Business

Why would people in your company (not) behave according to your strategy?

PICTURE: According to Ausrine Silenskyte’s dissertation presented at the University of Vaasa, the main driver of the implementation of the strategy is a person’s commitment to his personal preferences and organizational ability to retaliate, … see more

Credits: Riikka Kalmi, University of Vaasa

Despite extensive communication efforts or control systems, many employees still do not understand the organization’s strategic goals, let alone act toward them. How could that change?

According to Ausrine Silenskyte’s dissertation presented at Vaasa University, the main driver of implementing a strategy is a person’s commitment to their personal preferences and organizational ability to reciprocate, i.e. ensuring that people working in the organization feel supported in achieving their personal responsibilities. Once this is set up, employees open up to organizational strategy and become interested in strategic behavior.

“Strategy only makes sense when it is implemented. Every manager knows how difficult it is to ensure that every person in the company understands strategic goals and behaves strategically, helping the corporate vision become a reality. Top management tends to think that performance-driven culture and strong focus on tasks goals will lead to success in implementation, ”says Ausrine Silenskyte, a university lecturer and PhD student at Vaasa University.

In her dissertation, Silenskyte examined how and when strategic plans become strategic behavior among employees in different parts of a Finnish multinational corporation. Her research shows that middle and project managers, as well as professionals in non-managerial positions, often have difficulty with strategic plans and goals assigned to them by top management, even when the company is consistent and clear in communicating about strategies. The dissertation, which will be publicly defended on September 30, proposes a counter-intuitive recipe to support the implementation of the strategy.

“Research has found that employees can behave strategically without a prescription or even without knowing the details of the strategy, if certain conditions are met. It is equally important to make good strategies, set clear goals and communicate them, as it is crucial to discover personal aspirations and needs employees and create a sense that the organization will help people accomplish those personal commitments, ”says Ausrine Silenskyte.

Is the recipe for achieving strategic behavior the same in all countries?

The Silenskyte survey was conducted within a global service provider, a Finnish multinational corporation and its units in Finland, Russia and India. The research reveals that ways of achieving a sense of reciprocity will vary from country to country.

In the three states, Finland had the weakest sense of reciprocity, i.e., individuals who were mostly formally associated with organizations, and the importance of realizing their personal aspirations was very high.

In India, reciprocity was almost loyalty, but not to the organization or its strategy, but to the business leader: employees were willing to set aside their personal interests and follow the strategy if they believed the leader would take care of them and their needs.

In Russia, reciprocity was more bureaucratic: employees felt that strategic work was a matter for the manager, but their manager wanted to convince them that certain daily tasks of employees were related to the overall strategy.

Therefore, if a multinational corporation wants to achieve strategic behavior in each business unit, the definition of employee reciprocity must be understood first.

The findings imply that international experts working to implement the strategy in global teams will need to calibrate their understanding of the importance of achieving personal commitment and achieving organizational reciprocity, otherwise conflict will ensue. When colleagues work to implement a strategy in a global, culturally diverse team, strategic behavior can be achieved by addressing these culturally specific differences in reciprocity and personal commitment.

How to understand whether the implementation of the strategy was a failure or a success?

Visits to business units, interviews with top, middle and project managers and employees, as well as analysis of a large set of organizational documents revealed that managers evaluate strategy implementation processes under the assumption that there is one “truth” in the organization.

It is seldom considered or remembered that organizational systems, process descriptions, or policies are merely managerial intentions described “on paper.” It is often assumed that once we design these structures and policies, they should be followed as expected.When people do not meet such expectations , implementation is usually considered to have failed, ”says Ausrine.

The case study in the dissertation provides a detailed illustration of how more than one “truth” exists in an organization and explains why managers must take this into account.

“Different behaviors, differently used strategic and operational systems do not mean that strategy implementation has failed! If managers are able to recognize layered reality, analyze it systematically, for example, using the methodology proposed in the dissertation, implementation efforts are likely to become much easier. managers will know what actually failed, and what turned out to be an unexpected or unintended success, ”says Ausrine.

Public exam

Public exam mr. Ausrine Silenskyte’s doctoral dissertation entitled “Implementation of Corporate Strategy. How Strategic Plans Become Individual Strategic Actions at the Organizational Levels of the MNC” will be held on Wednesday, September 30, at noon. The public exam will be organized via the Internet:

https://uwasa.zoom.us/j/61152153370?pwd=YjFSSEVRYWpSSzJwT2JTOHFaUFNuQT09

The field of the dissertation is management. Professor Rebecca Piekkari (Aalto University) and Associate Professor Catherine Welch (University of Sydney) will perform as opponents, and Professor Adam Smale as curators. The exam will be held in English.

Silenskyte, Ausrine (2020). Implementation of corporate strategy. How strategic plans become individual strategic actions at the organizational levels of the MNC. Acta Wasaensia 446. Doctoral dissertation. University of Vaasa.

Publication pdf: http://urn.fi/URN:ISBN:978-952-476-919-8

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