strategic conte t were called sustaining technologies while those that did not fit the conte t were called disrupti!e technologies and these were implemented successfully by setting up a new organisation (,hristensen 199=). /his process can fail when there are institutional barriers around sources of capital (sull 1999)1 when highly !olatile and uncertain in!estment decisions are made (eisenmann *$$*) and re;uire corporate inter!ention to set it right or when the magnitude of in!estment e ceeds the authority of the managers proposing and are not willing to bear the risk associated with the proposal (eisenmann *$$*) or when the middle managers block proposals due to differences with the operating managers (kuemmerle 199-). <part from the abo!e mentioned factors1 managerial cognition is another important factor. Resource allocation to disrupti!e !entures is seen when such e!ents are framed as threats and yet were attempted to be ad5usted among the e isting strategic and structural conte t (Gilbert *$$$). /hus cogniti!e framing shapes the resource allocation process. Eormati!e functions of the resource allocation systemI 1. Be!elop capabilities *. ,reate !alue for the organisation and enhance employee reputation and security A. allow for inno!ati!e proposals to get resources to facilitate creation of e plorati!e capabilities

11

>or effecti!e implementation of autonomous or new strategic initiati!es that are not in line with the present strategic conte t1 both recognition and incorporation into the strategic conte t is re;uired. /he process can be changed. /op management can effect changes in the structural conte t to effect changes in the way definition and impetus is managed. 8y changing the strategic conte t1 and the cogniti!e frames of the managers1 the definition and impetus process can be managed. . ternal forces (customer and capital market feedback) can also be harnessed to effect change in the same processes. In the whole process consensus at all le!els is implicit. <t the definition stage1 the initiation may be in one department but the acceptance of the final definition is dependent upon the influence the pro5ect will ha!e on other departments and hence their inputs will influence it. /he final definition is thus1 implicitly1 a consensusual decision either by participation or by imposition or a combination of both. ,ustomers ,apital mkts

0trategic conte t &anage rial cognitio n

Befinition Resource allocation appro!al

,ustomers

0tructural conte t

Impetus

The resource allocation process (Bower and Gilbert 2005)

Reali'ed strategy

Reali'ed strategy becomes the key outcome !ariable in the resource allocation model. 4%e role of t%e corporate office in t%e resource allocation process1 /he corporate office can inter!ene to support resource allocation to disrupti!e inno!ations and then either spin it off as a separate organisation or re!ise the strategic conte t to incorporate the strategic implication of the disrupti!e inno!ation. It can also be re;uired when organisational politics hamper the implementation of the disrupti!e strategy. 0imilar inter!ention will be re;uired when the en!ironmental changes re;uire large scale changes in strategic conte t or speed of decision making due to speed of change in en!ironment or both. ,orporate inter!ention will also be re;uired in cases where units are working based on cooperati!e strategies or in transnational corporations. /he resource allocation model is a process model. +owe!er it has been e clusi!ely studied only in large manufacturing organisations and has not considered the link to performance outcomes. Its strength lies in its ability to gi!e intermediate le!el constructs which facilitate the de!elopment of a comprehensi!e process model of strategy implementation (8ower and Gilbert *$$#).

1*

(ro/lems associated wit% t%e researc% in t%is field 1. 0trategy implementation is still a neglected area for research (hrebiniak and 7oyce *$$1) hut'schenreuter and kleindienst *$$6). >ormulation and implementation are complimentary and logically distinguishable areas of strategic management research (hrebiniak and 7oyce *$$1). .mpirical research shows many implementation related !ariables are important in e plaining performance (+anson and 4ernerfelt 19-9). Implementation of strategy directly or indirectly relates to all facets of management. Organisations fail to implement more than #$% of their strategic decisions (miller *$$*) hambrick and canella 19-9) mint'berg 199(). Bespite the importance of implementation process1 the emphasis of strategic management research has been on content or formulation (dess1 gupta1 hennart and hill 199#). /he reasons for such paucity of research on implementation ha!e been stated to be due to the comple ity and difficulty associated with it) the field being less glamorous and implementation being !iewed as a mere administrati!e e ercise1 an e tension of the planning process (okumus and roper 1999). *. /here is no e hausti!e and cohesi!e body of prior literature due to paucity of research (noble 1999) hut'schenreuter and kleindienst *$$6). A. /he e isting content of research on strategy implementation is widely spread and fragmented. <lthough strategy implementation is a function of multiple !ariables that must recei!e an integrated approach to understand the interacti!e effects) howe!er they ha!e recei!ed only differentiated attention in both strategic management and organisational beha!ior literature (hrebiniak and 7oyce *$$1) (. /here is no agreed upon and dominant frame work in strategy implementation (hut'schenreuter and kleindienst *$$6) /his has hampered both practioners and researchers alike (noble 19991 <le ander 1991). /his has resulted in lack of a starting or reference point for practioners to use for their guidance and researchers1 a model to build upon. /he literature on the implementation frame works while listing out the !ariables affecting the implementation process1 has not looked at how these !ariables interact and influence other !ariables and how these interaction effects affect the o!erall implementation process and the outcome (Okumus *$$A). 2et%odological issues1 Implementation has to be !iewed along with strategy content. 0trategy content literature can be grouped as those dealing with di!ersification1 mergers and ac;uisitions1 collaborati!e strategies1 competiti!e strategies1 and inno!ations dri!en strategies. . cept literature on inno!ations which has dealt with factors influencing adoption of it) all other streams ha!e looked at strategy contentD performance link without considering the organisation !ariables which represent the implementation process (Ginsberg and :enkatraman 19-#) Bess et al 199#). Research in strategic management has predominantly been cross sectional in nature1 concentrating mostly on simple bi!ariate relationships and has been plagued with the problems of multiple definitions of constructs (Ginsberg and !enkatraman) hut'schenreuter and kleindienst *$$6). /he use of configurations

1A

as a methodological principle offers potential to help in pro!iding more useful e planations of the strategy process (hut'schenreuter and kleindienst *$$6) miller 1996). In recent times there has been a proliferation of use of in depth single and multiple case studies1 but large sur!eys still predominate. "ongitudinal studies are rare1 although as a method are gaining in use (@ettigrew et al *$$*) hut'schenreuter and kleindienst *$$6). -aps in literature /he gaps in literature concerned with implementation areI 1. /he need to look at strategy as an integrated and dynamic process. Research concerning formulation and implementation is better if done together as strategy process research. 0trategy process has been identified at !arious times as an important facet of strategic management research (gopinath and +offman 199#1 @ettigrew et al *$$*1 hitt *$$#). 0tudy of the process is study of simultaneously occurring acti!ities and their linkages. *. /he e tension of the only process model (resource allocation model) dealing with strategy process to include performance outcomes and test its application in ser!ice and public utility organisations. A. /here is a need for achie!ing integration of the fragmented and dispersed pieces of research on strategy implementation. /his re;uires a model which would look at the !ariables in!ol!ed in implementation in an integrated way1 duly looking at the interacti!e effects of the !ariables( hrebiniak and 7oyce *$$1) ,hakra!arty and Roderick *$$*) @ettigrew et al *$$*) (. "ack of a good process model which e plains the implementation process duly accounting for the interacti!e effects of !ariables influencing it and which would be more practioner and researcher friendly. .onclusion 0trategy implementation is important but difficult because implementation acti!ities take a longer time frame than formulation1 in!ol!es more people and greater task comple ity1 and has a need for se;uential and simultaneous thinking on part of implementation managers (hrebiniak and 7oyce *$$1). In !iew of these factors1 research into strategy implementation is also difficult for it entails the need to look at it o!er time ( longitudinal studies)) presents conceptual and methodological challenges as it in!ol!es multiple !ariables which interact with each other and show reciprocal causality(fa5ourn *$$$). /opic of implementation is a neglected and o!erlooked area in strategic management literature. @ublished research re!eals emphasis on strategy formulation. 0trategy formulation and implementation are complementary and logically distinguishable areas of strategic management and part of the o!erall process of planning e ecuting and adapting. &ore Research on implementation has been done in organi'ational theory and de!elopment than in strategic management. Implementation research needs to be interdisciplinary. /he importance of implementation can be gauged from the study of 7oyce (*$$$) which showed that firms with unusually high performance and firms which turned around their performance relied upon key acti!ities of strategic direction1 building a fast and effecti!e organisation1 establishing an adapti!e culture and e ecuting against focus of customer needs and cost (hrebiniak and 7oyce *$$1 hand book of strategy).

1(