Strategizing in a focused context: managerial discretion in the Arab world

Open strategizing and accelerated internationalization process in different contexts

Purpose

Due to the changes in organizational, social, cultural and technological factors, companies from different contexts are shifting towards open forms of strategy-making with more widened inclusion of internal and external actors and greater transparency regarding their strategic issues, including their internationalization processes. The purpose of this paper is to understand how Open Strategizing occurs in the accelerated process of internationalization considering different contexts.

Design/methodology/approach

The authors conducted a qualitative comparative case study in Brazilian and English technology-based small and medium-sized enterprises (SMEs) which rapidly internationalized. Furthermore, data was collected through semi-structured interviews, observations and documental analysis.

Findings

The authors suggest that openness contributes to the accelerated process of internationalization. Additionally, the authors show that the home-country and the national cultural contexts affect openness. The authors also disclose openness as crucial and inherent to the accelerated process of internationalization, while context is relevant but not determinant in the Open Strategizing.

Originality/value

The authors contribute to Open Strategy (OS) literature by presenting how Open Strategizing unfolds daily during the internationalization process and by evidencing the role of home-country and national cultural contexts in the configuration and dynamics of Open Strategizing. The authors also contribute to the international entrepreneurship (IE) literature by advancing the understanding of the strategies and drivers adopted by technology-based SMEs internationalizing in an accelerated way.

Leading open strategizing practices for effective strategy implementation

Purpose

Implementing a new organizational strategy effectively nowadays is said to require open strategizing practices. The purpose of this paper is to examine the adoption of three intertwined open strategizing practices in conjunction with a transformational leadership style towards effective strategy implementation.

Design/methodology/approach

The study was conducted within 37 geographically dispersed locations of a Dutch governmental organization. The top managers and senior managers were surveyed at two points in time (n T1 = 548; n T2 = 414) and group interviewed at T2. Exploratory factor and linear regression analyses were performed. The qualitative data pertaining to the specific way in which leaders can impact the relationship between open strategizing practices and strategy implementation was analyzed using the Gioia methodology.

Findings

As hypothesized, transformational leadership moderates the positive relationship between open strategizing practices and effective strategy implementation. This moderating effect was corroborated through the interview data in which the managers stressed the need for “intrinsically motivated” and “empowering” leaders to effectively support the adoption of their own locally-developed location strategy, as part of the overall strategy.

Research limitations/implications

Despite the timely focus on the three intertwined open strategizing practices, the findings are only based on the perceptions of the various top and senior managers employed by one Western public sector organization.

Practical implications

Top and senior managers who need to improve their organization's strategy implementation can apply the here tested three open strategizing practices. They should also be aware of the key role of transformational leadership.

Originality/value

The authors contribute to the “open” strategy-as-practice domain by showing how top and senior managers' transformational leadership style supports the beneficial effects of adopting the three practices.

The more you value, the less you practice: a study on culture and managerial discretion

Purpose

The purpose of this paper is to examine cross-cultural differences in managerial discretion and the extent to which variations and interaction of cultural practices and values affect the degree of freedom in decision making that is accorded to executives. This paper offers a holistic approach to investigating culture in addition to acknowledging its paradoxical nature.

Design/methodology/approach

Using a panel of prominent management consultants to rate discretion across 18 countries, the authors further develop the national-level construct of managerial discretion by empirically investigating the influence of cultural practices and values on CEOs’ discretion.

Findings

The study reveals that cultural values moderate the relationship between cultural practices and managerial discretion for three cultural dimensions: individualism, uncertainty tolerance and power distance (PD). By adopting the logic of marginal utility, the authors also show that the more a society values individualism, uncertainty tolerance and PD, the weaker the effect of their practices on managerial discretion.

Originality/value

Few research has attempted to assess both cultural values and practices in relation to managerial discretion. By showing the mechanism in which culture affects the level of managerial discretion, the authors offer new theoretical insights and practical implications, overall contributing to the field of cross-cultural and strategic management. Finally, this will offer CEO’s a new perspective of leveraging culture as a tool, enhancing their decision-making capabilities in the aim of improving organizational performance.

Exploring cultural heterogeneity

Research on the degree of managerial discretion, or latitude of action, accorded to executives at the national level has primarily focused on the effect of intercultural variation in values on managerial discretion by assuming spatial homogeneity within countries. However, evidence in cross-cultural research indicates that cultural heterogeneity within countries can be as salient as or sometimes even more than inter-country variation. Thus, this study examines the extent to which intra-cultural variation affects the degree of discretion accorded to executives. The study tests the proposed relationships using fixed-effect regression analysis by measuring managerial discretion through survey responses of senior management consultants. It operationalizes intra-cultural variation by the standard deviation in societal members’ behaviour in terms of individualism, uncertainty tolerance and power distance. Results show that a strong relationship exists between intra-cultural variation and managerial discretion and that the direction of the relationship is negative. Executives operating in countries with high heterogeneity are subject to increased constraints from the national environment and, as such, are not able to take idiosyncratic or bold actions. Managerial discretion not only is a function of the central tendency of a society but depends on the homogeneity/heterogeneity in views innate therein. Using institutional, stakeholder and upper echelons theories, the study shows that greater intra-cultural variation negatively affects the degree of executive discretion. Thus, it provides a more nuanced understanding of such relationship and introduces a new national conceptualization that plays an important role in the strategic decision-making of business executives.