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Designing strategy practice intervention
with Integrative Thinking and Action
Research
Presented to
The Graduate School of Business University of Cape Town
In partial fulfilment
of the requirements for the degree
Master of Business Administration specialising in Executive Management
Submitted by: Andries Francois de Wet
Supervisor: Kosheek Sewchurran and Jenny McDonogh
Executive MBA
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UNIVERSITY OF CAPE TOWN
GRADUATE SCHOOL OF BUSINESS
Declaration
1. I know that plagiarism is wrong. Plagiarism is to use another’s work and pretend that it
is your own.
2. I have used the APA convention for citation and referencing. Each significant
contribution and quotation from the works of other people has been attributed, cited,
and referenced where appropriate.
3. I certify that this submission is all my own work.
4. I have not allowed and will not allow anyone to copy this assignment with the intention
of passing it off as his or her own work.
Signed: Date: 4th December 2017
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Abstract
Structure from Baker and Schaltegger (Baker & Schaltegger, 2015).
Purposeofstudy
The study is conducted to explore strategy - theorising what strategy is and how it is practiced
and coming up with a model for strategy as practice. The theory will present a Framework of
Ideas which will be integrated into an Integrative Thinking model of strategy. The findings of
the literature review will be compared to the case study organisation to identify areas for action
taking. Action Research with a Soft Systems Methodology will be applied to understand the
approach to strategy practice in the case study organisation and identify the influences on the
area of focus that will influence action taking.
Methodology,approachanddesign
The methodology utilised in this paper to understand the powers at work in the case study
organisation is Action Research done in a Soft Systems Methodology way, applying the
LUMAS model as a framework for Action Research. LUMAS is defined as (Learning, User of
methodology, Methodology formally described, Actual approach adopted, Situation (real word
problem situation). This approach is used to understand how strategy is viewed and performed
in the case study organisation. A range of soft systems tools are used in the approach, including
Rich Picture, ‘CATWOE’, root definition, multilevel thinking and 3 E’s model. Martin’s
Integrative Thinking (Martin, 2017a) process is applied to design a process framework for
strategy as practice, informed by the literature review. Conversations for action and Causal
Relationships Diagrams also form part of the study’s Framework of Ideas.
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Researchlimitationsandimplications
This study will focus on my organisation (the case study organisation and organisation in
focus); it may take for granted some of the processes and practices in place in my organisation
that are not standard business practice, but rather are specific to the organisation’s business
model. I am not trying to generalise my organisation’s views and practices as common to the
rest of the world, but merely highlight key elements that the reader may be able to identify with
in their world. The readers should explore their own organisation’s practices to ensure the
conclusions I present are relevant to their situations.
Practicalimplementations
This paper’s objective is to design a framework for implementing and executing strategy
practices in an organisation. During the research process the study will present a methodology
for enquiry into human activity systems in order to understand what relationships exist around
the area of concern that should be considered before taking action and implementing an
intervention.
Originality/value
Strategy practice is performed by all companies, whether it is through deliberate planning or
emergence (Sewchurran, 2017). However, few may be aware of the full process and thinking
of strategy. My research will look at the strategy practice concept and the tension between these
two opposing practices and apply an Integrative Thinking approach to design a framework for
strategy practice from all these ideas.
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Keywords
Strategy practice, strategy as practice, strategy implementation, strategy process, defining
strategy, strategy’s purpose, Integrative Thinking, Action Research, Soft Systems
Methodology, Soft Systems Methodology in Action, LUMAS model.
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Table of Contents
Abstract ........................................................................................................................................... iii
Table of Contents ............................................................................................................................. vi
List of Figures .................................................................................................................................... x
List of Tables ................................................................................................................................... xii
Glossary of Terms .......................................................................................................................... xiii
Acknowledgements ....................................................................................................................... xiv
Chapter 1: Introduction to the study................................................................................................. 1
1. Introduction .......................................................................................................................... 1
2. Author’s view of strategy practice ......................................................................................... 2
3. Author’s background ............................................................................................................. 4
4. Situation of concern .............................................................................................................. 4
5. Research goals ...................................................................................................................... 5
6. Root Definitions .................................................................................................................... 6
7. Focusing questions ................................................................................................................ 7
8. Research methodology .......................................................................................................... 8
9. Ethical considerations ........................................................................................................... 8
10. Outline of the paper .............................................................................................................. 9
Chapter 2: Literature Review .......................................................................................................... 11
1. Introduction ........................................................................................................................ 11
2. Integrative Thinking ............................................................................................................ 12
I. Managing tensions and creating choices ......................................................................... 12
II. Phases of Integrative Thinking’s choice cascade .............................................................. 15
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3. What is strategy? ................................................................................................................ 17
I. Strategy is about making choices .................................................................................... 18
II. Strategy is making choices aligned with purpose ............................................................. 18
III. Strategy brings focus to efforts and choice-making ......................................................... 18
IV. Strategy is aligning capabilities with customer needs and competitive advantage ........... 20
4. What is the practice of strategy? ......................................................................................... 23
I. Practice-based view of strategy....................................................................................... 23
II. Strategy-as-practice view ................................................................................................ 24
5. What tensions exist around strategy practice? .................................................................... 30
I. Reconciliation between deliberate strategies versus emergent strategies ....................... 30
II. Tension of alignment between corporate and business unit strategies ............................ 31
6. Why do Strategy? ................................................................................................................ 32
I. Strategy is a structured approach to create direction and purpose .................................. 32
II. Strategy is the utilisation of capabilities, resources, and competitive advantages in order to
achieve defined objectives ...................................................................................................... 34
III. Strategy enables measuring performance and adapting to achieve defined objectives .... 34
7. How does one manage strategy as a process? ..................................................................... 36
I. Managing creating strategy choices ................................................................................ 36
II. Managing strategy impact ............................................................................................... 41
III. Measuring strategy outcomes ......................................................................................... 42
8. Conclusion........................................................................................................................... 43
Chapter 3: Research methodology .................................................................................................. 48
1. Introduction ........................................................................................................................ 48
2. Research methodology: Action Research ............................................................................. 48
I. Action Research with the LUMAS model ......................................................................... 49
3. Data collection .................................................................................................................... 51
I. Informal discussions........................................................................................................ 52
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4. Data analysis ...................................................................................................................... 54
5. Ethical considerations ......................................................................................................... 55
6. Conclusion........................................................................................................................... 56
Chapter 4: Theoretical framework: Soft Systems Methodology ...................................................... 57
1. Introduction ........................................................................................................................ 57
2. Background to SSM and SSMA ............................................................................................ 57
3. Hard and soft systems ......................................................................................................... 58
4. SSM guidelines .................................................................................................................... 59
5. SSM’s four main activities ................................................................................................... 60
6. Selection of relevant models for SSMA ................................................................................. 61
I. Multiple Perspectives ...................................................................................................... 62
II. CATWOE ......................................................................................................................... 62
III. Rich Picture building ....................................................................................................... 64
IV. Analyses One, Two, and Three ........................................................................................ 67
V. Multi-level Thinking ........................................................................................................ 68
VI. Measure of Performance ................................................................................................ 70
7. The objective of building purposeful activity models ............................................................ 70
8. Conclusion........................................................................................................................... 71
Chapter 5: Research findings........................................................................................................... 75
1. Introduction ........................................................................................................................ 75
2. Integrative Thinking design for strategy practice from Framework of Ideas ......................... 75
I. Salience and Causality ..................................................................................................... 76
II. Sequencing and Resolution ............................................................................................. 83
3. Background to strategy in the case study organisation ........................................................ 86
4. Strategy practice tensions between Framework of Ideas and the organisation .................... 86
I. Tensions on what is strategy ........................................................................................... 87
II. Tensions on strategy practice .......................................................................................... 87
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III. Tensions on deliberate versus emergent strategy ........................................................... 88
IV. Tensions on strategy alignment....................................................................................... 89
V. Tensions on why do strategy ........................................................................................... 90
VI. Apply the Integrative Thinking model for strategy practice to the case study organisation
92
5. Findings from applying SSMA on case study organisation .................................................... 94
I. Rich Picture of problem situation .................................................................................... 94
II. CATWOE of stakeholders in the organisations strategy practice ...................................... 96
III. Analyses One, Two, and Three ........................................................................................ 96
IV. Multilevel Thinking ....................................................................................................... 100
V. Measure of Performance .............................................................................................. 102
6. Conclusion......................................................................................................................... 103
Chapter 6: Conclusion and learning journey ................................................................................. 106
1. Overview of study ............................................................................................................. 106
2. Conclusion of the study ..................................................................................................... 108
3. Learning Journey ............................................................................................................... 108
4. Wider implications ............................................................................................................ 109
References .................................................................................................................................... 110
Appendices ................................................................................................................................... 113
1. Appendix A: SSM models ................................................................................................... 113
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List of Figures
Figure 1: Illustration of the Integrative Thinking process (Martin & Austen, 1999, p. 3) ..... 14
Figure 2: Roger Martin's Strategic choices (Martin, 2017b, p. 15) ....................................... 20
Figure 3: Collis & Rukstad’s Strategic Sweet Spot (Collis & Rukstad, 2008, p. 89) ............ 22
Figure 4: Practice-based view of strategy: authors own construction based on Jarzabkowski et
al’s (2016) explanation ....................................................................................................... 24
Figure 5: Strategy Practice: What, Who, and How? (Jarzabkowski et al, 2016, p. 251). ....... 27
Figure 6: Author’s interpretation of Johann Strümpfer’s continuous strategy process
(Strümpfer, 2016b) .............................................................................................................. 35
Figure 7: Roger Martin's interrelated strategy choices (Martin, 2017b, p. 17) ...................... 37
Figure 8: Roger Martin Nested Choice Cascades (Martin, 2017b, p. 67) .............................. 39
Figure 9: Roger Martin's Iterative Nature of Strategy (Martin, 2017b, p. 71) ....................... 40
Figure 10: Roger Martin's strategic choice structuring process (Martin, 2017b, p. 46) ......... 41
Figure 11: Author’s interpretation of Johann Strümpfer’s CRD for strategic impact assessment
(Strümpfer, 2016b) .............................................................................................................. 42
Figure 12: Checkland’s LUMAs model for learning (Checkland, 2000, p. 37) ..................... 50
Figure 13: Author's LUMAS for this research project’s learning cycle for Action Research 51
Figure 14: Author’s presentation of the case study organisation's functional hierarchy and
function managers ............................................................................................................... 52
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Figure 15: Checkland's distinction between hard and soft systems (2000, p. 18) .................. 59
Figure 16: Rich Picture of the author's problem situation..................................................... 66
Figure 17: Checkland's multilevel thinking (Checkland, 2000, p. 29) .................................. 69
Figure 18: Author’s illustration of the CATWOE model ..................................................... 72
Figure 19: Author's RD of what is strategy .......................................................................... 76
Figure 20: Author's CRD of integrated strategy practice interpreted from Jarzabkowski et al.
(2016) ................................................................................................................................. 77
Figure 21: Author's CRD of planned vs emergent strategy tensions ..................................... 78
Figure 22: Author's CRD of tension that exist around strategy practice ............................... 79
Figure 23: Author's CRD of strategy statement on strategy execution and planning ............. 80
Figure 24: Author's CRD of strategic purpose and measurement ......................................... 81
Figure 25: Author’s CRD of strategy management .............................................................. 83
Figure 26: Author’s Integrative Thinking designed model of strategy practice .................... 85
Figure 27: Author’s CRD of the case study organisation’s strategy process ......................... 88
Figure 28: Author’s representation of the organisation’s strategy development.................... 89
Figure 29: Author's Integrative Thinking CRD for action taking in the case study organisation’s
strategy practice .................................................................................................................. 93
Figure 30: Author’s Rich Picture of the problem situation of strategy practice in the
organisation ........................................................................................................................ 95
Figure 31: Author's Rich Picture of Analyses One, Two and Three ..................................... 99
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List of Tables
Table 1: Author's table of informal discussion points .......................................................... 53
Table 2 : Author’s Analysis One of Problem owners with process ....................................... 96
Table 3: Author’s Analysis Two of Level of need within the organisation to improve strategy
practice ............................................................................................................................... 97
Table 4: Author’s Analysis Three of Degree of Power of Problem owners with process ...... 98
Table 5: Author's representation of multiple level strategy practice for the organisation as it
could be ............................................................................................................................ 101
Table 6: Author's representation of multiple level strategy practice for the organisation how it
is ....................................................................................................................................... 102
Table 7: Author's application of CATWOE - Customers ................................................... 113
Table 8: Author's application of CATWOE - Actors.......................................................... 114
Table 9: Author's application of CATWOE - Transformation ............................................ 114
Table 10: Author's application of CATWOE – World View .............................................. 114
Table 11: Author's application of CATWOE – Owner ....................................................... 115
Table 12: Author's application of CATWOE – Environmental Constraints ........................ 115
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Glossary of Terms
Abbreviation Meaning
CIMA Chartered Institute for Management Accountants
CRD Causal Relationship Diagram
EMBA Master’s in Business Administration specialising in Executive
Management
GSB Graduate School of Business
JSE Johannesburg stock exchange
KPI Key Performance Indicator
LUMAS Learning, User of methodology, Methodology formally described, Actual
approach adopted, Situation (real word problem situation)
MIS Management Information Systems
MoP Measure of Performance
RD Relationship Diagram
ROOT
definition A statement of the transformation process in a purposeful activity system.
SADC Southern African Development Community
SBU Strategic Business Unit
SSM Soft Systems Methodology
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Acknowledgements
To my wife, Estelle, and children, Ben and Gwendoline, thank you for your support during this
research study and the entire EMBA course. Kosheek Sewchurran, director of the EMBA, for
introducing a new view of how things are in the world. I could not have attempted this without
knowing you are with me. Jenny McDonogh, my supervisor at the GSB, thank you for
providing guidance and challenging my limited thinking. Danie Theron, my dear friend, your
perspectives on how the world is, gives me an alternative perspective on how things might be.
The friends I made during this time on the EMBA course, who supported me when pressures
were high and for making this a truly memorable experience.
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Chapter 1: Introduction to the study
1. Introduction
The objective of the paper is to use an Integrative Thinking approach to finding choices for my
area of concern, namely, strategy practice, which others may utilise to contribute to their
understanding of the heuristics around strategy for their own organizations.
The test of a first-rate intelligence is the ability to hold two opposing ideas in mind at
the same time and still retain the ability to function. One should, for example, be able
to see that things are hopeless, yet be determined to make them otherwise. – F Scott
Fitzgerald (Martin, 2017a) .
Organisations are constantly challenged by the complexity in their environment, choices to
consider, and decisions to make. Dealing with these challenges requires a plan with a
determined objective, or a strategy. Strategy is a creating choice, selecting and executing a plan
to achieve the objective of a business. To achieve the objective of winning or achieving a set
goal, the organisation is required to consider its abilities versus those of competitors and what
customers want, all within the context of the environment in which the organisation operates
(Collis & Rukstad, 2008). However, strategy as a practice is complex in itself. Each person or
actor participating in the crafting of the organisation’s plan of action requires a clear
understanding of what strategy is and how to participate in strategy. The purpose of this
research is to explore the concept of strategy and how it may be applied. This paper will not
look into the concepts of leadership as practice or change management; the focus will be around
the phenomenon of strategy and strategy as a practice.
The focus of the study is to provide some clarity around the concept of strategy and its practice.
The first part of the study is a literature review. The objective of the literature review is to
generate a conceptual understanding and framework of strategy and how it is practiced. In the
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literature review, I will include key elements applicable to this study from previous work in the
EMBA course. The second part unpacks the concept and application of Action Research with
Soft Systems Methodology (SSM). Action Research is a methodology for understanding a
situation of concern in the real word in order to come to an action that can be taken to improve
the situation. As part of the Action Research process SSM will be applied to gain insight into
the elements that influence strategy practice in the organisation in focus. From the data
collected, by applying Action Research with Soft Systems Methodology, I will gain multiple
perspectives of how strategy is understood and practiced in the organisation in focus.
I will incorporate the LUMAS model for learning about the situation in Action Research and
bring in previous work from my EMBA course and my own experiences in strategy design and
implementation.
In the final part of the study I will apply Integrative Thinking to bring all the ideas together and
build a theoretical framework for practicing strategy. Integrative Thinking provides a way of
thinking about opposing ideas and choices, not by selecting one element or idea at the cost of
another, but by fusing the best elements of each into a new choice. Integrative Thinking
provides this ability to leverage tensions. Roger Martin defines Integrative Thinking in his
book, The Opposable Mind, as "the ability to face constructively the tension of opposing ideas
and, instead of choosing one at the expense of the other, generate a creative resolution of the
tension in the form of a new idea that contains elements of the opposing ideas but is superior
to each" (Martin, 2009, p. 15). The assertion is made that the practitioner should be able to hold
two opposing ideas at the same time. Having opposing ideas generates the tension. This tension
can be leveraged to bring out each idea’s strong points. These strong points can be considered
to form a new, superior idea.
2. Author’s view of strategy practice
As this is a Soft Systems Methodology informed by study, it is important to begin by declaring
my view of strategy (Checkland, 2000). In my experience, I believe strategy is practiced by all
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organisations, but not always understood. My perspective on strategy is that it is a plan of
action to achieve a specific goal. There is an overall organisational goal, but there are sub-level
goals for each function or department that support the overall goal. These sub-level goals
should cover all core aspects of the business and contribute towards to the organisation’s ability
to achieve its overall strategic objective. To achieve the strategic goals, there should be
strategic plans. The plan requires clear measures of performance, which must be monitored so
necessary adjustments can be made. Information systems or feedback systems need to be in
place at the different levels and functions of the organisation to ensure performance
measurements are reported and monitored, to allow for alterations to the plan that promote
necessary effectiveness and efficiency of the execution.
My view is further that there are also different contributors to the organisation, both at
horizontal and vertical parts of the hierarchy of the organisation, which have different
functions—functions that should make the organisation viable. It requires various participants
in the organisation to contribute according to their specific area of focus. People and functions
in the organisation therefore need a clear purpose and objective at their level of the
organisation, which is applicable to their area of focus.
I also hold the view these objectives need to be stated, monitored, and reported up through the
organisation so that the plan and the execution can continuously evolve to ensure the
organisation reaches its overall strategic goal.
The remaining part of the chapter provides a background to the author and the author’s work
experience and explains the situation of concern within the case study organisation. The
following sub-sections will set out the author’s personal research goals for this paper and
establish clear focussing questions for the study and the literature review conducted in this
paper. This is followed by a clarification of the research methodology and the author’s ethical
consideration on research conducted for this paper. The chapter concludes with a brief
overview of the rest of the study’s chapters.
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3. Author’s background
I am a finance professional with an ACMA qualification (CIMA, 2007). I spent almost eight
years in London working in the financial services sector, focussing on hedge funds and private
equity. My time in London provided me with a rich diversity of insights into strategy practices
across several cultures and countries as I managed businesses and corporate functions in both
developed and emerging market economies and with people from various cultural
backgrounds. My management style has been very quantitative due to my finance background
but, through the EMBA, I have made a conscious shift to incorporate qualitative methods,
specifically around applying effective conversation concepts (Kline, 1999). In my role as
CFO/COO of the Hedge Fund and Private Equity business, I was key in creating and
implementing management information systems (MIS). This included implementation of
group-wide accounting systems and processes and a group-wide portfolio management system.
Through this experience, I came to appreciate the value of systems thinking and what it adds
to an organisation’s structural effectiveness and efficiency. During the credit crunch, we were
able to manage the same business model, with almost 50% fewer employees, by managing
scarce resources effectively and applying technology to drive efficiency.
My current role is Head of Trading at an agricultural commodity trading organisation within
the Southern African markets. The organisation manages the entire value chain in the
agricultural and animal feed industry, from farm gate to processor. Our supply chain covers the
trading (buying and selling of physical commodities), transport, and storage of commodities,
as well as derivative trading (hedging and speculation on behalf of clients) and financing
activities. I am part of the executive management responsible for strategy planning and
execution.
4. Situation of concern
In my organisation, strategy is evaluated and set at start of the financial year. The primary
measure of performance is the extent to which we meet our income budget.
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Our business model is structured with autonomous Strategic Business Units (SBU’s) that
specialise in a commodity or related commodities and middle and back office functions that
support trading. SBU’s are measured on achieving budget. Middle and back office functions
are evaluated based on personal self-set goals. To date, promoting autonomy of the SBU has
been the source of growth for our business. This autonomy has provided agility to adapt
according to customer needs. However, my view is that, due to the growth in market share and
size of the business, future performance will depend on being able to look at strategy in a
different way. Our strategy process has been more emergent than planned, with autonomy of
decision making in business units leading the organisation’s performance.
It is my view, informed by previous learning cycles in the EMBA, that the organisation needs
to be more consciously clear on strategy and consistently drive strategy that meets our
customers’ needs, matches our capabilities, and differentiates us from the competition. This
requires people at each level and function to have a clear purpose for their efforts. This may
require changing the way the organisation manages strategy execution and monitors different
functions, which will result in tension coming from the SBUs and managers as their
performances will be measured on more than just budget and personal goals.
The desired future state is where every function is focussed on the strategic objective of the
business. Within the context of the strategic objective, each function should have its clear
strategic purpose and goal. Goals should be monitored with reporting systems. Within these set
goals and monitoring processes, autonomy can be promoted to achieve the strategic goals.
5. Research goals
Similar to my previous work (de Wet, 2016), the research goals of the paper are underpinned
by Maxwell’s interactive model (Maxwell, 2009).
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(1) PersonalGoal
Personal goals are what motivates one to do the study, and may overlap with the practical and
intellectual goals (Maxwell, 2009). I believe this study will develop my application of
Integrative Thinking and ability to lead strategy in any organisational structure. The study will
include gathering data from individuals. This requires ethical consideration and mindfulness
around the sensitivity of the topic and the people involved. Effective conversation practices
(Kline, 1999) is required to motivate people to participate, a skill that will have a profound
effect on my relationships with people in and out of the corporate environment.
I believe that strategy is a continuously evolving course of actions and choices that should be
driven by structured feedback systems within the organisation, between the different levels of
the organisation, as it moves to achieve a specific goal. My goal with the study is to establish
support for this belief with evidence-based management practices and research.
(2) PracticalGoal
One’s practical goals should be focussed on accomplishing something (Maxwell, 2009). My
purpose is to understand how my company performs strategy by applying soft systems
thinking. I will compare my organisation’s approach to the literature review and apply the
concepts of Integrative Thinking to innovate a new framework of strategy practices.
(3) IntellectualGoal
From an intellectual perspective, the objective is to gain a deeper understanding of Integrative
Thinking and strategy practice. Through the literature review and applying Integrative
Thinking, Soft Systems Methodology, and Action Research, I will not just understand how to
practice strategy; I will develop the skills and abilities to manage tension between people and
ideas, to unpack complex problems, and to resolve a challenge by creatively forming a solution.
6. Root Definitions
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The root definition aims to provide a clear definition of the complex purposeful activity to be
modelled (Checkland, 2000). The purposeful activity is around the situation of concern and is
defined as a transformation process, T, and the ROOT definition provides a statement of the
transformation process. The input into the transformation process will undergo transformation
through this process and take on a different form as an output. It is important to not confuse
the resources required for the transformation process with the inputs, but rather to maintain a
distinction between input and resources. The entire process could be formulated into the “need
for X” being transformed into “the need for X met” (Checkland, 2000). The alternative
expression is PQR (Checkland, 2000). The following three questions provides guidance in
establishing the root definition (Checkland, 2000):
1. What to do (P)?
2. How to do it (Q)?
3. Why do it (R)?
The root definition for taking on this study is:
Designing strategy practice (P) with Integrative Thinking and Action Research (Q) to
improve the researcher’s business management skills (R).
The Area of concern is strategy practice in the organisation. The transformation is required
around strategy practice. The root definition is a statement of the transformation process.
7. Focusing questions
As this study wishes to use the literature review to first develop a theory of strategy, the
literature review in Chapter Two will explore the following questions:
1. What is Integrative Thinking and how do I apply it to create choices and solve
problems?
2. What is strategy?
3. What is the practice of strategy?
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4. What tensions exist around strategy practice: planned versus emergent? Strategic
alignment between business units and corporate?
5. Why do strategy?
6. How does one manage strategy?
The intention is that the answers to these questions will help inform the study’s key research
questions, which are:
1. What Framework of Ideas exists out there about strategy practice?
2. How can one integrate strategy practice theories into a model for strategy practice?
3. What tensions exist around strategy practice?
4. How can strategy practice be improved in the case study organisation?
8. Research methodology
My research methodology is Action Research with Soft Systems Methodology. The LUMAS
model will be used as a framework for applying Action Research and Soft Systems
Methodology will be used as part of the LUMAS framework to explore the area of concern.
This methodology will be covered in Chapter Three.
9. Ethical considerations
Strategy is an organisation’s plan to achieve a pre-determined goal. If the plan achieves the
goal, the organisation is professed to be successful. This ability to be successful will be
beneficial to the stakeholders in the organisation aligned with this goal. The ethical and moral
dilemma is that research may cause certain changes in the organisation and impact people
(Velasquez, Andre, Shanks, & Meyer, 1987). The research also causes fear for participants in
how they will be treated by peers for their inputs.
For the research I engaged with work colleagues at different management levels and with
varying powers in the organisation. I was conscious of the influence I could have over people
that report to me or are at junior management level. Participants had different levels of
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experience which could lead to feeling pressured to participate or fear of what their answers
could lead to for them personally. The sensitivity will be around employee fears and concerns
about the interpretation and application of their responses. The considerations during my
interviews and discussions were:
• Fears and concerns about their level of understanding of strategy
• Tensions that their participation could cause
• Impact of the interpretation of their response
I will manage this by assuring them that responses are confidential, and people’s responses will
be used anonymously.
The study itself needs to provide validity. I believe the methodologies are correctly applied
and thus any conclusions drawn from this study is assumed to be valid for the case study
organisation. I believe that if the study was repeated under the same circumstances, the results
would be the same. To manage validity, the following aspects are considered:
Confirmability lies in the ability to provide proof that study was undertaken. The applied
SSMA models and appendices provide evidence that the study was undertaken. In Action
Research the researcher is part of the process, and bias is inherent to the research. However,
this bias is illustrated when presenting the SSMA models.
Transferability is presented by the Integrative Thinking model which may be applied in
organisations. The SSMA findings provide opportunity for other organisation and managers
to identify similar areas of concern and apply the suggested interventions to improve their
situation.
10. Outline of the paper
Chapter Two responds to the main focussing questions of the study for the design of an
integrative model, the Framework of Ideas and the tensions that exists around strategy practice.
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The literature review responds to the study focussing questions and explores literature relevant
to the focus questions.
Chapter Three will focus on Action Research as a methodology for research about a situation
of concern. Action Research will be guided by use of the LUMAS model. Only one Action
Research cycle will be performed. The research data is collected through informal discussion
around the area of concern of strategy as practice in the case study organisation. The informal
discussions are guided by the findings in the literature review. The chapter will also state the
ethical considerations around the Action Research cycle.
Chapter Four will explore Soft Systems Methodology as part for Action Research. SSM
provides a perspective on human activity systems which considers the relationships that exist
between variables and people that have influence over the problem situation. SSM models will
be selected and their purpose for this study explained. The models will be applied in Chapter
Five.
Chapter Five presents the findings of the study. This Chapter responds to the study’s focussing
questions around how strategy practice may be improved in the case study organisation. The
first part goes through the Integrative Thinking process to design a model for strategy practice.
The second part compares the theoretical model to the case study organisation to identify areas
for action taking to improve the organisation strategy practice. The organisations’ strategy
practice is also compared with the Integrative Thinking model to identify areas for action taking
in the case study organisation. The final part of the Chapter presents the findings from applying
the SSM models to the case study organisation and identifies tensions and influences for the
proposed action taking which need to be considered.
Chapter Six provides the conclusions and recommendations for future studies. It will consider
the impact of the study and limitations it may present.
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Chapter 2: Literature Review
1. Introduction
This study explores the phenomenon of strategy as practice and how strategy is practiced in an
organisation in the animal feed and grain commodity industry. The objective is to apply
Integrative Thinking in order to design a framework for practicing strategy.
The objective of the literature review is address the focussing question stated in Chapter One:
WhatFrameworkofIdeasexistsoutthereaboutstrategypractice?
The literature review will attempt to answer this through the focus questions listed below, also
stated in Chapter One. The literature review will also draw on research from previous EMBA
earning cycles relevant to this study (as noted in Chapter One).
The focus questions are:
1. What is Integrative Thinking and how do I apply it to create choices and solve
problems?
2. What is strategy?
3. What is the practice of strategy?
4. What tensions exist around strategy practice: Planned versus emergent? Strategic
alignment between business units and corporate?
5. Why do strategy?
6. How does one manage strategy? The focus is on the process from the point where one
decides to be strategic, perform a practice of strategy ideas, implementing it, manage
the progress of the strategy and achieving a strategy.
The first sub-section will focus on the integrative thinking approach to understanding strategy
practice.
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2. Integrative Thinking
The application of Integrative Thinking in this study is to design strategy practice from the
findings in the literature review. This part of the literature review starts to address the focussing
question of the study around how to integrate strategy practice ideas into a model for strategy
practice. This section does contain application from previous learnings during the EMBA (de
Wet, 2016). The focus question of the literature review being addressed is:
What is Integrative Thinking and how do I apply it to create choices and solve
problems?
I. Managing tensions and creating choices
As high-value decision makers and leaders, we are constantly faced with choice—in strategic
planning and (or) strategic execution. Often, choices are treated as mutually exclusive due to
scarce resources – the plan with the most positives is considered the correct one, because there
are limited funds available. Integrated Thinking presents an alternative hypothesis, one where
choice is a fusion of the best elements from both ideas (Martin & Austen, 1999). It presents a
heuristic solution rather than a linear or algorithmic solution. Heuristic is defined as the ability
to learn for yourself. It requires an integrative thinker, a person who is willing to take time to
understand the complexity of a situation and to embrace it - a person who does not see choice
as either A or B but can apply creativity to a choice where A and B are both accommodated by
C.
Martin & Austen (1999) asserted that the mind-set of the integrative thinker is to embrace
complexity, not to avoid it or try to simplify it. The integrative thinker wants to learn; that is
the central value of the process and the concept. “These choices inevitably involve tensions —
what appears to be a trade-off in which the choosing of one option precludes another attractive
option. Or using one resource renders that resource unavailable to others. Tension, by its very
nature, compels leaders to make choices of some kind. Maintaining the status quo, typically, is
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not an option. To move ahead, there’s no choice but to choose. Often these choices are
enigmatic, exhibiting a challenging combination of qualities including ambiguity, uncertainty,
complexity, instability, uniqueness, and risk” (Martin & Austen, 1999, p. 2).
Martin & Austen (1999) state that such choices have several elements that impact each other.
Making changes to one element will impact the others, which makes it difficult to break
problems into smaller independent parts and solve them separately. To add further complexity,
not only are there elements that impact on each other, but conditions around the choices can
change, creating change in possible outcomes of the choices. Martin & Austen (1999) say that
conditions around these choices can change before the implementation of the solutions, making
it extremely difficult to predict outcomes. Integrative thinking practice works from the premise
that choices are not mutually exclusive and embraces the complexity of change and cause and
effect or causal relationship of elements in choices.
Today’s leaders are often faced with decisions that do not appear to offer choice, but Integrated
Thinking provides a way of creating choices that are not necessarily visible when looking at
the problem.
“Integrative thinkers work to see the whole problem, embrace its multi-varied nature, and
understand the complexity of its causal relationships. They work to shape and order what others
see as a chaotic landscape. They search for creative resolutions to problems typically seen by
others as a simple ‘fork in the road’ or an irresolvable bind brought about by competing
organizational interests” (Martin & Austen, 1999, p. 2).
The high-value decision maker ought to have the ability to consider causal relationships of
elements or variables contained in choices and changing conditions around choices
simultaneously, to come up with creative resolutions. A causal relationship can be explained
as the direct or indirect impact of changing one element will have on another element in the
same context. For example, consider the causal relationship in the water cycle. If there is no
rain it has a direct impact on the amount of water in the dam and water level in the soil. It may
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have an indirect impact on nature’s ability to grow vegetation and water available for
consumption, causing potential drought.
Martin & Austen (1999) state that Integrative Thinking should be considered an art, and the
thinker must be guided by heuristics, not algorithms. They provide a four-step cascade process
for building the heuristic around the different choices in Figure 1. One should master the skills
“to move through and between the four steps” (Martin & Austen, 1999, p. 2). It consists of
higher-order choices (salience and causality) and lower order choices (sequencing and
resolution). Higher-order choices set the context and limitations for lower-order choices.
Figure1:IllustrationoftheIntegrativeThinkingprocess(Martin&Austen,1999,p.3)
Salience refers to the process of understanding what information or variables maybe relevant
to the choice. Causality is the process of drawing a causal map of the critical relationship, or
causal relationship diagram (CRD) that exists between the variables established in salience
phase. Sequencing requires one to review the variables and relationships or impact variables
have in the CRD. One should focus on parts of the CRD one at a time and consider whether
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elements need changing in the salience phase or causality needs amendment. The resolution
phase points to taking action based on the position drawn from the previous phases.
Martin & Austen (1999) further explain that, in Integrative Thinking, choices are all
interrelated; the cascade model demonstrates this with the arrows, showing the movement up
from lower order choices and down from higher order choices, as well as revisiting previous
steps within each choice order level. If the limitations and constraints set by higher-order
choices do not allow a lower-order choice to be constructed, then the higher-order choice must
be revisited and revised until consistent lower-order choices can be made. This is “integrative
integrity” (Martin & Austen, 1999, p. 3) and it ensures that, “choices are adjusted fluidly to
become both consistent with and reinforcing of other related choices. Preserving and enhancing
the quality of choice in rapidly changing business environments demands both close attention
to and ongoing reshaping of integrative integrity over time”. Integrative Thinking accepts that
choice-making is not a one-off process but a continuous loop of implementation, review, re-
adjustment, re-implementation, and so on, until the outcome is achieved. The next section will
provide an explanation of how to apply Integrative Thinking.
II. Phases of Integrative Thinking’s choice cascade
This sub-section will focus on the four choice cascades phases, namely salience, causality,
sequencing and resolution as presented by Martin & Austen (1999) choice cascade in Figure 1
and will provide a summary of their application and explanations.
Salience
Salience is about considering and listing the elements that have influence on the choice one is
faced with. The aim is to get an understanding of the big picture surrounding your choice and
what variables will be impacted by a choice. One is guided by the following question:
Which information or variables are relevant to the choice?
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It is critical to ensure variables are adding value; if not, the “salience threshold” has been
reached. If this “salience threshold” is reached, move to the next phase. One can always add
variables at a later stage as you move through the cascade.
Understand the level of importance of the element. Not variables will be known to the
integrated thinker but, as the process is aimed at learning, this should not limit the inclusion of
these more uncomfortable variables. Do not fall to the temptation of ignoring variables for the
sake of relieving tension. Now is the time to embrace tension points. Importance may be ranked
later. In some instances, one will rely heavily on experience, and over time build up a
“knowledge bank” of what “salient features” are important.
Causality
Causality requires one to create a causal loop diagram (CRD) of the causal relationship between
the variables identified in the salience phase. This way, relationships are identified where cause
and effect of choice can be identified. This is different from linear models, as the CRD allows
you to map the complexity of the outcomes of choice, rather than simply seeing a singular
outcome for a given choice. The integrative thinker wants to see how choice affects other
variables and, as discussed earlier, he / she does not see choice-making as mutually exclusive
option-taking. There may even be a need to create more than one CRD. With a CRD, one can
include mysterious variables, where relationships are not clear. In a linear model, one must
understand the link, limiting the ability to add complexity or mystery to the process.
Sequencing
The key to sequencing is not losing sight of the entire CRD but focusing on one part of the
CRD at a time. As one considers the different parts of the CRD, one may decide to change
some of the variables established in salience and change direction or relationships formed in
causality. The objective is to establish directional sequence of decision or choice-making. Both
direct and indirect influences should be mapped.
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Resolution
Resolution points to action taking. Here, attitude is key. One is reminded that this process is
not about reaching a point where one chooses between option A or B. There may be tension
between the options, but the integrated thinker must leverage off this tension. There will be
trade-offs, but one ought to see this as an opportunity to be creative in managing them. The
integrated thinker looks for a win-win solution.
The choice cascade model (Figure 1) offers a method to understand the wider impact of choice-
making and it is useful for problem-solving and creating choices or solutions to problems,
which may not be apparent by simply looking at the problem as a linear, cause and effect
algorithm. It allows one to understand what tensions may exist between elements that the
choice will influence. From the literature review Integrative Thinking and the choice cascade
model will be applied to the theoretical models to consider the elements that exist around
strategy practice. The literature review will respond to the focus questions on strategy practice
and the tensions that exist around strategy. In Chapter Five the literature review will be the
source for the salience variables and their causality to each other will be illustrated by creating
causal relationship diagrams (CRDs) to provide theoretical frameworks for strategy practice.
3. What is strategy?
Strategy, in its broadest sense, refers to a plan of action and the allocation of “scarce” resources
to achieve an objective (Grant, 2016). This section will explore key elements of strategy. It will
contribute to the Integrative Thinking process elaborated in Chapter Two to help address the
focus question:
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Whatisstrategy?
I. Strategy is about making choices
Martin says “to win, a company must choose to do some things and others not” (Martin, 2017b,
p. 1) and Porter argues that trade-offs are fundamental to a strategy (Porter, 1996). For
organisations to be successful, they have to be able to make choices. Strategy practices guide
an organisation in choice generation and choice evaluation. The important thing for an
organisation is to be clear on their focus, and equally where they choose not to focus. This
focus requires a plan of how to achieve the goal of the organisation. Strategy provides the
process for creating, evaluating and implementing choices.
II. Strategy is making choices aligned with purpose
Strategy is not simply just doing something well, but, first, knowing why you are doing
something. Once the organisation has purpose in a clear strategy, then the organisation needs
to focus on operational effectiveness in delivering the strategy.
Collis & Rukstad (2008) point out the importance of understanding what your strategy is and
constantly making the right strategic choices.
III. Strategy brings focus to efforts and choice-making
The critical first step for an organisation is to realise how it aims to pursue its “sustainable
competitive advantage” (Martin, 2017b, p. 14). This choice exists around two options: with
low cost leadership strategy or through differentiation strategy, referring to Michael Porter’s
generic strategies (Porter, 1996).
Lowcostleadershipstrategy
In cost leadership, customers typically require a standardised offering, with limited features.
A cost leader strategy does not necessarily mean the offering is a “undifferentiating
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commodity” (Grant, 2016, p. 224); rather, it means the focus is on generating the offering at
the lowest possible cost to secure the maximum margin.
Differentiationstrategy
On the other side of the spectrum, the differentiation strategy requires the organisation to
choose which customer requirements it will focus on and where they will position their offering
versus the competition in the market (Grant, 2016). Following a differentiating strategy does
not mean costs are not an issue. One is still required to consider the factor of scarce resources.
A differentiating strategy requires effective differentiation according to customer needs whilst
being focused on low cost efficiency—this way maximising profits (or margin) (Grant, 2016
and Martin, 2017b).
In both instances of strategic choice, the focus is on delivering the maximum sustainable profit
margin on the product being offered, as suggested by the graph below (Figure 2). A
differentiating strategy may spend more in principle than a cost leader, but the additional
spending is focussed on what customers will pay extra for that is not already offered by
competitors. If the competition is already well developed in the offering of a specific
differentiating feature, the strategy for differentiating may require even more focus or,
alternatively, the organisation should be focussed on low cost production of its offering to
maximise returns or margin. What this first strategic choice brings is focus so that firm efforts
can be channelled towards this overall objective. Interpreting the graph below (Figure 2) means
knowing which strategy the organisation follows provides a competitive edge in itself in the
sense that, if the competition starts to move into the organisation’s market segment, the
organisation is already operating with efficiency and, due to higher margins, has the ability to
compete on price to a point where the competition may not be able to operate profitably.
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Figure2:RogerMartin'sStrategicchoices(Martin,2017b,p.15)
IV. Strategy is aligning capabilities with customer needs and competitive advantage
This section looks at the use of strategy as a tool to evaluate an organisation’s capabilities and
matches them to customer needs. This matching process needs to focus on where the company
has a competitive advantage. “The creative part of developing a strategy is finding the sweet
spot that aligns the firm’s capabilities with customer needs in a way that competitors cannot
match given the changing external context—factors such as technology, industry
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demographics, and regulation” (Collis & Rukstad, 2008, p. 89). Figure 3 below presents the
strategic sweet spot concept. The process of developing a strategy statement requires a
“rigorous, objective assessment of the firm’s capabilities and resources compared to that of
competitors” (Collis & Rukstad, 2008, p. 89). The process is more than just considering your
core capabilities, because what you are good at may not be what your customers want. The
strategic sweet spot considers the organisation’s abilities within the context of its environment
and aims at finding the overlay where the strategic sweet spot exists between the organisations
capabilities and customer needs, outside competitors’ offerings. The topics the strategic sweet
spot focusses on are:
1. Customer needs: what are the customer’s needs and wants in terms of products.
2. Competitors’ offerings: what are competitors offering similar to the organisation
that customers need, or offering that customers need but the organisation is not
offering. It is also worth understanding what competitors offer which customers do
not need and to ensure the organisation does not offer these products, to avoid
following the wrong strategy.
3. Company’s capabilities: what are the capabilities of the organisation in respect of
offering products, and what capabilities do they not have but need to acquire to
compete.
4. Context: The environment and external factors that bring opportunities or
challenges (technology, industry, demographics, regulation, etc.) that will influence
the company’s abilities, the customers’ needs, and your competitors’ offerings.
The key is having a clear understanding of each sphere, to establish where it is that the
organisation has a competitive advantage that matches the customer’s needs, and to focus on
this strategic sweet spot (Collis & Rukstad, 2008). From this evaluation, your strategy
statement serves to summarise the strategy, so employees have a clear direction that will guide
their decision-making and actions. Collis & Rukstad’s (2008) state that the strategy
development process and the creation of the strategy statement should not be limited to only
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include the executive management. Roger Martin (2017b) states that, if you do not include
coalface employees (employees who face the clients or execute tasks), your strategy will not
consider the organisation’s true capabilities, competitors’ abilities, and customer needs -nor
will there be the ability to measure the strategy throughout to ensure you make necessary
adjustments to your strategy execution.
Figure3:Collis&Rukstad’sStrategicSweetSpot(Collis&Rukstad,2008,p.89)
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4. What is the practice of strategy?
In this section strategy practices will be explored. There are two views on strategy processes,
or practices. The objective is to consider which is more valid from an Integrative Thinking
perspective where one is receptive to complexity and appreciates the causality of different
salient elements. This section addresses the question:
Whatisthepracticeofstrategy?
I. Practice-based view of strategy
This case study organisation has very specific strategy practices. The practice is focussed on
specific outcome of financial performance. Due to success, this strategy practice is repeated.
To bring creativeness, the application of the process is slightly adjusted, but the practice and
outcome requirements remain constant. This application of strategy practice resembles the
practice-based view of strategy. According to Jarzabkowski et al’s (2016) research in strategy
practices, the recent focus of best practice in strategy practices (driven by economists) has been
on the basis of the “Practice Based View of Strategy” (PBV), which suggests that strategy
practice is a stand-alone phenomenon, where standard practices generate performance
differentials. This practice-based view (PBV) presented by Bromley & Rau (2014) suggests
that the organisation in focus’s strategy practice is not different from many other organisations.
However, Jarzabkowski et al’s (2016) research challenges Bromley & Rau’s (2014) PBV of
strategic practices. They present an integrative strategy practice perspective and suggest that
the practice of strategy should not be limited to considering what practices are used to generate
outcomes. It should also emphasise the impact on the strategy process of who is engaged and
how practices are applied.
The PBV is “focused on the actual techniques managers might use to develop strategies or
generally applicable firm practices” (Jarzabkowski et al, 2016, p. 249). Figure 4 below
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illustrates this focus of PBV, where specific techniques or practices are used (PRACTICE n)
to generate certain desired outcomes. Figure 4 is my illustration of how I understand the
concept. The diagram is not in the Jarzabkowski et al. (2016) paper.
Figure4:Practice-basedviewofstrategy:authorsownconstructionbasedonJarzabkowskietal’s(2016)explanation
II. Strategy-as-practice view
The traditional view of strategy is the Practice-based view (PBV). As explained above, it
focusses only on the practices applied in strategy. It further suggests that practices (the models
and tools used) are the only contributing factor to the outcome and success of strategy.
Jarzabkowski et al. (2016) is critical of the PBV. They suggest that although the PBV focuses
on the practices used and does suggest what is considered to be the best practices to use, the
practice should not be considered in isolation as the only contribution to performance and
achieving the outcomes.
Jarzabkowski et al. (2016) offers instead an applied practice theory perspective on research of
strategic practices by management in various industries, organisation sizes, and organizational
models, to establish what elements outside practices influence strategy. Jarzabkowski et al’s
(2016) research provides an integrative approach to strategy practice which looks wider than
what practices are applied to generate strategies to deliver desired outcomes. It suggests that it
is not only what we do as strategists that matters. One should consider the impact of “what”,
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“who”, and “how”, relating to a range of performance outcomes. Applying this wider
perspective to the strategy process may lead to a rethinking in core strategic topics by strategic
management.
“What”,“who”,and“how”
Jarzabkowski et al. (2016) explains the definition and scope of the core elements to the
integrated approach, which is summarised below.
The “what” considers the practices that organisations take on. Economic-based studies list 18
management practices as suggested best practices, and have grouped them into monitoring,
targets, and incentives. Substantial gains in outcomes, including profitability and growth in
sales, have a correlation to adopting best practice—which is why Jarzabkowski et al. (2016)
agrees that practices are important and PBV of strategy practice does bring success, however
what they suggest is that “who” and “how” provide additional valuable insights into strategy
practices and outcomes.
The “who” refers to the practitioners that develop, transfer, and enact the practices. Therefore,
the practitioner’s perspective and impact on the selected practices is inevitable and makes the
practice and the practitioner inseparable. The performance of the outcome cannot be evaluated
without considering the practitioner’s influence on the practice, as they influence how the
practice is performed. This points to the importance of ensuring that the right people are
involved with the strategy practice—in skills, knowledge, and experience. A strategy for the
business unit, for example, cannot be made without the business unit being represented, as the
practice will not perform to its full extent. Equally, one should be clear on the practitioner or
group of practitioners’ agenda, experience, and relevance when taking on the practice given
certain desired outcomes.
The “how” points to importance of understanding the praxis of the practice, in other words,
how was the practice performed. Jarzabkowski et al. (2016) recognises that practices do not
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occur automatically or without challenges. They are performed within a specific context and
“often vary considerably from their espoused pattern” (Jarzabkowski et al, 2016, p. 250). These
variations do not imply failures of the practice. Adaptations become necessary in changing
circumstances; for example, public sector organisations have taken planning and quality
management practices from the private sector into their context (Jarzabkowski et al, 2016).
Such adaptations can provide enablers for changing an organisation’s strategy—leading to the
importance of understanding practices within the context they are applied (Jarzabkowski et al
2016).
Anintegrativemodelofstrategypractice
Jarzabkowski et al’s (2016) integrative perspective views the practices within the context they
are being applied, and considers who the practitioners are and how they work.
Figure 5 below is Jarzabkowski et al’s (2016) model for an “integrated practice-theoretic
approach to strategic management research” (Jarzabkowski et al, 2016, p. 250). Unlike the
PBV, Jarzabkowski et al’s model suggests that the “relationship between practices and
economic performance cannot be understood without taking into account not only “what”
practices exist but also “who” implements them and “how” (Jarzabkowski et al, 2016, p. 250).
This model also shows the linkages between practice and performance. These elements are
well known within the strategy practice field, and Jarzabkowski et al’s model integrates
insights from research that make these connections.
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Figure5:StrategyPractice:What,Who,andHow?(Jarzabkowskietal,2016,p.251).
Given that the model presented in Figure 5 considers various elements of salience that influence
strategy practice, this integrative strategy practice approach is chosen in the rest of the study.
Whatpractices?
Jarzabkowski et al. (2016) acknowledges that practices are fundamental to performance, but
states that there are two key differences to practices: “multiple interdependencies between
practices” and consideration for “non-standard, and especially new, practices” Jarzabkowski et
al. (2016). Figure 5 illustrates the interdependency between many practices (Practice 1 to n)
towards an outcome. It is well known in strategy that practices complement each other, and the
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effect of a practice will vary, depending on whether certain other practices are present. For
example, introducing scenario planning practice will depend on having strong financial and
analytical practices in place.
Jarzabkowski et al. (2016) states that one should understand strategy practices that are
considered the “best” practices but, equally, one should innovate new and non-standard
practices, as this could lead to a competitive advantage. An example given is that top-down
strategic planning processes are being challenged by social media technologies which are
generating new practices like IBM’s popular ‘strategy and innovation jams’. One can also look
at the change brought by the availability of data and new technology tools to generate analytics
on customer profiles, such as on purchase habits, changing how traditional practices are
executed.
Whoengagesinpractices?
Jarzabkowski et al. (2016) suggests that integrative practice considers the actors due to their
influence over the development of practices and the selection of recommended practices. The
actors’ influence over the execution of the strategy practice is shaped by their “cognitive traits”
and “organisational position” (Jarzabkowski et al, 2016, p. 252). The example given of the
actors’ influence on the strategy is between Lycos (India based) and Yahoo (USA based).
Lycos is dominated by engineers and has a very different strategy to Yahoo, dominated by
marketers. Equally, says Jarzabkowski et al. (2016), the person presenting the strategy will
have varying effects on the performance of the strategy, depending on their authority—a CEO’s
influence over introducing strategy will have different outcomes compared to the outcomes if
the strategy is presented by a middle manager. As suggested in Figure 5, there are feedback
effects from the integrative model. For example, the performing of strategy practice has
improving effects on the actor’s ability to perform strategy practices, because the actor is
gaining experience in the practice of strategy.
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Howaretheypracticed?
Jarzabkowski et al’s (2016) integrative model (Figure 5) illustrates that the ‘how strategy is
practiced’ sits between the practice and outcomes from practice, and thus they have influences
on each other. Jarzabkowski et al. (2016) states how risky it is to ignore how the practice is
applied, in fact stating it as a danger to the business if the practice is not completely understood.
If the application of a practice is adapted, it must be clearly understood what is adapted in the
practice and why it is adapted to successfully attribute performance of the adaption.
Whataretheoutcomes?
Jarzabkowski et al. (2016) states that the three main topics for strategy purpose is focussed
around monitoring, targets, and incentives. Jarzabkowski et al’s (2016) integrative model in
Figure 5 points to the fact that the outcomes from the practice are not just for example
performance, but there is a feedback into the selection and adoption of the practices themselves.
If you have successful performance following a specific strategy practice, a bias may develop
toward the practice, hereby reinforcing the practice. If this influence of bias towards a practice
based on an outcome is acknowledged, the practitioner can ensure the bias is based on fact and
not assumption or perception. Similarly, when changing the practice being used, the new
practice should be scrutinised to ensure the practice is fully understood and outcomes can be
attributed to the specific practice.
A key point that is made is that “strategy as a domain may be over susceptible to novelty”
(Jarzabkowski et al, 2016, p. 253). Strategy practice is often followed in a certain way, because
of an organisation history of perceived success with a practice perception of best practices. In
times of poor performance, these perceptions of strategy practice may suggest change in
strategy practice. If one decides to change strategy practice or adopt a new practice, it requires
significant research into the new practice, its resources requirements and economic influences
to avoid damaging effects of its incorrect implementation.
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Rethinkingstrategyfromanintegratedpracticeperspective
Jarzabkowski et al. (2016) state that their integrated practice perspective can bring about
significant findings for strategic management. A critical factor that came out of their research
is that the strategy maker should realise that the past is as much up for interpretation as the
future. This means that a change in strategic direction will only be taken if this direction is
known to the organisation and it has been part of the history of the organisation. This means
that the strategy for the future will be based on the experiences an organisation has had in the
past. These experiences are reworked into plausible future scenarios, which the organisation
can accept or reject due to its experience in the past. The same may be relevant in terms of
strategy practices.
5. What tensions exist around strategy practice?
This section discusses the tensions that exist between the different approaches to strategy
formation and the question:
Whattensionsexistaroundstrategypractice?
There are two primary tensions which will be focussed on, namely:
1. Deliberate (or planned) strategy versus emergent strategy
2. The need for strategic alignment between corporate strategy and the business units’
strategy.
I. Reconciliation between deliberate strategies versus emergent strategies
Deliberate strategy making is usually generated with strategy planning practices. Planning
practices are followed by strategy execution. Strategy execution are from autonomous actions
of managers, which generates an emergent strategy through their continuous actions at multiple
levels in the business (Jarzabkowski et al, 2016). These actions of managers are deliberate and
at the same time in response to a strategy plan’s objective (Jarzabkowski et al, 2016). The
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strategy that emerges from these autonomous actions may be different from the intended
strategy plan, but the emergent strategy achieves the same objective. Therefore, the tension that
exists between deliberate and planned strategy formation is between the process of strategic
planning performed by the executive management of the organisation and the emergent
strategy from reactive decision making lower down the organisation. What this points out is
that strategy is both deliberate and emergent at the same time (Jarzabkowski et al, 2016), and
strategy practice should make room for the emerging strategies that come from the execution
of strategies in the organisation. This means rethinking the benefits alignment between
corporate and business unit strategies.
This illustrates that strategies in an organisation can be deliberate and emergent, and the tension
between the two should be leveraged as it may deliver a competitive advantage if the overall
strategic objective is met. It also points to the importance of a level of autonomy for business
unit decision making to achieve the strategic objective.
II. Tension of alignment between corporate and business unit strategies
This section will consider the tension between the alignment or misalignment of corporate and
business unit strategies. Business units can refer to functions in the organisation other than
primary operations of the organisation. Strategic alignment is perceived as desirable to ensure
strategic objectives are met (Jarzabkowski et al, 2016). However, when considering multiple
levels and functions in an organisation, achieving the desired organisational strategic outcomes
may require a level of deviation from corporate policies (Jarzabkowski et al, 2016). These
misalignments are necessary to maintain strategic advantages, market share, and skills within
business units, and in some cases bringing about innovation. The misalignment ensures that
the organisation can adjust to the complexity it faces, through autonomous strategy execution
at multiple levels or business units of the organisation (Jarzabkowski et al, 2016).
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This advocates that pure alignment may in fact be damaging to performance, whereas a certain
level of misalignment with certain level of autonomous execution is a sustainable strategy
practice (Jarzabkowski et al, 2016) and may enhance an organisation’s performance.
6. Why do Strategy?
This section explores the focus question: Why do strategy? It discusses the motivation for
organisations to perform strategy practice and what strategy practice offers organisations.
I. Strategy is a structured approach to create direction and purpose
Strategy provides a process for an organisation to structure its objectives, purpose and plan of
action. There are several elements to strategy and it is important to understand what these
elements are as they clarify the purpose of strategies, the mind-set with which to approach
strategy, and what to consider when doing strategy. Collis & Rukstad (2008) state that
companies that provide a strategy statement that is clear and to the point, and one that
employees can adopt into their own strategies, give employees a clear purpose, and these
organisations are more likely to become top companies. They say:
“A well understood statement of strategy aligns behaviour within the business. It allows
everyone in the organisation to make individual choices that reinforce one another,
rendering those 10,000 employees exponentially more effective” (Collis & Rukstad,
2008, p. 84).
Below is a summary of their guide to creating an effective strategy statement and where it fits
into the corporate statement hierarchy (Collis & Rukstad, 2008, p. 85-95). The first three
statements are above strategy in the corporate statement structure but build the context for
strategy statement for the organisation.
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MissionStatement
This states why the organisation exists. It should have some contribution to be valid. For
example, to provide supply chain management solution in the animal feed and grain industry.
Valuestatement
This states what the organisation believes in and how it will behave. For example, progress is
a mind-set and out values are positivity, integrity and client service.
VisionStatement
A statement of what the organisation wants to be. For example, the best supply chain manager
in Africa.
StrategyStatement
This states what the organisations competitive game plan will be. It consists of three elements.
1. Strategy objective: the end goal. It is specific, measurable and time bound. It should be
clearly measurable and finite. It should answer the question; which objective is most
likely to give X growth (or market leader or market share) over the next seven years?
2. Scope: The domain of the organisation in terms of customer or offering, geographic
location, vertical integration. It presents boundaries which provide managers with the
ability to focus efforts and understand what not to do. For example, trading grain and
animal feed in Africa.
3. Competitive advantage: consists of two elements. (1) Customer value proposition –
why should the customer pick you? Compares the organisation to competitors’ core
competencies. (2) Unique activities or complex combination of activities allowing the
organisation to deliver the customer value proposition which competitors cannot – this
focusses the organisation to make consistent choices about the configuration of the
organisation’s activities.
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BalancedScorecard
The balanced scorecard states how the organisation will measure the strategy execution and
what the measure of performance will be. It enables the organisation to monitor strategy
execution.
II. Strategy is the utilisation of capabilities, resources, and competitive advantages in
order to achieve defined objectives
Considering a strategy requires consideration of the impact on the organisation’s capabilities,
resources, and positions in the market (Huy, Sonenshein, & Bresman, 2016) . Decisions,
processes, and action-taking should be measured at all levels of business for their contribution
to the desired objective of the business. Given the reality of scarce resources and applying it to
an organisation’s ability to achieve its objective, an organisation should evaluate all functions
equally for their effective contribution to the objective. In order to achieve defined objectives
requires an organisation’s functions and operations to operate with absolute purpose and rigor
to ensure the organisation executes better than the competition and according to customer needs
under the constraints of scarce resources.
III. Strategy enables measuring performance and adapting to achieve defined objectives
The environment that organisations face has only one certainty—change. Change is relentless,
fast, and constant, and organisations need to be able to adapt strategic direction to increase
performance and achieve their objectives (Huy et al., 2016). If change is constant and the
environment in which organisations operate is constantly changing, the plan of attack for
survival should arguably be able to change with it.
A key to strategy lies in the ability to constantly adapt strategic direction. This is promoted by
a level of autonomy in business unit decision making. This autonomy cannot be left
unmonitored, if it gets out of control it could threaten the survival of the organisation.
Performance and autonomous decision making should be monitored and provide mechanisms
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for signalling adapting strategy to achieve the desired measure of performance (MoP)
(Strümpfer, 2016a). The measure of performance is not limited to an end game scenario; rather,
effectiveness should be measured continuously. This continuous strategy process is illustrated
in Figure 6, which is adapted from Johann Strümpfer’s teachings on strategy (Strümpfer,
2016a). It illustrates the continuous process of strategy as practice and the relationship between
strategy planning and strategy execution with the focus on achieving the MoP or strategic
objective.
Figure6:Author’sinterpretationofJohannStrümpfer’scontinuousstrategyprocess(Strümpfer,2016b)
The top continuous loop represents the strategy planning process, which is not a single event,
but should be continuous and adaptive. This adaptiveness will be triggered by the feedback
coming from the bottom strategy execution loop. This feedback is reviewed and analysed to
consider whether the strategy plan requires adaptation, given changing circumstances in the
environment in which the organisation operates. The strategy execution loop is continuous and
gathers information from its interaction with the environment and from implementing the
strategy plan. Ensuring this bottom feedback loop information reaches the strategy planners
requires reporting and monitoring to be put in place. An organisation would require sufficient
reporting and monitoring around the execution of the strategy, so the organisation can assess
when changes need to be made.
Strümpfer’s approach in Figure 6 can serve as a holistic view of Jarzabkowski et al’s integrative
approach to strategy (Figure 5). Jarzabkowski et al’s integrative practice (Figure 5) links
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Strümpfer’s strategy planning process to strategy execution process. The link creates a
feedback loop between the two continuous processes, illustrating that strategy process is as a
circular causal relationship. The difference between the two is only that Strümpfer’s
positioning of a MoP at the end of the specific strategy process, whereas Jarzabkowski et al.
looks past a single strategy cycle to future strategy cycles.
7. How does one manage strategy as a process?
Given the preceding literature review, it appears that the critical part to managing strategy is
encompassing into the strategic success the contribution that various functions and people have
at different levels of the business. This leads to a need for managing strategy at multiple levels
in the organisation. The feedback from executing strategy at the coalface in planning strategy
should be continuous, ensuring that strategy is both planned and emergent. Equally, the actors
and the practices involved in the strategy practices influence the outcome of the strategy
practice.
I. Managing creating strategy choices
Roger Martin (2017b) highlights two key principles for creating strategy choices.
Rigour
Creating choices requires rigor when analysing the “cause of the observed effect and optimise
for that inevitable effect,” (Martin, 2017b, p. 5). This rigour in analysing and understanding
should focus on the factors in the environment which are what they are, and an organisations’
actions do not change them, rather they change the actions of the organisations, for example a
low wheat crop’s impact on the commodity trading of wheat and the organisation.
Creativity
The creativity required is around the ability to “imagine possibilities and choose the one for
which the most compelling argument can be made,” (Martin, 2017b, p. 5). This creativity
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should focus on possibilities that are different to the obvious current environment, and the
organisations action must have the ability to influence these possibilities.
Martin identifies five “interrelated strategy choices” (Martin, 2017b, p. 4) to follow when
generating your strategic choices. Martin’s five interrelated strategy choice questions cascade
from question one to question five (see Figure 7). If your strategic choice cannot answer these
five questions, he argues you do not have a complete strategy choice. For example, following
the answers to question one, question two is considered. If question two cannot be answered,
revisit question one, etc.
Figure7:RogerMartin'sinterrelatedstrategychoices(Martin,2017b,p.17)
Below is an explanation of the five interrelated strategy choice questions (Martin, 2017b) :
1. What is our winning aspirations? This is the motivation for the strategy. The focus
is on establishing the strategic objective.
2. Where will we play? Here we must bring focus to what the market opportunity looks
like, to profitability, competition, or market growth opportunities.
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3. How will we win? This requires attention to the competitive edge and ability to
either meet customer needs or create customer needs for the organisation’s offering.
4. What capabilities must we have? This requires consideration to what capabilities
will be needed to make the offering according to the suggested “how will we win”
and “where will we play” ideas.
5. What management systems are required? We draw attention to the reality of
implementing the strategy. A strategy requires a management system to facilitate,
measure, report, and control operations that execute the strategy.
Roger Martin (2017b) applies his interrelated strategy choices to differentiate the functions
that contribute to strategy. He calls this a “multilevel strategy” (Martin, 2017b, pp. 66) concept
and illustrates it with a “Nested Choice Cascade” (Martin, 2017b, p. 67) (see Figure 8).
Applying Martin’s logic of layers of strategy and multilevel strategy to different levels of the
organisation ensures each function in the organisation considers their strategy to achieve the
wider system strategy, whilst also contributing back into the planning processes of the function
above them.
There are three strategy levels according to Martin (2017b, pp. 67 - 68) , which are illustrated
in Figure 8. All three levels consider the interrelated strategy choices in the applicable context
of that level. Corporate Level is where the organisation focusses on holistic strategic setting of
the organisation given the environment it faces. Strategic Group is a selection of management
that can consider the organisation’s competitive advantages given its resources, according to
the corporate strategic direction. Individual Business considers the coalface of how the business
units will apply themselves and contribute to achieving the strategic objective. Their objective
is to expand or prune the offerings to enhance competitiveness. The red arrows in Figure 8
illustrate this feedback loop between different strategic levels in the organisation. Martin’s
concept incorporates the different levels in the organisation by applying the interrelated
strategy choice questions to the three levels. This provides a framework for each level in the
organisation to not just contribute to the wider strategy, but also to create their own strategy,
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which should fit into achieving the same strategic objective, while focussing on their part of
the strategy delivery.
Figure8:RogerMartinNestedChoiceCascades(Martin,2017b,p.67)
Martin goes on to discuss the “iterative nature of strategy development” (Martin, 2017b, p. 71),
which is represented in Figure 9. Accordingly, strategy is developed at two levels: the
indivisible level, which is holistic consideration of the entire idea, and the aggregate level,
where the sum of the parts to make the strategy work is considered. The indivisible level
initiates ‘where to play’ by holistically considering Customers, Products, Geographies, and
Vertical stages. This requires further analysis and consideration at the aggregate level of ‘where
to play’, in terms of the portfolio of the organisation and relative weighting across business
units, and ‘how to win’, in terms of the method of increasing the competitiveness of the
individual businesses. The aggregate ‘how to win’ circles back to influence the indivisible level
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‘how to win’, requiring consideration of unique combinations of activities, which produces a
superior value equation.
Figure9:RogerMartin'sIterativeNatureofStrategy(Martin,2017b,p.71)
Martin presents a framework for creating a strategy (Martin, 2017b) , which is illustrated in
Figure 10 below. This process requires a clearly defined problem statement that is challenging
the organisation. The second step is to reframe the problem so there is a strategic choice that
needs to be made between several possibilities. The possibilities should be defined and listed.
The next step requires creativity. It requires the actors to make up a list of what would have to
be true for the possibility to become reality. It is important not to focus on what is not true or
limits to the option, but purely focus on what should be true. The next step requires
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consideration for the barriers. Here the actors can come up with the limits to the option and
what may not be true. The next step is to test the possibilities and narrow choices down to those
with the least number of barriers within the organisation’s abilities. From this list one can make
a choice and execute. What stands out is the loop from making the decision to executing the
strategy. It illustrates that Martin is supportive of the continued, circular process of strategy
practice and choice-making. This circular process is in agreement with Johan Strümpfer’s
continuous strategy process, which is presented earlier in this chapter in Figure 6.
Figure10:RogerMartin'sstrategicchoicestructuringprocess(Martin,2017b,p.46)
II. Managing strategy impact
Johann Strümpfer (2016a) provides a causal relationship diagram (CRD) with a specific
logic, which is useful for unpacking strategy choices and its influence on the organisation
when assessing company abilities, as suggested in strategic sweet spot (Figure 3). The CRD
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is useful in conjunction with Roger Martin’s interrelated strategy choice (Figure 7), nested
choice cascades (Figure 8), and strategic choice structuring (Figure 10). Strümpfer’s CRD
(Figure 11) requires the strategy practitioner(s) to frame five to seven variables that must be
in place in order to achieve a specific MoP or strategy objective. These variables feed directly
or indirectly into the MoP. In turn, these variables will have certain consequences that will
result in resource implications. The CRD suggests framing two to three resources required to
satisfy implementing the variables and achieve the MoP. These two to three resources should
be directly or indirectly linked to the variables to illustrate the logic and create the CRD.
Figure11:Author’sinterpretationofJohannStrümpfer’sCRDforstrategicimpactassessment(Strümpfer,2016b)
III. Measuring strategy outcomes
A strategy’s target outcome should be made clear. As per Collis & Rukstad (2008) , the strategy
objective should be made clear in the strategy statement. It is the end goal and it should be
specific, measurable and time-bound (Collis & Rukstad, 2008) . Collis & Rukstad’s suggests a
Consequence
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balanced scorecard approach to measuring strategy executing, which one can feed back into
strategy planning (Collis & Rukstad, 2008) —but one is not limited to a single tool. It is more
important to appreciate what each business unit or function is contributing to the achievement
of the objective and to measure these executions. For example, following Roger Martin Nested
Choice Cascades (Figure 8) and combining it with Johann Strümpfer’s CRD (Figure 11), the
strategic objective may be set as the MoP at a corporate level. For each level down the cascade
model, the MoP will be different, according to its contribution to achieving the strategy and
the variation in strategy choice it faces.
Key performance indicators (KPI) should be considered when evaluating the business
management system, as per question five in Martin’s interrelated strategy choices (Figure 7).
Performance measurement requires a management information system (MIS) to report and
provide feedback to the functions that manage and control the system. The quality of MoPs set,
and the quality of performance measurement systems will have a direct impact on the
organisation’s ability to manage strategy planning through the information flow received from
strategy execution (Strümpfer’s CRD, Figure 11). Quality KPIs do not necessarily mean that
an organisation is micro-managing functions. If the KPIs are set on strategically important
aspects, it could allow for more autonomy around execution in business units, as the
organisation is focussed on measuring performance and stability and allowing managers to
make their own decisions under these KPIs.
8. Conclusion
The literature review begins by providing a back ground to Integrative Thinking and its
application. The rest of the Chapter reviewed the literature to obtain a Framework of Ideas
around strategy and strategy practices, guided by the focus questions set for the literature
review. These ideas flow through the Integrative Thinking choice-making process to design
strategy practice that can be compared to the case study organisations strategy practice. Around
each focus question covered in the literature review several elements came to light as critical
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to strategy and strategy practices. These elements are listed below under each focus question
and the literature review’s response to the focus questions.
Whatisstrategy?
Strategy is about making choices to win or to achieve set objectives. Strategy brings focus to
an organisations effort and choice-making. There are only two strategies and an organisation
must know which one it is pursuing.
1. Differentiation strategy
2. Cost leader strategy
Strategy is aligning company capabilities with customer needs and competitive advantage.
Strategy is about finding the sweet spot, where company capabilities matches customer needs
and where the organisation has a competitive advantage. Strategy is about considering the
environment in which the organisation operates that impacts on these factors.
1. Strategic sweet spot
2. Customer’s needs
3. Company’s abilities
4. Competitors’ offerings
5. Environment
Whatisthepracticeofstrategy?
The practice of strategy is more than simply the practice which provides an outcome. There are
elements present that influence on the practice and the outcome of the practice. There is an
interrelated and continues causal relationship between the elements of strategy practice.
1. Participants
2. Practices
3. Application of practices
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4. Outcome
Whattensionsexistsaroundstrategypractice?
Deliberate versus emergent strategies was the first tension explored. The conclusion is that this
tension can benefit the organisation, as long as it is achieving the strategic objective and within
defined boundaries. Having emergent strategies from strategy execution that is different to
deliberate strategies can identify competitive advantages and this tension should be explored
in strategy planning.
1. Deliberate Strategy
2. Strategy execution
3. Emergent Strategy
The second tension explored was alignment between corporate and business unit strategies.
The tension arises due to the business unit’s autonomy in decision making around strategy
execution. It was concluded that this misalignment from autonomous decision making can
provide competitive advantage as the business unit is able to adjust strategy execution to
achieve the strategic objective, contributing to an emerging strategy. However, if the level of
autonomy is not monitored it could present risks for the organisations survival.
1. Level of strategy alignment
2. Level of autonomy of decision making
3. Emerging Strategy
The next section looked at the purpose of strategy and focus on the question:
Whydostrategy?
Strategy provides a structured approach to create direction and purpose. A strategy statement
provides a format to capture the strategy in a way that clarifies strategic direction and provides
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managers with the necessary boundaries within which they can make decisions to contribute to
the strategic objective.
The second motivation for strategy is it provides for the planning around utilisation of
capabilities, resources and competitive advantages to win. It suggests that strategic planning
should consider its operational efficiency to ensure resources are applied effectively. This
requires functions in the organisation to have clear purpose of their strategic contribution.
Thirdly, strategy enables measuring performance and adapting to win. Quality of strategic
planning should provide clear measures of performance which enables the organisation to
measure the strategy execution and in turn make changes to strategy execution and revise
strategy planning. The strategy execution should have a level of autonomy to make decisions
to achieve strategic objectives, but this should be monitored to ensure it stays within the
parameters set by the organisation monitoring functions.
1. Strategy statement
2. Multiple level strategy planning
3. MoPs (Measure of Performance)
Howdoesonemanagestrategyasaprocess?
The literature review contributed to answering this focus question by providing a structure to
the process of strategy practice from planning to assessing execution.
Strategy planning requires creating strategy choice. The strategic choice can be generated with
five interrelated strategic choice questions. Answering these questions require a combination
of rigour and creativity. The strategic choice structure will provide a guideline to creating and
evaluating strategic choice and incorporates the five interrelated strategic choice questions. It
is important to apply this process to the different levels within the business, as all the levels
contribute to the achievement of the overall strategy objective. Each level will, however, apply
the process to their relevant functions. Following this process will contribute to the quality of
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the strategic plan. The quality of the strategic plan requires consideration of the measures of
performance and the impact the plan will have on the resources of the organisation. All these
elements will in turn influence strategy execution.
1. Strategy planning
2. Interrelated strategy choice
3. Strategic choice Structuring
4. Multiple level strategy setting
5. MoPs
6. Strategy execution
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Chapter 3: Research methodology
1. Introduction
The research methodology that will be used for this study is Action Research applied with Soft
Systems Methodology. In this chapter, I will first explain Action Research as a methodology
for research. This is followed by an outline of how data was collected and analysed, before
explaining the ethical consideration of the research and providing a conclusion. Chapter four
will explain Soft Systems Methodology as a theoretical framework for inquiring into human
activity systems, being the case study organisation’s view on strategy and strategy practice.
The purpose of the research was to make sense of strategy practice in the case study
organisation and to identify where an improvement can be made. Through Action Research
and Soft Systems Methodology this study will look at what influences, and relationships should
be considered before action taking. This research is to gain insight into the mechanisms at work
and gain an understanding of the influences and relationships between the actors in strategy
practices. The research will also look at how the people in the case study organisation perceive
strategy planning, strategy execution and strategy management.
2. Research methodology: Action Research
The methodology that will be used for this study is Action Research with Soft Systems
Methodology (SSM). This section will discuss Action Research as a methodology for research,
as described by Checkland (2000) and McDonogh (2014) . For the Action Research
methodology, the study will use the LUMAS model as a process to guide the Action Research.
The research philosophy is pragmatism.
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I. Action Research with the LUMAS model
Action Research is an approach by which one conducts inquiry into a situation of concern
where action taking is required to improve the situation (Checkland, 2016) . The LUMAS
model provides a structure for an Action Research approach. The LUMAS process works as
follows:
The user (U) is faced with an area of concern or a problem situation (S) in which action (A)
must be taken to improve the situation. The process starts with a need to explore an area of
concern that the user wishes to improve. This need to improve the situation yields a need to
learn (L) about the situation, without judgement or attempting to find a solution. To learn about
the situation the user (U) selects a methodology (M), in this case I am using SSM. The user (U)
will tailor the methodology according to the situation (S) which creates an actual (A) picture
of context specific to the situation (S) and user (U). This actual (A) context is used to guide
enquiry and action taking into the real-world problem situation (S). The LUMAS cycle, due to
its learning nature, is a continuous learning cycle. It accepts that the problems in the world out
there is never completely solved. The problem situation identified through LUMAS may
present a new area of concern following the action takings impact on the area of concern. The
Action Research and the LUMAS model appreciates that, once an action is taken the problem
situation may still require further action to improve over time as it is a human activity system,
which is constantly evolving and along with it the relationship between elements or variables
too change (Checkland, 2000) and (McDonogh, 2014) . This process is illustrated in Figure
12 below.
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Figure12:Checkland’sLUMAsmodelforlearning(Checkland,2000,p.37)
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3. Data collection
This paper’s research into the problem situation follows the LUMAS approach to Action
Research and SSM. The LUMAS model in Figure 12 is a tool to guide Action Research, and
its circular flow suggests that several Action Research cycles are required so the user continues
to learn and refine interventions. In this research paper there will only be one learning cycle.
The LUMAS steps that will be followed in this paper is illustrated below in Figure 13.
Figure13:Author'sLUMASforthisresearchproject’slearningcycleforActionResearch
The process requires the user to learn about the problem situation. To learn about the problem
situation the user should choose models according to the methodology being applied for
learning. The models enable the user to require and learn about the problem situation. The data
collection was in the form of informal discussions around strategy and strategy practices as
perceived by the people in the case study organisation. In this chapter the focus is on the data
collection to inform the learning part of the cycle.
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I. Informal discussions
Objective
The purpose of the informal discussions was to gain insights from several perspectives within
the organisation on what is strategy and strategy practices in the organisation in focus and in
the functions, present in each informal discussion. The conversations were with people
representing all parts of the organisation.
Selectionprocess
The selection of people for the informal discussions was done by identifying each of the
functions and levels within the case study organisation. I selected people with different
functions and managerial levels, which contributes to getting rich data from multiple
perspectives on the organisation’s strategy, in terms of practices, planning, and execution.
Figure 14 illustrates the functional hierarchy of the organisation and the informal discussions
were held with a person from each function shown here.
Figure14:Author’spresentationofthecasestudyorganisation'sfunctionalhierarchyandfunctionmanagers
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The total number of participants was 18 respondents, drawn from across the different function
in the organisation. There are about 120 people employed across these functions. The
discussions were not held as an entire group, but rather over meetings in smaller groups of 6
people to get the most out of the discussions. Discussions lasted between 30 minutes and 45
minutes.
Focusareasduringinformaldiscussionsfordatacollecting
The areas of focus were informed by the focus questions in Chapter One and the salience
elements established in the literature review in Chapter Two. In other words, I asked the same
questions as explored in the literature, to the respondents, to establish whether their views align
with those in the literature. The objective was to establish what participants’ thoughts were on
the organisations strategy practices and how strategy is managed, executed, measured, and
adapted. The table below outlines the informal discussion points and the focus questions these
discussion points relate to (Table 1):
Table1:Author'stableofinformaldiscussionpoints
Informal discussion point Focus Question What strategy do we follow: low cost or differentiation? What is strategy? Do we know where we wish to focus our efforts? What is strategy? Do we consider the advantages of technology as a strategy in our business?
What is strategy?
What position did you hold before joining the company? What is the practice of strategy? What is our strategy practice? What is the practice of strategy? Who participates in strategy? What is the practice of strategy? What mechanisms and tools do we use to do strategy? What is the practice of strategy? How do we perform the practice for strategy? What is the practice of strategy? What are the outcomes of our strategy practices? What is the practice of strategy? When do we plan strategy? What tensions exist around strategy
practice? Is there a specific output from planning sessions? What tensions exist around strategy
practice? Does the execution follow this plan? What tensions exist around strategy
practice? Is the corporate strategy the same as the business unit strategy? What tensions exist around strategy
practice?
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Is the business aware of business units acting on a different strategy?
What tensions exist around strategy practice?
Do we achieve the strategic objective? What tensions exist around strategy practice?
What is our strategic statement? Why do strategy? What measures our strategic success? Why do strategy? Are there other elements that contribute to success? Why do strategy? Do we follow growth of profitability strategy? Why do strategy? Do all functions have a clear purpose? Why do strategy? Are we focussed on operational efficiency? Why do strategy? Do we measure anything other than achieving budget? Why do strategy? How important is operational efficiency to our competitive advantage?
Why do strategy?
Are we able to monitor and report on all function's strategies? Why do strategy? Do all functions have a clear purpose and measurable strategy? How does one manage strategy as a
process? Do we create different possibilities when evaluating a strategy? How does one manage strategy as a
process? Do we list and monitor clear MoPs for a new strategy? How does one manage strategy as a
process? Do all functions have clear MoPs that are monitored? How does one manage strategy as a
process?
4. Data analysis
The responses to the informal discussions are used to inform the learning of the situation. The
responses serve as data for applying the Soft Systems Methodology (SSM) models which will
be explained in Chapter Four. The data collected also provides information about how strategy
is practiced and how strategy practices are perceived in the organisation. The findings from the
Action Research will be presented in Chapter Five.
Responses to the question in the informal questions were noted down and at the end of the
group discussions collated into one sheet. The data is analysed using Gioia et al’s methods
(Gioia, Corley, & Hamilton, 2013) for qualitative data analyses. The first grouping would be
the responses to the questions, grouping the responses according to the questions asked above.
The responses are then reviewed to establish valid themes as a second categorisation and the
third categorisation is to create variables. The variables are used to compare the organisation’s
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practice to the literature review models of strategy practice and provide inputs into the SSM
models to identify relationships and influence that exist around the area of concern.
5. Ethical considerations
The participants were informed upfront about the purpose of the study and that the objective
of the informal discussions is to understand how people see strategy and strategy practices in
the organisation. The participants were made aware that the outcome of the study is to suggest
a course of action that would improve strategy practice for the organisation, and thereby add
value to stakeholders. The ethical consideration for data collection was around:
• the participants’ influence on each other in terms of positions of power
• the influence of their responses on themselves and how others would perceive them
• relating participation back to the individual if there is an impact on the wider
organisation
During data collection, I had to consider the position of power, or lack of power, that would
influence responses. To gain participation and neutralise the effect of power the participants
were placed in groups according to the personal relationships and similarity of power. This
grouping also addressed the issue of participation around fear of perception from others on
responses in the groups.
To manage the fear of responses being linked back to the individual participant, I stated upfront
that data collected form all three the groups would not be recorded as individual responses or
group responses. The responses will be consolidated and used as a pool of data to build
purposeful models of the situation.
In support of this ethical approach, I wish to state that the observations made from these
informal group discussions were my own. It was not double checked by all the participants and
I did not get written approval from the participants in the discussions to use the observations.
My ethical considerations for not getting written approval was that the observations are my
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own perspectives of the participants feedback about the mechanisms at work. The observations
were further enriched by considering personal previous learning cycles about the case study
organisation during the EMBA course.
The outcome of the research project is to use Integrative Thinking to design a model of strategy
practice. The ethical impact here is limited, in that it is my opinion. Therefor if it is applied on
the case study organisation, or others, it should be evaluated for purpose and impact.
6. Conclusion
This chapter outlines the research methodology for the paper as Action Research in a Soft
Systems Methodology way. It explains the features of Action Research as a process for enquiry
and learning to understand a situation of concern, rather than trying to solve it from the get-go.
The LUMAS model serves as a framework for Action Research. It requires exploring the
situation with models chosen from SSM building a model of the actual problem, before acting
to improve the situation. This chapter discussed the data collection and analyses processes for
the research and lays out the LUMAS cycle specific to this research paper. This paper contains
one LUMAS learning cycle and the data collection is from informal discussions with people in
the organisation that are relevant to the topic. The questions asked during the informal
discussions were created around the focus questions stated in Chapter Two. The final part of
the chapter explains the ethical consideration for the data collection and building the models in
the remaining chapter.
Chapter 4 explains Soft Systems Methodology and explains which models are selected for this
research paper, how they should be applied and why they are relevant.
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Chapter 4: Theoretical framework: Soft Systems Methodology
1. Introduction
To structure the research the LUMAS model is applied. It provides a framework for learning
about the elements that influence strategy practice in the case study organisation. As part of the
LUMAS framework the Soft Systems Methodology in Action (SSMA) will be applied as
described by Peter Checkland in his research paper “Soft Systems Methodology: a Thirty Year
Retrospective” (Checkland, 2000) . He argues that modern business managers require a thought
process that considers what is currently taking place in their environment, what has worked or
been observed in other similar situations for other decision makers, and what the theory of
business (i.e. best available models) suggests should work. SSMA supports such an
exploration. Before I explain what SSMA is and how it should be applied, I think it is important
to understand how SSMA as a science developed.
2. Background to SSM and SSMA
There have been many holistic thinkers in history, but thinking of an organisation holistically
and considering the organisation as a system only started in the 1950’s; General Systems
Theory (GST) was the archetype for holistic systems thinking (Checkland, 2000) . GST
provided a “mathematically expressed general theory of systems” to provide “theory in which
the problems of many different disciplines could be expressed and solved” (Checkland, 2000,
p. 1) . It was an almost linear rule of thumb for specific scenarios—which forced business
design problems into a one-size-fits-all solution as it generalised the variety of different
situations and influences. Although GST did lack success and general acceptance, the concept
of systems thinking was not lost (Checkland, 2000) . In the 1980s systems thinking started
gaining more traction as it evolved to considering the organisation as a human activity system
and comparing it to the concept of an autonomous living system, consisting of various
interacting elements (Checkland, 2000) . An autonomous living system can be defined as a
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self-organised living thing which interacts with its environment. This thing or system is made
up of several elements which act autonomously to make up the whole and the autonomous
actions of the elements ensure its survival in its environment. This shift to focussing on the
elements of the system means the observer’s concept of purpose, goal or function is no longer
central to understanding the system—it is only to understand what is being observed.
Checkland (2000) states that SSM in Action (SSMA) requires one to not allow ideas or
practical experience to dominate, but rather to have a learning circle. Ideas are cautiously put
into practice following the learning cycle. What is then observed in the following learning cycle
is used to form supplemented ideas.
In SSMA, it is assumed that this process of learning to deal with the world can be organised as
a system. In other words, soft systems thinking considers how we enquire about the world as a
system, whereas hard systems consider the world itself as a system. The next section will
further explain the difference between hard and soft systems.
3. Hard and soft systems
Hard systems theory assumes that the world consists of interacting systems ‘out there’ that can
be improved or re-engineered (Checkland, 2000) , but which are well defined (McDonogh,
2014) .
Soft systems theory, in contrast, embraces the complexity of the world, and focusses on how
we cope with it and make sense of the complexity we see in it. This approach is useful for this
study because the case study organisation strategy practices are influenced by many factors and
this complexity must be understood before action talking can be suggested.
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Checkland’s diagram below illustrates the difference between hard systems (observer 1) and
soft systems (observer 2) (Figure 15).
Figure15:Checkland'sdistinctionbetweenhardandsoftsystems(2000,p.18)
4. SSM guidelines
Checkland provides three “key thoughts” that should guide the SSMA practitioner (Checkland,
2000, p.14) .
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Firstly, the practitioner should not approach the situation as if it needs repair or improvement.
Instead, one should consider that the situation of concern in the organisation is a human activity
system with people influencing the ability of the system to operate. People are attempting to
take purposeful actions that are meaningful to them. When the sets of activities are viewed
together the purposefulness of the activity system would emerge. In this study, the human
activity system that is investigated is strategy practices. The approach is to enquire into strategy
practices through informal discussions without stating ideas up front to participants.
Secondly, the declared purpose can have many interpretations. Given the amount of human
system models available, the practitioner must make a choice on what relevant models to use,
stating the reason for the selection, the content it will focus on and the perspective from which
it is being designed. One should declare the worldview on both the choice of model selected
and the determination of content to be focused on. Due to different possible interpretations of
purpose, one should apply several models to describe the situation (rather than just one). The
models selected for this research is explained and validated in Section 6 below and applied in
Chapter Five.
Thirdly, the models are used to question the real situation. Checkland states that this
contributed to SSM emergence as an “organised learning system” (Checkland, 2000, p.15) .
This learning process is ongoing and is only brought to an end when action is taken. Action is
taken when the people in the activity system deem the action as desirable and feasible with
consideration of their particular “history, relationships, culture and aspirations” (Checkland,
2000, p.15) . The real situation that SSM will create for this research will contribute to possible
action taking which will be evaluated by the executive management before implementing.
5. SSM’s four main activities
SSMA is based on four main activities and the definitions are very precise. The four main
activities are incorporated into the LUMAS model (Figure 12) seeing as though LUMAS is a
SSM tool. In the SSM it is defined as follows:
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1. Enquiring into the problem situation
2. Formulating relevant, purposeful activity models
3. Debating the situation, using the models, and seeking from that debate both:
a) changes which would improve the situation and are regarded as both desirable and
(culturally) feasible, and
b) the accommodations between conflicting interests which will enable action-to-
improve to be taken;
4. Taking action in the situation to bring about improvement.
Checkland (2000) argues that 3(a) and 3(b) are closely connected, and their interplay build on
the emergence of answers to both feasible and accommodating. These four activities will be
applied to the SSM process in Chapter Five and the process followed is illustrated in Figure 13
above.
It can be observed that there are similarities between SSMA and Integrative Thinking. SSMA
starts with enquiry into the problem situation, which is what is required for generating salience
variables in Integrative Thinking. SSMA then builds models to create perspectives on the
situation, similar to causality where CRD’s are created for the same purpose. Debating the
situation in SSMA serves the same purpose as sequencing, which seeks to review the causality
of the variables. Action taking represents resolution. Both disciplines require looking at the
problem situation by holding opposing views in mind at the same time. Integrative Thinking
however, provides more interaction between the steps, as the user moves in between or up and
down the steps until it reaches resolution (Figure 1), whereas SSMA is a circular process which
goes through the entire process and starts at the beginning of the learning process for the next
cycle.
6. Selection of relevant models for SSMA
This section provides an explanation and validation of the models chosen for the SSMA
exploration of the problem situation. A justification will be advanced for choosing each model.
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I. Multiple Perspectives
The section provides reasoning for gaining multiple perspectives when applying the models.
This requires input from participants with varying areas of responsibility, power and functions
in the organisation. When facing a problem situation within a complex human activity system
such as an organisation, establishing the truth of the problem is very difficult to do. Every
participant in the situation may have a different point of view with their own “set of
assumptions, values and beliefs” (Creating Minds, 1995, p. 75) of what are the mechanisms at
work creating the situation. Similarly, the observer will be facing the same challenges. The
“nature of perspectives” (Creating Minds, 1995, p. 74) is that one cannot see past this
perspective when looking at the problem—it is perceived as the reality from that angle.
Perspectives are not necessarily wrong or right. Some may be better than others, and one’s
consideration of the situation should include as many plausible perspectives as possible. The
observer, too, may be biased. Therefore, when learning about the problem situation, one should
apply tools to assist in creating a picture from multiple perspectives. SSM offers a number of
ways of understanding a problem situation (Checkland, 2000) . In this study, data is collected
from informal discussions with participants from various levels of power and with different
functional responsibility in the organisation to bring multiple perspectives on the purpose of
strategy and strategy practices.
II. CATWOE
The CATWOE model was defined by Peter Checkland as part of his work on Soft Systems
Methodology (Checkland, 2000) . It provides the SSMA practitioner with form of enquiry into
multiple perspectives about a problem or attempting to implement a solution or intervention
(Creating Minds, 1995) . It provides a framework for thinking about the problem and asks key
questions about stakeholders in the situation, from the perspective of its customers (C), its
actors (or participants) (A), the transformation process that takes place (T), the worldview of
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the situation (W), the owners of the process (O) and the environmental constraints (E) that are
present (Creating Minds, 1995) . The tool looks at the entire system and how elements interact
with each other, to provide key insights into the problem. It also highlights peoples different
ethical perspectives for considering if a planned action is desirable or feasible (Creating Minds,
1995) which is critical activity in SSMA. The questions involved in the CATWOE tool are as
follows (Creating Minds, 1995) :
C Customer (clients of the system – how does it affect them)
• Who is on the receiving end?
• What problems do they face now?
• How will they react to what you are proposing?
• Who are the winners and losers?
A Actors (people who will implement changes)
• Who are the actors who will ‘do the doing’, and carrying out your solution?
• What is the impact on them?
• How might they react?
T Transformation process (changes the system brings about)
• What is the process for transforming inputs into outputs?
• What are the inputs?
• Where do they come from?
• What are the outputs?
• Where do they go?
• What are all the steps in between?
W World View (Weltanschauung) (different views and impact of the transformed process)
• What is the bigger picture into which the situation fits?
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• What is the real problem you are working on?
• What is the wider impact of any solution?
O Owner (Decision makers with authority to make your changes)
• Who is the real owner or owners of the process or situation you are changing?
• Can they help you or stop you?
• What would cause them to get in your way?
• What would lead them to help you?
E Environmental constraints (environmental constraints for success)
• What are the broader constraints that act on the situation and your ideas?
• What are the ethical limits, the laws, financial constraints, limited resources,
regulations?
• How might these constrain your solution?
• How can you get around them?
The CATWOE will be applied in Chapter Five. Observations are gathered from debates held
in each of the informal group discussions. Observations will made around CATWOE elements
that impact on making changes in strategy practices.
III. Rich Picture building
The Rich Pictures is a useful tool to demonstrate the relationship between elements or variables
in the system, in order to capture holistically the complexity of human affairs in a specific
situation (Checkland, 2000) . The complexity of multiple interacting relationships is easier to
depict in a picture than in a linear written or mathematical representation and advises drawing
the pictures by hand (Checkland, 2000) . The Rich Picture adds further value when presented
at the start of the exploration because it can bring everyone’s attention to the same system-in-
focus and clarifies the perspective on the situation that will be unpacked (Checkland, 2000) .
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The Rich Picture shows the interrelationships between primary stakeholders and their concerns,
their interrelationships, and their concerns (Monk & Howard, 1998) . The three most important
elements are structure, process, and concerns, which are covered in the guidelines below for
the construction of a Rich Picture (Monk & Howard, 1998) :
1. Include sufficient structure to ensure concerns and process are recorded. Ensure
concerns of affected stakeholders about the potential new system are included.
2. Apply a broad-brush approach to process. Describe what transformations take place in
the area of concern or system in focus.
a. Concerns are key. Checkland refers to issues as opposed to concerns.
Illustrate stakeholders’ motivations for using the system to gain each
perspective. Include concern of the element in thought bubble and tension
between stakeholders, for example using cross swords.
b. Use language applicable and familiar to the people depicted in the picture
as they will view the picture.
c. Use text or pictures.
Below in Figure 16 is a rich picture of the problem situation. The Rich Picture is useful for this
study because it provides an overall picture of the problem situation and human relationships
that influence the process under exploration. It contains the relevant stakeholders in the process
and shows the relationship between the people and processes involved in the organisation
strategy practice.
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Figure16:RichPictureoftheauthor'sproblemsituation
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IV. Analyses One, Two, and Three
Analyses Two and Three looks at the framework for social and political analyses. It considers
people’s roles, their norms and values, and “the analysis of commodities which embed
power” (Checkland, 2000, p. 24) . Commodities refer to what means, or mechanisms are
available to people for exerting power over the system or process in focus (Checkland, 2000)
. Analyses One, Two, and Three should be applied alongside the Rich Picture to increase the
richness of understanding of the problem situation and is explained below (Checkland, 2000)
. Although Analysis Two and Three seem simple, they provide the “main underlying
conclusion” of SSMA that “social reality is no reified entity ‘out there’, waiting to be
investigated”, rather, social reality is to be “seen as continuously socially constructed and
reconstructed by individuals and groups (the latter never perfectly coherent) ” (Checkland,
2000, p. 24) .
AnalysisOne
Analysis One requires an examination of the intervention itself. It provides the list of “problem
owners” selected by the “problem solver” and provides a main source of ideas for “relevant
systems” that could be useful to model. It is valuable to consider “Who could I / we take the
problem owner to be?”, where the aim is that the answer provides a holistic grasp of the
situation. These influences are mapped, and the observer should keep them in mind to guide
thinking until the intervention has been completed.
AnalysisTwo
In Analysis Two, the focus is on the social consideration of the people involved in the process.
The aim is to identify roles, norms, and values of the owners of the process. These social
considerations are important when considering the feasibility and desirability of the action to
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improve the situation. Knowing what roles, norms and values people have will also help
manage tensions of the proposed action.
AnalysisThree
Analysis Three goes further than the framework, to include the “main determinants of outcome
of that process, the distribution of power in the social situation” (Checkland, 2000, p. 24) . The
purpose is not to understand what is power, but rather who has the power or influence over the
intervention. Political power considers who has influence over other ‘problem owners” in the
intervention and what means, or mechanisms are available to them for exerting power over the
system or process in focus. This power can change, depending on the situation, and should not
necessarily be linked to a position or job title. This power could refer to skills, knowledge,
experience, charisma, commitment, or anything that bares influence given a certain situation.
Analyses One, Two, and Three are selected for this research as a tool to gain an understanding
into the perspectives of the people that have influence over strategy practice. This tool will
bring insight into how to design the action and consider what tension may arise from the
proposed action.
V. Multi-level Thinking
Most complex human systems or organisations will have several levels of functions and
operations. When looking at a problem situation through SSMA, it is important to explore these
multiple levels for their influence on the problem situation, and equally to know which level is
being referred to (Checkland, 2000) . Whichever level the Root definition’s transformation
process is focussing on is referred to as the system (in focus). A level down from this is called
the sub-system level. The higher system is referred to as the wider system. At the wider system
level, transformation process is considered to take place at the sub system. SSMA assumes that
the wider system level is the owner of the system level and can make decisions to stop the
system. Three-level thinking ensures that thoughts around the situation are not too narrow and
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brings consideration of whether more models are needed on different levels. When applying
multi-level thinking, one should be applying a ROOT definition, PQR, at three levels. Each
ROOT definition will be according to an observer’s perspective relevant to that level. The
ROOT definitions at each level will impact on the level below, influencing the ROOT
definition of the lower level as shown in the list below:
1. “What to do” (P) is focussed at the system level
2. “How to do it” (Q) is focussed at the sub system level
3. “Why do it” (R) is focussed on the wider system level
In Figure 17 the perspective of the observer on the ROOT definition is illustrated and how
each level influences the other level’s ROOT definition.
Figure17:Checkland'smultilevelthinking(Checkland,2000,p.29)
In this study the levels can be defined as follows:
Why: Wider system being MD and shareholders
What: System in focus level is Executive Management
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How: Lower system is Department and Functional Managers
VI. Measure of Performance
In SSM, it is important to state the measure of performance (MoP) of the activity system as the
system needs to adapt when circumstances change and the adaption should not threaten the
survival of the system (Checkland, 2000) . The criteria for measurement should be the defined.
This requires the core structure of the monitor and control function in the sub-system’s
“monitor” activity should be built around the criteria by which the system’s performance will
be evaluated (Checkland, 2000) . When this function takes action, “it is rendered as ‘take
control action’ which is contingent upon the monitoring” (Checkland, 2000, p. 30) . The
performance measurement focusses on three issues, or the three ‘E’s’ which are relevant for
every model (Checkland, 2000) :
1. Efficacy (E1) - considering at a higher level whether T is worth doing and adding
required value
2. Efficiency (E2) - confirming if minimum resources are being applied
3. Effectiveness (E3) - confirming whether the T was achieved
7. The objective of building purposeful activity models
The purpose of building models in SSMA is to structure the exploration of the problem
situation by looking at relationships. In so doing, one should try not to limit the modelling of
existing structures, because the role of models in SSM is “to lift the thinking in the situation
out of the normal, unnoticed, comfortable grooves” (Checkland, 2000, p. 27 ) . As these
relationships change with circumstances, so too should the model be able to adapt. The models
should present sets of linked activities of the system that carry out the transformation and the
activities that monitor and control the system (Checkland, 2000) .
It is important to note that the model should not be over-engineered. It is important to apply
logical thought and attempt to complete a model in 20 minutes. The models should be kept
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simple and draw activities that generate the input, transform the input, and distribute the output
(Checkland, 2000) . It is also important to check that other CATWOE elements are covered; to
link activities on whether they are dependent on each other; and keep individual activities to 7
+/- 2. The aim is to use your knowledge of the real world and limit your activities to those
justified by the models used, for this study being the root definition, Rich Picture, Multi-level
thinking, CATWOE and 3E’s.
8. Conclusion
In this chapter, the methodology of Soft Systems Methodology in Action was outlined and its
four main activities of:
1. Enquiring into the problem situation.
2. Formulating relevant, purposeful activity models.
3. Debating the situation, using the models, and seeking from that debate both:
a. changes which would improve the situation and are regarded as both desirable
and (culturally) feasible, and
b. the accommodations between conflicting interests which will enable action-to-
improve to be taken;
4. Taking action in the situation to bring about improvement.
The enquiry into the relationships and influences on the problem situation of strategy practice
in the case study organisation is done through the application of SSMA. SSMA is useful
because it looks at various stakeholders and variables that influence on the system and problem
situation. This allows one to deliberate on an intervention with understanding and consideration
wider that just the problem situation. The application is done in Chapter Five by formulating
relevant and purposeful activity models based on my experience of the organisation and the
informal discussion held for data collection (Chapter Three). The SSMA models selected
provide multiple perspectives on the human activity systems around the problem situation
which will enable deliberation over the desirability and feasibility of change and which
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conflicts of interests may need to be accommodated. Each of the models selected are below,
including the purpose of the model and the reason for their selection.
CATWOE
The CATWOE provides a framework for thinking about the problem and asks key questions
about stakeholders in the situation. This provides multiple perspectives about the problem
situation. Below is a sketch the illustrates the different perspectives and elements considered
in a CATWOE analysis (Figure 18).
Figure18:Author’sillustrationoftheCATWOEmodel
RichPicture
The Rich Pictures provides a holistic over view of the relationship between elements in the
system. This will provide an overview of the interactions that should be considered in the
specific situation.
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AnalysesOne,TwoandThree
Analyses Two and Three provide a framework for exploring social and political influence
around the problem situation. It works well in conjunction with the Rich Picture as it increases
the depth of understanding around the area of concern.
Multi-levelThinking
Multi-level thinking identifies and explores the different levels that have influence on the
problem situation. It also brings clarity to stakeholders should be considered in understanding
the problem or considered for the proposed action.
MeasureofPerformance
Measure of performance will evaluate whether the system is structured correctly by applying
the three Es model. This model considers performance at multiple-levels in the organisation to
establish if there are any lack of performance that can be focussed on. The criteria is set out
below:
1. Efficacy (E1) – considering at a higher level whether T is worth doing and adding
required value.
2. Efficiency (E2) – confirming if minimum resources are being applied.
3. Effectiveness (E3) – confirming whether the T was achieved.
The next Chapter presents the findings for the study. The first section presents the Integrative
Model for strategy practice designed form the literature review. This is followed by a review
of the differences between the Framework of Ideas from the literature review and the case study
organisation to find areas in the organisation strategy practice where action to improve can be
considered. This is followed by the application of the SSMA models. Through these models,
the aim is to unpack the situation and come up actions to consider and implement. The objective
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of the SSMA methodology is to generate outcomes more favourable than what is currently
being experienced.
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Chapter 5: Research findings
1. Introduction
This Chapter presents the research findings and concludes the response to the focussing
questions of the study. The first part of this Chapter presents findings from the literature review.
It responds to the focussing questions based on the findings of the research to present a
Framework of Ideas about strategy practice and the tensions that exist around strategy practice.
This forms part of the Integrative Thinking process that is completed in this Chapter by
presenting an Integrative Thinking model designed for strategy practice as resolution for the
focussing question on whether strategy practice ideas can be integrated into a model for
strategy practice. This is followed by comparing the strategy practice of the case study
organisation to the Framework of Ideas and the Integrative Thinking model in order to address
the focussing question of what strategy practice maybe improved in the case study organisation.
The objective here is to identify areas in the organisation for action taking. The Chapter then
moves to present the findings from applying the SSMA models around the area of concern.
The SSMA models explores and identifies the relationships that have influence on the area of
concern. These influences should be evaluated against feasibility, desirability and conflicts of
interest before the proposed action taking.
2. Integrative Thinking design for strategy practice from Framework of Ideas
The first step in the Integrative Thinking process is salience. Salience requires one to list
elements that contribute to the choice one is faced with. This is followed by phase two of
Integrative Thinking, which is Causality. Causality requires one the draw the causal
relationship between the salience elements. Each focus question’s salience elements are
followed by a causal relationship diagram (CRD) which provides the causality of these
elements. In the end of this section the salience elements are reviewed, and causality re-
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considered for sequencing before the final step of resolution presents the Integrative Thinking
model for strategy practice.
I. Salience and Causality
Whatisstrategy?
The causality of the relationship between these elements of salience are suggested below in the
Relationship Diagram (RD) in Figure 19.
Figure 19: Author's RD of what is strategy
Strategy is finding the
organisation’s sweet spot
and developing strategic
choice
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Whatisstrategypractice?
As illustrated in Figure 20, these elements interact with each and the arrows indicate the
causality of these relationships.
1. The practitioners (who?)
2. The practices (what?)
3. The application of the practice (how?)
4. The outcomes required (outcome?)
Outcomes of the strategy process fall into three main categories.
5. Main topics for outcomes (Monitoring, Targets, Incentives)
Figure 20: Author's CRD of integrated strategy practice interpreted from Jarzabkowski et al.
(2016)
Integrated strategy practice involves inter-relationship between practitioners, practices, application of practices and outcomes to ultimately achieve monitoring, target and incentive objectives.
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Whattensionsexistsaroundstrategypractice?
The elements of salience to this tension are:
1. Strategy planning
2. Practice of strategy
3. Deliberate strategy
4. Strategy execution
5. Emerging strategy
Figure 21 illustrates the causal relationship between these elements. Strategy as practice refers
to the elements of integrative strategy practice (Jarzabkowski et al, 2016), shown in Figure 20
above. The illustration suggests the process starts with strategy planning as the strategy
practice, which delivers a deliberate strategy. The strategy is executed, from which a variation
of the deliberate strategies may emerge. These emergent strategies must be fed back into the
strategy planning and strategy practice as inputs to refine the strategy. The entire process is
circular.
Figure 21: Author's CRD of planned vs emergent strategy tensions
Strategy is a continues loop between planning and practice of strategy to develop deliberate strategy. Tension develops when execution creates an emergent strategy. This emergent strategy should be taken into planning for review for competitive advantages.
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The elements to take out of this for salience are:
1. Level of autonomy
2. Level of misaligned strategies between business units and corporate strategic goals
The causal relationship of these elements is illustrated in Figure 22. The direct causal
relationship with elements of strategy practice is shown in red (illustrated with the previous
CRD (Figure 21). The element of ‘outcome’ is added from the practices practice CRD (Figure
20) due to the influence on this specific element.
Figure 22: Author's CRD of tension that exist around strategy practice
Whydostrategy?
The elements of salience around the strategy statement and its components which will provide
direction and purpose for the execution of strategy:
1. Strategy statement
2. Strategy objective
3. Strategy Scope
Tension in strategy exits around autonomy of business unit decision making and misalignment of strategy between corporate and business units.
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4. Competitive advantage
5. Customer value proposition
6. Unique activities
7. Balanced Score card
Strategy statement formation forms part of strategy planning and provides the measure and
boundaries for strategy execution. In Figure 23 below these elements of salience and their
causality with the planning and execution element of strategy is illustrated, with their
relationships and influences on each. The strategy statement will be an outcome of strategy
planning practice.
Figure23:Author'sCRDofstrategystatementonstrategyexecutionandplanning
The remainder of the motivation for doing strategy is interrelated and the CRD for the elements
of salience are shown together in Figure 24 below. The salience elements that play a key role
here are:
1. Quality of strategic planning
2. Functional purpose
Strategy statement brings purpose to strategy execution
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3. Operational efficiency
4. Quality of feedback systems between planning and execution (information systems)
5. Quality of measure of performance to evaluate execution versus planning
6. Level of autonomy held by business units to perform their tasks within set parameters
In Figure 24 below the causality of the salience elements are captured.
Figure 24: Author's CRD of strategic purpose and measurement
Howdoesonemanagestrategyasaprocess?
The key concepts and the salience elements are discussed below, followed by a CRD showing
the causal relationship of these elements in Figure 25. Strategy planning requires management
of the process to ensure the discussions are effective and that practitioners and participants
Strategy brings functional and operational purpose through MoPs and MIS
Functional
Purpose
Operational
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follow the process. The objective of the process is to generate strategy choice and the Five
interrelated choice questions provide a framework for generating choice. Creating choice
requires rigor and creativity. Choices can be evaluated using the structured choice process. This
choice process should be considered at various levels of the organisation, as each level
contributes in a different way and their strategy should be clear. These variables contribute to
the quality of the strategic plan, which now requires clear MoPs for each strategy set at each
level. The quality of the MoPs will drive the strategy execution and allow for assessment of
the impact on resources the strategy may have.
1. Strategy planning
2. Quality of managing strategy planning
3. Creating strategy choice
4. Level of rigor applied
5. Level of creativity applied
6. Five Interrelated strategic choice questions
7. Strategic choice structured process
8. Level of multilevel strategy application
9. Quality of strategic plan
10. Quality of MoPs
11. Level of resource impact
12. Strategy execution
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Figure 25: Author’s CRD of strategy management
II. Sequencing and Resolution
The models presented above are part of salience and causality steps for of all the variables
identified in the literature review. In this final phase of Integrative Thinking the sequencing is
considered with a reviewing of the Framework of Ideas presented by the models above. The
Strategy management requires creating and evaluating choice and applying strategy at multiple levels. Driving strategy requires clear MoPs set out in the strategic plan to drive execution and asses impact on resources.
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causality is revisited, and the salience elements are re-considered. The Integrative Thinking
process requires revisiting the first two phases as part of the sequencing phase to make certain
the model maintains integrity until the end of the process. The final phase is resolution, which
requires action taking. In this study not all the variables from all the CRDs above will be
included in the final model. The action taken here is to establish which variables will add the
most value and include them in the final model, but rather key variables were selected from
each process. The key variables were selected based on the amount of influence they have on
other variables. This is decided based on the number of arrows that flow form each variable or
receives the most arrows. Variables that had influence on variables that receive the most arrows
were also selected due to this relationship with key variables. With the variables that will be
taken into the final model selected, the sequencing is re-assessed for validity. As suggested
below, the causality around variables of the integrative strategy practice model (practitioners,
practices, application of practices, outcome) has been integrated with the other strategy practice
variables. The other strategy practice variables have been placed between them (practitioners,
practices, application of practices) and outcome variable to create a circular and a continues
strategy practice model. The final resolution step is the model designed by Integrative Thinking
for strategy practice as shown below in Figure 26. This model resolves the study’s focussing
question that the strategy practice Framework of Ideas can be integrated.
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Figure26:Author’sIntegrativeThinkingdesignedmodelofstrategypractice
This model will be used to identify the key areas for action taking in the case study organisation
in the remaining part of this Chapter.
Integrative Thinking model of key variables in strategy practice and their causality relationships.
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3. Background to strategy in the case study organisation
In the case study organisation, strategy practice is approached as an annual planning session
which is then executed over the year. The organisation looks at strategy during an annual
strategic planning session, or “Bosberaad”, followed by a strategy presentation to the wider
organisation, from which people create their personal goals. This takes place in the beginning
of the year. The planning session is held over two days. The session starts with an overview of
the industry and historical performance numbers of the organisation, to identify any changes
that may influence the current strategic objective. This is followed by a drill down into each
SBU’s market to assess growth potential and performance potential and a presentation from
department heads of their plans for the year. The output from this session is the establishment
of the strategy objective for the SBUs which becomes the measure of performance for the
business, which will be reviewed monthly. The strategy statement of the firm is revisited, and
the strategy objective is established. The strategy objective is then presented to the entire
organisation at a strategy weekend following which SBUs will draft budgets and people will
create personal objectives for performance appraisals. The single measure of strategy
performance is on making budget and reviewing personal goals for personal appraisals.
Strategy is reviewed annually as part of strategy planning. Strategy outcome is monitored
during the year in terms of whether budgets are being achieved by the traders of the respective
SBUs. However, if an SBU budget is being not achieved, there is currently no indication that
action will be taken during the year to amend strategy. At the end of the year, personal goals
are assessed to determine remuneration.
4. Strategy practice tensions between Framework of Ideas and the organisation
This section compares the case study organisations’ strategy practice to the Framework of Ideas
presented above in order to identify tensions that present opportunities for action taking to
improve the strategy practice of the organisation. This strategy practice of the case study
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organisation is informed by the Action Research Chapter and the author’s experience in the
organisation strategy practice.
This section is completed by comparing the case study organisation to the Integrative Thinking
model designed for strategy practice. These findings will present the final suggestions of which
areas for action taking should be focussed on given the designed model.
I. Tensions on what is strategy
In the organisation’s strategy planning sessions, the following elements are considered:
• environmental impacts of the industry on the organisation
• change in industry customer preferences
• company’s ability to grow in the industry; and
• competitive advances which we should consider.
Compared to the literature review of what is strategy (Figure 19) the key elements that should
be considered is what strategy the organisation is following, being either:
• low cost leader strategy; or
• differentiation strategy
This will bring purpose to strategic choice-making in the organisation in line with this over-
arching strategies and maximise the competitive advantage with customer needs to find the
strategic sweet spot of the organisation.
II. Tensions on strategy practice
The organisation’s strategy practices consist of an annual planning session. The practitioners
at the planning sessions are the MD, Executive Management team, heads of Departments and
traders of the SBUs. The practices review the corporate strategy statement, an industry
overview, a SWOT analysis, and evaluating the corporate strategy profit objective and assesses
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whether growth opportunities still exist for the trading SBUs. This flows into SBU budget
setting and personal objectives. The outcome from the planning session that needs to be
executed is the SBU’s achieving budget targets and personal goals being achieved. This
practice is illustrated below in Figure 27.
The process followed is very similar to the Strategy as Practice framework suggested by the
literature (Figure 20), except for:
• Outcomes, and
• Practices used.
There is no outcome for monitoring the operations and applying a practice like Sweet Spot
Analysis will bring strategic choice, which is currently limited to trading by SBUs.
Figure27:Author’sCRDofthecasestudyorganisation’sstrategyprocess
III. Tensions on deliberate versus emergent strategy
The organisation uses strategy planning with strategy practice to achieve a deliberate strategy,
with a single strategy objective. This strategic objective is executed by the SBUs. The strategy
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of achieving the strategic objective is not set by the organisation. The SBU’s have autonomy
to achieve the strategic objective, which allows strategy to emerge from the SBUs execution
as illustrated in Figure 28. As suggested in Chapter Two this tension between variance in
deliberate strategy and emerging strategy can present a competitive advantage, but there needs
to be a link back to the strategy planning, which is missing in the organisation’s model. The
organisation may consider looking closer at what emerging strategies achieved what outcomes
and bring this into the next strategy planning round.
Figure28:Author’srepresentationoftheorganisation’sstrategydevelopment
IV. Tensions on strategy alignment
Both the firm’s and SBU’s strategic objectives are to achieve profit targets. In this sense,
outcomes are aligned. However, the SBU’s strategy execution is not necessarily aligned with
the corporate view of things. Corporate strategy is providing supply chain management from
source to processor. On the coalface, the SBUs often must trade through traders. This is due to
an industry norm that large corporate processors deal with international traders because of the
perception that this removes supply risk. To gain access to these processors the SBU’s must
trade with traders.
A second view of corporate strategy is that the organisation must grow market share. However,
the main driver for SBU’s are profitability. This appears to be a tension, yet this misalignment
does ensure that SBU’s achieve the performance targets demanded by corporate. Autonomy is
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a main driver for the SBU’s to be able to make this strategic choice away from corporate
strategic views. The organisation does however monitor market share to evaluate when the
profit strategy will be threatened by a too large market share, as it will suppress a profitability
strategy. A shift may have to made at this point to focus on economy of scale and trading
volumes.
Although there is tension here, similar to what is described in the literature review (see Figure
22), it can provide competitive advantages and should be monitored to ensure that:
• The level of autonomy of SBU’s to choose their own strategy execution does
not threaten the survival of the organisation.
• The level of misalignment does not impact negatively on the sustainability of
the organisation.
V. Tensions on why do strategy
ProvidingDirectionandPurpose
The organisation practices strategy in order to consider major changes in customer needs,
competitor offerings, and the ability of SBU’s to meet strategic objective of profit targets. It
will evaluate its competitive advantage, set strategy scope and strategy objective, which forms
a strategy statement and is presented to the organisation as a guide to set personal objectives
and SBU’s to do planning. This compares well to the structure suggested in Figure 24, but
consideration maybe given to these areas:
• Articulating the Customer Value Proposition to establish operational and
service competitive advantages that need to be maintained.
• Unique activities that the organisation offers that bring competitive advantage,
as this is where competition will attack.
• Balanced Scorecard with KPIs to monitor the above key contributors to
competitive advantage.
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Measuringperformance
The organisation’s outcome of strategy practice is the strategic objective of profit targets. This
is the primary KPI and measured monthly. Although Department Heads are presenting plans
for the year ahead, these are not set into KPIs to be monitored by the executive management
team. From the literature review some of the key variables influencing successful strategy
practice that is should be considered are:
• Setting MoPs around operational activities
• Implementing feedback systems (Information Systems) that monitor strategy
execution of operations and SBU’s set around competitive advantages
Managingstrategy
Strategy management considers the quality of strategy planning and creating strategy choice in
the organisation. Creating strategic choice requires evaluation and considering implications at
multiple levels of the organisation. Strategy should also be set for each level of the organisation
with clear MoPs. Executing the strategy will require consideration for the consequences and
impact on resources it will have (see CRD in Figure 25 of strategy management).
The organisation’s strategy management is well structured at a corporate level, but value can
be added by considering the following process around strategic choice and functional level
strategy setting:
• Strategy at multiple levels and functions with clear MoP
• Strategy impact on resources
• Generating strategic choice with five interrelated strategic choice questions
• Applying structured strategic choice process
The variables identified in this section suggests a wide range of possible actions that can be
taken to address the area of concern in this study. In the next section these options will be
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narrowed down by comparing the Integrative Strategy model to the organisation to identify
area for action-taking. The final section will present the SSMA influences and relationships for
consideration around the proposed action taking changing in strategy practice.
VI. Apply the Integrative Thinking model for strategy practice to the case study
organisation
The above section considered every CRD from the Framework of Ideas generated in Chapter
Two. The variables identified here present the opportunity for action-taking. The objective in
Action Research is not however to take action on all the areas, but to be selective on
implementation so that the impact on the system can be monitored and lead to another cycle of
learning. The selection for this study’s action taking is informed by comparing the Integrative
Thinking model against the case study organisation and present these variables for action taking
consideration. The diagram below (Figure 29) presents this comparison. The variables in red
indicate the areas which is not present in the organisation’s practice which should be considered
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Figure29:Author'sIntegrativeThinkingCRDforactiontakinginthecasestudyorganisation’sstrategypractice
Strategy
Planning
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5. Findings from applying SSMA on case study organisation
Having now presented the opportunities for action taking around strategy practice, the study
will consider the influences on the proposed changes found through applying the SSMA
models to the area of concern. This will present considerations for the relationships that will
be influenced or have influence over the action taking.
I. Rich Picture of problem situation
The Rich Picture illustrates how strategy is practiced in the case study organisation (Figure 30)
It illustrates the relationship between elements in the process and the people involved in the
planning and execution of strategy. The Rich Picture points out where there is lack of feedback
from employees into planning to consider impact on resources and where MoPs and KPIs are
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Figure30:Author’sRichPictureoftheproblemsituationofstrategypracticeintheorganisation
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II. CATWOE of stakeholders in the organisations strategy practice
In undertaking the CATWOE exercise, what I learned was that changing the strategy practice
will require consideration for the impact it will have on executive management and department
heads because as customers of strategy practice they will be directly affected by the proposed
action taking. The change will require consideration of impact of change on executive
managers, department heads and employees as they will be the actors that will have to
implement the change. The organisation’s view on the purpose of strategy practice will also
require consideration as the action proposed adds other strategy outcomes to the process, other
than profit targets. The action will require support from the executive managers as owners of
the strategy process in the organisation. Appendix A: SSM models shows the application of
the CATWOE model.
III. Analyses One, Two, and Three
From the analyses, variables will be created to draw a Rich Picture of social and political
influences over the action taking to illustrate the relationships.
AnalysisOne:ProblemOwners
The intervention will require several people with different levels of power within the
organisation. Table 2 below sets out the ‘problem owners’ or ‘actors’ which will have to be
consulted before taking action on the proposed interventions on strategy practice.
Table2:Author’sAnalysisOneofProblemownerswithprocess
Problem owners MD Executive Management Department Heads SBU Traders
Each of these owners will be taken as variables into the Rich Picture of Analyses One, Two
and Three.
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AnalysisTwo:Socialanalyses
Analysis Two considers the social consideration of the stakeholders in the process. The
feasibility and desirability of the action taking will be influenced by their social profiles. The
results below demonstrate the level of need within the organisation to improve strategy practice
in organisation.
Table3:Author’sAnalysisTwoofLevelofneedwithintheorganisationtoimprovestrategypractice
Problem owners
MD Executive Management
Department Heads SBU Traders
Roles Leading strategy practice
Managing strategy practice
Executing strategy practice
Executing strategy practice
Norms Strategy process can improve
Strategy process can improve
Strategy process can improve
Strategy process can improve
Values Strategy process is critical
Strategy process is critical
Strategy process is necessary
Strategy process is necessary
The variables taken from social analysis are:
• Influence on leading strategy practice
• Influence on managing strategy practice
• Influence on executing strategy
• Level of need to improve strategy practice
• Level of value of strategy
AnalysisThree:Politicalanalyses
This considers the power of influence over the process containing the area of concern.
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Table4:Author’sAnalysisThreeofDegreeofPowerofProblemownerswithprocess
Problem owners MD Executive Management Department Heads SBU Traders Level of Power over System High High Low Medium
The variables taken from this analysis are:
• Each of the owners; and
• Their levels of influence.
From the additional insights gained from Analyses One, Two, and Three, I have created a
second Rich Picture below illustrating the influences and relationships around the area of
concern to be considered for action taking (Figure 31). The additional Rich Picture provides
for richer insights into the people and their beliefs and power over strategy practice which is
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Figure31:Author'sRichPictureofAnalysesOne,TwoandThree
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IV. Multilevel Thinking
Applying multilevel thinking to the organisation brought some interesting facts to light, which
support thoughts on the problem situation. The Action Research and SSMA research indicates
that the organisation is doing strategy practice as a single event, out of which the outcome is
that employees create their own personal goals and the SBUs create the budgets for achieving
the strategic objective. The output from the strategy process is used as a measure for assessing
individuals’ performance SBUs on achieving targets. If multilevel thinking from SSMA is
applied and combine it with Martin’s (2017) multiple level descriptions in his Nested Choice
Cascade (Figure 8) it becomes clear where there is a gap in the organisation’s application of
strategy practice at multiple levels. An individual level is added for the purpose of the study to
add more depth to the model’s application and include the employee level for strategy because
employees set personal goals and objectives as part of the organisation’s strategy process. The
first table (Table 5) below shows how multiple level strategy practice would be applied under
these two methods with reference to the organisation’s corporate structure in brackets and
Martin categorisation in front.
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Table5:Author'srepresentationofmultiplelevelstrategypracticefortheorganisationasitcouldbe
Corporate Level (Executive Management) Why do it?
Increase organisations future success and sustainability
Strategic Group (Departments)
What to do?
Implement new strategy practices
Why do it?
Implement new strategy practices
Individual Business Units (SBU)
How to do it?
Improve strategy planning
What to do?
Improve strategy planning
Why do it?
Improve strategy planning
Individual level (Employee)
How to do it?
Formulate sub strategies
What to do?
Formulate sub strategies
Why do it?
Formulate sub strategies
How to do it?
Create business unit strategy plans
What to do?
Create business unit strategy plans
How to do it?
Formulate personal goals and objectives
Below is a table of the current strategy practice applied to multiple level (Table 6). Note the
gap between Strategic Group level (Departments) and Individual Business Units (SBU). This
is where an opportunity for action taking exists—apply strategy practice at the strategic group
level (department level). In addition, there is opportunity to add improved strategy practice at
the individual level (Employee). The areas for action-taking is highlighted in red in Table 6.
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Table6:Author'srepresentationofmultiplelevelstrategypracticefortheorganisationhowitis
Corporate Level Why do it?
Review the organisation's strategy for profit
Strategic Group (Departments)
What to do?
Brainstorm, historical review and SWOT
Why do it?
Individual Business Units (SBU)
How to do it?
Annual planning session at the 'Bosberaad'
What to do?
Why do it?
Create income generation strategy
Individual level
How to do it?
What to do?
Plan strategy execution
Why do it?
How to do it?
Setup budgets per SBU
What to do?
How to do it?
Formulate personal goals and objectives
Our strategic objective is to achieve budget targets. If the organisation applies multi-level
thinking in strategy practice, there is opportunity for each level in the business to have a
strategy that contributes to the overall strategy in a defined way with clear MoPs.
V. Measure of Performance
Measure of performance is done in terms of the 3 E’s model. The 3 E’s consider the process of
transformation (T) of the system in focus on three criteria’s. These criteria are listed below and
for each criterion the transformation of the strategy practice of the case study organisation is
stated.
1. Efficacy (E1) – considering at a higher level whether T is worth doing and adding
required value: Yes, strategy as practice is worth doing as it is critical to the success of
the organisation.
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2. Efficiency (E2) – confirming if minimum resources are being applied: minimum
resources are being applied, although resources impact of the strategy execution is not
being evaluated during strategy practice.
3. Effectiveness (E3) – confirming whether the T was achieved: the organisation does
perform strategy practice, and from a PBV of strategy they have been very successful.
The value lies in the fact that the areas for action taking can increase competitive
advantage to the organisation and provide for efficient use of resources.
6. Conclusion
This Chapter presents the findings of the study and responds to the focussing questions of the
study. The first part compares to the compared tensions between the Framework of Ideas
created from the literature review in Chapter Two to answer the study’s focussing questions on
the Framework of Ideas that exists out there about strategy practice. This section also presents
findings about tensions that exist around strategy practice. This section concludes with
presenting an Integrative Thinking model for strategy practice designed from the findings to
answer the study’s focussing question on whether one can integrate strategy practice theories
into a model for strategy practice.
The next section presents findings in response to the focussing question of whether strategy
practice could be improved in the case study organisation. These findings are informed by the
Action Research in Chapter Four and comparing it to the Framework of Ideas from the
literature review focus questions on strategy practice, strategy tensions and how to manage
strategy practice. The information gathered on the organisation is from Action Research with
the LUMAS in Chapter Three and the author’s experience of its strategy practice in the case
study organisation. From the comparison, key tensions between the Framework of Ideas and
the research are identified in order to improve the case study organisation. The areas for action
taking are compared to the Integrative Thinking model for strategy practice to identify main
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areas for action-taking that should be consider. Below is a summary of the variables identified
for consideration for action taking.
The organisation can improve on its strategy focus. This focus is the critical and provides the
purpose for all strategy choice that follows. Here there are two options:
• Cost Leadership Strategy
• Differentiation Strategy
Achieving strategy objectives is driven by the management of strategy. Improvement is in the
application of clear strategy planning with MoP at multiple levels of the organisation—each
function should have clear purpose of how it will contribute to the organisation. This will drive
operational efficiency and bring focus to the efforts that present competitive advantages to the
organisation.
• Strategy at multiple levels; and
• Functions with clear MoP
Implementing feedback systems (Information Systems) that monitor strategy execution of
operations and SBUs set around competitive advantages will ensure the organisation is
functioning effectively towards achieving the strategic objective. MoPs are only as good as the
systems that monitor it. Quality information systems will monitor the level of autonomous
decisions making to ensure it does not threaten the competitive advantage of the organisation.
Information systems also provide the ability to monitor and learn from emerging strategy from
SBU’s, which may be misaligned vis-à-vis the corporate strategy. This misalignment often
presents competitive advantages that can be exploited or indicate influences that corporate
strategy may have to incorporate into strategy planning. Therefore, management and SBUs
need quality management information systems (MIS) that provide information about the
interaction with the clients and the competition.
• Quality of MIS
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SSMA analyses on the area of concern in the organisation identified the following influences
and relationship around the area of concern.
The Rich Picture illustrated no link between employees and strategy planning. This feedback
does not have to be direct. According to the multiple level analyses, if there were strategy
practice for departments or functions, it would provide for MoPs on these functions, which
would require feedback from employees, and this would flow from departments into strategy
planning. There is currently no strategic MoP for Department Heads and Functions. There is
also opportunity to clarify at an employee level what their contribution is to strategy and setting
MoPs around this. The CATWOE points to the fact that any change would require buy in from
executive management and consideration for the impact of change on executive management
and department heads, as they would directly have impacted in a negative way due to new
performance measurements. The Analyses One, Two and Three concludes that the MD and
executive management have the most influence over the process and therefor any change. The
3 E’s point to the fact that the areas identified for action-taking in the organisation’s strategy
practice can bring efficiency and effectiveness to the organisation.
The final Chapter will provide an overview of the study and reflect on the wider implications
of the study.
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Chapter 6: Conclusion and learning journey
1. Overview of study
This study started with an introduction to the study by stating my view on strategy as well as
my working background. It explained the situation of concern and set out the research goals
for the study with the focussing questions driving the study and the focus questions for the
literature review. The research methodology was explained, and the ethical considerations were
stated, and finally an outline of the paper was produced.
The concept of Integrative Thinking as a tool to design new ideas was discussed Chapter Two
as well as a literature review on strategy and strategy practice to come up with a Framework of
Ideas around these topics. This was followed by an explanation of the Research Methodology
in Chapter Three and the process the study applied in data collection, analyses and the ethical
considerations. The Research Methodology is Action Research and the LUMAS framework is
used as a framework to guide the research process. The data was collected through informal
discussions with a selection of people from various levels in the case study organisation.
Chapter Four explained the theoretical framework that will inform the Research Methodology.
The study is using Soft Systems Methodology in Action as part of the Action Research
methodology to explore the situation of concern in the case study organisation.
Chapter Two is the literature review, which explored the focussing questions stated in Chapter
One. This Chapter started an explanation of Integrative Thinking and how it should be applied.
This was followed by a literature review guided by the focus questions set for this Chapter.
The focus here was around making choices that are aligned with purpose, which will bring
focus to efforts and align capabilities with customer needs and the organisation’s competitive
advantage. The literature review looked at strategy practices and responded to the focus
questions set for the literature review. It included exploring tensions that exist around strategy.
The review looked at the tensions between deliberate versus emergent strategies and how this
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can be managed by including feedback from emergent strategies into strategy planning to
influence deliberate strategy. It also looked into tension of misalignment between the corporate
strategy and the business unit’s strategy and came to the conclusion that this misalignment
provides a competitive advantage in many cases, so the autonomy of decision making at the
business unit level should be allowed and monitored to ensure it does not influence the
organisations objectives. This Chapter further considers the motivation for doing strategy and
concluded it provides direction and purpose to the functions in the organisation. Strategy is
considering the best application of capabilities, resources and competitive advantage to achieve
its defined objectives. The final part of this Chapter considered managing strategy process to
create choices, consider the impact of the strategy and measuring the outcomes.
Chapter Three stated the research methodology. Action Research is applied in a SSMA way to
explore and understand the variables influencing the situation of concern. The LUMAS model
was applied as a framework to guide the exploration with SSMA. This Chapter explained how
data would be collected for the research and how it is analysed.
In Chapter Four, SSMA was explained and set out the four main activities of SSMA as a
methodology. The models for exploring the situation was identified and motivated as well as
clarifying the purpose for model building in SSMA.
Chapter Five brought together the literature review’s Framework of Ideas and compared it to
the case study organisation in order to identify areas where action could be taken to improve
the situation of concern of strategy practice. This is followed by application of the SSMA
models chosen in Chapter Four which provided a picture of what variables have influence on
the area of concern and what people or groups of people will be influenced and have influence
over the area of concern and the proposed action taking.
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2. Conclusion of the study
The conclusion drawn from the study is that there are four main variables for action taking that
can be considered Figure 29.
• Choice between low cost leadership strategy or differentiation strategy
• Strategy at multiple levels; and
• Functions with clear MoP
• Quality of MIS
As mentioned in discussion of the main activities of SSMA, the action taking should be debated
for both feasibility and desirability by the stakeholders, whilst accommodating conflicts of
interest to enable action-to-improve to be taken. The Rich Picture in Figure 31 illustrates the
key stakeholders and their relationship and influence on the proposed changes in strategy
practices.
The Integrative Model presented in Chapter Five (Figure 26) provides a theoretical framework
for strategy practice. This can be applied to the organisation strategy planning and execution
of strategy. The application of the framework will require consideration by another
organisation for the impact it will have on its resources, and people. The SSMA influences
from this study maybe different for other organisations and should be revisited before
implementing this strategy practice framework to consider the impact on the stakeholders of
that organisation.
3. Learning Journey
Through this study I have gained a deeper understanding through the application and literature
review of the value of Integrative Thinking as a problem-solving tool and as a method to
generate choice. The Literature review has provided new knowledge on strategy practice and
the tensions that exists around strategy. I have gained new insight into how to evaluate human
activity systems and how to establish key relationships and influences around problem
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situations through the use of Action Research with the LUMAS model and Soft Systems
Methodology. I have identified key areas for cation taking that can bring the organisations
strategy practice to new height as they continuously search for improvement and for that
competitive advantage. Through the application of all the above on the case study organisation
I have gained new understanding about how the organisation thinks about strategy practice and
about who the key stakeholders are that need to be involved in action taking.
4. Wider implications
This study did not consider the practices that can be used, the selection of participants or the
application of practices. Value may be added by considering these elements in depth. Similarly,
the framework does not provide explanation on how to apply each variable, it only suggests
what should be included in the practice.
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Porter, M. E. (1996). What is a strategy? Harvard Business Review, 1996(November-
December), 61–78.
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Appendices
1. Appendix A: SSM models
Table7:Author'sapplicationofCATWOE-Customers
Who is on the receiving end?
Shareholders Executive management
Departments heads SBU Traders Employees
What problem do they have now?
They are participants in strategy practices by setting their requirements and providing assessment of inputs at 'Bosberaad'.
Each executive manager relays their focus points for the year. The focus points are not measured for contributing to the need of other departments or sets out measures of performance (MoP).
Department heads do not receive strategic objectives for their level of the organisation. Departments do not set strategic objectives.
Inputs they give on operational efficiency is not taken into strategy objectives in other departments, and not executed or measured.
Employees are only asked to do personal goals and objectives, but there are no strategies for departments and MoPs of operational efficiency in their tasks from which they can make goals.
How will they react to what you are proposing?
They will be supportive because there is a culture in the shareholder to find new strategies.
They will not be embracing change.
It will improve their ability to contribute to the organisation which will give them more confidence to make decision. They will have strategic purpose to guide decision making in the departments.
They will be positive as the proposal will enable to organisations functions and trading function to work together to achieve ultimate strategic objectives.
They will support the change as there is room for improvement in operational efficiency, which will decrease work hours and increase job satisfaction.
Who are the winners and losers?
Shareholders will benefit from practice.
Executive managers will lose because MoPs will be set, and they will have KPI's to report on.
Department heads will gain because there will be strategic objectives for them to achieve, with MoPs to monitor where operational changes need to be made.
Traders will win because they will have support from other functions.
Employees will gain job satisfaction through renewed focus and purpose.
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Table8:Author'sapplicationofCATWOE-Actors
Who are the actors who will ‘do the doing’, and carrying on out my solution?
Executive management Departments heads SBU Traders Employees
What is the impact on them?
More thought and preparation will have to go into strategy planning. More responsibility for organisational success.
More thought and preparation will have to go into strategy planning. More responsibility for organisational success.
More support from other departments.
Clear purpose and a drive to be
more efficient.
How might they react?
Negative to change, but positive to a process where value is clearly measurable.
Negative to change, but positive to a process where value is clearly measurable.
Positive to a process where value is clearly measurable.
Negative to change, but positive to a
process where value is clearly
measurable.
Table9:Author'sapplicationofCATWOE-Transformation
What is the process for transforming inputs into outputs?
Annual strategy 'Bosberaad' and planning sessions
What are the inputs? SWOT analysis, historical numbers, brainstorm session, review business objectives
Where do they come from?
Executive team and SBU managers
What are the outputs? Budget setting, personal goals and objectives
Where do they go to? HR and finance department
What are all the steps in between?
The executive team assesses strategy at "Bosberaad". On annual strategy planning day, following 'Bosberaad' strategy is communicated to rest of organisation. Following this,
heads of departments and SBU's brainstorm ideas around the given strategy. After planning sessions SBU's set budgets and rest of employees write personal goals and
objectives.
Table10:Author'sapplicationofCATWOE–WorldView
What is the bigger picture into which the situation fits?
The organisation focussed on income generation for growth with less focus around monitoring and strategising for operational efficiency.
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What is the real problem you are working on?
The strategy planning process is not performed on a multi-level in the organisation and MoPs are not set and monitored.
What is the wider impact of any solution?
The organisation will become effective in achieving its strategic objectives and growth will be supported with an efficient execution function creating
competitive advantage.
Table11:Author'sapplicationofCATWOE–Owner
Who is the real owner or owners of the process or situation you are changing?
Executive management
Can they help you or stop you? Yes
What would cause them to get in your way?
If they believe the proposed practice structure will have a negative influence on the evaluation of their personal or departmental
performance.
What would lead them to help you? If the benefits to the business is made clear and the logic of the proposal does not reflect directly on a person.
Table12:Author'sapplicationofCATWOE–EnvironmentalConstraints
What are the broader constraints that act on the situation and your ideas?
Our constraints to apply new strategy practices are individual perspectives on the impact of change.
What are the ethical limits, the laws, financial constraints, limited resource, regulations, etc?
The ethical limits are people’s feelings on change and the perception of the impact new practices will have on their work
environment and performance measurement.
How might these constrain your solution?
The executive team may not support the change in strategy practices.
How can you get around them? Convince the impact of the change on the bottom line of the organisation with the executive.
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