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October 4, 2000

RMIT BUSINESS
The School of Management

Master of Business Administration


GB590 Field Investigation
A Study of the Relationship Between Strategic
Thinking, Strategic Planning and the High
Technology Industry In Australia

Final Report

A report submitted in partial fulfilment of the requirements for the award of


Master of Business Administration

Supervisor:

Student:
Justin Spangaro B.Eng (comms.)

Tim OShannassy

Student No.

RMIT Business, School of Management

8302946R

Phone: (03) 9817 3318 / (0427) 087 313


Address: Unit 3/385 Barkers Road,
Kew, VIC., Australia 3101
Email:
justin@spangaro.com

Phone:
(03) 9925 5951
Address: Level 16, 239 Bourke St.,
Melbourne, VIC., Australia, 3000.
Email:
tim.oshannassy@rmit.edu.au

Spangaro Systems Pty. Ltd.

Strategic Thinking, Strategic Planning and High-Technology Industries

Justin Spangaro

I declare that
except where due acknowledgement has been made, the work is mine alone
the work has not been submitted previously in whole or in part to qualify for
any other academic subject or academic award
the work has been carried out since the official commencement date of the
research project and in accordance with the undertakings given in the signed
RMIT Business ethics approval

Student Signature................................................Date........................

Spangaro Systems Pty. Ltd.

A STUDY OF THE RELATIONSHIP BETWEEN STRATEGIC PLANNING, STRATEGIC THINKING AND


THE HIGH TECHNOLOGY INDUSTRY IN AUSTRALIA.
Executive Summary ...........................................................................................................7

CHAPTER 1: INTRODUCTION
Synopsis...............................................................................................................................9
Research Topic: Definition, Background and Rationale ................................................9
Research Aims ..................................................................................................................11
Research Questions ..........................................................................................................12

CHAPTER 2: LITERATURE REVIEW


Synopsis.............................................................................................................................13
Introduction......................................................................................................................13
The Concept of Strategy..................................................................................................14
Strategic Planning ............................................................................................................18
Characteristics of strategic planning ......................................................................................................... 19
Analytic .................................................................................................................................................. 19
Formalised ............................................................................................................................................. 19
Detached. ............................................................................................................................................... 20
Convergent. ............................................................................................................................................ 20
Scientific. ............................................................................................................................................... 20
Engages left-brain (or right-handed planning). .................................................................................. 20
Strategy formulation .................................................................................................................................. 20
Planning Today .......................................................................................................................................... 21

Strategic Thinking ...........................................................................................................22


Connecting Planning with Thinking - the Evolution of Strategy ................................25
Single-loop/ double-loop learning ............................................................................................................. 26
Analysis versus intuition ........................................................................................................................... 29

Strategy and High Technology Industries......................................................................29


Conclusion ........................................................................................................................36

CHAPTER 3: FIELD RESEARCH


Introduction......................................................................................................................39
Research Design ...............................................................................................................39
Research Methodology ....................................................................................................41
Inductive/Deductive Methodology ............................................................................................................ 41
Hypothesis testing/falsification ................................................................................................................. 41
Time period of research ............................................................................................................................. 41
Quantitative and Qualitative Methods ....................................................................................................... 41
Measurement scales ................................................................................................................................... 42
Data Collection Methods ........................................................................................................................... 42
Sample Design ........................................................................................................................................... 43
Fieldwork ................................................................................................................................................... 44
Data Analysis Methods .............................................................................................................................. 44
Statistical Analysis Methods ..................................................................................................................... 49

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Hypotheses ........................................................................................................................51
Hypothesis A
Hypothesis B
Hypothesis C
Hypothesis D

............................................................................................................................................. 51
............................................................................................................................................. 51
............................................................................................................................................. 51
............................................................................................................................................. 51

Operationalisation ...........................................................................................................53
Operationalisation of Primary Constructs ....................................................................53
Operationalisation of Strategic Thinking .................................................................................................. 53
A Systems Perspective ........................................................................................................................... 53
Intent focused. ........................................................................................................................................ 54
Intelligently Opportunistic: .................................................................................................................... 54
Thinking in time: ................................................................................................................................... 54
Hypothesis-driven .................................................................................................................................. 54
Operationalisation of Assumptions about strategic thinking versus strategic planning ............................ 55
Operationalisation of Strategic Planning ................................................................................................... 55
Operationalisation of the Criticality of the Impact of Technology on the Organisation ........................... 56
Operationalisation of the Interaction between analysis and formulation (iterative or linear) ................... 56

Operationalisation of Secondary Constructs ................................................................56


Operationalisation of technological inflexibility ....................................................................................... 56
Operationalisation of Management Experience (type of) ......................................................................... 57
Operationalisation of Organisational Complexity and Size ...................................................................... 57
Secondary Constructs not Operationalised for this survey ........................................................................ 57

CHAPTER 4: ANALYSIS
Results and Discussion.....................................................................................................59
Hypothesis B ............................................................................................................................................. 61
Hypothesis C ............................................................................................................................................. 61
Hypothesis A ............................................................................................................................................. 62
Hypothesis D ............................................................................................................................................. 62
Secondary Constructs and Spearman Rank-Order Analysis ..................................................................... 63
Factor Analysis .......................................................................................................................................... 64
Component 1 .......................................................................................................................................... 66
Component 2 .......................................................................................................................................... 66
Component 3 .......................................................................................................................................... 67
Regression Analysis of Secondary Constructs .......................................................................................... 68
Regression Curve Fit of CT versus ST/SP ................................................................................................ 68

Summary of Analysis.......................................................................................................70
Research Limitations .......................................................................................................73
Sample Size ............................................................................................................................................... 73
Linear Regression ...................................................................................................................................... 73
Factor Analysis .......................................................................................................................................... 73
Survey Design ........................................................................................................................................... 73
Strategic Thinking Elements ..................................................................................................................... 74

CHAPTER 5: RESEARCH IMPLICATIONS


75

CHAPTER 6: CONCLUSION
79

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REFERENCES
83

APPENDIX A: STRATEGIC MANAGEMENT RESEARCH SURVEY QUESTIONNAIRE .............89


General Instructions ........................................................................................................89
Section 1: Strategic Planning ..........................................................................................89
Comments on Strategic Planning .............................................................................................................. 90

Section 2: Strategic Thinking..........................................................................................90


The Intelligent Opportunism Scale ............................................................................90
The Systems Perspective Scale....................................................................................91
The Intent Focused Scale.............................................................................................92
The Thinking In Time Scale........................................................................................93
The Hypothesis-Driven Scale ......................................................................................94
Assumptions about Strategy and the Strategy Process ................................................94
Comments on Strategic Thinking .............................................................................................................. 94

Section 3: Criticality of the Impact of Technology........................................................95


Section 4: Moderating Factors........................................................................................95
Technological Inflexibility ........................................................................................................................ 95
Type of Management experience .............................................................................................................. 96
Organisational Complexity ........................................................................................................................ 96

APPENDIX B: INTERVIEW QUESTIONS FOR STRUCTURED INTERVIEWS ............................99


APPENDIX C: DETAILED ANALYSIS CALCULATIONS ......................................................101
Data Transposition and Interpretation ........................................................................101
Strategic Thinking ................................................................................................................................... 101
Strategic Planning .................................................................................................................................... 102
Criticality of Technology ........................................................................................................................ 102
Formulation/Analysis Relationship ......................................................................................................... 102
Inflexibility of Technology ...................................................................................................................... 102
Management Orientation ......................................................................................................................... 103
Organisational Complexity ...................................................................................................................... 103
Question 30: organisational size .......................................................................................................... 103
Question 32: organisational structure .................................................................................................. 104

Spearman Rank-Order Correlation Coefficient .........................................................105


APPENDIX D: RESULTS: DATA TABLES ...........................................................................107
APPENDIX E: SPEARMAN RANK-ORDER CORRELATION COEFFICIENT CALCULATIONS .111
APPENDIX F: SUPPLEMENTARY STATISTICAL ANALYSES ...............................................127
APPENDIX G: REGRESSION CURVE FIT FOR CT VS ST/SP ............................................131
APPENDIX H: MULTIPLE LINEAR REGRESSION CORRELATION TABLES .........................133
INDEX .............................................................................................................................135

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Spangaro Systems Pty. Ltd.

October 3, 2000

A Study of the Relationship


between Strategic Planning,
Strategic Thinking and the High
Technology Industry in Australia.
Justin Spangaro
GB590 Field Investigation, Final Report

Executive Summary
This study investigates the nature of strategic management processes in
the high technology industry in Australia. The investigation reveals that
the field of strategic management is in a state of confusion over how to
find a balance between strategic planning and strategic thinking, and even
what is strategic thinking.
This research measures the emphasis on strategic thinking and strategic
planning and the criticality of technology to the organisations studied.
The proposition made is that high technology companies will need to
place greater emphasis on strategic thinking, according to contemporary
management theory on strategic thinking. Also, the research explores the
nature of the strategy formulation process and the role of analysis, to
attempt to resolve the debate about how new strategies are actually
formed.
The study shows that the proposition that high technology industries will
need to place a greater emphasis on strategic thinking is valid. FurtherSpangaro Systems Pty. Ltd.

Strategic Thinking, Strategic Planning and High-Technology Industries

Justin Spangaro

Executive Summary

more, this emphasis is found to be at the cost of strategic planning, which


tends to be less emphasised. It shows that formulation and analysis in this
situation are more intertwined and interactive, resolving the debate about
the use of analysis in an integrated thinking/planning process. The implication for management in traditional industries is that strategic thinking
should be more emphasised when they are subjected to forces of change
and increasing complexity similar to high technology industries.

Spangaro Systems Pty. Ltd.

October 3, 2000

Chapter 1: Introduction
Synopsis
This final report presents the findings of a study of the strategic management process in the high technology industry in Australia. The research
was conducted by Justin Spangaro in 1999/2000 as the final field
research dissertation for a Masters of Business Administration award at
RMIT University, Melbourne, Australia.

Research Topic: Definition, Background and


Rationale
This research project is a study of the relationship between strategic
thinking, strategic planning and the high technology industry in Australia.
The terms strategic thinking and strategic planning are commonly
used in the literature on strategic management to describe opposite
extremes of a continuum defining the concept of the strategic management process (OShannasy 1999a). At the strategic thinking end of the
continuum, the strategy process is an intuitive, incremental, informal,
emergent, divergent process. Conversely, at the strategic planning end the
process is an analytical, planning oriented, formalised, deliberate, convergent process. However, the definition of strategic thinking is highly
contentious; this research attempts to resolve this confusion.
Debate and controversy in the field about strategic management processes often centres on the tensions between the strategic thinking and

Spangaro Systems Pty. Ltd.

Strategic Thinking, Strategic Planning and High-Technology Industries

Justin Spangaro

Research Topic: Definition, Background and Rationale

strategic planning perspectives (Heracleous, 1998). Contemporary management literature has been seeking to reconcile and integrate these perspectives into a more holistic understanding of the strategy process
(Heracleous, 1998; Liedtka, 1998a; 1998b; Mintzberg 1994a; Mintzberg,
Ahlstrand & Lampel, 1999). Reconciling these opposing perspectives
offers the hope of resolving the dilemma apparent for practitioners of
strategy, that is, how to create an effective strategic management process
that attracts the benefits of both strategic thinking and strategic planning
while avoiding their respective shortcomings.
This study makes a constructive contribution to this debate by investigating the relationship between strategic thinking and strategic planning in
the high technology industry environment.
High technology industries routinely face turbulent and uncertain environments, highly complex products and markets, an unpredictable future,
widespread dissemination of critical competitive knowledge and high
rates of growth, and rely upon constant innovation and creativity to survive. The high-tech environment offers an ideal setting for a study of strategic thinking. Furthermore, many of these problems are the same as
those being faced for the first time by organisations faced with unprecedented forces of technology-driven change.
A competitive local high technology industry has been recognised as critical to the long term economic well-being of Australia (Brain, 2000;
Semple, 2000), and effective strategic management is key to this success.
To contribute to resolving the debate over the nature of the strategic management process, this research specifically examines the relative emphases on strategic thinking and strategic planning in the high technology
sector. The study also explores the nature of the strategy formulation process, particularly the often contentious role of analysis in strategy formu-

Introduction

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Research Aims

lation (Porter, 1979 pp21-22; Heracleous 1998; Mintzberg 1994a;


Mintzberg, Ahlstrand & Lampel 1999, p77).

Research Aims
The aim of this project is to explore and examine the nature of the strategy process, in the context of the high technology industry in Australia.
The relationship between the impact of technology on organisations and
the relative emphasis placed on strategic thinking and strategic planning
are examined. In doing so, the validity of the definitions of strategic
thinking (Liedtka, 1998a) and strategic planning (Boyd & ReuningElliott, 1998) are tested and the two concepts contrasted.
In comparing strategic thinking with strategic planning, this research
makes a contribution by clarifying an important and contentious issue in
the strategy field, that is, how are the apparent incompatibilities between
strategic thinking and strategic planning resolved in practice, and what
are their respective roles?
In particular, this research uncovers and explains strategic management
processes in the Australian high technology sector. These results may
provide the basis for further comparative studies with similar sectors in
other countries, or with other industries within Australia.
The results presented of an analysis of strategy processes for the hightech sector could also have implications for the making of strategy in
other sectors that are now facing unprecedented technological change, for
example the banking and finance sector in an internet-based economy.
Finally, inferences are drawn from this research for the likely evolution of
the practice of strategy-making for industrialised economies as the preva-

Introduction

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Research Questions

lence of the knowledge worker increases and internal and external environments continue to become more complex.

Research Questions
This research aims to answer the following research questions:
1.

2.

3.

4.

How much emphasis is placed on strategic planning in high technology organisations, relative to other types of organisations?
How much emphasis is placed on strategic thinking in high technology organisations, relative to other types of organisations?
Does the criticality of technology to an organisations business influence the balance between strategic planning and strategic thinking in
the strategic management process?
In high technology industries are analysis, strategy formulation and
hypothesis testing through implementation iterative and intertwined
processes or do they tend to be linearly and sequentially related processes.

Introduction

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October 4, 2000

Chapter 2: Literature Review


Synopsis
This chapter examines the academic literature concerning the concepts
of Strategic Planning and Strategic Thinking, and their relationship to
each other and the strategy process. It also reviews, in this context, strategy in the high technology industry.

Introduction
The field of strategy has evolved over the last 35 years or so (OShannassy 1999a). Over time, the emphasis has shifted from strategic planning to the more contemporary concept of strategic thinking (Mintzberg
1994a; 1994b). However, as Heracleous (1998) states:
The relationship between the two ideas of strategic planning and strategic thinking is by no means clear in the literature, which is in a state of
confusion over the issue. Strategic planning is often used to refer to a
programmatic, analytical thought process and strategic thinking to refer
to a creative, divergent thought process.

It is argued that strategic planning and strategic thinking both have their
place in the strategy process (Mintzberg 1994a; Heracleous 1998;
Liedtka 1998a), and that both are necessary for effective strategy (Heracleous 1998; Liedtka 1998a).
This literature review explores the relationship between strategic planning and strategic thinking as these two concepts appear in the academic
literature on the subject. Attempts to reconcile these seemingly contra-

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The Concept of Strategy

dictory ideas are examined, revealing a holistic view of strategy that


includes both concepts, and that strategic planning can be seen as singleloop organisational learning and strategic thinking as double-loop learning. In this view, both analysis and intuition are used in a balanced way.
Still, contention remains over how strategic planning and strategic thinking relate to the strategy process, particularly which concept is most relevant to the creation of new, innovative and by implication more
successful strategies.
Reviewing literature on strategy in the high technology industry, it is similarly found that there are opposing forces of alignment and disruption, of
analysis and intuition and deliberateness versus emergence at work. The
nature of the strategy process is found to be dependent on a complex
range of contextual factors such as internal and external complexity, environmental turbulence, organisational size and technological flexibility.
Within this contextual framework, there appears to be scope to reconcile
strategic thinking with strategic planning by appropriate balancing of the
emphasis on each process.

The Concept of Strategy


The historical origin of the concept of strategy is generally based in the
use of strategy in the military domain as a means to victory in times of
conflict. The writings of Sun Tsus The Art of War (1971) circa 400
B.C. are often quoted in business strategy literature as one of the earliest
works on strategy (Mintzberg 1994b, p6).
Turning to more peaceful applications of strategy in the business
world, the meaning of strategy can be taken in a variety of contexts.
Ansoff (1965), one of the earlier significant authors on corporate strategy
defined strategy as a concept of the firms business that has a common

Literature Review

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The Concept of Strategy

thread that pervades the business. This common thread is a relationship


between present and future product-markets which would enable outsiders to perceive where the firm is heading, and the inside management to
give it guidance.
Compare Ansoffs views with Andrews (1980b, pp43-44), who suggests
that corporate strategy is the pattern of company purposes and goals and the major policies for achieving those goals - that defines the business or businesses the company is to be involved with and the kind of
company it is to be. He goes on to then also explain that strategy is an
organisation process, which is in many ways inseparable from the structure, and can be distinctly divided into formulation and implementation.
The various views defining strategy are integrated by Mintzberg (1987;
1994b; Mintzberg, Ahlstrand & Lampel 1999, pp9-15) into a five Ps
view of strategy, not as components but as five discrete concepts on the
nature of strategy. Strategy can be a plan, a consciously intended course
of action, or a pattern, seen as consistency in behaviour, intended or not.
Strategy can mean an aspect relative to the environment, or a position.
Strategy can be the set of views and beliefs held about the organisation
and the world around it, providing a perspective. Or, finally, strategy can
be a deliberate maneuver intended to outwit an opponent, thus a ploy.
Perhaps in this five Ps representation of strategy, we can recognise the
dimensions of strategy identified by Andrews: pattern of . . . purposes
and process (pattern), defines the business (perspective), policies
for achieving . . . goals (plan).
Ansoffs earlier definition can similarly be reconciled with the five Ps:
concept of the firms business (seems like perspective), common
thread (pattern), where the firm is heading (plan). Interestingly, Mintzberg (1994b, p43) describes Ansoffs views of strategy as pattern and
plan, but not perspective.
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The Concept of Strategy

Key to the definition of strategy and particularly strategy formulation is


the tension between the incrementalist perspective and the planning perspective of strategy. The planning perspective takes the view that strategies should be deliberately planned and executed, whereas the
incrementalist perspective sees strategy formulation more as a process of
experimentation, innovation, learning and organisational development
(De Wit and Meyer 1998).
The planning perspective favours the view that a realised strategy can
and should be a deliberate strategy, whereas the incrementalist view
accepts that a strategy may be emergent, that is, arises from forces and
causes outside the control of the would-be planners, and also that some
strategies may never be realised (unrealised strategies). Mintzberg and
Waters (1985) introduced this concept of emergent strategy, as shown
in Figure 1 on page 16.
FIGURE 1.

Forms of Strategy (Mintzberg and Waters 1985)

int
e

nd

ed
str
a

teg
y
del
ibe

unrealised
strategy

rat

es

tra
t

egy

realised strategy

y
trateg
S
t
n
ge
Emer

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The Concept of Strategy

A further important contribution by Mintzberg, Ahlstrand and Lampel


(1999) to the understanding of the many dimensions of strategy has been
the classification of our understanding of strategy into ten schools of
thought. The first three schools are prescriptive, about how strategies
should be formulated: the Design School, where strategy formation is a
process of conception; the Planning School, strategy formation being a
formal process; the Positioning School, strategy formation as an analytical process. Another six schools describe how strategies really do get
made: the Entrepreneurial School, where strategy formation is a visionary process; the Cognitive School - strategy formation as a mental process; in the Learning School strategy formation is an emergent process; in
the Power School strategy formation is a process of negotiation; the Cultural School where strategy formation is a collective process; and the
Environmental School where strategy formation is a reactive process.
Finally the Configuration School stands alone with strategy formation as
a process of transformation, somewhat integrating aspects of the other
schools into regarding strategy as a process of change of state.
These ten schools provide a valuable framework for managing and understanding the complexities of strategy1. The five Ps of strategy are complementary to these ten schools in providing an overall structure for
making sense of a definition of strategy.
As can be seen, the definition of strategy itself is complex, multidimensional and often contentious. To plan strategy, to think about strategy, to
understand strategy requires an appreciation of the nature of strategy
itself. Any attempt to define strategic planning and strategic thinking
must be made within this context.

1. Crouch and Basch (1997) conducted a study examining the lexical and content analysis of the
cognitive process of strategic thinking. The results indicated that there was no evidence of representation of the planning, cultural or environmental schools in the process of strategic thinking.

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Strategic Planning

Strategic Planning
Strategic planning in the commercial world evolved since the late 1800s
in five principal stages identified by Hax and Majluf (1984) as:
1.

Budgeting and financial control (1890 - 1930)

2.

Long range planning (1930 - mid 1950s)

3.

Business strategic planning (mid 1950s - late 1960s)

4.

Corporate strategic planning (1970s)

5.

Strategic management (1980s). (Pfeiffer 1984, pp371-380)

In strategic plannings heyday, centralised strategic planning departments


were heavily staffed with armies of planners who developed grand strategies for the masses to implement. However, in the mid 1980s, Pfeiffer
(1984, p377) noted a strong trend towards reintegrating planning with
execution and increasing the involvement of operations in the planning
function, a separation between formulation and implementation that had
existed since the turn of the century.
Strategic planning, such as it was, gradually fell from favour beginning in
the early 1970s. Much of the evidence suggested that planning either
was ineffective or did not consistently produce improved performance. In
many cases planning was simply not done, as it had been found to produce poor results. In one study by Jacques Sarrazin (1975; 1977/78),
planning was found to be an ineffective process for making strategic
decisions; output information was not available on time, planning could
not handle the complexities of the environment, and it merely served to
enhance conflict within the organisation. The main benefit of planning
seemed in this study to be for management to attempt to regain control
over the decision making process (Mintzberg, 1994b, pp 92-107).
Despite the mixed success of planning sorties, Andrews (1980a) provides
insight into the actors involved in the planning process, prescribing the
appropriate role for the board in the making of strategy. He sees planning

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Strategic Planning

as a formal, centralised process for the benefit of the board, and involving
senior management and the board. He suggests conducting the typical
formal annual strategy review as the fabled executive retreat, making
only passing reference to the need to encourage creativity. He recommends the use of Corporate Strategy Committees, comprised mostly of
board members with one-way input from business segments, as a methodology to make strategy formulation better informed and relevant.
Prahalad and Hamel (1990) introduced the concept of core competencies of the corporation, which should constitute the focus for strategy at
the corporate level (p299). This view integrates markets, products and
the organisation into a single combined perspective about what the organisation does particularly well. In this sense, planning revolves around
making sure that you exploit your Strengths and shore up your Weaknesses to be able to capitalise on Opportunities and defend against
Threats. Considering strategy as Position, the planning strategist navigates the core competence of the organisation to profitable waters. The
responsibility for identifying and developing the required core competence still sits in this view with the top level corporate planners. Mintzberg, Ahlstrand and Lampel (1999, p218) assign this core competence
notion of strategy to the Learning School.
Characteristics of strategic
planning

The nature of strategic planning can be described in terms of the following characteristics:
Analytic. Planning is

a process of analysis, number crunching, evaluation.

(Porter 1979)
Formalised. Planning

is a formal, mechanistic process to which tools may

be applied to improve the quality of the result (Ansoff 1965; Porter 1979;
1985; 1990)

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Strategic Planning

Detached. Planning

separates formulation from implementation, and the

planners from those implementing (Andrews 1980a; 1980b) (also Ohmae


(1982, p206) laments this detachment as separation of the brains from
the muscle).
Convergent. Planning narrows down, systematically eliminates alternatives

(Mintzberg, Ahlstrand & Lampel 1999).


Scientific. Planning

can be applied as a scientific method (OShannassy

1999b).
Engages left-brain (or right-handed planning). Planning

favours analytic

cognitive processes associated with the functioning of the left hemisphere


of the brain (Mintzberg 1994b, pp393-396).
Critics of traditional strategic planning (Mintzberg 1994a; 1994b, p60,
pp92-97; Mintzberg, Ahlstrand & Lampel 1999; Ohmae 1982; Stacey
1996) claim that strategic planning fails to lead to formulation of winning
strategies, and that strategic planning is really best conceived as strategic programming (the implementation of already formulated strategies)
(Mintzberg 1994b, p415).
Strategy formulation

Such criticism generally centres around the lack of opportunity for creativity, innovation, questioning of paradigms or the use of intuition in the
planning process. Consider Porters (1979, pp21-22) description of the
process under the heading Formulation of Strategy:
Once having assessed the forces affecting competition in an industry
and their underlying causes, the corporate strategist can identify the
companies strengths and weaknesses . . . Then the strategist can devise
a plan of action that may include (1) positioning the company so that its
capabilities provide the best defense against the competitive force; and/
or (2) influencing the balance of forces through strategic moves, thereby
improving the companies position; and/or (3) anticipating shifts in the
factors underlying the forces and responding to them with the hope of
exploiting change by choosing a strategy appropriate for the new competitive balance before opponents recognise it.

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Strategic Planning

It may be argued that influencing the balance is the chief aim of creative strategy making (and apparently where planning has failed to
deliver). In this view, analysis clearly precedes strategy formulation.
Mintzberg, Ahlstrand and Lampel (1999, pp 66-79) claim that the concept that strategic planning may be used to formulate strategy is fallacious. They identify these fallacies of strategic planning: the fallacy of
predetermination (the environment is sufficiently predictable as is
required by planning), the fallacy of detachment (that strategists can
purely rely on hard data to remain separate from the objects of their strategies to remain detached from operations) and the fallacy of formalisation (that internalisation, comprehension, synthesis, insight and intuition
can be systematised and formalised to produce strategic thinking).
The sum of these misconceptions comprises the grand fallacy of strategic planning: Because analysis is not synthesis, strategic planning has
never been strategy making (p77).
Planning Today

Recent evidence (Glaister & Falshaw 1999) suggests that strategic planning is still used by most large companies. The strategies realised are
more deliberate rather than emergent, and formulation of strategy stems
from a deliberate process. Most plans address a time horizon of less than
five years. The tools used in the planning process are predominantly simple spread sheet what if analyses, analysis of critical success factors,
financial competitor analysis and SWOT analysis; relatively unsophisticated methods. Planning emphasizes closely related markets over totally
new markets. Strategic planning is seen as important and an effective way
to achieve improved performance.
Despite the chequered history of strategic business planning, the basic
premise that good strategy can lead to better outcomes is well rooted in

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Strategic Thinking

human history, and strategic planning has been an important feature of


business management for over forty years.

Strategic Thinking
The definition of strategic thinking is contentious in the academic literature (OShannassy 1999b; Heracleous 1998). There are schools of
thought about strategic thought, if you like.
The strategy paradigm has evolved in the 1990s (OShannassy 1999a);
the modern concept of strategy, strategic thinking, sees strategy making
itself as a creative, intuitive, non-linear process, not able to be formalised
or mechanised by a typical strategic planning approach (OShannassy
1999a; 1999b; Ohmae 1982; Mintzberg 1994b, pp381; Mintzberg, Ahlstrand & Lampel 1999, p72) and that attempting to formalise the process
actually critically inhibits the organisations ability to think strategically
(Stacey 1996, pp412-414).
Strategic thinking is then central to the strategy process, whereas strategic planning applies around the process (Mintzberg 1994b, p331; 1994a,
p108).
In another view, Porter (1991) and others see strategic thinking as a convergent and analytical process, and consider that such analysis is central
to the strategy making process (Heracleous 1998).
Ohmae (1982) integrates analysis ideally as part of the creative strategic
thinking process, as shown in Figure 2 on page 23. There are similarities
between this view and Mintzbergs (1994b) view that planing and analysis support the strategic thinking process (also Mintzberg, Ahlstrand &
Lampel 1999). The use of non-linear brain-power remains the essence of
strategic thinking (Ohmae 1982, p13).

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Strategic Thinking

Stages of strategic thinking (Ohmae 1982, p20)

solving the problem

typical
short
circuit

Phenomena

Draft plan of actions

Grouping

Giving concrete form to


conclusions

Abstraction
Emergence of conclusion
Determination
of approach

Validation or rebuttal of
hypothetical solutions
by in-depth analysis
Provisional formulation of
hypothetical solutions

Implementation
by line managers

planning for implementation

FIGURE 2.

Liedtka (1998a; 1998b) attempts to resolve this analytic/intuitive debate


over the nature of strategic thinking, claiming that in fact strategic thinking is both. She proposes a model of the elements of strategic thinking
(see Figure 3 on page 24). Being hypothesis-driven, strategic thinking
iterates hypothesis generation (creative) and testing (analytical). Similarities are apparent between this conceptualisation of hypothesis-driven
strategic thinking and that of Ohmae (1982).

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Strategic Thinking

FIGURE 3.

The elements of strategic thinking (Liedtka 1998b, p122)

intent
focused

systems
perspective

Strategic
Thinking
intelligent
opportunism

thinking
in time

hypothesisdriven
This model also recognizes strategic intent (Hamel & Prahalad 1989;
Prahalad & Hamel 1990); that strategy creates and depends on tension
between current circumstances and a desired future. It integrates the
understanding that strategic thinking connects the past, present and future
(thinking in time), that strategies can be emergent as well as deliberate
(Mintzberg 1987) (intelligent opportunism), and that, as in the traditional
planning literature, strategy is about a holistic view of the organisation
and its environment (systems perspective).
In contrast to Porters (1979) strategic planning based view, in the strategic thinking paradigm analysis supports formulation, but does not strictly
precede it. If strategic thinking were observed, analysis would be at least
partly driven by attempts at formulation in iterative hypothesis-testing
cycles (Ohmae 1982; Liedtka 1998).

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Connecting Planning with Thinking - the Evolution of Strategy

Connecting Planning with Thinking - the Evolution of


Strategy
Several authors (Heracleous 1998, Mintzberg 1994a; 1994b; Mintzberg,
Ahlstrand & Lampel 1999; Liedtka 1998a; 1998b) have attempted to
integrate the seemingly opposite concepts of strategic planning with strategic thinking without throwing the (strategic planning) baby out with
the bathwater (Liedtka 1998a). Generally these authors agree that both
planning and thinking are needed for effective strategy.
Wilson (1994) suggests that strategic planning has evolved to strategic
management (or thinking). He states that harnessing the power of opposites is necessary to be able to apply both strategic planning and strategic thinking to the problems of management (Wilson 1998), in particular
being able to balance analysis with intuition, and between holding to a
strategic vision and having flexibility in tactical action. In a similar vein,
Butler et al. (1998) describe the need to balance tensions between errors
of tightness and errors of looseness in decision making and control of
organisations.
Strategic conversations are suggested to be one means of integrating
the planning process with thinking activities (also Taylor 1997):
The most valuable role strategic planning processes play is to legitimize a developmental dialogue around strategic issues, the outcome of
which is both better strategy for an organisation and better developed
strategic thinking capabilities in its members (Liedtka, 1998b, p124).

Combining strategic thinking and strategic planning can also be viewed


as having complementary impacts on McKinsey 7S alignment/disruption
(see Figure 4 on page 26):
A broadened view of the strategy making process . . . would incorporate both strategic thinking and strategic planning as related activities . .
. in an ongoing process of creating and disrupting the alignment
between an organisations present and its future (Liedtka 1998a, p33)

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Connecting Planning with Thinking - the Evolution of Strategy

FIGURE 4.

Strategy Making as Creating and Disrupting Alignment (Liedtka,

1998a)

S tra te g ic T h in k in g
D isru p tin g
A lig n m e n t

C u rre n t
R e a lity

D e s ir e d
F u tu r e

S tra te g ic P la n n in g
C re a tin g
A lig n m e n t

This relationship between strategic thinking and strategic planning may


be explained in part by the view of the strategy process on which they
focus. Strategic planning focuses on the cross-sectional problem (performance at a point in time) whereas strategic thinking focuses on the longitudinal problem (how strategies are arrived at) (Heracleous 1998).
Single-loop/ double-loop
learning

Heracleous (1998) proposes a dialectic view of strategy, where thinking


and planning are seen as different forms of organisational learning, based
on established learning models (Argyris 1977; Senge 1990; Bateson
1972). Strategic planning can be viewed as simple, or single-loop learning, whereas strategic thinking is complex or double-loop learning.
Similar ideas are presented by Stacey (1996). Single-loop (simple)
learning occurs where the organisation uses a fixed mental model (or
plan) and adjusts within a given set of action alternatives, as shown in
Figure 5 on page 27.

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Connecting Planning with Thinking - the Evolution of Strategy

FIGURE 5.

Simple single-loop learning model (Stacey 1996, p63)


Consequences
and other changes

Acting

Discovering

Choosing

Double-loop learning, however, is where the mental models, assumptions and choice of action alternatives themselves are adjusted to adapt to
the results, as shown in Figure 6 on page 27. Complex learning is the
shifting, breaking and creating of paradigms (Stacey 1996, p65)
FIGURE 6.

Complex Double-loop learning model (Stacey 1996, p64)


Consequences
and other changes

Previous Mental
Model
Acting

Discovering

New Mental
Model
Choosing

This single-loop/double-loop representation of strategy captures both the


creative and the convergent aspects of strategy. Strategy as organisational
learning fits into the learning school, and can be a messy process, but
still requires a great deal of sophistication (Mintzberg, Ahlstrand &
Lampel 1999, p230).

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Connecting Planning with Thinking - the Evolution of Strategy

In this dialectic view, the strategist uses both synthetic and analytical,
divergent and convergent processes for making strategy. This enables the
strategist to go up and down the ladder of abstraction . . . being able to
see both the big picture and the operational implications (Heracleous
1998). This process is represented by Figure 7 on page 28.
FIGURE 7.

Strategic thinking and strategic planning (Heracleous 1998, p485)

Strategic Thinking
Thought process:
synthetic
divergent
creative

The purpose of strategic thinking is to


discover novel, imaginative strategies
which can rewrite the rules of the
competitive game; and to envision
potential futures significantly different
from the present

strategic
management
The purpose of strategic planning
is to operationalise the strategies developed
through strategic thinking, and to support
the strategic thinking process.

Thought process:
analytical
convergent
conventional

Strategic Planning

This learning model of strategy is particularly applicable to the high technology organisation in a turbulent environment:
Some organisations face perpetual novelty. . . their environments are
dynamic and unpredictable, which makes it difficult to converge on a
clear strategy at all. In this case, the structure tends to take the form of
adhocracy, or project organisation, and the learning approach becomes
almost mandatory - the means to work things out in a flexible manner.
At the very least, it allows the organisation to do something to respond
to an evolving reality in individual steps instead of having to wait for a
fully determined strategy (Mintzberg, Ahlstrand & Lampel 1999,
p229).

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Strategy and High Technology Industries

Analysis versus intuition

An effective balance between the use analysis or intuition is necessary;


an excess of either in decision making leads to dysfunction and either
paralysis by analysis or extinction by instinct (Langley 1995).
This tension between analysis and intuition is often recognised: Innovative strategies do not emerge from sterile analysis and number-crunching:
they come from new insights and intuitive hunches (Wilson 1994). Such
comments are reactions to the inability of traditional strategic planning to
stimulate creativity in strategy making. Integrative authors (Heracleous
1998; Mintzberg 1994b, p324-330; Mintzberg, Ahlstrand & Lampel
1999; Liedtka 1998) argue that rather than an either/or proposition, both
analysis and intuition are necessary, in the right contexts, for successful
strategy making.

Strategy and High Technology Industries


The contextual focus for an examination of the strategy process for this
study is the high technology industry sector.
Strategic planning for technology products is the leading unresolved
technology management problem faced by the high technology industry
in new product development (Scott, 1999) and high technology industries
have unique characteristics that make an examination of strategic thinking particularly interesting, in particular with respect to environmental
turbulence or uncertainty, market dynamism and organisational, product
and environmental complexity.
In the high technology sector, the internal and external environments are
increasingly complex, and strategies are usually incremental and emergent (Lowendahl & Revang 1998). Innovation and organisational learning are critical factors to success (Mintzberg, Ahlstrand & Lampel 1999,
Claver et al., 1998 p56). Creative new strategies are required to deal with

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Strategy and High Technology Industries

significant changes to the competitive landscape and to capitalise on


opportunities offered by the emergence of new technologies. The unpredictability of the future may make traditional long range planning difficult and somewhat futile (Franko, 1989 in Diaz and Gomez-Mejia, 1997
p303). The complexity of products, technologies and markets makes it
additionally difficult for planners to remain detached from those who
must implement.
Specifically, the flexibility of an organisations core technologies impacts
the relationship between organisational complexity and the degree of formalisation of the strategy process (Yasai-Ardekani and Haug, 1997). It
was found in their study of contextual determinants of the strategy process that technological flexibility moderated the impact of organisational
complexity on the degree of formalisation of the strategy process. They
found that the more complex the organisation, the more formal the planning process became when core technologies were inflexible, but that the
process actually became less formal with increasing organisational complexity when the core technologies were flexible. They also found that
top managements involvement decreased under competitive pressure and
when core technologies were inflexible, suggesting that top management may (consequently) restrict its role in planning to review, choice
and authorisation of strategic proposals and plans. (p738).
We may perhaps draw some inferences from Yasai-Ardekani and Haugs
(1997) study. More flexible technologies may also produce greater rates
of technological change and uncertainty. Strategic moves by (equally
flexible) competitors may be harder to predict. There may also be a wider
real choice of potential opportunities to choose from that are based on
emerging technological and marketplace changes. To cope with this situation, as organisations become more complex planning gives way to less
formal strategic thinking, engaging in double-loop organisational learning by relying on proposals from within the organisation to provide

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Strategy and High Technology Industries

options and ideas rather than relying on their own limited mental models
of the competitive landscape.
In another study, Drago (1999) found that different types of organisational complexity affected strategic complexity. He examined product
diversity, vertical integration and international scope. Vertical integration
increased strategic complexity, while increased product diversity actually
led to a simplification of strategic complexity, or a focus on fewer competencies. It is suggested that this simplification is a result of focusing
towards areas of synergy.
In high technology industries the competitive environment is characteristically turbulent. Hodgekinson (1997) conducted a study that examined
cognitive inertia in turbulent markets (in real estate, in his study),
revealing that mental models of the competitive landscape can tend to
remain stuck in the face of obvious changes (hence cognitive inertia).
Such failure to adapt probably leads to poor strategy formulation and
strategic failure (p940). Apparent in this image is the single-loop versus
double-loop learning discussed previously. He concluded that within
volatile business environments changes in mental models of competitive
space significantly lag behind the changes in the material conditions of
the marketplace implying that actors should periodically engage in a
period of individual and collective reflection in order to reconsider anew
the extent to which their assumptions and beliefs about the external environment provide a viable basis on which to build effective strategies for
competitive success (Hodgekinson, 1997 p940). If we accept that high
technology industries operate in turbulent environments, and that narrowing this gap or lag between mental models and the changes in the marketplace leads to better strategy formulation, this conclusion adds weight to
the argument that strategic thinking as double-loop learning is critical for
strategic success.

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Strategy and High Technology Industries

Examining the prescriptive literature on strategy formation in a high technology environment, much of the literature proposes methods for alignment of the technology strategy with the objectives of the corporate
strategy (e.g. Barker and Smith 1995; Adler, McDonald and McDonald
1992). Such alignment processes are primarily strategic programming
functions.
However, in line with the trend away from top down planning, some
authors emphasise the influence technical strategy and technical issues
may have on corporate strategy (e.g. Schroederer, Congden and Gopinath, 1995; McGrath, 1995). As Schroederer, Congden and Gopinath
(1995, p185) state: Although a new technology is generally adopted to
support a given strategy, the technologys full capabilities are often
unknown prior to their use. Consequently, exploiting the technologys
complete competitive advantages requires adjustment in the firms strategy.
The tension is apparent between creating alignment of technology strategy with the corporate strategy, and the disruptive, misalignment provoking effects of the introduction of new technologies and the creation of
new possible futures and consequent revision of the original strategy.
This process of alignment and misalignment, convergence and divergence parallels Heracleous (1998) and Leidtkas (1998a) description of
an integrated strategy making process that combines both strategic planning and strategic thinking. This process can also be seen as double-loop
organisational learning, redefining understanding of the firms view of
the competitive space as new possibilities or realities emerge.
Organisational processes for technology strategic management vary. In a
study of 95 large firms worldwide Roberts (1995) noted significant differences in the role technology played in corporate strategy formulation
between U.S., Japanese and European firms. Notably, Japanese compa-

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Strategy and High Technology Industries

nies have more chief technologists on company boards, more thoroughly


link technology strategies to overall corporate strategies and they have a
greater upward influence on overall corporate strategy than their U.S.
counterparts, suggesting that Japanese firms are structured to better facilitate the dialectic alignment/disruption process.
Despite the apparently emergent and unpredictable nature of strategy in
the high-tech environment, engaging in appropriate formal planning is
effective to improve performance. Covin and Slevin (1998) examined the
effects of risk taking and adherence to plans as predictors of firm sales
growth, and found that adhering to (formal) plans has a particularly positive effect on firm sales growth in technologically sophisticated environments, and also that minimising unnecessary risk taking was also an
effective measure to obtain growth. They suggest that strategic flexibility . . . will most effectively occur within the context of a broadly defined
plan (or) umbrella strategy (p231). Suggesting that both formal planning and maintaining strategic intent are important elements of an effective strategy process.
Roberts (1991), one of the most widely published authors on technology
management, also found that formal strategic planning and market
research correlates with success in high-technology companies, adding to
the evidence that traditional strategic planning is an important element of
the strategy process.
Berry (1998) conducted a study of the existence of formalised strategic
planning in 257 small high technology companies in the U.K. She
observed levels of planning formalisation, ranging from non-planners
to formal financial, non-strategic planners then formal financial, informal
strategic planners and finally formal strategic planners.
She concluded that the degree of formalisation of planning was principally a function of the size and complexity of the firm and the business/
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Strategy and High Technology Industries

technical experience mix of management. The more complex (larger) the


firm the more formal the planning process becomes. She concludes that
formalised strategic planning is unnecessary in the early stages of a hightech companies life, but is important to long term growth and development. Interestingly, the formal financial, informal strategic planner
type characterises a strategic thinker, whereas the formal strategic planner is more like a strategic planner, suggesting that the relative dependence on either strategic thinking or strategic planning varies depending
on organisational context and management experience.
In addition, she concludes that whether formal or informal strategic
planning is carried out, managers should emphasize the substantive analytical elements of the process (p463), suggesting that strategic thinking
alone is not seen as delivering sufficient analytical rigour.
Berrys (1998) conclusions appear to contradict the findings of
Lowendahl and Revang (1998). They found that as the internal environment of the organisation becomes more complex (while in a complex
external environment), strategy becomes more emergent and incremental
and structure becomes more fluid. These views may perhaps be reconciled: If the critical dependence on innovation diminishes as companies
mature, then the use of more formal systems and structures for strategy
development may be feasible (Lowendahl & Revang 1998; Butler et al,
1998).
In high technology companies R&D is often the core function of the firm
(Diaz and Gomez-Mejia, 1197 p302). Particularly in firms with less product diversification, product strategy has elevated significance, and a discussion of high technology strategy would not be complete without some
reference to product strategy. McGrath (1995) identifies the elements of
product strategy, represented by Figure 8 on page 35). However, he

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Strategy and High Technology Industries

makes an important distinction between corporate strategy and product strategy:


Real product strategy differs from other management activities that
sometimes masquerade as product strategy (such as annual planning).
These activities have a useful purpose in the management of an enterprise but should not be confused with product strategy . . . in fact it is
entirely different than planning. . . Product strategy is not the responsibility of strategic planners (McGrath 1995, pp259-261 in ch14 Strategic Thinking).
Overview of the Product Strategy Process. Illustrates the primary
elements along with their relationships (McGrath 1995, p248).
FIGURE 8.

strategic
vision

strategic
balance

resources

competitive
strategy
differentiation
strategy

expansion
strategy

platform
strategy

supporting
strategies:
- time-based strategy
- cannibalisation
- global product
strategy

core
competencies

innovation
strategy

price-based
strategy

product-line
strategy

It can be seen that strategy in high technology industries is both formal


and informal, deliberate and emergent, aligning and disruptive. The exact
nature of the strategy process varies between organisations, and can

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Conclusion

depend on a wide range of factors including technological flexibility,


organisational, environmental and product complexity, environmental
turbulence, management experience, organisational size and risk orientation. Differences in approach can lead to impacts on organisational performance. Both strategic thinking and strategic planning are evident in
the literature, and it may be argued that both are necessary for strategic
success, although this claim is highly dependent on many contextual factors.

Conclusion
This literature review has examined three principle issues: strategic planning, strategic thinking and strategy in the high-technology industry.
The definitions of strategic thinking and strategic planning are highly
contentious, and a range of views on definition have been presented. Strategic planning is generally considered to be an analytical, formal, convergent process, whereas strategic thinking is a creative, divergent, intuitive
process of strategy development. Both appear to be important for effective strategy. Contention exists around how successful, ground breaking
strategies are formulated, with some authors claiming that planning creates strategies, while others insist that strategic thinking does.
Some authors have attempted to resolve this dilemma by integrating the
two processes into a dialectic or holistic view, balancing intuition and
analysis, and regarding strategic planning as single-loop organisational
learning, whereas strategic thinking is double-loop learning.
In literature on strategy in the high technology sector evidence of both
strategic thinking and strategic planning may be found. The nature and
likely effectiveness of the process employed is dependent on a wide
range of contextual factors. Balancing the tensions between strategic

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Conclusion

thinking and strategic planning with consideration of these complex contextual factors is the art of strategic management in high technology
industries.

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Conclusion

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Introduction

Chapter 3: Field Research


Introduction
This chapter describes the design of the research project, the research
hypotheses tested and the operationalisation of the research constructs.

Research Design
Two research models were constructed to describe the relationships
between phenomena being investigated. Research Model 1 is designed to
primarily investigate the relationship between the criticality of technology on an organisation and the balance between strategic thinking and
strategic planning employed in the organisation.
Secondly, moderating factors or control variables are measured to determine the influence that these factors may have on the relationship
between the criticality of technology and the strategic thinking/strategic
planning balance. Research Model 1 is depicted in Figure 9 on page 39.
FIGURE 9.

Research Model 1

technological inflexibility
organisational complexity and size
environmental hostility
need for innovation
environmental turbulence
product diversity
management experience

balance between
strategic thinking
and strategic
planning emphasis

criticality of
impact of
technology

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Research Design

Research Model 2 is designed to empirically test the thesis that strategic


thinking and strategic planning occur in iterative, hypothesis generation hypothesis testing cycles as suggested by Mintzberg (1994a, 1994b),
Liedtka (1998a; 1998b) and Heracleous (1998), rather than in a linear,
single pass of analysis then formulation in line with the views expressed
by Porter (1979). Research Model 2 is shown in Figure 10 on page 40.
Research Model 2 evaluates whether there is a relationship between the
criticality of technology and the iterative/linear nature of the relationship
between formulation and analysis processes. As with Research Model 1,
moderating factors or control variables are measured to determine the
influence that these factors may have on the relationship between the criticality of technology and the relationship between formulation/analysis
processes.
FIGURE 10.

Research Model 2

technological inflexibility
organisational complexity and size
environmental hostility
need for innovation
environmental turbulence
product diversity
management experience

formulation and
analysis are
iterative or linear
processes

criticality of
impact of
technology

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Research Methodology

Research Methodology
This research employed a hypothetico-deductive research methodology.
Inductive/Deductive
Methodology

Seth and Zinkhan (1990) identify that approaches anywhere on the continuum of research methods from the inductive to the deductive can be
valid for the study of strategy. In this case, a deductive methodology is
preferred. It is noted, however, that given the complexity of the phenomena being examined, scope remains for inductive analysis particularly in
regard to the phenomena of strategic thinking and the nature of the relationship to strategic planning.

Hypothesis testing/
falsification

Seth and Zinkhan (1990) further address falsification versus testing in


strategy research. In consideration of their view presented that Popperian
falsification is an inferior theory validation method than hypothesis testing, the research hypotheses are subjected to empirical testing.

Time period of research

The study was cross-sectional (taken at a single point in time); no longitudinal (over time) research was conducted.

Quantitative and Qualitative


Methods

Data was obtained by means of a formal written survey. A combination


of quantitative and qualitative methods were used to investigate the phenomena being examined by the research questions.
The process of strategic planning, is an overt, typically formalised, externalised and deliberate process. As such, this phenomena lends itself to
positivist/quantitative approaches for identification and analysis. A multiple indicator measure of strategic planning was used to improve the measurement reliability (Boyd & Reuning-Elliott, 1998).
Conversely, strategic thinking, the intuitive, possibly covert, informal,
internalised and often emergent process is more difficult to quantify. Artifacts of strategic thinking are not so readily available. To study this phe-

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Research Methodology

nomena, five sub-constructs and three underlying assumptions were


measured on a quantitative scale, then combined to form an overall measure of strategic thinking. In general the questions required subjective
evaluations about the organisation.
Both the planning and thinking measures were supported by qualitative
data gathered by written comments volunteered on the survey by participants, and also through a small number of structured and unstructured
interviews with participants to add depth and insight to the interpretation
of the survey data.
The research also investigated process sequences, that is, whether formulation and analysis are sequential and discrete or iterative and intertwined
processes. The nature of the process sequence was measured quantitatively by particpants responses to subjective likert scale survey questions.
Measurement scales

Likert scales were generally used to measure survey quantitative data. A


combination of five-point and seven-point scales were used. Five-point
scales are generally likely to provide the optimum data reliability where
the respondent is not highly trained in the area, and seven point scales
where the subject is more knowledgeable (Van de Ven & Ferry, 1980,
pp63-65). Generally the choice on number of scale points (five or seven)
was made based on prior research the operationalisation of the research
variable was derived from and for consistency with other items in the
construct.
The survey instrument used is provided in Appendix A: on page 89. A
brief summary of the questions from this survey is also provided in
Table 2 on page 48.

Data Collection Methods

The majority of data gathered for this survey research was obtained by
means of a written quantitative survey, generally either sent and returned
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Research Methodology

by post, but occasionally surveys were returned in person. In several of


the cases where the surveys were returned, respondents were invited to
make any additional comments on the issues raised in the survey. This
verbal feedback was useful in general to aid interpretation of the survey
results, and to gain more qualitative insights into the matters under study
and qualification of the responses. Care was taken to avoid detailed discussion of the survey prior to the participant completing the questionnaire to avoid unintentionally biasing the results; all participants were
provided exactly the same preliminary information and survey questionnaire. Space was also provided for respondents to volunteer additional
written comments on the subjects investigated by the survey if they
wished. These comments provided valuable qualitative information to
assist in interpretation of the results.
Sample Design

Thirty-three surveys were sent to participants, from which twenty-one


responses were received, giving a response rate of 64%. The initial batch
of surveys were targeted specifically at companies in the high technology
industry. Later surveys were targeted at senior management in more traditional industries. Lower-tech industries were included in order to
increase the reliability of measurement of the association between criticality of dependence on technology and dependent planning variables.
The survey included responses from ten different companies, all based in
and around Melbourne, Victoria. While surveys were also sent to companies outside Victoria (e.g. Sydney), no responses from interstate were
received. However, as it is known that many of the respondents managed
operations that spanned both interstate and international borders, it is
expected that the results can reasonably be generalised across Australia.
Participants were targeted by a variety of methods. In most cases, participants were identified through the researchers personal business network,
and referrals within that network. While not strictly random, this method

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Research Methodology

was very effective at locating and targeting respondents who were most
qualified to respond to the survey and to obtain a high response rate. Generally, the closer to the personal network the invited participant was the
more likely that a well considered response would be received. Participants were offered a copy of the research findings to add incentive to
complete the survey and to give adequate consideration to their
responses.
In other cases, specific companies with a profile of success in the high
technology industry in Australia were selected based on general industry
knowledge. Contact was made by phone to request participation, and followed up with a mailed survey package. In some cases this was successful in obtaining a response and several participants were kind enough to
consent to an interview as well. The structured interview questions used
are provided in Appendix B: on page 99.
The types and size of companies surveyed ranged from mid sized local
companies to divisions of large multinationals and Australian based public companies with substantial international operations. Organisational
complexity was measured by the survey as an independent variable.
Fieldwork

All research activities including participant selection, survey handling,


responding to queries, gathering of feedback on the survey, keying of survey data and structured interviews were performed by the principle
researcher (Justin Spangaro). A database was maintained of participants
and results catalogued to facilitate double-checking of responses for
recording accuracy.

Data Analysis Methods

From the literature and the research aims, a set of independent variables
and a set of dependent variables were identified as shown in Research

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Research Methodology

Models 1 and 2. The variables used in the research are summarised in


Table 2 on page 48.
TABLE 1. Research

Type of
variable
dependency
Dependent
variables

Variables/Constructs used in the research analysis

Variable

Abbreviation

Emphasis placed on Strategic Planning

SP

Emphasis placed on Strategic Thinking

ST

Relative Emphasis between Strategic


Thinking and Strategic Planning

Independent
variables

Type of
research
construct
Primary
Constructs

ST/SP or
STvSP

Nature of the relationship between formulation and analysis (iterative or linear)

FAR

Criticality of Technology to the organisation

CT

Management orientation (business or


technology)

MO

Organisational Complexity

OC

Technological Inflexibility

TI

Secondary
Constructs

Table 1 on page 45 shows that SP, ST, ST/SP, FAR and CT are primary
constructs, that is the research is designed to directly investigate relationships between these variables. On the other hand, MO, OC and TI are
secondary constructs, that is we are interested in the moderating effects
of these variables on relationships between the primary constructs.
Table 1 on page 45 also shows that SP, ST, ST/SP and FAR are dependent
variables, while CT, MO, OC and TI are being treated as independent
variables. The research principally examines the effects of the independent variables on the dependent variables, and therefore a cause/effect
relationship is assumed. While noted in the literature review as possible
moderators, the variables Need for Innovation, Environmental Turbulence, Environmental Hostility and Product Diversity were not operationalised to limit the scope of the research within manageable limits.
The survey was designed and administered to enable the measurement of
the constructs described above. Survey responses were tabulated then

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Research Methodology

adjusted responses were generated by compensating for reverse scored


items by reversing the item score. For example, for question 10, the raw
score was subtracted from eight to provide the adjusted score.
Resultant values for the constructs (or indices) above were constructed
from the summated measurement of several associated scale items,
divided by the number of items (or questions) to normalise the score,
effectively giving the arithmetic mean of adjusted responses. A summary
of the question items and the constructs they are associated with is provided by Table 2 on page 48.
For example, measurement of the strategic planing construct was formed
from the summation of responses to survey questions 1 through 7, then
divided by 7, as specified in Appendix C: on page 101. Strictly speaking,
each scale item is measured on an ordinal scale, and an appropriate averaging method for ordinal scales would usually be calculated from the
median (not the arithmetic mean). However, as described by Zikmund
(1994, p303, p469), the appropriate method for combining multi-item
Likert scales to measure a combination index or construct is the summation of the individual item scores. Dividing the sum by the number of
items (or questions) simply scales the response, and effectively produces
the arithmetic mean. Finally, missing items are included by counting
them as neutral scores (the scale midpoint) to avoid unwanted bias of the
construct.
The strategic thinking (ST) construct was derived from the summation of
the mean scores for each of the elements or sub-constructs, namely
Intelligent Opportunism (IO), Systems Perspective (SYSP), Intent
Focused (IF), Thinking in Time (TT) and Hypothesis Driven (HD), plus
the mean of responses to the three assumptions measures A1, A2 and
A3 (refer Table 2 on page 48). The calculations for the overall strategic
thinking (ST) construct are provided in Appendix C: on page 101.

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Furthermore, three other independent variables were measured: Technological Inflexibility (TI), Organisational Complexity (OC) and Management Orientation (MO). These measures were derived from likert scale
and some numerical response questions. Calculations are shown in
Appendix C: on page 101.

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TABLE 2. Summary

Question

of survey questions and associated constructs


reverse
scored?

no. of
points

Construct

Focus of question

SP

mission statement

SP

trend analysis

SP

competitor analysis

SP

long term plans

SP

annual goals

SP

short term action plans

SP

ongoing evaluation

ST:IO

adherence to intended plans

5
RS

ST:IO

modifications to intended plans

RS

10

ST:IO

effectiveness at implementing intended plans

RS

11

ST:IO

ability to implement intended plans

RS

12

ST:SYSP

mental model of value creation system

RS

13

ST:SYSP

thinking about the external business ecosystem

RS

14

ST:SYSP

effects of actions on other parts of the business

RS

15

ST:IF

long term view of direction

RS

16

ST:IF

competitively unique view of the future

RS

17

ST:IF

worthwhile organisation goals

RS

18

ST:TT

past history predicts effectiveness of future actions

RS

19

ST:TT

concentrating on the gap between the past and a desired future

RS

20

ST:HD

formulation is an iterative or linear process

RS

21

A1

future is unpredictable

22

A2

concurrency of formulation and implementation

23

A3

levels of management which are concerned with strategy

24

CT

percentage of expenses spent on R&D

25

CT

technological sophistication

26

CT

industry level of R&D

27

TI

time to set up a new facility

28

TI

adaptability of core technology

29

MO

management technical-business orientation

30

OC

number of employees

linear

RS

linear
5
5

31

OC

level of diversification

32

OC

divisional structure

SP = strategic planning; CT = criticality of technology; TI = technological inflexibility;


OC = organisational complexity; A1-A3 = assumptions about strategic thinking; RS = reverse scored.
ST = strategic thinking, with sub-element constructs: IO = intelligent opportunism,
SYSP = system perspective, IF = intent focused, TT = thinking in time, HD = hypothesis driven.

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Statistical Analysis Methods

Four different statistical analysis techniques were used to interpret the


survey data: Spearman Rank-Order Correlation Coefficient Analysis;
Varimax Rotated Factor Analysis; Multiple Linear Regression Analysis;
and Bivariate Regression Curve Fit Analysis.
Spearman Rank-Order Correlation Coefficient Analysis was used to measure the degree of correlation between data sets of two variables. Using
the procedure suggested by Siegel and Castellan (1988, pp235-244), each
variable has its data samples assigned numerical rankings based on the
each samples value. The two sets of rankings are compared to detect correlations between the variables. This method is appropriate for small
ordinal data sets where normality of the data is not assumed, and provides
a relatively powerful test for correlation. The calculations for rs are given
in Appendix C: on page 101.
Using this method, correlations were measured between each of the independent research variables CT, OC, MO and TI, and the dependent variables ST, SP, FAR and the ratio of ST/SP. The direct measurement of ST
and SP allowed direct relative comparisons to be made of the emphasis
on one construct between high- and low-tech organisations. The ST/SP
ratio provided an indication of the thinking-planning orientation of the
organisation in relative terms, and effectively eliminates differences in
strategic orientation when measuring the relative planning/thinking
emphasis in different types of organisations. The results of this correlation analysis was used as the principal means to verify the research
hypotheses.
Varimax rotated principal component factor analysis was used to examine
the complex, multi-dimensional relationships between all of the research
variables. Varimax factor rotation reduced the number of highly loaded
factors to enable more meaningful component interpretation. The factor
analysis correlation tables and factor scores were interpreted to explore

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Research Methodology

relationships revealed by the data not apparent through simple correlation


analysis. The findings were used to gain greater insight into the research
data and to determine if further support for the research hypotheses could
be found.
Multiple linear regression analysis was performed between the set of
dependent variables (CT, OC, TI and OC) and the each of the four dependent variables (SP, ST, FAR and ST/SP), resulting in four sets of regression results (one for each dependent variable). The aim of this analysis
was to explore the relative degrees of dependency between the research
variables, and to find any simple linear relationships that may explain the
relationships being studied.
Bivariate regression curve fit analysis was performed using a range of
curve fitting algorithms, including linear, quadratic, logarithmic, exponential, inverse and cubic. Only the relationship between criticality of
technology and the ST/SP ratio was reported on. Quadratic curve fitting
provided the best fit, and the differences between quadratic and linear
curve fits are discussed. This analysis was conducted in order to explain
the apparent failure of the multiple regression analysis to find any significant correlations in the data.
The results of these analyses are discussed in Chapter 4: on page 59, and
detailed statistical data is provided in the Appendices.

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Hypotheses

Hypotheses
Following from the research questions on page 12, the following research
hypotheses are proposed:
Hypothesis A

H1: The more critical the impact of technology on the organisation, the
greater the probability that analysis, strategy formulation and hypothesis testing are iterative and intertwined rather than linearly and sequentially related processes.
H0: Whether analysis, strategy formulation and hypothesis testing are
iterative and intertwined or linearly and sequentially related processes is
unrelated to the criticality of the impact of technology on the organisation.

Hypothesis B

H1: The more critical the impact of technology on the organisation, the
greater the probability that strategic thinking will be more emphasised
than strategic planning.
H0: The relative emphasis between strategic thinking and strategic planning is independent of the criticality of technology to the organisation.

Hypothesis C

H1: The more critical the impact of technology on the organisation, the
greater will be the emphasis on strategic thinking.
H0: The emphasis placed on strategic thinking is independent of the
criticality of technology to the organisation.

Hypothesis D

H1: The more critical the impact of technology on the organisation, the
less will be the emphasis on strategic planning.
H0: The emphasis placed on strategic planning is independent of the
criticality of technology to the organisation.

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Hypotheses

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Operationalisation

Operationalisation
This section discusses how the concepts studied are operationalised.
The primary constructs of this study are
1.

Strategic Thinking (emphasis on)

2.

Strategic Planning (emphasis on)

3.

The criticality of the impact of technology on the business

4.

Interaction between analysis, formulation and hypothesis testing (iterative or linear)

The secondary constructs that have been identified as moderating factors


to the relationship under investigation are:
5.

technological inflexibility

6.

management experience (type of)

7.

organisational complexity and size

8.

environmental hostility (omitted from survey)

9.

need to support innovation (omitted from survey)

10.

environmental turbulence (omitted from survey)

11.

product diversity (omitted from survey)

Only moderating factors 5-7 were considered in the research.

Operationalisation of Primary Constructs


Operationalisation of
Strategic Thinking

Strategic thinking is operationalised by measurement of each of the five


elements of strategic thinking identified by Liedtka (1998a; 1998b),
namely having a systems perspective, being intent focused, thinking in
time, being intelligently opportunistic, and being hypothesis driven.
A Systems Perspective. The systems perspective

element is measured by

considering the following aspects:


Do the strategy makers have a mental model of the complete end-to-end
system of value creation and the interdependencies within it?
Do they think strategically about the external business ecosystem within
which the organisation operates, or is thinking related just to the industry itself?
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Operationalisation of Primary Constructs

Do they understand and think about the effects of their behaviour on


other parts of the internal business system?
Intent focused. Being intent

focused is measured by considering the fol-

lowing factors:
Does the organisation have a particular point of view or sense of direction about the long term market or competitive position that the organisation hopes to build over the coming decade or so?
Does the organisation have a competitively unique point of view about
the future which could lead the organisation to explore new competitive
territory?
Does the organisation have a goal or goals that are perceived as inherently worthwhile by its employees?
Intelligently Opportunistic: The intelligent opportunism

element is opera-

tionalised by taking the view that intelligent opportunism, the process of


unplanned adaptation, can be equated to the antithesis of adherence to
plans (Covin and Slevin, 1998), They suggest that absence of adherence to plans necessarily entails unplanned strategic change/adaptation
(p211). The operationalisation of adherence to plans is derived directly
from their survey, and is adapted for this research as shown in The
Intelligent Opportunism Scale on page 90.
Thinking in time: The Thinking in Time

element is operationalised by

examining the degree to which the past and the future are considered
when formulating and implementing strategy. The following questions
are posed:
To what degree is an awareness about the past history of the organisation and/or other organisations used to predict what courses of action
might be effective in designing and implementing new strategies?
When planning and striving towards the future of the organisation, to
what degree is the gap between the way things were in the past and the
way things need to be in the future considered?
Hypothesis-driven. The

Hypothesis-Driven element is operationalised by

measuring responses to the following questions:

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Operationalisation of Primary Constructs

Which statement best describes the strategy formulation process in your


organisation?
In my organisation the process of developing a new strategy is an iterative process where new strategy ideas are repeatedly generated then
their usefulness is tested by a process of analysis.

versus
In my organisation the process of developing a new strategy is a linear
process where analysis is first conducted then new strategy ideas are
generated based on insights gained from the analysis.

A Likert scale is used to measure where between the extremes the


respondents answer lies.
Operationalisation of
Assumptions about
strategic thinking versus
strategic planning

Assumptions identified by Liedtka (1998a) as underlying strategic thinking are operationalised by investigating the nature of the relationship
between formulation and implementation, and asking the following questions:
Is the future predictable and specifiable in detail, or can we just predict
the shape of it?
Compare: First we formulate, then we implement versus Formulation and implementation are interactive and intertwined or concurrent
activities.
Is thinking about strategy the responsibility of the senior executives or
the lower level managers (or somewhere in between)?

Operationalisation of
Strategic Planning

Strategic planning was operationalised using the multi-variate measurement model of strategic planning characterised by Boyd and ReuningElliott (1998), which measures the strategic planning construct in terms
of the combined emphases on mission statement, trend analysis, competitor analysis, long term plans, annual goals, short term action plans and
ongoing evaluation.

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Operationalisation of Secondary Constructs

Operationalisation of the
Criticality of the Impact of
Technology on the
Organisation

The criticality of the impact of technology on the organisation construct


was operationalised by combining measures of relative spending levels
on R&D as used in Moon (1998) and Diaz and Gomez-Mejia (1997),
with subjective measures of the environmental influence of technology as
used by Covin and Slevin (1998). This combination is designed to provide some balancing between objective financial and subjective interpretive data, further improving accuracy of measurement.
The financial measure used was R&D as a proportion of operating
expenses (Diaz and Gomez-Mejia, 1997), whereas Moon (1998) and others have used R&D versus sales. The distinction is not regarded as significant.

Operationalisation of the
Interaction between analysis
and formulation (iterative or
linear)

This construct addresses one of the key areas of contention in the literature that compares strategic thinking with strategic planning (Heracleous
1998; Liedtka 1998a; 1998b; Mintzberg 1994a). It explores whether
strategy formulation is an iterative, hypothesis generation - testing process or a linear process of first analysis then formulation.
This construct is not operationalised separately, rather measurement is
derived directly from a combination of three measures: the operationalisation of the hypothesis-driven element of the strategic thinking construct, and testing of two assumptions: that formulation and
implementation are intertwined activities and that the future cannot be
predicted in detail, as specified in Operationalisation of Assumptions
about strategic thinking versus strategic planning on page 55.

Operationalisation of Secondary Constructs


Operationalisation of
technological inflexibility

Technological inflexibility was measured by Yasai-Ardekani and Haug


(1997) as a contextual determinant for examining the strategy process.
Operationalisation of this construct is based on their measures.
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Operationalisation of Secondary Constructs

Two items are measured. The first measures the length of investment
gestation period (time to set up a new operating facility in months). The
second measures the adaptability of core technology to develop new but
related products on a five-point Likert scale ranging from very easily (1)
to cannot be done (5). (p763).
Operationalisation of
Management Experience
(type of)

Type of management experience refers to whether senior management


have formal business training or a business background or come from a
technical background. Berry (1998) measured this construct and found it
influenced the strategy process.
To operationalise this construct a seven point Likert scale is used to measure where the managers competence lies on the range between technical and business-related skills and experience.

Operationalisation of
Organisational Complexity
and Size

Organisational complexity and size is used by Yasai-Ardekani and Haug


(1997, p763) by measuring:
the log of the total number of employees
diversification on a seven point scale from single product to unrelated
divisionalisation on a six point scale ranging from functional to worldwide geographic or geographically based divisional structure

The combination of these scales are used to operationalise this construct,


calculated from the normalised average of these scores.
Secondary Constructs not
Operationalised for this
survey

Secondary constructs environmental hostility, need to support innovation,


environmental turbulence and product diversity were omitted from the
survey, as these constructs are considered less critical and had they been
included the survey questionnaire would have exceed reasonable length.
No further analysis has been undertaken with respect to these secondary
constructs.

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Operationalisation of Secondary Constructs

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Results and Discussion

Chapter 4: Analysis
Results and Discussion
The Spearman Rank-Order Correlation Coefficient rswas chosen as an
appropriate measure of association for analysis of the survey data. The
Spearman Rank-Order measure is a suitable test for association for small
paired data sets with ordinal data that is not necessarily normally distributed (Emory, 1976, p409; Siegel & Castellan, 1988, pp235-236). The
correlation coefficient rs indicates the significance and direction of the
correlation between two variables, and ranges from +1 to -1.
The Spearman Rank-Order correlation coefficients were calculated to
examine the relationship between the independent variables criticality of
technology (CT), organisational complexity (OC), management orientation (MO) and technological inflexibility (TI) and the dependent variables strategic planning (SP), strategic thinking (ST), formulation/
analysis relationship (FAR) and the ratio of ST/SP. The rs and values
calculated are summarised in Table 3 on page 60. The detailed results and
Spearman Correlation Coefficient calculations for each of the rs values
are shown in Appendix E: on page 111.

Analysis

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Results and Discussion

TABLE 3. summary

of rs values for N=21


spearman
correlationa

significanceb

significancec

Associated Hypotheses
or authors

predicted
association

Independent
Variable

Dependent
Variable

Hypothesis D

negative

CT

SP

-0.266

0.13

1.188

Hypothesis C

positive

CT

ST

0.341

0.069

1.524

Hypothesis B

positive

CT

ST/SP

0.448

0.022

2.004

Hypothesis A

positive

CT

FAR

0.284

0.10

1.270

Yasai-Ardekani & Haug


(1997); Drago (1999);
Lowendahl & Revang
(1998)

complex, can
depend on TI

OC

SP

0.138

too large

0.617

OC

ST

0.000

too large

0.000

OC

ST/SP

-0.265

0.13

-1.187

OC

FAR

0.013

too large

0.060

SP

0.384

0.044

1.719

rs

Berry (1998)

positive

MO
MO

ST

-0.238

0.16

-1.066

Berry (1998)

negative

MO

ST/SP

-0.501

0.01

-2.242

MO

FAR

-0.196

0.21

-0.876

TI

SP

0.282

0.11

1.260

Yasai-Ardekani & Haug


(1997)

complex,
interacts with
OC

TI

ST

0.109

too large

0.487

TI

ST/SP

-0.159

0.25

-0.711

TI

FAR

0.080

too large

0.359

a. rs adjusted for tied observations


b. values are derived from linear interpretation of critical rs values table (Siegel & Castellan, 1988, p360)
c. calculated as z = r s N 1 . Alternative method for calculating significance for N > 20 to 25. (Siegel & Castellan,
1988, p243)

The data sample size of N = 21 is small, and the statistical significance of


the results obtained with a small data set are necessarily limited. The
sample size was limited by practical resourcing considerations. It is
expected that with a larger sample reliability will be improved. However,
providing the statistical accuracy of the results are kept in mind, the data
does reveal relationships that, while not statistically significant, are worthy of note. It is anticipated that with a larger sample set some of these
correlations would become statistically significant.

Analysis

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Results and Discussion

Having said that, there are notable correlations that are demonstrated to
be statistically significant, even with the small data set available, as
shown in Table 3 on page 60.
The rs values in Table 3 on page 60 show that correlation is present and in
the predicted direction for each of Hypotheses A, B, C and D (See
Hypotheses on page 43.). The significance level varies for each
hypothesis, as indicated by the values.
Hypothesis B

The most interesting significant correlation ( = 0.022) is the positive CT


to ST/SP ratio correlation. This relationship is central to the thesis of this
research, that is, that in higher technology organisations strategic thinking will be emphasised over strategic planning. This thesis is reflected by
Hypothesis B. The data confirms this hypothesis.
According to Table 3 on page 60, the data shows that Ho can be rejected
for Hypothesis B at a significance level of = 0.022. That is, we can state
to a confidence level of 97.7% that we can reject Ho. Detailed calculations of rs for the CT versus ST/SP relationship are tabulated in Table 11
on page 113 in Appendix E:.
Rejection of Ho indicates that there is support for the hypothesis that the
balance in emphasis between Strategic Thinking and Strategic Planning
is dependent on the criticality of technology to the organisation (CT), and
that as predicted the more critical technology is to an organisation, the
more that they will emphasise strategic thinking over strategic planning
in relative terms. The implication is that strategic management in high
technology industries consists of a heavier emphasis on strategic thinking
compared with strategic planning.

Hypothesis C

The second most significant correlation ( = 0.069) of the CT construct is


the Hypothesis C correlation between criticality of technology and strate-

Analysis

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Results and Discussion

gic thinking. Once again, this correlation is central to this research, and
indicates that organisations in higher technology environments tend to
place more emphasis on practicing strategic thinking. This measure provides an absolute comparison, not a relative balance, so this has implications for management styles relative to other industries. The implication
is that more strategic thinking is performed in high technology organisations compared with lower technology organisations. Detailed calculations are shown in Table 10 on page 112.
Hypothesis A

The third most significant CT correlation is the CT-FAR correlation ( =


0.10). According to Table 3 on page 60, the data shows that Ho can be
rejected for Hypothesis A at a significance level of = 0.10. That is, we
can state to a confidence level of 90% that we can reject Ho. Detailed calculations of rs are tabulated in Table 12 on page 114 in Appendix E:.
While only significant to a 90% probability level, the implication is that
in high technology organisations formulation and analysis become more
iterative, intertwined processes as described by Heracleous (1998),
Liedtka (1998a; 1998b) and Mintzberg, Ahlstrand & Lampel (1999,
pp66-77). This result is significant, as it provides support for the arguments of these authors on this contentious subject. In the high technology
environment, problems that exist with the traditional, linear, analysethen-formulate approach are amplified. Confirming that the formulationanalysis relationship becomes more iterative, hypothesis driven and intertwined in this environment helps to resolve this important grand-incremental strategy formulation issue.

Hypothesis D

The criticality of technology - strategic planning correlation is negative,


but the data only indicates statistical significance at = 0.13. Notwithstanding the lower , the negative correlation supports Hypothesis D, that
higher technology organisations will place less emphasis on strategic

Analysis

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Results and Discussion

planning than lower technology organisations. Furthermore this conclusion tends to support the other hypotheses.
Secondary Constructs and
Spearman Rank-Order
Analysis

The most statistically significant correlation the data reveals ( = 0.01) is


the negative correlation between management orientation (MO) and the
strategic thinking/strategic planning balance (ST/SP). Closely related is
the positive MO-SP correlation ( = 0.044). The implication of this result
is that business-oriented management will have a propensity for emphasising strategic planning over strategic thinking, whereas technically oriented management will do the reverse. This would appear to be
principally due to an increased emphasis in strategic planning, although
there are indications ( = 0.16) that less strategic thinking occurs also.
Such a result directly supports the findings of Berry (1998) that management orientation will influence emphasis on and degree of formalisation
of strategic planning.
No significant correlations were found between organisational complexity (OC) or technological inflexibility (TI) and the dependent variables
(ST, SP, ST/SP and FAR). This is unsurprising, given that the nature of
the interaction of these variables is complex and interrelated, and as such
their influence on the planning processes will not be straightforward.
However, the positive TI-SP correlation ( = 0.11) lends tentative support
to the suggestions discussed previously by Yasai-Ardekani and Haug
(1997, p738) that in some contexts technological inflexibility can lead to
an increased emphasis on formal planning.
The influencing effects of the secondary constructs on the ST/SP balance
are known to be complex and interdependent, particularly TI and OC.
Care must be taken not to draw too many simplistic conclusions on these
complex relationships based on this correlation analysis.

Analysis

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Results and Discussion

Factor Analysis

Varimax rotated factor analysis was performed to reveal the associations


between strategic thinking (ST), strategic planning (SP) and the independent variables (CT, TI, MO and OC). The correlation coefficients and significance values are shown in Table 4 on page 65. The Formulation/
Analysis (FAR) construct was excluded from factor analysis because
FAR is calculated from items that are also included in the ST construct
and would disturb the analysis. The ST/SP construct was excluded for
similar reasons. Therefore only Hypotheses C and D are interpreted with
factor analysis.
To be reliable, factor analysis should normally be conducted on samples
where N is large, at least a hundred or so samples (Cureton and Agostino,
1983, p11). The large sample size relies on the Central Limit Theorem to
prevent intolerable errors. However, in this study, N = 21, and there is
therefore significant risk of error due to the possible failure of the sampling distribution to approximate a normal distribution.
This research sample was limited in size due to time and resource constraints, so for the reasons stated above the results of factor analysis must
be treated with caution. While some of the results may not be statistically
reliable, they do provide useful indicative data in support of the research
hypotheses.

Analysis

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Results and Discussion

TABLE 4. Correlation

Matrix for rotated factor analysis

Correlation Matrix

Correlation

Sig. (1-tailed)

CT
TI
MO
OC
ST
SP
CT
TI
MO
OC
ST
SP

CT
1.000
-.082
-.258
.192
.313
-.204
.362
.129
.202
.083
.188

TI
-.082
1.000
.282
.028
.081
.233
.362
.108
.452
.364
.154

MO
-.258
.282
1.000
.426
-.155
.353
.129
.108
.027
.250
.058

OC
.192
.028
.426
1.000
.078
.172
.202
.452
.027
.368
.228

ST
.313
.081
-.155
.078
1.000
.006
.083
.364
.250
.368

SP
-.204
.233
.353
.172
.006
1.000
.188
.154
.058
.228
.490

.490

The correlation coefficients extracted from the data are shown in Table 4
on page 65. The correlation analysis shows positive correlation between
strategic thinking and criticality of technology (at significance p = .083),
which adds further support to Hypothesis C, that high technology businesses will engage in more strategic thinking. While not statistically significant (p = 0.188), the negative correlation between criticality of
technology and strategic planning also tends to support Hypothesis D,
that high technology companies will engage in less strategic planning.
Combined, these results add support to Hypothesis B, that there will be
more relative emphasis on strategic thinking than strategic planning in
high technology companies.
The factor values extracted from the data are shown in Table 5 on
page 68. Of the six components calculated, only three components
(shown) have eigenvalues greater than one, and are therefore significant
enough to include in the analysis. Factors greater than 0.40 may be considered statistically significant (Van de Ven and Ferry, 1980, p175) (noting the comments above about the small sample size).

Analysis

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Results and Discussion

Component 1. The

first component reveals a strong positive association

between the criticality of technology (0.774) and strategic thinking


(0.815). The third most significant factor of component 1 is the negatively correlated management orientation construct (-0.323). Furthermore, strategic planning is negatively correlated (-0.146) as predicted by
Hypothesis D. Organisational complexity is also positively correlated
with component 1.
This component may be interpreted to imply that in organisations where
technology is more critical, and particularly where management are more
technically oriented and the organisation is more complex, strategic
thinking will be relatively emphasised over strategic planning. This finding lends support to hypotheses B, C and D, and also loosely supports the
conclusion of (Yasai-Ardekani and Haug, 1997) that organisational complexity results in less formal planning, providing technologies are not too
inflexible. The positive correlation of technological inflexibility is generally unexpected, although it is small. As explained by Yasai-Ardekani
and Haug (1997), the moderating effects of technological inflexibility are
not simple and linear. Component 1 might be called the Technocratic
Thinkers component, to indicate the situation where high technology
organisations managed by technologists engage in strategic thinking.
Component 2. The

second component is dominated by the technological

inflexibility construct (0.826), and is significantly positively associated


with strategic planning (0.635). Management orientation is also positively associated with this component (0.427), and the criticality of technology is negatively associated (-0.317, not significant). This component
indicates that in organisations where technology is less critical, technological inflexibility will lead to a strategic planning orientation, and perhaps as a result management will tend to be business oriented. This
analysis supports Hypotheses B and D. The conclusion is intuitively justifiable, as in such organisations and industries the core technology appli-

Analysis

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Results and Discussion

cations will be relatively stable and well defined, and management focus
will be on business operations rather than R&D.
Component 2 might be labeled the Specialist-Business Planners component, to describe the type of organisation where mature, purpose-specific (i.e. inflexible) base technology requiring little R&D is managed by
business-oriented management that tend to engage in strategic planning.
Component 3. Organisational complexity

is the dominant factor of the

third component (0.910). Strongly related is management orientation


(business oriented correlation) (0.688). These were considered to be
independent constructs, but the data implies that there is a factor association between organisational complexity and management orientation.
Strategic planning is also positively correlated (0.298), whereas strategic
thinking is uncorrelated, as is technological inflexibility. Finally, criticality of technology has a weak positive correlation (0.145).
The primary implications of the third component are that management
will become more business oriented and less technically oriented when
organisations become more complex, and will increase their strategic
planning orientation. This agrees with the findings of Berry (1998).
This third component might be labelled the Complexity Managers
component, to indicate that the management problems are dominated in
this case by organisational complexity issues rather than technological
complexity issues, and accordingly management are business focused.

Analysis

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Results and Discussion

TABLE 5. Varimax

rotated principal component factor analysis component

values

CT
TI
MO
OC
ST
SP

1
.774
.109
-.323
.203
.815
-.146

Component
2
-.317
.826
.427
-2.57E-02
.233
.635

3
.145
-4.56E-02
.688
.910
-8.83E-02
.298

Extraction Method: Principal Component Analysis.


Rotation Method: Varimax with Kaiser Normalization.
a. Rotation converged in 7 iterations.

Regression Analysis of
Secondary Constructs

Multiple linear regression analysis was performed to correlate the independent variables for criticality of technology (CT), technological inflexibility (TI), management orientation (MO) and organisational complexity
against the primary constructs (i.e. dependent variables) of strategic
thinking (ST), strategic planning (SP), formulation/analysis relationship
(FAR) and the ratio of ST/SP. The regression analysis results are summarised in Appendix H: on page 133.
The regression analysis reveals that while some trends are apparent, there
are no statistically significant linear associations between the any of the
independent variables and any of the dependent variables. This lack of
correlation tends to support the idea that the relationships between the
independent and dependent variables in this study are non-monotonic,
and are complex and interactive, as indicated by Covin and Slevin (1998)
and Yasai-Ardekani and Haug (1997). Furthermore the failure to detect
correlations indicates that simple linear regression techniques are inadequate to analyse the type of data produced.

Regression Curve Fit of CT


versus ST/SP

Investigating the argument that variable relationships may be non-monotonic, linear and quadratic curve fits were attempted in relating CT to ST/
SP. The full results are shown in Appendix G: on page 131, and a plot of
the CT, ST/SP curve is shown also in Figure 11 on page 69.
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Results and Discussion

FIGURE 11. CT versus ST/SP


curve fit, linear and
quadratic curves

STVSP
1.8

1.6

1.4

The R2 values for the lin-

1.2

ear and quadratic curves


are respectively 0.138 and

1.0
O bs er v ed
.8

0.436. The stronger qua-

Linear
.6

Q uadr atic
1

dratic fit shown indicates

that the CT - ST/SP rela-

CT

tionship may be nonmonotonic, and that the relationship between criticality of technology
and relative thinking/planning emphasis may be more complex than
anticipated by Hypothesis B.
Viewing the graph of Figure 11 on page 69, the data appears to be generally more consistent at the high-technology end of the scale. At the
lower-technology end, there appears to be more variability in the data,
and there are fewer samples. As this study has focused on high-technology industries, it is of less interest what occurs at the lower end of the
scale, but it is useful to offer some tentative explanations for the phenomenon observed.
There appear to be two plausible explanations for the curved relationship.
One possible explanation is that at the lower-technology end of the scale,
the balance between strategic thinking and strategic planning is more
affected by other concerns, such as organisational complexity, environmental hostility or management style. The samples that record high ST/
SP scores at the low-tech end are likely to be spurious, caused by other
unrelated factors.
Another possible explanation may be that the lower-tech businesses have
a lower propensity for formal planning. There are no clear reasons for

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Summary of Analysis

this, but it may be speculated that management styles vary in lower technology industries. Some evidence was noted in the survey process that
the more traditional, operations-focused low-tech businesses were relatively less concerned with formal strategic management overall, and their
manner of ad-hoc strategic management may in fact approximate strategic thinking.

Summary of Analysis
The Spearman Rank-Order Correlation Coefficient analysis proved to be
an effective method of detecting correlations in the data. The data
revealed statistically significant evidence verifying Hypothesis B (to 95%
confidence) and Hypotheses A and C, and to 90% confidence. Indicative
evidence (to 87%) was also found in support of Hypothesis D.
The complex nature of the relationship between the moderating constructs of organisational complexity, technological inflexibility and management orientation is also apparent from the Spearman Correlation
results. The principal finding is that management orientation appears to
have a direct influence on the strategic thinking/strategic planning balance, with business oriented managers preferring the planning approach.
Factor analysis revealed further insights into the data, with correlations
noted supporting Hypotheses B, C and D. This analysis revealed three
components underlying the relationships examined, further supporting
the research hypotheses and providing further insight into the strategy
process. These components indicated strong relationships between (1)
high technology and strategic thinking; (2) technological inflexibility and
strategic planning; and (3) organisational complexity and business-oriented management.

Analysis

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Summary of Analysis

Linear regression analysis proved inadequate to reveal useful information


about the data available. Curve-fit regression analysis does indicate that
the relationship between criticality of technology and the strategic thinking/strategic planning balance is probably not linear, and that other
effects (not technology related) probably dominate in the lower technology industries to shape the nature of the strategy process.

Analysis

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Summary of Analysis

Analysis

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Research Limitations

Research Limitations
Sample Size

The research findings are subject to several limitations. The respondents


were considered to be knowledgeable about their organisations strategy
process; quality data is expected. However the sample size is small (N =
21). The small sample size restricted the statistical significance achievable wtih the correlation analyses, as described in Chapter 4:.

Linear Regression

The survey data is ordinal, and not known to be normally distributed, so


linear regression results may be unacceptably inaccurate due to the Central Limit Theorem with the small sample size. As the linear regression
results were not relied upon to draw conclusions (insufficient statistical
significance) this is not considered to be an important factor in the overall
analysis.

Factor Analysis

As discussed on page 64 in Chapter 4:, factor analysis normally requires


the sample size to be large to prevent intolerable errors according to the
Central Limit Theorem. As a consequence of the small sample size, the
factor analysis may be unreliable. However, once again this analysis was
interpreted in support of hypothesis validation achieved with known statistical significance through Spearman Rank-Order Correlation analysis,
so the results are not necessesarily invalidated by the Central Limit Theorem issue. The factor analysis, however, should be treated with appropriate caution.

Survey Design

In answering the survey, respondents sometimes appeared unsure as to


what level(s) of the organisation to contemplate when answering survey.
Modifying the survey to clarify the choice of organisational level should
improve the accuracy of the results, and would potentially result in
increased statistical significance of the data.

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Research Limitations

The quantitative methodology used does not readily allow for the exploration of subtlteties of the thinking processes that form part of the subject
of this investigation. Research into organisational cognition is a fundamentally challenging task. However, it is believed that the breadth and
sophistication of the strategic thinking construct developed minimises the
limitations of a quantitative methodology.
Strategic Thinking Elements

This research explores the measured emphasis on strategic thinking as a


whole, but there is scope to explore each of the construct elements. A
more extensive research project could decompose strategic thinking to
analyse more about the nature of the process and to validate the theoretical model used.

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Chapter 5: Research Implications


This chapter discusses the implications of the research findings on management theory and practical applications of strategic management.
As discussed in Chapter 4:, evidence was found in the data to support all
of the research hypotheses, and in particular Hypothesis B was supported
to a 97.7% confidence level, while the other hypotheses were supported
at lower levels of confidence.
The primary implication of Hypothesis B is that, as predicted, higher
technology organisations will tend to place relatively more emphasis on
strategic thinking than strategic planning. By validating the research
hypotheses, by implication this research weighs in on the debate over the
nature of strategic thinking itself. The results show that strategic thinking
and strategic planning tends to be an either-or proposition. An increased
emphasis on strategic thinking, as in the high technology industries, was
matched by a decreased emphasis on strategic planning.
The results also add support to the model of strategic thinking proposed
by Leidtka (1998a; 1998b) upon which the survey questions were based.
The confirmation of the research hypothesis by implication reveals that
the strategic management process is characterised by intelligent opportunism, adopts a systems perspective, is intent focused, is hypothesis
driven and requires thinking in time, as described by Liedtkas model
(1998b).
The inversely proportional relationship between strategic thinking and
strategic planning raises interesting questions about the merits and practicalities of attempting to integrate the two. It would appear that strategic
thinking is a substitute for strategic planning, not merely an addition to

Research Implications

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or refinement of the strategic planning process. Reform of traditional


strategic planning processes to embrace the contributions that can be
made by an increased emphasis on strategic thinking will perhaps appear
as a systematic process of letting go of planning control in areas where
planning is ineffective.
The analysis observed that high organisational complexity is associated
with a business-oriented management type. At the same time, businessoriented management tend more to be strategic planners. However, as
Yasai-Ardekani and Haug (1997) found, with flexible technologies, high
organisational complexity should lead to a lower planning emphasis.
Apparent is contention between the propensity of such business oriented
managers towards a planning orientation and the appropriateness of a
strategic thinking orientation in such high-technology industries. As
such, management in complex organisations need to beware of an overemphasis on strategic planning that is driven primarily by managements
tendency to be planners.
Investigating the influence of the independent variables on the ST/SP
ratio, the influence of factors affecting the balance between thinking and
planning was shown to be complex, non-monotonic and interactive, and
cannot always be explained by simple formulae. An appreciation of the
factors that can influence the process will assist managers towards better
process and organisational design.
Inflexible technologies increase the need for strategic planning, and having technological flexibility, can reduce the need for planning. If efficient
resource deployment can still be achieved without risking the pitfalls of
formal planning (e.g. slower response) by developing flexible technologies, then technological flexibility can become a competitive advantage.
This will allow the organisation to be more dynamic and responsive, to be
able to take an incremental approach in exploring an uncertain future.

Research Implications

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The research found that formulation, analysis and hypothesis testingdriven action are more intertwined and incremental in high technology
organisations. This finding provides support for the contentious arguments of Mintzberg (1994a; 1994b), Mintzberg, Ahlstrand and Lampel
(1999), Heracleous (1998), Leidtka (1998a; 1998b) and Ohmae (1982)
that strategic thinking is hypothesis driven. It tends to argue against Porters (1979, pp21-22) view that strategy formulation follows after analysis, at least in the uncertain high technology environment. This implies
also that high-tech companies should not necessarily expect to produce
grand strategies; a hypothesis-driven incremental approach appears to
be more suitable.
Such findings may have important implications for old-economy
medium- or low-tech industries suddenly facing unprecedented levels of
technological change that affects their business, such as banks, traditional
media organisations and retailers in an internet driven marketplace. As
the influence of technological change increases the criticality of technology to these businesses, strategic management processes will need to be
adapted to suit the new environment. Traditional strategic planning will
need to give way to more strategic thinking, reflecting the changing
nature of the industry.
Even in these industries, strategic planning is still required for coordination of effort, to legitimise a dialogue around strategic issues and for optimal deployment of ever-scarce resources for strategic advantage.
Learnings from this research can be employed to facilitate strategic planning. Room for intelligent opportunism and for timely abandonment of
bad strategies should be build into the strategic planning process. Some
organisations facilitate this by monthly strategy reviews, and by having a
systematic process of identifying, discussing and making decisions on
important unexpected strategic opportunities, such as a newly identified
acquisition target or product-market.

Research Implications

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Strategic thinking has clearly evolved in the high technology industry as


an important feature of strategic management in response to the challenges of this environment. Organisations seeking a competitive strategy
process need to focus on developing an organisations strategic thinking
capability. However, strategic thinking can be confounded by technological inflexibility, organisational complexity and the management orientation required to deal with these issues.
This research offers some possibilities for resolving this dilemma created
by the strategic thinking/strategic planning contention in high technology
industries. It suggests that management can ease the burden on their strategic planning processes by placing an emphasis on building flexible
technologies, creating the space for more strategic thinking. Further,
management may endeavour to keep organisational complexity low to
make communication and strategic management an easier task, allowing
management to focus on technical rather than organisational complexity.

Research Implications

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Chapter 6: Conclusion
This research investigated the nature of the strategic management process
in the context of the high technology industry in Australia.
The strategic management process was examined by measuring the
emphasis placed on strategic thinking and strategic planning and also
exploring whether formulation and analysis were intertwined or sequential activities.
Research hypotheses (see page 51) B, C and D were based on the proposition that high technology organisations would have a greater emphasis
on strategic thinking, compared with more conventional organisations. In
general this proposition was found to be correct, with Hypothesis B significant to 97% confidence. A corresponding decrease in emphasis on
strategic planning was also revealed, as predicted. The statistical significance of Hypotheses A, C and D were lower than 95% confidence, due to
the small sample size but still provided useful indicative results supporting the predictions.
The research found that high technology companies in Australia tend to
engage in strategic thinking more than other organisations. Organisational complexity, technological inflexibility and management orientation are important moderating factors that influence the nature of the
strategic management process, and their effects are complex and interrelated. In particular, a business management orientation tends to lead to
strategic planning, whereas technically oriented management tend to
practice strategic thinking.
These findings also help to resolve a contentious issue in the strategic
management literature over how new strategies are actually formulated.

Conclusion

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The indications are that new strategies are produced by a continual process of iterative analysis, formulation and testing combined in incremental fashion. This incremental view prevails over the concept that effective
grand strategies can be produced by at a single point in time following
extensive analysis. The incrementalist view is particularly applicable to
the high technology sector.
The research also adds support to a view of strategic thinking proposed
by Liedtka (1998a; 1998b), that strategic thinking can be described in
terms of five elements: it requires thinking in time, uses intelligent opportunism, it is hypothesis driven, requires a systems perspective and is
intent focused.
Furthermore strategic thinking appears, to a degree, to substitute for strategic planning, so raises some questions about whether strategic thinking
can really be developed as a reform of the strategic planning process, as
suggested by some authors (Liedtka, 1998a; 1998b).
Management in high technology organisations need to develop a strategic
thinking capability. Emphasising the development of flexible technologies and minimising organisational complexity can free management to
be less business-planning oriented and fosters strategic thinking.
Strategic management is a complex and inexact business. The design of
strategic management processes are critical to the effective management
of business, and to long term competitive advantage. High technology
industries face fundamental revolutionary change to their competitive and
internal environments, and cope with significant complexity, as a matter
of routine. They must constantly foster innovation to survive. Strategic
management processes in these types of organisations have evolved
towards strategic thinking to cope with these pressures.

Conclusion

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The challenges routinely faced by high technology industries are common to many traditional organisations that are facing unprecedented levels of technological change in their competitive environments. Similarly,
innovation and responsiveness are recognised to be keys to business success. The value of strategic thinking to the high technology industry provides lessons to traditional industry attempting to cope with sudden
technological upheaval. The message should not be lost either on todays
management who may consider that formal planning and control are the
panacea for dealing with the strategic management problems of the
future.

Conclusion

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About the author


Justin Spangaro holds a B.Eng (comms.) from RMIT and with this thesis concludes the submission for his MBA. Justin has worked in the high technology
industry since 1987 designing advanced semiconductor products and communications systems, managing development projects and developing new product concepts. He is managing director of Spangaro Systems Pty. Ltd., a consulting firm
specialising in technology strategy, systems, architecture and development and
research management.
For further information or if you wish to comment on this research contact:
Spangaro Systems Pty. Ltd.
Level One, 302 Barkers Road,
Hawthorn,
Victoria, Australia, 3122.
Tel:
Mobile
Fax:
Email:
Web:

(+61) (3) 9815 0012


(+61) (427) 087 313
(+61) (3) 9815 0012
justin@spangaro.com
http://www.spangaro.com

Conclusion

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Schroeder, D., Congden, S. & Gopinath, C. 1995, Linking Competitive Strategy and Manufacturing
Process Technology, Journal of Management Science, 32:2 March 1995, Blackwell Publishers,
Oxford.
Scott, George M. 1999, Critical Technology Management Issues of New Product Development in
High-Tech Companies, Journal of Product Innovation Management, 2000:17:57-77.
Semple, Peter 2000, IT is key to renewing Melbourne, The Age, September 13, 2000, Property
Business p9, Fairfax, Melbourne.
Senge P.M. 1990, The Leaders New Work: Building Learning Organisations, Sloan Management
Review, Fall pp7-23.
Seth A. and Zinkhan G. 1990, Strategy and the Research Process: A Comment, Strategic Management
Journal Vol. 12 75-82 (1991), John Wiley & Sons.
Siegel Sidney. & Castellan N. John Jr. 1988, Nonparametric Statistics for the Behavioural Sciences,
2nd edn., McGraw Hill Inc., New York.

References

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86

Strategic Thinking, Strategic Planning and High-Technology Industries

Justin Spangaro

Stacey R. 1996, Strategic Management and Organisational Dynamics, 2nd ed., Pitman Publishing,
London.
Sun Tzu 1971, The Art of War, Oxford University Press, New York.
Taylor, Bernard 1997, The Return of Strategic Planning - Once More with Feeling, in Long Range
Planning, June 1997, Elsevier Science Ltd., London.
Van de Ven, A. & Ferry, D. 1980, Measuring and Assessing Organisations, Wiley, New York.
Wilson, I. 1994, Strategic Planning isnt Dead - its Changed, in Long Range Planning, Vol. 27, No.
4, pp12-24, 1994, Elsevier Science Ltd., London.
Wilson, I. 1998, Strategic Planning for the Millennium, in Long Range Planning, Vol. 31, No. 4,
pp507-513, 1998, Elsevier Science Ltd., London.
Yasai-Ardekani, M. & Haug, R. 1997, Contextual Determinants of Strategic Planning Processes,
Journal of Management Studies, 34:5 September 1997 pp729-767, Blackwell Publishers, Oxford.
Zikmund, W.G. 1994, Business Research Methods, Fourth edition, Dryden Press, Fort Worth.

References

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References

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88

General Instructions

Appendix A: Strategic Management Research Survey Questionnaire


This survey questionnaire is designed to gather data for the RMIT School of Management research
project described in the accompanying covering letter. It is kindly requested that this survey be completed by the person indicated and returned to the researchers as soon as possible to enable your
responses to contribute to the research findings.

General Instructions
Please answer the questions below as accurately as possible. Circle the answer that best indicates your
response to the question or degree of agreement with the statements indicated as appropriate.
These questions are presented in four sections. The first section examines strategic planning. The second section provides measures of strategic thinking. The third section explores the criticality of the
impact of technology on your organisation. Finally, the fourth section measures some of the moderating factors of the strategy process.
At the end of each section, extra space is provided so that if you wish you may add any comments you
think might be helpful. Pilots have shown this survey will take 10 -15 minutes to complete, and your
answers and comments are very important to this research.
If at any point in the process you would like clarification, have questions or concerns or wish to discuss the survey please do not hesitate to contact Justin Spangaro on (0427) 087 313 (24 hours),
(03)9815 0012 or jspangar@bigpond.com.

Section 1: Strategic Planning


This section examines several common planning activities. Please indicate the emphasis placed on
each activity within your organisation (circle one):
1.

a mission statement
1

no emphasis

2.

moderate
emphasis

5
very strong
emphasis

trend analysis
1
no emphasis

3
moderate
emphasis

5
very strong
emphasis

89

Section 2: Strategic Thinking

3.

competitor analysis
1

no emphasis

4.

5
very strong emphasis

annual goals
1

moderate emphasis

5
very strong emphasis

short term action plans


1

no emphasis

7.

5
very strong emphasis

moderate emphasis

no emphasis

6.

long term plans


no emphasis

5.

3
moderate emphasis

moderate emphasis

5
very strong emphasis

ongoing evaluation
1

no emphasis

3
moderate emphasis

5
very strong emphasis

Comments on Strategic Planning

Section 2: Strategic Thinking


The questions in this section measure elements of strategic thinking in your organisations strategy
process.

The Intelligent Opportunism Scale


The following questions measure the degree of opportunism and flexibility exercised in your organisations strategy process.

90

The Systems Perspective Scale

Please circle the numbers in the following scales that best describe the strategy implementation process within your business unit:
8.

My business unit almost never


adheres closely to its intended business plans/strategies

My business unit almost always


adheres closely to its intended business plans/strategies

9.

Modifications to my business units


intended business plans/strategies
are typically extensive

Modifications to my business units


intended business plans/strategies
are typically minimal

10.

In general, my business unit is very


ineffective at implementing its chosen business plans/strategies

In general, my business unit is very


effective at implementing its chosen
business plans/strategies

11.

My business unit is almost never


able to implement the business
plans/strategies it would most like to
employ.

My business unit is almost always


able to implement the business
plans/strategies it would most like to
employ.

The Systems Perspective Scale


12.

Please indicate how much you agree with the statement below:
Strategy making in my organisation is performed based on a clear mental model or understanding of the complete end-to-end system of value creation and the interdependencies
within it.
1

Strongly
agree

generally
agree

somewhat
agree

Neither
agree nor
disagree

somewhat
disagree

generally
disagree

Strongly
disagree

91

The Intent Focused Scale

13.

In this question, please select the number that indicates your relative level of agreement with the
two statements below:
When thinking about the environment, the strategy makers in my
organisation tend to think strategically about the whole external
business ecosystem within which
the organisation operates.

14.

When thinking about the environment, the strategy makers in my


organisation tend to think strategically only about the particular
industry within which the organisation operates.

Once again, please indicate your level of agreement with the below statement:
The strategy makers in my organisation understand and think about the effects of their
actions on other parts of the internal business systems.
1

Strongly
agree

generally
agree

somewhat
agree

Neither
agree nor
disagree

somewhat
disagree

generally
disagree

Strongly
disagree

The Intent Focused Scale


This section measures strategic intent. As before, for each section please indicate your level of
agreement with each statement.
15.

16.

The organisation I work in has a particular point of view or sense of direction about the long term
market or competitive position that the organisation hopes to build over the coming decade or so.
1

Strongly
agree

generally
agree

somewhat
agree

Neither
agree nor
disagree

somewhat
disagree

generally
disagree

Strongly
disagree

The organisation I work in has a competitively unique point of view about the future which could
lead the organisation to explore new competitive territory.
1

Strongly
agree

generally
agree

somewhat
agree

Neither
agree nor
disagree

somewhat
disagree

generally
disagree

Strongly
disagree

92

The Thinking In Time Scale

17.

The organisation I work in has a goal or goals that are perceived as inherently worthwhile by its
employees
1

Strongly
agree

generally
agree

somewhat
agree

Neither
agree nor
disagree

somewhat
disagree

generally
disagree

Strongly
disagree

The Thinking In Time Scale


This section measures thinking in time, or the way your organisation connects the past with the
future.
18.

This time please indicate your level of relative agreement with the two statements below:
An awareness about the past history
of my organisation and/or other
organisations is almost always used
to predict what courses of action
might be effective in designing and
implementing new strategies?

19.

An awareness about the past history


of my organisation and/or other
organisations is almost never used
to predict what courses of action
might be effective in designing and
implementing new strategies?

In this question, please indicate your level of agreement with the statement:
When planning and striving towards the future of the organisation, an important consideration for our organisation is to be concentrating on the gap between the way things were or
have been in the past and the way things need to be in the future to succeed.
1

Strongly
agree

generally
agree

somewhat
agree

Neither
agree nor
disagree

somewhat
disagree

generally
disagree

Strongly
disagree

93

The Hypothesis-Driven Scale

The Hypothesis-Driven Scale


20.

In this question, please choose on the scale below your view about which statement best describes
the strategy formulation process in your organisation. Choose a number from 1-7 that indicates
your relative agreement with the statements.
In my organisation the process
of developing a new strategy is
an iterative process where creative new strategy ideas are
generated then their usefulness is tested by a process of
analysis, conducted repeatedly
over time.

In my organisation the process


of developing a new strategy is a
linear process where analysis is
conducted first, then new strategy ideas are generated based
on insights gained from the
analysis.

(If not sure about your answer, just tick here [ ] and leave this question blank, and if you like you may
add your own explanation or description at the end).

Assumptions about Strategy and the Strategy Process


Please indicate your level of relative agreement with the statements below:
21.

The future predictable and


specifiable in detail

The best we can hope for is


to just predict the shape of
the future, not in detail

22.

Formulation and implementation are interactive


and intertwined or concurrent activities

First we formulate, then we


implement

23.

Thinking about the organisations strategy is the


responsibility of senior
executives.

Thinking about the organisations strategy is the


responsibility of lower level
managers.

Comments on Strategic Thinking

94

Section 3: Criticality of the Impact of Technology

Section 3: Criticality of the Impact of Technology


This section provides a measure of the criticality of the impact of technology on your organisation.
24.

25.

Please select the appropriate choice below indicating your best estimate of the percentage of total
operating expenses of your organisation in any given period (say, last financial year) that is spent
on research and development activities.
1

less than 5%

5% - 10%

11% - 16%

17% - 22%

more than 22%

How would you characterise the external environment within which your business unit functions?
An environment demanding little
in the way of technological
sophistication

26.

Technologically, a very sophisticated and complex environment.

How much research and development (R&D) activity takes place within your business units principal industry?
Virtually no R&D in industry
(e.g. bakery, real estate, construction)

Extremely R&D oriented industry


(e.g. telecommunications, space,
pharmaceuticals)

Section 4: Moderating Factors


This section measures a variety of moderating factors that are considered to exert an influence on the
strategy process.
Technological Inflexibility
27.

If you were required to set up a new operating facility to do what you do today, how many months
do you expect that it would take for the facility to become operational?
..................... months

95

Section 4: Moderating Factors

28.

Considering the core technology(s) of your organisation, how easily can this core technology be
adapted to develop new but related products?
1

very easily

with reasonable
ease

not that easily

with considerable difficulty

cannot be done

Type of Management experience


29.

Considering the executive management of your business unit, would you say their skills and experience are technically-oriented or business-oriented?
1

very
technically
oriented

quite
technically
oriented

partly
technical,
partly business

quite business
oriented

very business
oriented

Organisational Complexity
30.

Please estimate the total number of employees that work for your entire organisation.
....................... people (approx.)

31.

Please select the statement that best describes the level of diversification of your organisation:
we are a single product company

we have dominant product(s) or businesses that are constrained to serving product


markets that enjoy both technological and market related synergies

we have dominant product(s) or businesses that are linked via product markets that
enjoy either technological or market related synergies but generally not both

we have dominant product(s) or businesses that serve unrelated product markets

we have a number of related products or businesses that are constrained to serving


product markets that enjoy both technological and market related synergies

we have a number of related products or businesses that are generally linked via
product markets that enjoy either technological or market related synergies but generally not both

we do not have particularly dominant products or business and they generally serve
unrelated markets

96

Section 4: Moderating Factors

32.

Please select the statement that best describes the divisional structure of your entire organisation:
functional divisions

functional divisions with subsidiaries

holding company

multidivisional

multidivisional with international division

worldwide product or geographically based divisional structure

Thank you for completing this important survey. If you would like to receive a summary of the
research findings, please fill in the information below:
I would like to receive an electronic (pdf) copy via email

yes

no

I would like an email that tells me the web address of the published results so I can
view them myself. My email address is:

yes

no

yes

no

My email:
I would like a printed copy sent in the mail. My mail address is written below, or I
have attached a business card here instead for convenience:
My postal address:

----------------------------------if desired detach here for your records --------------------------------------Please ensure that your responses are included in the research results by forwarding immediately in
the enclosed self-addressed envelope to:
Spangaro Systems Pty. Ltd.,
Level One, 302 Barkers Road,
Hawthorn,
Victoria, Australia, 3122.
Attention: Justin Spangaro

Ph/Fax (03) 9815 0012


Email: jspangar@bigpond.com

97

Section 4: Moderating Factors

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Justin Spangaro

Appendix B: Interview Questions for Structured Interviews


Name:
1. What do you understand to be the meaning of a strategic plan?
2. What would or does your organisation do to respond when an unexpected opportunity of value
arises that is not necessarily part of an existing strategic plan?
3. What would or does your organisation do to respond when an unexpected obstacle of significance
arises that reduces the probability of success of an existing strategic plan?
4. What are the main factors or types of factors outside your control that are likely to influence your
strategic plans?
5. How do you determine what effect these factors might have on your plans?
6. Can you describe an overall direction that your organisation expects to pursue for the next five or
ten years?
7. How relevant is your organisations history to where you are today and where you will be tomorrow
(or in a future you can envision)?
8. Where or by what process would you say that the best new strategies or strategy ideas are produced?
9. How do you decide whether these strategy ideas have merit?
10. When you have an idea that you think has merit and you decide to implement it, how do you
determine whether the idea is working as hoped or expected?

Appendix B:

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Appendix B:

Justin Spangaro

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Justin Spangaro

Data Transposition and Interpretation

Appendix C: Detailed Analysis Calculations

Data Transposition and Interpretation


Strategic Thinking

The strategic thinking (ST) construct was derived from the summation of
the mean scores for each of the elements or sub-constructs, namely
Intelligent Opportunism (IO), Systems Perspective (SYSP), Intent
Focused (IF), Thinking in Time (TT) and Hypothesis Driven (HD), plus
an average each of the results of testing the three assumptions measures
A1, A2 and A3 (refer Table 2 on page 54). The calculation for the overall
strategic thinking (ST) construct for each respondent i is given by:
A1 i + A2 i + A3 i
IO i + SYSPi + IF i + TT i + HD i + -------------------------------------3
ST i = -----------------------------------------------------------------------------------------------------------------------6

(EQ 1)

where
( 8 q 8 ) + ( 8 q 9 ) + ( 8 q 10 ) + ( 8 q 11 )
i
i
i
i
IO i = Intelligent Opportunism = --------------------------------------------------------------------------------------------------------4

(EQ 2)

( 8 q 12 ) + ( 8 q 13 ) + ( 8 q 14 )
i
i
i
SYSP i = System Perspective = -------------------------------------------------------------------------------3

(EQ 3)

( 8 q 15 ) + ( 8 q 16 ) + ( 8 q 17 )
i
i
i
IF i = Intent Focused = -------------------------------------------------------------------------------3

(EQ 4)

( 8 q 18 ) + ( 8 q 19 )
i
i
TT i = Thinking In Time = --------------------------------------------------2

(EQ 5)

HD i = Hypothesis Driven = 8 q 20

(EQ 6)

Appendix C:

A1 i = q 21 i

(EQ 7)

A2 i = 8 q 22i

(EQ 8)

A3 i = q 23 i

(EQ 9)

q ni = survey answer for question n for participant i

(EQ 10)

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Data Transposition and Interpretation

The assumptions scores A1, A2 and A3 were effectively weighted by a


factor of 0.33 to give the assumptions overall an equal weighting to each
of the individual elements of strategic thinking. Subjectively, this
weighting is appropriate to prevent the ST measure being overly influenced by the assumptions rather than the process factors of interest.
Strategic Planning

The Strategic Planning (SP) construct is calculated as stated in equation


11.
q 1 i + q 2i + q 3i + q 4 i + q 5 i + q 6 i + q 7 i
SP i = --------------------------------------------------------------------------------7

Criticality of Technology

(EQ 11)

The Criticality of Technology (CT) construct is calculated as stated in


equation 12.
q 24 i + q 25i + q 26 i
CT i = ------------------------------------3

Formulation/Analysis
Relationship

(EQ 12)

The construct to measure whether formulation and analysis are related by


an iterative (intertwined activities) or linear (analyse then formulate) process, the Formulation/Analysis Relationship (FAR) construct, is calculated as shown in equation 13.
HD i + A1 i + A2 i
FAR i = ---------------------------------------3

(EQ 13)

As stated in Operationalisation of the Interaction between analysis and


formulation (iterative or linear) on page 47, this construct is derived
from the Hypothesis Driven sub-construct and Assumptions 1 and 2.
Inflexibility of Technology

The Technological Inflexibility (TI) construct is calculated as stated in


equation 14. Note that question 27, number of months to set up a new
facility, is converted to an equivalent weighting to question 28 by converting the answer provided to scale units of 4.8 months. The scale unit
of 4.8 months was derived from respondents answers; the values for

Appendix C:

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Data Transposition and Interpretation

mean (12 months) and range (24 months) will then give a weighted rating
on a scale of 0 to 5.
q 27 i
------------------- + q 28i
( 24 5 )
TI i = ---------------------------------------2
Management Orientation

(EQ 14)

The Management Orientation (MO) construct is calculated as stated in


equation 15. This is a single-item measure. A high score implies high
business orientation, a low score implies high technical orientation.
MO i = q 29i

Organisational Complexity

(EQ 15)

The Organisational Complexity (OC) construct is calculated as stated in


equation 12.
7
log ( q 30i ) + q 31i + --- q 32 i
6
OC i = -----------------------------------------------------------3

(EQ 16)

Generating a unidimensional scale measure for organisational complexity


is particularly complicated. Organisational complexity is a multidimensional concept, and can include size, geographical organisation, product
diversity and several other factors. The items used to measure diversification (question31) and divisional structure (question 32) are ordinal measures; care must be taken when calculating the scale value for
complexity.
The items used for organisational complexity are based on Yasai-Ardekani and Haug (1997, p744).
Question 30: organisational size. Examining the

distribution of organisa-

tional size found in the sample, size is found to range between 80 and
111,000, with a mean of approximately 28,000. Using the linear value of
size would not provide a meaningful distinction between small, medium

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Data Transposition and Interpretation

and large organisations; the results would be swamped by the larger values. A normal distribution is desirable for adequate sensitivity of the
measure to all values in the range, and it was found that plotting the log
of organisational size gave an approximately normal frequency distribution with a mean at about 4.4, as shown in Figure 12 on page 104. This
value of 4.4 is sufficiently close to the mid point of the seven point scale
range used for question 31, so no additional weighting is required. This
approach is consistent with that used by Yasai-Ardekani and Haug (1997,
p744).
FIGURE 12.

Frequency distribution of log of organisational size in sample,

Probability Distribution: Log of Organisation Size


versus no. of matching samples
10
9

no. of samples

8
7
6
5
4
3
2
1
0
0

log(org. size)

Question 32: organisational structure. This 6-point item

is weighted by a fac-

tor of 7/6 to normalise the scale to be consistent with question 31, a 7


point scale.

Appendix C:

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Spearman Rank-Order Correlation Coefficient

Spearman Rank-Order Correlation Coefficient


The Spearman Rank-Order Correlation Coefficient rs was calculated
according to equation 17, which also corrects rs for ties in the data.
3
2 ( Tx + Ty)
( N N ) 6d ---------------------2
r s = -----------------------------------------------------------------------------------------2
3
3
( N N ) ( Tx + Ty ) ( N N ) + T x T y

(EQ 17)

where
g

Tx =

(t

3
i

ti )

(EQ 18)

i=1

and a similar calculation is performed for Ty, and where g is the number
of groupings of different tied ranks in the ith grouping. d is the distance
between rankings of the data pairs (Siegel & Castellan, 1988, p239).

Appendix C:

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Spearman Rank-Order Correlation Coefficient

Appendix C:

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106

Survey Data, 21 respondents x 32 questions

9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26

27 28 29

11

19

26

37

38

40

42

43

45

46

48

49

50

51

median

mode

30 31 32

12

2500

18

3 101000

180

24

2300

4 111000

3 110000

24

2000

2100

1500

12

55000

2200

500

450

24

2200

12

55000

80

50000

2000

600

12

1000

24

1500

3 2.5

7.5

2100

2000

3 4.4

mean

3.5 3.8 3.3 3.8 4.4 4.6 3.8 5.1 4.8 5.1 4.7

std dev

1.1 1.1 1.1 0.8 0.7 0.7 0.9 0.7 1.2 1.0 1.3 1.7 1.6 1.6 0.9 1.5 1.1 1.4 1.5 1.5 1.7 1.8 1.0 1.4 1.8 1.9

3 2.2 3.3 2.6 3.6 2.9 4.2 5.3 3.6 3.2 2.7 5.8 5.8

11 2.1

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Respondent

Appendix D:

TABLE 6. Raw

3 23957.6 3.2 3.9

7.7 0.6 1.0 39470.7 1.4 2.3

107

Justin Spangaro
Strategic Thinking, Strategic Planning and High-Technology Industries

Appendix D: Results: Data Tables

Survey Data, 21 respondents x 32 questions

9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26

11

19

26

37

38

40

42

43

45

46

48

49

50

51

adjustment:a

27 28 29

30 31

32

7 2.5

3 3.3979

2 1.17

6 3.8

3 5.0043

7 0.6

1 2.2553

2 1.17

3 3.3617

2 1.17

7 1.3

4 5.0453

7 1.3

3 5.0414

5 2.33

7 1.3

2 3.3222

2 5.83

7 1.3

3 3.1761

5 2.5

4 4.7404

7 0.6

3 3.3424

7 1.3

3 1.17

3 2.6532

4 3.3424

6 2.5

5 4.7404

4 5.83

6 0.6

2 1.9031

2 1.17

7 0.8

4.699

1 1.9

3.301

3 1.17

3 1.3

3 2.7782

5 5.83

2 2.5

2 1.17

4 3.1761

4.67

RS RS RS RS RS RS RS RS RS RS RS RS RS

RS

5
/4.8

3.301

2.699

log()

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*7/6

Appendix D:

Respondent

a.Weightings applied to q27 & q32. q30 log scaled. Columns marked with RS are reverse scored:

108

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Strategic Thinking, Strategic Planning and High-Technology Industries

TABLE 7. Adjusted

Primary and secondary constructs (measures). Refer Table 2 on page 54 for details.
IO

SYSP

IF

TT

HD

A1

A2

A3

CT

FAR

TI

MO

OC

ST

STvSP

asmptns

2.857

3.5

2.667

6.5

5.333

2.75

2.188

4.13889

1.44861

4.667

4.286

2.5

6.333

5.667

3.5

5.333

5.667

3.375

4.668

4.66667

1.08889

2.75

5.333

5.667

4.5

6.333

4.667

1.313

1.807

4.48611

1.12153

4.667

2.25

5.667

6.333

2.176

4.48611

1.12153

3.857

3.75

3.667

4.333

5.5

5.333

1.625

4.682

3.93056

1.01903

4.333

3.25

4.667

4.5

5.667

4.667

1.625

4.125

4.06944

1.01736

3.857

5.333

6.333

4.667

4.434

4.5

1.16667

4.333

11

3.143

3.5

4.333

4.667

5.5

3.667

1.625

3.719

1.27273

19

5.333

1.625

4.725

3.93333

0.78667

4.667

26

3.143

3.333

2.333

2.75

5.58

3.27778

1.04293

2.333

37

3.286

3.5

6.333

5.5

6.333

1.313

5.447

5.66667

1.72464

5.667

38

3.714

3.75

4.333

5.5

5.333

1.625

2.289

4.15278

1.11806

4.333

40

4.143

2.5

4.5

4.667

4.667

4.218

4.16667

1.00575

42

4.857

2.75

4.667

5.667

2.5

2.667

4.667

3.5

4.114

3.70833

0.76348

4.667

43

4.429

1.75

5.333

4.667

2.333

1.75

4.858

4.23611

0.95654

3.333

45

3.143

3.667

4.667

1.313

1.69

3.66667

1.16667

3.667

46

2.667

5.333

5.5

5.667

1.417

5.566

4.75

1.58333

48

3.714

2.5

4.333

2.438

2.489

4.08333

1.09936

3.667

49

4.714

3.333

1.625

4.537

4.05556

0.86027

3.333

50

3.714

5.333

6.333

5.5

1.667

5.667

2.25

2.056

4.80556

1.2938

4.667

51

4.571

6.5

3.5

3.921

5.4

1.18125

Spangaro Systems Pty. Ltd.

SP

Appendix D:

Respondent

Strategic Thinking, Strategic Planning and High-Technology Industries

secondary and sub-constructs (measures, indices) extracted from the adjusted data (refer Table 7 on page 108)

109

Justin Spangaro

TABLE 8. Primary,

Strategic Thinking, Strategic Planning and High-Technology Industries

Appendix D:

Justin Spangaro

Spangaro Systems Pty. Ltd.

110

Strategic Thinking, Strategic Planning and High-Technology Industries

Justin Spangaro

Appendix E: Spearman Rank-Order Correlation


Coefficient Calculations
This appendix contains the tabulated Spearman rank-Order Correlation
Coefficient calculations.
TABLE 9. Spearman Rank-Order Correlation Coefficient calculation of CT
versus SP
RANKS
CT - SP

Item No.

CT

SP
21

20

400

11.5

16

-4.5

20.25

19

13

36

19

13

36

11.5

10.5

14

13

16

10.5

5.5

30.25

16

12

144

11.5

21

-9.5

90.25

10

11

19

13

169

12

11.5

3.5

12.25

13

7.5

15

-7.5

56.25

14

20

-17

289

15

7.5

17

-9.5

90.25

16

17

16

14

196

18

-6

36

19

19

-14

196

20

-7

49

21

18

-9

81

y
4

Ties2
Ties3

3
3

rs1
rs2
k

Appendix E:

Ties1

Tx, Ty

di

Ties4

di

2
114

2 d 2
i
3N
r
s (no ties)
rs (ties)

1937.5
21 z
-0.25812

-1.15433

-0.26571

-1.18829

30

0.156 1
0.292 2

0.25
0.1

-0.906667
rs

-0.26571

rs

0.128997

Spangaro Systems Pty. Ltd.

111

Strategic Thinking, Strategic Planning and High-Technology Industries

TABLE 10. Spearman

Justin Spangaro

Rank-Order Correlation Coefficient calculation of CT

versus ST
RANKS
CT

Item No.

21

10

11

121

11.5

17

-5.5

30.25

19

14.5

4.5

20.25

19

14.5

4.5

20.25

11.5

7.5

56.25

14

36

16

16

16

10

100

11.5

6.5

42.25

10

25

11

19

21

-2

12

11.5

11

0.5

0.25

13

7.5

12

-4.5

20.25

14

15

7.5

13

-5.5

30.25

16

17

16

18

-2

18

-7

49

19

-2

20

19

-18

324

20

-11

121

9
x

Ties1

Ties2

Ties3

Tx, Ty

0.292 1
0.37 2

-1.56

Appendix E:

2 d 2
i
N

1012
21 z

r
s (no ties)
rs (ties)

2
114

rs2

rs1

di 2

21

Ties4

CT - ST
di

ST

0.342857

1.533304

0.340856

1.524352

6
0.1
0.05
rs

0.340856

rs

0.068682

Spangaro Systems Pty. Ltd.

112

Strategic Thinking, Strategic Planning and High-Technology Industries

TABLE 11. Spearman

Justin Spangaro

Rank-Order Correlation Coefficient calculation of CT

versus ST/SP
RANKS
Item No.
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21

CT - STvSP

Ties1
Ties2
Ties3
Ties4
Tx, Ty

CT
21
11.5
19
19
11.5
14
16
16
11.5
6
19
11.5
7.5
3
7.5
4
16
2
5
1
9
x
4
3
3
2
114

STvSP
19
9
12.5
12.5
7
6
14
17
2
8
21
11
5
1
4
15
20
10
3
18
16
y
2

rs1
rs2
k

0.435
0.508
-4.866667

a1
a2

di

di2

2
2.5
6.5
6.5
4.5
8
2
-1
9.5
-2
-2
0.5
2.5
2
3.5
-11
-4
-8
2
-17
-7

4
6.25
42.25
42.25
20.25
64
4
1
90.25
4
4
0.25
6.25
4
12.25
121
16
64
4
289
49

d 2
i

848
21
0.449351
0.448047

N
r

s (no ties)

rs (ties)

2.009557
2.003727

6
0.025
0.01
rs
rs

Appendix E:

0.448047
0.022319

Spangaro Systems Pty. Ltd.

113

Strategic Thinking, Strategic Planning and High-Technology Industries

TABLE 12. Spearman

Justin Spangaro

Rank-Order Correlation Coefficient calculation of CT

versus FAR
RANKS
Item No.

CT - FAR

CT

FAR

21

16

25

11.5

18

-6.5

42.25

19

12

49

19

12

144

11.5

4.5

20.25

14

12

16

12

16

16

12

144

11.5

15

-3.5

12.25

10

1.5

4.5

20.25

11

19

21

-2

12

11.5

4.5

20.25

13

7.5

12

-4.5

20.25

14

12

-9

81

15

7.5

1.5

36

16

-3

17

16

18

-2

18

-5

25

19

20

18

-17

289

20

-11

121

21

9
x

Ties1

Ties2
Ties3

3
3

Ties4
Tx, Ty
rs1
rs2
k

Appendix E:

di 2

di

2
114

2 d 2
i
5N
3r
s (no ties)
rs (ties)

1090.5
21 z
0.291883

1.305341

0.283927

1.269759

150

0.156 1
0.292 2

0.25
0.1

-0.906667
rs

0.283927

rs

0.108904

Spangaro Systems Pty. Ltd.

114

Strategic Thinking, Strategic Planning and High-Technology Industries

TABLE 13. Spearman

Justin Spangaro

Rank-Order Correlation Coefficient calculation of OC

versus SP
RANKS
Item No.

OC - SP

OC

SP

15

16

-1

13

-11

121

13

-9

81

16

10.5

5.5

30.25

11

13

-2

13

10.5

2.5

6.25

16

17

21

-4

16

10

21

17

289

11

19

13

169

12

-2

13

12

15

-3

14

10

20

-10

100

15

18

17

16

-3

17

20

18

324

18

-1

19

14

19

-5

25

20

-5

25

21

18

-9

81

y
0

Ties2
Ties3

2 d 2
i
3N

1328.5
21 z

2r
s (no ties)
rs (ties)

Ties4
Tx, Ty

16

x
Ties1

di 2

di

rs1

0.156 1

rs2

0.292 2
-0.906667

0.137338

0.614193

0.137931

0.616848

36
0.25 rs1 out of
range of rs!

Appendix E:

0.1
rs

0.137931

rs

0.269929 ERROR

Spangaro Systems Pty. Ltd.

115

Strategic Thinking, Strategic Planning and High-Technology Industries

TABLE 14. Spearman

Justin Spangaro

Rank-Order Correlation Coefficient calculation of OC

versus ST
RANKS
Item No.

OC - ST

OC

ST

10

-5

15

17

-2

14.5

-12.5

156.25

14.5

-10.5

110.25

16

12

144

11

13

16

-3

17

12

144
400

10

21

20

11

19

21

-2

12

11

-5

25

13

12

12

14

10

49

15

18

13

25

16

-1

17

20

18

18

-2

19

14

49

20

19

-16

256

21

20

-11

121

y
0

Ties2

2 d 2
i
N

Ties3

1543.5
21 z

r
s (no ties)
rs (ties)

Ties4
Tx, Ty

25

x
Ties1

di 2

di

rs1

0.156 1

rs2

0.292 2
-0.906667

-0.00227

-0.01016

-0.00032

-0.00145

6
0.25 rs1 out of
range of rs!

0.1
rs
rs

Appendix E:

Spangaro Systems Pty. Ltd.

-0.00032
0.421701 ERROR

116

Strategic Thinking, Strategic Planning and High-Technology Industries

Justin Spangaro

TABLE 15. Spearman

Rank-Order Correlation Coefficient calculation of OC


versus ST/SP
RANKS
OC Item No.

OC
5

19

-14

15

36

12.5

-10.5

110.25

12.5

-8.5

72.25

16

81

11

25

13

14

-1

17

-9

81

17

15

225

21

13

169

11

19

21

-2

12

11

-5

25

13

12

49

14

10

81

15

18

14

196

16

15

-14

196

17

20

20

18

10

-3

19

14

11

121

20

18

-15

225

21

16

-7

49

y
0

2 d 2
i
N

Ties3

rs2
k

Appendix E:

1951.5
21 z

r
s (no ties)
rs (ties)

Ties4

rs1

196

10

Ties2

Tx, Ty

di 2

x
Ties1

STvSP
di

STvSP

-0.26721

-1.19499

-0.26535

-1.18666

0.156 1
0.292 2

0.25
0.1

-0.906667
rs

-0.26535

rs

0.129398

Spangaro Systems Pty. Ltd.

117

Strategic Thinking, Strategic Planning and High-Technology Industries

TABLE 16. Spearman

Justin Spangaro

Rank-Order Correlation Coefficient calculation of OC

versus FAR
RANKS
Item No.

OC - FAR

OC

FAR

16

-11

15

18

-3

12

-10

100

-3

16

81

11

12

-1

13

12

1
16

17

15

10

21

1.5

19.5

380.25
4

11

19

21

-2

12

-1

13

12

12

14

10

12

-2

15

18

1.5

16.5

272.25

16

-6

36

17

20

18

18

19

14

11

121

20

18

-15

225

21

20

-11

121

y
0

Ties2
Ties3

2 d 2
i
5N

1510.5
21 z

3r
s (no ties)
rs (ties)

Ties4
Tx, Ty

121

x
Ties1

di 2

di

rs1

0.156 1

rs2

0.292 2
-0.906667

0.019156

0.085668

0.013421

0.060021

150
0.25 rs1 out of
range of rs!

Appendix E:

0.1
rs

0.013421

rs

0.407256 ERROR

Spangaro Systems Pty. Ltd.

118

Strategic Thinking, Strategic Planning and High-Technology Industries

TABLE 17. Spearman

Justin Spangaro

Rank-Order Correlation Coefficient calculation of MO

versus SP
RANKS
Item No.

MO -SP

MO

SP

11.5

10.5

110.25

11.5

16

-4.5

20.25

13

-12

144

11.5

13

-1.5

2.25

18

10.5

7.5

56.25

11.5

13

-1.5

2.25

4.5

10.5

-6

36

4.5

0.5

0.25
90.25

11.5

21

-9.5

10

18

14

196

11

11.5

5.5

30.25

12

4.5

-3.5

12.25

13

11.5

15

-3.5

12.25

14

18

20

-2

15

21

17

16

16

4.5

0.5

0.25

17

4.5

2.5

6.25

18

18

10

100

19

11.5

19

-7.5

56.25

20

4.5

-3.5

12.25

21

18

18

Ties1

Ties2
Ties3

6
5

Ties4
Tx, Ty
rs1
rs2
k

Appendix E:

di 2

di

834

2 d 2
i
3N
2r
s (no ties)
rs (ties)

907.5
21 z
0.410714
0.384381

1.83677
1.719005

36

0.37 1
0.435 2
-2.6

0.05
0.025
rs

0.384381

rs

0.044469

Spangaro Systems Pty. Ltd.

119

Strategic Thinking, Strategic Planning and High-Technology Industries

TABLE 18. Spearman

Justin Spangaro

Rank-Order Correlation Coefficient calculation of MO

versus ST
RANKS
Item No.

MO -ST

MO

ST

11.5

10

1.5

2.25

11.5

17

-5.5

30.25

14.5

-13.5

182.25

11.5

14.5

-3

18

14

196

11.5

3.5

12.25

4.5

16

-11.5

132.25

4.5

-1.5

2.25

11.5

6.5

42.25

10

18

17

289

11

11.5

21

-9.5

90.25

12

4.5

11

-6.5

42.25

13

11.5

12

-0.5

0.25

14

18

15

225

15

21

13

64

16

4.5

2.5

6.25

17

4.5

18

-13.5

182.25

18

18

81

19

11.5

4.5

20.25

20

4.5

19

-14.5

210.25

21

18

20

-2

Ties1

Ties2

Ties3

2 d 2
i
N

rs1
rs2
k

Appendix E:

834

1823.5
21 z

r
s (no ties)
rs (ties)

Ties4
Tx, Ty

di 2

di

-0.18409

-0.82328

-0.23836

-1.06597

0.156 1
0.292 2

0.25
0.1

-0.906667
rs

-0.23836

rs

0.159164

Spangaro Systems Pty. Ltd.

120

Strategic Thinking, Strategic Planning and High-Technology Industries

Justin Spangaro

TABLE 19. Spearman

Rank-Order Correlation Coefficient calculation of MO


versus ST/SP
RANKS
MO Item No.

MO

STvSP
di

STvSP

11.5

19

-7.5

11.5

2.5

6.25

12.5

-11.5

132.25

11.5

12.5

-1

18

11

121

11.5

5.5

30.25

4.5

14

-9.5

90.25

4.5

17

-12.5

156.25

11.5

9.5

90.25

10

18

10

100

11

11.5

21

-9.5

90.25

12

4.5

11

-6.5

42.25

13

11.5

6.5

42.25

14

18

17

289

15

21

17

289

16

4.5

15

-10.5

110.25

17

4.5

20

-15.5

240.25

18

18

10

64

19

11.5

8.5

72.25

20

4.5

18

-13.5

182.25

21

18

16

x
8

Ties2

Ties3

2 d 2
i
N

rs1
k

Appendix E:

834

2209.5
21 z

r
s (no ties)
rs (ties)

Ties4

rs2

56.25

Ties1

Tx, Ty

di 2

-0.43474

-1.94422

-0.50123

-2.24158

0.435 1
0.508 2
-4.866667

0.025
0.01
rs

-0.50123

rs

0.011391

Spangaro Systems Pty. Ltd.

121

Strategic Thinking, Strategic Planning and High-Technology Industries

TABLE 20. Spearman

Justin Spangaro

Rank-Order Correlation Coefficient calculation of MO

versus FAR
RANKS
Item No.

MO -FAR

MO

FAR

11.5

16

-4.5

20.25

11.5

18

-6.5

42.25

12

-11

121

11.5

4.5

20.25

18

11

121

11.5

12

-0.5

0.25

4.5

12

-7.5

56.25

4.5

0.5

0.25

11.5

15

-3.5

12.25

10

18

1.5

16.5

272.25

11

11.5

21

-9.5

90.25

12

4.5

-2.5

6.25

13

11.5

12

-0.5

0.25

14

18

12

36

15

21

1.5

19.5

380.25

16

4.5

-2.5

6.25

17

4.5

18

-13.5

182.25

18

18

11

121

19

11.5

8.5

72.25

20

4.5

18

-13.5

182.25

21

18

20

-2

Ties1

Ties2
Ties3

6
5

Ties4
Tx, Ty
rs1
rs2
k

di 2

di

834

2 d 2
i
5N
3r
s (no ties)
rs (ties)

1747

-0.60112

-0.19597

-0.87639

150

0.156 1
0.292 2

0.25
0.1

-0.906667
rs
rs

Appendix E:

21 z
-0.13442

Spangaro Systems Pty. Ltd.

-0.19597
0.20592

122

Strategic Thinking, Strategic Planning and High-Technology Industries

TABLE 21. Spearman

Justin Spangaro

Rank-Order Correlation Coefficient calculation of TI

versus SP
RANKS
Item No.

TI - SP

TI

SP

15.5

14.5

18

16

13

-11

121
16

17

13

7.5

10.5

-3

7.5

13

-5.5

30.25

21

10.5

10.5

110.25

7.5

3.5

12.25

7.5

21

-13.5

182.25

10

15.5

11.5

132.25

11

-4

16

12

7.5

-0.5

0.25

13

12

15

-3

14

19.5

20

-0.5

0.25

15

11

17

-6

36

16

-2

17

18

14

36

19

7.5

19

-11.5

132.25

20

13

25

21

19.5

18

1.5

2.25

y
3

Ties2
Ties3

6
2

Tx, Ty
rs1
rs2
k

2
246

2 d 2
i
3N
2r
s (no ties)
rs (ties)

1092.5
21 z
0.290584

1.299533

0.281918

1.260775

36

0.156 1
0.292 2

0.25
0.1

-0.906667
rs
rs

Appendix E:

210.25

Ties1

Ties4

di 2

di

Spangaro Systems Pty. Ltd.

0.281918
0.11112

123

Strategic Thinking, Strategic Planning and High-Technology Industries

TABLE 22. Spearman

Justin Spangaro

Rank-Order Correlation Coefficient calculation of TI

versus ST
RANKS
Item No.

TI - ST

TI

ST

15.5

10

5.5

18

17

14.5

-12.5

156.25

17

14.5

2.5

6.25

7.5

3.5

12.25

7.5

-0.5

0.25

21

16

25

7.5

1.5

2.25

7.5

2.5

6.25

10

15.5

14.5

210.25

11

21

-19

361

12

7.5

11

-3.5

12.25

13

12

12

14

19.5

16.5

272.25

15

11

13

-2

16

17

18

-14

196

18

14

25

19

7.5

0.5

0.25

20

13

19

-6

36

21

19.5

20

-0.5

0.25

x
3

Ties2

Ties3

Tx, Ty

30.25

Ties1

Ties4

di 2

di

2 d 2
i
N

rs1

0.156 1

rs2

0.292 2
-0.906667

21 z

r
s (no ties)
rs (ties)

2
246

1357

0.118831

0.531429

0.108963

0.487296

6
0.25 rs1 out of
range of rs!

Appendix E:

0.1
rs

0.108963

rs

0.301879 ERROR

Spangaro Systems Pty. Ltd.

124

Strategic Thinking, Strategic Planning and High-Technology Industries

Justin Spangaro

TABLE 23. Spearman

Rank-Order Correlation Coefficient calculation of TI


versus ST/SP
RANKS
TI - STvSP
Item No.

TI

STvSP

15.5

19

-3.5

18

81

12.5

-10.5

110.25

17

12.5

4.5

20.25

7.5

0.5

0.25

7.5

1.5

2.25

21

14

49

7.5

17

-9.5

90.25

7.5

5.5

30.25

15.5

7.5

56.25

11

21

-19

361

12

7.5

11

-3.5

12.25

13

12

49

14

19.5

18.5

342.25

15

11

49

16

15

-13

169
256

17

20

-16

18

14

10

16

19

7.5

4.5

20.25

20

13

18

-5

25

21

19.5

16

3.5

12.25

y
3

Ties2

Ties3

Tx, Ty
rs1
rs2
k

2 d 2
i
N

21 z

r
s (no ties)
rs (ties)

2
246

1764

-0.14545

-0.65049

-0.159

-0.71107

0.156 1
0.292 2

0.25
0.1

-0.906667
rs
rs

Appendix E:

12.25

10

Ties1

Ties4

di 2

di

Spangaro Systems Pty. Ltd.

-0.159
0.246691

125

Strategic Thinking, Strategic Planning and High-Technology Industries

TABLE 24. Spearman

Justin Spangaro

Rank-Order Correlation Coefficient calculation of TI

versus FAR
RANKS
Item No.

TI - FAR

TI

FAR

15.5

16

-0.5

18

18

12

-10

100

17

10

100

7.5

0.5

0.25

7.5

12

-4.5

20.25

21

12

81

7.5

3.5

12.25
56.25

7.5

15

-7.5

15.5

1.5

14

196

11

21

-19

361

12

7.5

0.5

0.25

13

12

12

14

19.5

12

7.5

56.25

15

11

1.5

9.5

90.25

16

-5

25

17

18

-14

196

18

14

49

19

7.5

4.5

20.25

20

13

18

-5

25

21

19.5

20

-0.5

0.25

y
3

Ties2
Ties3

6
2

Tx, Ty

0.25

10

Ties1

Ties4

di 2

di

2
246

rs1

0.156 1

rs2

0.292 2
-0.906667

2 d 2
i
5N
3r
s (no ties)
rs (ties)

1389.5
21 z
0.097727
0.080293

0.43705
0.359082

150
0.25 rs1 out of
range of rs!

0.1
rs
rs

Appendix E:

Spangaro Systems Pty. Ltd.

0.080293
0.3335 ERROR

126

Justin Spangaro

Appendix F: Supplementary Statistical Analyses


The tables in this section are not discussed but are presented for additional information for the interested reader.
TABLE 25. Pearson

Correlation Coefficient Matrix for subconstructs of Strategic Thinking

ST
ST
ASMPTNS
A1
A2
A3
IO
SYSP
IF
TT
HD
FAR

ASMPTNS
.643

.643
.131
.672
.121
-.150
.518
.582
.394
.792
.758

.657
.709
-.026
.146
.293
.187
-.032
.394
.877

A1
.131
.657
.083
-.352
.515
-.019
-.299
-.063
-.125
.506

Correlation between Vectors of Values


A2
A3
IO
SYSP
.672
.121
-.150
.518
.709
-.026
.146
.293
.083
-.352
.515
-.019
-.231
-.165
.373
-.231
-.277
.077
-.165
-.277
-.586
.373
.077
-.586
.379
.314
-.509
.645
-.102
.224
-.024
-.083
.647
.016
-.172
.159
.841
-.295
.106
.252

IF
.582
.187
-.299
.379
.314
-.509
.645
-.065
.331
.185

TT
.394
-.032
-.063
-.102
.224
-.024
-.083
-.065
.280
.035

HD
.792
.394
-.125
.647
.016
-.172
.159
.331
.280

FAR
.758
.877
.506
.841
-.295
.106
.252
.185
.035
.702

Spangaro Systems Pty. Ltd.

Proximity Matrix

.702

This is a similarity matrix

of strategic planning construct survey questions 1-7

Correlation

Sig. (1-tailed)

Q1
Q2
Q3
Q4
Q5
Q6
Q7
Q1
Q2
Q3
Q4
Q5
Q6
Q7

Q1
1.000
.196
.390
.098
.266
.392
.080
.197
.040
.337
.122
.039
.366

Q2
.196
1.000
.605
.585
.561
.261
.622
.197
.002
.003
.004
.126
.001

Q3
.390
.605
1.000
.449
.422
.133
.652
.040
.002
.021
.028
.282
.001

Q4
.098
.585
.449
1.000
.361
.179
.538
.337
.003
.021
.054
.219
.006

Q5
.266
.561
.422
.361
1.000
.085
.294
.122
.004
.028
.054
.357
.098

Q6
.392
.261
.133
.179
.085
1.000
.381
.039
.126
.282
.219
.357

Q7
.080
.622
.652
.538
.294
.381
1.000
.366
.001
.001
.006
.098
.044

Appendix F:

Correlation Matrix

.044

127

Strategic Thinking, Strategic Planning and High-Technology Industries

TABLE 26. Covariance

matrix for factor analysis of Elements of Strategic Thinking and Assumptions

Correlation

TABLE 28. Varimax

A1
1.000
.083
-.352
.515
-.019
-.299
-.063
-.125

A2
.083
1.000
-.231
-.165
.373
.379
-.102
.647
.367

.367
.070
.012
.469
.107
.398
.305

A3
-.352
-.231
1.000
-.277
.077
.314
.224
.016
.070
.171

.171
.250
.058
.055
.339
.001

.126
.377
.095
.178
.475

IO
.515
-.165
-.277
1.000
-.586
-.509
-.024
-.172
.012
.250
.126
.004
.013
.461
.240

SYSP
-.019
.373
.077
-.586
1.000
.645
-.083
.159
.469
.058
.377
.004

IF
-.299
.379
.314
-.509
.645
1.000
-.065
.331
.107
.055
.095
.013
.001

.001
.368
.258

.396
.083

TT
-.063
-.102
.224
-.024
-.083
-.065
1.000
.280
.398
.339
.178
.461
.368
.396

HD
-.125
.647
.016
-.172
.159
.331
.280
1.000
.305
.001
.475
.240
.258
.083
.123

.123

Rotated Principal Component Factor Analysis of Strategic Planning Elements and Assumptions
Component Matrixa

A1
A2
A3
IO
SYSP
IF
TT
HD

1
-.457
.537
.336
-.777
.743
.844
5.811E-02
.540

Component
2
.587
.731
-.693
.294
.170
-2.04E-03
-.241
.419

Communalities
3
-8.25E-02
.148
.175
.192
-.374
-.159
.804
.627

Extraction Method: Principal Component Analysis.


a. 3 components extracted.

A1
A2
A3
IO
SYSP
IF
TT
HD

Initial
1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000

Extraction
.561
.845
.624
.727
.720
.737
.708
.860

Appendix F:

Strategic Thinking, Strategic Planning and High-Technology Industries

Sig. (1-tailed)

A1
A2
A3
IO
SYSP
IF
TT
HD
A1
A2
A3
IO
SYSP
IF
TT
HD

Spangaro Systems Pty. Ltd.

Correlation Matrix

Extraction Method: Principal Component Analysis.

128

Justin Spangaro

TABLE 27. Correlation

Q8
Q9
Q10
Q11
Q12
Q13
Q14
Q15
Q16
Q17
Q18
Q19
Q20
Q8
Q9
Q10
Q11
Q12
Q13
Q14
Q15
Q16
Q17
Q18
Q19
Q20

TABLE 30. Unrotated

Q8
1.000
.722
.697
.391
-.619
-.323
-.361
-.449
-.188
-.255
-.113
-.050
-.073

Q9
.722
1.000
.386
.117
-.297
.192
-.415
-.089
.027
-.149
-.252
-.025
.231
.001

.001
.001
.060
.004
.103
.077
.035
.235
.161
.333
.425
.391

Q10
.697
.386
1.000
.593
-.798
-.257
-.439
-.637
-.566
-.463
.087
-.336
-.248
.001
.063

.063
.327
.124
.230
.049
.367
.458
.284
.164
.463
.186

.006
.000
.160
.039
.003
.009
.031
.370
.093
.169

Q11
.391
.117
.593
1.000
-.703
-.278
-.197
-.321
-.404
-.499
.318
.091
-.304
.060
.327
.006

Q12
-.619
-.297
-.798
-.703
1.000
.279
.476
.744
.424
.459
-.410
.084
.026
.004
.124
.000
.001

.001
.140
.224
.105
.054
.021
.107
.364
.118

.139
.027
.000
.045
.032
.051
.374
.461

Q13
-.323
.192
-.257
-.278
.279
1.000
-.279
.342
.188
.156
.076
-.048
.630
.103
.230
.160
.140
.139
.139
.090
.235
.275
.386
.427
.003

Q14
-.361
-.415
-.439
-.197
.476
-.279
1.000
.587
.250
.262
-.221
.140
-.078
.077
.049
.039
.224
.027
.139

Q15
-.449
-.089
-.637
-.321
.744
.342
.587
1.000
.642
.381
-.480
.087
.193
.035
.367
.003
.105
.000
.090
.007

.007
.167
.154
.197
.296
.384

.003
.066
.026
.371
.229

Q16
-.188
.027
-.566
-.404
.424
.188
.250
.642
1.000
.182
-.337
.100
.479
.235
.458
.009
.054
.045
.235
.167
.003
.242
.093
.351
.026

Q18
-.113
-.252
.087
.318
-.410
.076
-.221
-.480
-.337
-.020
1.000
.294
.301
.333
.164
.370
.107
.051
.386
.197
.026
.093
.469

.469
.156
.202

Q19
-.050
-.025
-.336
.091
.084
-.048
.140
.087
.100
.261
.294
1.000
.240
.425
.463
.093
.364
.374
.427
.296
.371
.351
.156
.126

.126
.120

Q20
-.073
.231
-.248
-.304
.026
.630
-.078
.193
.479
.216
.301
.240
1.000
.391
.186
.169
.118
.461
.003
.384
.229
.026
.202
.120
.177

.177

and Rotated Principal Component Factor Analyses of Strategic Thinking Construct Questions 8-20
Component Matrix

Rotated Component Matrix

2
-.705
-.364
-.901
-.703
.899
.351
.561
.819
.632
.572
-.283
.183
.303

.278
.665
3.375E-02
-.163
-.130
.704
-.513
3.737E-02
.326
7.402E-02
.102
9.504E-02
.804

Component

Component
1
Q8
Q9
Q10
Q11
Q12
Q13
Q14
Q15
Q16
Q17
Q18
Q19
Q20

Q17
-.255
-.149
-.463
-.499
.459
.156
.262
.381
.182
1.000
-.020
.261
.216
.161
.284
.031
.021
.032
.275
.154
.066
.242

3
-.416
-.491
-.185
.142
-.159
.160
-8.64E-02
-.303
-.266
.155
.901
.475
.303

Extraction Method: Principal Component Analysis.


a. 4 components extracted.

4
.388
.230
-7.04E-02
.270
-.122
-.429
.352
.150
.251
.182
1.063E-02
.731
.100

Q8
Q9
Q10
Q11
Q12
Q13
Q14
Q15
Q16
Q17
Q18
Q19
Q20

-.331
-9.41E-03
-.707
-.631
.821
.187
.565
.879
.735
.463
-.651
8.512E-02
.186

2
.872
.892
.499
.262
-.423
-8.14E-02
-.305
-9.87E-02
.151
-.232
-.359
-3.42E-03
.133

3
-.171
.262
-.170
-.335
6.012E-02
.880
-.492
3.876E-02
.221
.147
.298
-2.53E-02
.795

4
1.153E-02
-6.47E-02
-.273
.187
-9.28E-02
-.112
.234
5.078E-02
.165
.316
.511
.892
.397

Appendix F:

Correlation

Spangaro Systems Pty. Ltd.

Correlation Matrix

Sig. (1-tailed)

Strategic Thinking, Strategic Planning and High-Technology Industries

Matrix of Strategic Thinking Construct Questions 8-23

Extraction Method: Principal Component Analysis.


Rotation Method: Varimax with Kaiser Normalization.
a. Rotation converged in 7 iterations.

129

Justin Spangaro

TABLE 29. Correlation

Strategic Thinking, Strategic Planning and High-Technology Industries

Appendix F:

Justin Spangaro

Spangaro Systems Pty. Ltd.

130

Strategic Thinking, Strategic Planning and High-Technology Industries

Justin Spangaro

Appendix G: Regression Curve Fit for CT vs ST/SP


Regression curve estimation calculations for CT versus ST/SP
(linear and quadratic)
FIGURE 13.

MODEL: MOD_3.
Dependent variable.. STVSP

Method.. LINEAR

Listwise Deletion of Missing Data


Multiple R
R Square
Adjusted R Square
Standard Error

.37138
.13792
.09255
.22528

Analysis of Variance:

Regression
Residuals
F =

DF

Sum of Squares

Mean Square

1
19

.15427463
.96428844

.15427463
.05075202

3.03977

Signif F =

.0974

-------------------- Variables in the Equation -------------------Variable


CT
(Constant)
_

SE B

Beta

Sig T

.058917
.850430

.033792
.170568

.371379

1.743
4.986

.0974
.0001

Dependent variable.. STVSP

Method.. QUADRATI

Listwise Deletion of Missing Data


Multiple R
R Square
Adjusted R Square
Standard Error

.66002
.43563
.37292
.18727

Analysis of Variance:

Regression
Residuals
F =

DF

Sum of Squares

Mean Square

2
18

.48727721
.63128586

.24363860
.03507144

6.94692

Signif F =

.0058

-------------------- Variables in the Equation -------------------Variable


CT
CT**2
(Constant)

SE B

Beta

Sig T

-.511883
.067572
1.887731

.187359
.021929
.365276

-3.226630
3.639145

-2.732
3.081
5.168

.0137
.0064
.0001

Spangaro Systems Pty. Ltd.

131

Strategic Thinking, Strategic Planning and High-Technology Industries

Justin Spangaro

Plot of ST/SP versus CT; observed data with linear and quadratic
regression equations
FIGURE 14.

STVSP
1.8

1.6

1.4

1.2

1.0
Observed
.8
Linear
.6

Quadratic
1

CT

Spangaro Systems Pty. Ltd.

132

TABLE 31. Multiple

Linear Regression Correlation Coefficient Matrix for ST/SP versus CT, TI, MO and OC

Standardi
zed
Unstandardized Coefficien
Coefficients
ts
Model
B
Std. Error Beta
t
1
(Constant 1.139
.291
3.908
CT
458E-02
.039
.281
1.155
TI
.70E-02
.064
-.061
-.265
MO
7.20E-02
.067
-.296 -1.076
OC
156E-03
.047
.045
.173

% Confidence Interval for


Correlations
Collinearity Statistics
Sig. Lower BoundUpper BoundZero-order Partial
Part Tolerance VIF
.001
.521
1.757
.265
-.037
.126
.371
.277
.255
.821
1.218
.794
-.153
.119
-.167
-.066
-.059
.910
1.099
.298
-.214
.070
-.367
-.260
-.237
.640
1.562
.865
-.092
.108
-.029
.043
.038
.712
1.405

a.Dependent Variable: STVSP

Linear Regression Correlation Coefficient Matrix for ST versus CT, TI, MO and OC
a
Coefficients

Standardi
zed
Unstandardized Coefficien
Coefficients
ts
Model
B
Std. Error Beta
1
(Constant 3.741
.724
CT
797E-02
.096
.263
TI
625E-02
.160
.148
MO
9.71E-02
.166
-.170
OC
070E-02
.117
.096

t
5.165
1.021
.603
-.583
.348

% Confidence Interval for


Correlations
Collinearity Statistics
Sig. Lower BoundUpper BoundZero-order Partial
Part Tolerance VIF
.000
2.205
5.276
.322
-.105
.301
.313
.247
.238
.821
1.218
.555
-.242
.434
.081
.149
.141
.910
1.099
.568
-.450
.256
-.155
-.144
-.136
.640
1.562
.732
-.207
.288
.078
.087
.081
.712
1.405

Appendix H:

Strategic Thinking, Strategic Planning and High-Technology Industries

TABLE 32. Multiple

Spangaro Systems Pty. Ltd.

a
Coefficients

a.Dependent Variable: ST

133

Justin Spangaro

Appendix H: Multiple Linear Regression Correlation Tables

Linear Regression Correlation Coefficient Matrix for SP versus CT, TI, MO and OC

Standardi
zed
Unstandardized Coefficien
Coefficients
ts
Model
B
Std. Error Beta
1
(Constant 3.323
.800
CT
6.36E-02
.106
-.151
TI
.113
.176
.154
MO
.147
.184
.228
OC
731E-02
.129
.099

t
4.152
-.601
.642
.799
.366

% Confidence Interval fo
Correlations
Collinearity Statistics
Sig. Lower Bound
Upper BoundZero-order Partial
Part Tolerance VIF
.001
1.626
5.019
.557
-.288
.161
-.204
-.148
-.137
.821
1.218
.530
-.260
.487
.233
.159
.147
.910
1.099
.436
-.243
.536
.353
.196
.183
.640
1.562
.719
-.226
.321
.172
.091
.084
.712
1.405

a.Dependent Variable: SP

Linear Regression Correlation Coefficient Matrix for FAR versus CT, TI, MO and OC
a
Coefficients

Standardi
zed
Unstandardized Coefficien
ts
Coefficients
Mode
B Std. Error Beta
t
1
(Constan 4.054 1.535
2.641
CT
.121
.203
.150
.594
TI
.353
.338
.250 1.045
MO
-.433
.353
-.351 -1.229
OC
.108
.248
.118
.437

% Confidence Interval fo
Correlations
Sig. ower Bound
Upper Bound
Zero-order Partial
.018
.800
7.308
.561
-.310
.552
.242
.147
.311
-.363
1.070
.143
.253
.237
-1.181
.314
-.268
-.294
.668
-.417
.633
.005
.109

ollinearity Statistic
Part Tolerance VIF
.135
.239
-.281
.100

.821
.910
.640
.712

1.218
1.099
1.562
1.405

Appendix H:

Strategic Thinking, Strategic Planning and High-Technology Industries

TABLE 34. Multiple

Spangaro Systems Pty. Ltd.

a
Coefficients

a.Dependent Variable: FAR

134

Justin Spangaro

TABLE 33. Multiple

Strategic Thinking, Strategic Planning and High-Technology Industries

Justin Spangaro

Index

A
a values 59
Abbreviation 45
adaptability of core technology 57
adherence to plans 33
Adler, McDonald and McDonald 32
alignment 25
alignment and misalignment 32
alignment of technology strategy 32
Analysis 59
Analysis versus intuition 29
analytic/intuitive debate 23
Andrews 15, 18, 20
Ansoff 14, 19
Ansoffs 15
Argyris 26
Assumptions 55
B
Barker and Smith 32
Bateson 26
Berry 33, 57, 63, 67
Bivariate regression curve fit 50
Bivariate Regression Curve Fit Analysis 49
Boyd & Reuning-Elliott 11, 41
Boyd and Reuning-Elliott 55
Brain 10
Butler 25, 34
C
Calculations 101
central 22
Central Limit Theorem 64, 73
Characteristics of strategic planning 19
Claver 29
Complex learning 27
Concept of Strategy 14
Conclusion 79
Connecting Planning with Thinking 25
Constructs 45
constructs 48
core competencies 19
Corporate Strategy Committees 19
Covariance 127
Covin and Slevin 33, 54, 56, 68
Criticality of Technology 102
criticality of technology 39
Criticality of Technology to the organisation 45
Crouch and Basch 17
CT 45, 59
Cureton and Agostino 64
D
Data 107
Data Collection Methods 42
Data Transposition and Interpretation 101
De Wit and Meyer 16
deliberate strategy 16
Dependent variables 45

dialectic view of strategy 26


Diaz and Gomez-Mejia 30, 34, 56
Discussion 59
double-loop learning 14, 26
double-loop organisational learning 30, 32
Drago 31
E
elements of strategic thinking 24
emergent strategy 16
Emory 59
Environmental Hostility 45
environmental hostility 57
Environmental Turbulence 45
environmental turbulence 57
F
Factor Analysis 64, 73
factor analysis 49
fallacies of strategic planning 21
FAR 45, 59
five Ps 15
flexibility of an organisations core technologies 30
flexible technologies 30, 76, 78
formulation 20
Formulation/Analysis Relationship 102
formulation-analysis relationship 62
Franko 30
G
Glaister & Falshaw 21
grand strategies 77
grand-incremental strategy 62
H
Hamel & Prahalad 24
Hax and Majluf 18
Heracleous 10, 11, 13, 22, 25, 26, 28, 29, 32, 40, 56, 62, 77
High Technology Industries 29
Hodgekinson 31
holistic view of strategy 14
Hypotheses 51
hypotheses 79
Hypotheses A and C 70
Hypothesis A 51, 62
Hypothesis B 51, 61, 65, 69, 70, 75, 79
Hypothesis C 51, 61, 65
Hypothesis D 51, 62, 65, 70
hypothesis driven 77
hypothesis generation - testing 56
hypothesis testing 40
Hypothesis testing/falsification 41
Hypothesis-driven 54
hypothesis-testing 24
hypothetico-deductive research methodology 41
I
incrementalist perspective 16
Independent variables 45

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Strategic Thinking, Strategic Planning and High-Technology Industries

Inductive/Deductive Methodology 41
Inflexibility of Technology 102
intelligent opportunism 24
Intelligently Opportunistic
54
Intent focused 54
Interview Questions 99
J
Japanese companies 32
Justin Spangaro 82
L
Langley 29
left-brain 20
Leidtka 75, 77
Leidtkas 32
length of investment gestation period 57
Liedtka 10, 13, 23, 24, 25, 26, 29, 40, 53, 55, 56, 62, 80
likert scale 42
Likert scales 46
Linear Regression 73
Literature Review 13
Lowendahl & Revang 29, 34
Lowendahl and Revang 34
M
Management Orientation 103
management orientation 78
Management orientation (business or technology) 45
McGrath 32, 34, 35
measure of strategic thinking 42
Measurement scales 42
Mintzberg 10, 11, 13, 14, 15, 18, 20, 22, 25, 29, 40, 56, 77
Mintzberg and Waters 16
Mintzberg, Ahlstrand & Lampel 10, 11, 15, 20, 22, 25, 27, 28, 29,
62
Mintzberg, Ahlstrand and Lampel 17, 19, 21, 77
missing items 46
MO 45, 59
moderating factors 39
Moon 56
Multiple Linear Regression 133
Multiple linear regression 50
Multiple Linear Regression Analysis 49
N
Need for Innovation 45
need to support innovation 57
non-linear brain-power 22
number of employees 57
O
OShannassy 20, 22
OShannasy 9
OC 45, 59
Ohmae 20, 22, 23, 24, 77
Operationalisation 53
Operationalisation of Organisational Complexity 57

Justin Spangaro

Operationalisation of Primary Constructs 53


Operationalisation of Strategic Planning 55
Operationalisation of Strategic Thinking 53
Operationalisation of technological inflexibility 56
Operationalisation of the Criticality of the Impact of
Technology 56
Operationalisation of the Interaction between analysis and
formulation 56
Organisational Complexity 45, 103
Organisational complexity 57
organisational complexity 30, 31, 78
organisational level 73
organisational size 103
organisational structure 104
P
Pearson Correlation Coefficient Matrix 127
Pfeiffer 18
planning perspective 16
Popperian falsification 41
Porter 11, 19, 20, 22, 24, 40
Prahalad & Hamel 24
Prahalad and Hamel 19
Primary Constructs 45
primary constructs 53
process sequences 42
Product Diversity 45
product diversity 57
Q
Quantitative and Qualitative Methods 41
quantitative methodology 74
R
R2 values 69
realised strategy 16
Reform of traditional strategic planning processes 76
Regression Analysis of Secondary Constructs 68
Regression curve 131
Regression Curve Fit of CT versus ST/SP 68
relationship between formulation and analysis 45
Relative Emphasis between Strategic Thinking and Strategic
Planning 45
Research Aims 11
Research Design 39
research hypotheses 51
Research Implications 75
Research Limitations 73
Research Methodology 41
research models 39
Research Variables 45
Results 59
Roberts 32, 33
rs 49, 59
S
Sample Size 73
sample size 60
Sarrazin 18

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Strategic Thinking, Strategic Planning and High-Technology Industries

schools of thought 17
Schroederer, Congden and Gopinath 32
Scott 29
Secondary Constructs 45, 63
secondary constructs 53
Semple 10
Senge 26
Seth and Zinkhan 41
Siegel & Castellan 59
Siegel and Castellan 49
single-loop learning 26
single-loop organisational learning 14
single-loop versus double-loop learning 31
Single-loop/ double-loop learning 26
SP 45, 59
Spearman Rank-Order Correlation analysis 73
Spearman Rank-Order Correlation Coefficient 105
Spearman Rank-Order Correlation Coefficient Analysis 49
Spearman Rank-Order Correlation Coefficient analysis 70
Spearman Rank-Order Correlation Coefficient Calculations 111
Spearman Rank-Order Correlation Coefficient rs 59
ST 45, 59
ST/SP 45, 59
Stacey 20, 22, 26, 27
Statistical Analysis Methods 49
Strategic conversations 25
strategic intent 24, 33
Strategic Planning 18, 102
strategic planning 9
strategic programming 20
Strategic Thinking 22, 101
strategic thinking 9
Strategic Thinking Elements 74
strategy formation 32
Strategy formulation 20
STvSP 45
Sun Tsu 14
Survey Questionnaire 89
survey questions 48
SWOT 21
Systems Perspective 53
systems perspective 24

Justin Spangaro

U
U.K. 33
umbrella strategy 33
unrealised strategies 16
V
Van de Ven & Ferry 42
Van de Ven and Ferry 65
Variable 45
Varimax factor rotation 49
Varimax Rotated Factor Analysis 49
Varimax rotated factor analysis 64
W
Wilson 25
Y
Yasai-Ardekani and Haug 30, 56, 63, 66, 68, 76
Z
Zikmund 46

T
Taylor 25
technological flexibility 36
Technological Inflexibility 45
Technological inflexibility 56
ten schools of thought 17
Thinking in time
54
thinking in time 24
TI 45, 59
turbulent environments 31
turbulent markets 31
Type of research construct 45
Type of variable dependency 45

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