Making Strategy Work: A Literature Review on the Factors Influencing Strategy Implementation

Topics: Strategic management, Management, Strategic planning Pages: 52 (16541 words) Published: February 20, 2012
ICA Working Paper 2/2008

Making Strategy Work: A Literature Review on the Factors influencing Strategy Implementation Yang Li1, Sun Guohui1, Martin J. Eppler2
1 2

Business School, Central University of Finance and Economics, Beijing, China

Institute of Corporate Communication, University of Lugano (USI), Lugano, Switzerland

Yang li: Email: yangbaihe07@hotmail.com Tel: +86-010-62289680 Address: Business School, Central University of Finance and Economics, No.39 Xueyuan Nanlu, Haidian District, Beijing 100081, China Sun Guohui: Email: guohui-sun@263.net Fax: +86-010-62288081 Tel: +86-010-62288113 Address: Business School, Central University of Finance and Economics, No.39 Xueyuan Nanlu, Haidian District, Beijing 100081, China

Martin J. Eppler: Email: martin.eppler@lu.unisi.ch Fax: +41 586664647 Address: Institute of Corporate Communication, University of Lugano (USI), Via Buffi 13, 6900 Lugano, Switzerland.

1

Making Strategy Work: A Literature Review on the Factors Influencing Strategy Implementation Abstract
Although numerous studies acknowledge that strategies frequently fail not because of inadequate strategy formulation, but because of insufficient implementation, strategy implementation has received less research attention than strategy formulation. In this study, we review the factors that enable or impede effective strategy implementation, and survey the state-of-the-art in this domain. We highlight how strategy implementation has been researched so far – and in which contexts – and how this field may be moved forward. As a result of our literature analysis, spanning the last twenty-four years, we find nine crucial factors for strategy implementation that are frequently discussed in the literature as well as two approaches of aggregating and relating relevant factors. We find several important research needs regarding these factors and outline how they could be addressed.

Keywords Implementation factors, implementation phases, strategy communication, strategy implementation, strategy execution, strategic management

Acknowledgement The China Scholarship Council provided financial support for this study.

2

1. Introduction
Although formulating a consistent strategy is a difficult task for any management team, making that strategy work – implementing it throughout the organization – is even more difficult (Hrebiniak, 2006). A myriad of factors can potentially affect the process by which strategic plans are turned into organizational action. Unlike strategy formulation, strategy implementation is often seen as something of a craft, rather than a science, and its research history has previously been described as fragmented and eclectic (Noble, 1999b). It is thus not surprising that, after a comprehensive strategy or single strategic decision has been formulated, significant difficulties usually arise during the subsequent implementation process. The best-formulated strategies may fail to produce superior performance for the firm if they are not successfully implemented, as Noble (1999b) notes. Results from several surveys have confirmed this view: An Economist survey found that a discouraging 57 percent of firms were unsuccessful at executing strategic initiatives over the past three years, according to a survey of 276 senior operating executives in 2004 (Allio, 2005). According to the White Paper of Strategy Implementation of Chinese Corporations in 2006, strategy implementation has become “the most significant management challenge which all kinds of corporations face at the moment”. The survey reported in that white paper indicates that 83 percent of the surveyed companies failed to implement their strategy smoothly, and only 17 percent felt that they had a consistent strategy implementation process. It is thus obvious that strategy implementation is a key challenge for today‟s organizations. There are many (soft, hard and mixed) factors that influence the success of strategy...


References: Akan, O., Allen, R.S., Helms, M.M., and Spralls Ш, S.A. (2006). „Critical Tactics for Implementing Porter‟ s Generic Strategies‟. The Journal of Business Strategy, 27, 43-53. Alexander, L.D. (1985). „Successfully Implementing Strategic Decisions‟. Long Range Planning, 18, 91-97. Allio, M.K. (2005). „A Short, Practical Guide to Implementing Strategy‟. Journal of Business Strategy, 26, 12-21. Bantel, K.A. (1997). „Performance in Adolescent, Technology-Based Firms: Product Strategy, Implementation, and Synergy‟. The Journal of High Technology Management Research, 8, 243-262. Beer, M., and Eisenstat, R.A. (2000). „The Silent Killers of Strategy Implementation and Learning‟. Sloan Management Review, Summer, 29-42. Bourgeois Ш, L. J., and Brodwin D.R. (1984). „Strategic Implementation: Five Approaches to an Elusive Phenomenon‟. Strategic Management Journal, 5, 241-264. Brenes, E.R, Mena, M. and Molina, G.E. (2007). „Key success factors for strategy implementation in Latin America‟. Journal of Business Research, 1-9. Chimhanzi, J. (2004). „The impact of marketing/HR interactions on marketing strategy implementation‟. European Journal of Marketing, 38, 73-98. Chimhanzi, J., and Morgan, R.E. (2005). „Explanations from the marketing/human resources dyad for marketing strategy implementation effectiveness in service firms‟. Journal of Business Research, 58, 787– 796. Dess, G.G., and Priem, R.L. (1995). „Consensus-Performance Research: Theoretical and Empirical Extensions‟. Journal of Management Studies, 32, 401-417. Dooley, R.S., Fryxell, G.E., and Judge, W.Q. (2000). „Belaboring the Not-So-Obvious: Consensus, Commitment, and Strategy Implementation Speed and Success‟. Journal of Management, 26, 1237–1257. Floyd, S.W., and Wooldridge, B. (1992a). „Managing Strategic Consensus: The Foundation of Effective Implementation‟. Academy of Management Executive, 6, 27-39. Floyd, S.W., and Wooldridge, B. (1992b). „Middle Management Involvement in Strategy and Its Association with Strategic Type: A Research Note‟. Strategic Management Journal, 13,
42
153-167. Floyd, S.W., and Wooldridge, B. (1997). „Middle Managements Strategic Influence and Organizational Performance‟. Journal of Management Studies, 34, 465-485. Forman, J., and Argenti, P.A. (2005). „How Corporate Communication Influences Strategy Implementation, Reputation and the Corporate Brand: An Exploratory Qualitative Study‟. Corporate Reputation Review, 8, 245-264. Govindarajan, V. (1988). „A Contingency Approach to Strategy Implementation at the Business-Unit Level Integrating Administrative Mechanisms With Strategy‟. Academy of Management Journal, 31, 828-853. Govindarajan, V. (1989). „Implementing Competitive Strategies at the Business Unit Level: Implications of Matching Managers to Strategies‟. Strategic Management Journal, 10, 251-269. Govindarajan,V., and Fisher.J. (1990). „Strategy, Control systems, and resource sharing: effects on business-Unit Performance‟. Academy of Management Journal, 33, 259-285. Grundy, T. (1998). „Strategy implementation and project management‟. International Journal of Project Management, 16, 43-50. Gupta, A.K. (1987). „SBU Strategies, Corporate-SBU Relations, and SBU Effectiveness in Strategy Implementation‟. Academy of Management Journal, 30, 477-500. Gupta, A.K., and Govindarajan, V. (1984). „Business Unit Strategy, Managerial Characteristics and Business Unit Effectiveness at Strategy Implementation‟. Academy of Management Journal, 27, 25-41. Guth, W.D., and Macmillan, I.C. (1986). „Strategy Implementation Versus Middle Management Self-Interest‟. Strategic Management Journal, 7, 313-327. Hantang Qi. (2005). „Strategy Implementation: The Impact of Demographic Characteristics on the Level of support received by middle managers‟. Management International Review, 45, 45-70. Harrington, R.J. (2006). „The moderating effects of size, manager tactics and involvement on strategy implementation in food service‟. Hospitality Management, 25, 373-397. Heide, M., Grønhaug, K.,and Johannessen, S. (2002). „Exploring Barriers to The Successful Implementation of a Formulated strategy‟. Scandinavian Journal of Management, 18, 217-231.
43
Heracleous, L. (2000). „The Role of Strategy Implementation in Organization Development‟. Organization Development Journal, 18, 75-86. Higgins, J.M. (2005). „The Eight „S‟s of Successful Strategy Execution‟. Journal of Change Management, 5, 3–13. Homburg, C., Krohmer, H., and Workman, J.P. (2004). „A strategy implementation perspective of market orientation‟. Journal of Business Research, 57, 1331–1340. Hrebiniak, L.G. (2006). „Obstacles to Effective Strategy Implementation‟. Organizational Dynamics, 35, 12-31. Judge, W.Q., and Stahl, M.J. (1995). „Middle-Manager Effort in Strategy Implementation: a Multinational Perspective‟. International Business Review, 4, 91-111. Kim W.C., and Mauborgne, R.A. (1991). „Implementing Global Strategies: The Role of Procedural Justice‟. Strategic Management Journal, 12, 125-143. Kim, W.C., and Mauborgne, R.A. (1993). „Making Global Strategies Work‟. Sloan Management Review, 34, 11-27. Lehner, J. (2004). „Strategy Implementation Tactics as Response to Organizational, Strategic, and Environmental Imperatives‟. Management Revue, 15, 460-480 Nilsson, F., and Rapp, B. (1999). „Implementing Business Unit Strategies: The Role of Management Control Systems‟. Scandinavian Journal of Management, 15, 65-88. Noble, C.H. (1999a). „Building the Strategy Implementation Network‟. Business Horizons, 19-27. Noble,C.H. (1999b). „The Eclectic Roots of Strategy Implementation Research‟. Journal of Business Research, 45, 119-134. Noble, C.H., and Mokwa, M.P. (1999). „Implementing Marketing Strategies: Developing and Testing a Managerial Theory‟. Journal of Marketing, 63, 57-73. Nutt, P.C. (1986). „Tactics of Implementation‟. Academy of Management Journal. 29, 230-261. Nutt, P.C. (1987). „Identifying and Appraising How Managers Install Strategy‟. Strategic Management Journal, 8, 1-14. Nutt, P.C. (1989). „Selecting Tactics to Implement Strategic Plans‟. Strategic Management
44
Journal, 10, 145-161. Okumus, F. (2001). „Towards a strategy implementation framework‟. International Journal of Contemporary Hospitality Management, 13, 327-338. Olson, E.M., Slater, S.F., and Hult, G.T. (2005). „The importance of structure and process to strategy implementation‟. Business Horizons, 48, 47-54. Peng, W., and Litteljohn, D. (2001). „Organisational Communication and Strategy Implementation-A Primary Inquiry‟. International Journal of Contemporary Hospitality, 13, 360-363. Piercy, N.F. (1998). „Marketing Implementation: The Implications of Marketing Paradigm Weakness for the Strategy Execution‟. Academy of Marketing Science Journal, 26, 222-236. Rapert, M.I., Lynch, D., and Suter, T. (1996). „Enhancing Functional and Organizational Performance via Strategic Consensus and Commitment‟. Journal of Strategic Marketing, 4, 193-205. Rapert, M.I., Velliquette, A., and Garretson, J.A. (2002). „The Strategic Implementation Process Evoking Strategic Consensus through Communication‟. Journal of Business Research, 55, 301-310. Roth, K., Schweiger, D.M., and Morrison, A.J. (1991). „Global Strategy Implementation at the Business Unit Level: Operational Capabilities and Administrative Mechanisms‟. Journal of International Business Studies, 22, 369-402. Sashittal, H.C., and Wilemon, D. (1996). „Marketing Implementation in Small and Midsized Industrial Firms An Exploratory Study‟. Industrial Marketing Management, 25, 67-78. Schaap, J.I. (2006). „Toward Strategy Implementation Success: An Empirical Study of the Role of Senior-Level Leaders in the Nevada Gaming Industry‟. UNLV Gaming Research & Review Journal, 10, 13-37. Schmidt, S.L., and Brauer, M. (2006). „Strategic Governance: How to assess Board Effectiveness in Guiding Strategy Execution‟. Strategic Governance, 14, 13-22. Singh, D.T. (1998). „Incorporating cognitive aids into decision support systems: the case of the strategy execution process‟. Decision Support Systems, 24, 145–163. Skivington, J.E., and Daft, R.L. (1991). „A Study of Organizational „Framework‟ and „Process‟ Modalities for The Implementation of Business-Level Strategic Decisions‟.
45
Journal of Management Studies, 28, 46-68. Slater, S.F., and Olson, E.M. (2001). „Marketing‟s Contribution to the Implementation of Business Strategy: An Empirical Analysis‟. Strategic Management Journal. 22, 1055-1067. Smith, K.A., and Kofron, E.A. (1996). „Toward a research agenda on top management teams and strategy implementation‟. Irish Business and Administrative Research, 17,135-152. Viseras, E.M., Baines, T., and Sweeney, M. (2005). „Key success factors when implementing strategic manufacturing initiatives‟. International Journal of Operations & Production Management, 25, 151-179. Waldersee, R., and Sheather, S. (1996). „The Effects of Strategy Type on Strategy Implementation Actions‟. Human Relations, 49, 105-122. Walker, Jr, O.C., and Ruekert, R.W. (1987). „Marketing‟s Role in The Implementation of Business Strategies: A Critical Review and Conceptual Framework‟. Journal of Marketing, 51, 15-33. Wernham, R. (1985). „Obstacles to Strategy Implementation in a Nationalized Industry‟. Journal of Management Studies, 22, 632-648. White, R.E. (1986). „Generic Business Strategies, Organizational Context and Performance: An Empirical Investigation‟. Strategic Management Journal. 7, 217-231. Wooldridge, B., and Floyd, S.W. (1990). „The Strategy Process, Middle Management Involvement, and Organizational Performance‟. Strategic Management Journal, 11, 231-241.
46
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • Strategy Essay
  • Essay about Porsche Strategy
  • Literature Review on What Is Strategy Essay
  • Strategy Implementation Organization Strategy Evaluation Essay
  • Strategy Essay
  • Strategy Implementation Essay
  • Factors impacting strategy 2014 Essay
  • Challenges of Strategy Implementation Essay

Become a StudyMode Member

Sign Up - It's Free