Download - STRATEGIC MANAGEMENT AND ORGANIZATIONAL …
STRATEGIC MANAGEMENT AND ORGANIZATIONAL
PERFORMANCE: FINDINGS FROM HEALTH
INSTITUTIONS IN NAIROBI COUNTY
BY
GEORGE KADONDI KASERA
UNITED STATES INTERNATIONAL UNIVERSITY –
AFRICA
FALL 2017
STRATEGIC MANAGEMENT AND ORGANIZATIONAL
PERFORMANCE: FINDINGS FROM HEALTH INSTITUTIONS
IN NAIROBI COUNTY
BY
GEORGE KADONDI KASERA
A Project Report Submitted to the Chandaria School of Business in
Partial Fulfilment of the Requirement for the Degree of Masters in
Business Administration (MBA)
UNITED STATES INTERNATIONAL UNIVERSITY – AFRICA
FALL 2017
iii
STUDENT’S DECLARATION
I, the undersigned, declare that this is my original work and has not been submitted to any
other college, institution or university other than United States International University –
Africa in Nairobi for academic credit.
Signed: _________________________________ Date: _______________________
George Kadondi Kasera (632250)
This project has been presented for examination with my approval as the appointed
supervisor.
Signed: _________________________________ Date: _______________________
Dr. Peter N. Kiriri
Signed: _________________________________ Date: _______________________
Dean, Chandaria School of Business
iv
COPYRIGHT
©GEORGE KADONDI KASERA, 2017
All Rights Reserved
v
ABSTRACT
The purpose of this study was to determine the effects of strategic management on
organizational performance in health institutions in Nairobi County. The study had three
research questions on what was the effect of strategic thinking, planning and strategy
implementation on organizational performance of health institutions in Nairobi County.
This study was descriptive and the study design was cross – sectional. The study was
designed to capture utilization of strategic management in health institutions in Nairobi,
representing a snapshot of one point in time. The study described and explained phenomena
that observations reflected measure social reality or describe what was in use in health
institutions in Nairobi. The independent variables were strategic thinking, strategic planning
and strategy implementation, while the dependent variable was organizational performance.
The study population was the management at health institutions that are Kenya Essential
Package for Health (KEPH) level four, five and six, and are in Nairobi County. For this
study, the sampling frame was the list of all health institutions that were KEPH level four or
five or six, and in Nairobi County based on the Kenya Master Health Facility List (Ministry
of Health, 2017). The health institution was the sampling unit. Census was used to enroll
every health institution into this study since they are few, and the unit of analysis was the
health institution. Primary data for this study was collected using a structured self-
administered questionnaire, that captured both qualitative and quantitative data,
administered to the study prospective participants after they had been recruited and enrolled.
Stata 12 ® was the statistical software used to analyze the data from the study. Data was
presented in charts and graphs.
Of the health institutions surveyed, 23 (96%) carried out strategic thinking while 7 (29%)
agreed that strategic thinking improves organizational performance. From the study,
organizational performance was positively correlated to strategic thinking, but the strength
of the relationship was weak since the value of the correlation coefficient was 0.0801.
With regard to strategic planning, 15 (63%) of the health institutions surveyed carried out
strategic planning, while only 6 (25%) agreed that it improved organizational performance.
On the other hand, organizational performance was negatively correlated to strategic
planning with the value of the correlation coefficient being – 0.4175.
vi
Of the health institutions surveyed, 10 (42%) carried out strategy implementation, while only
3 (12%) agreed that it improved organizational performance. Strategy implementation had a
negative correlation with organizational performance among health institutions in Nairobi
County with the value of the correlation coefficient being – 0.3164.
The study concludes that strategic thinking has a weak positive relationship on
organizational performance, while strategic planning and strategy implementation have a
negative relationship on organizational performance among health institutions in Nairobi
County. This study has raised the specter of there being other underlying factors that have a
bearing on organizational performance among health institutions in Nairobi County.
This study has provided evidence of the relationship between strategic management and
organizational performance in health institutions. Going forward, much as the study found
that the relationship between strategic thinking and organizational performance was positive,
this will be best measured through a key informant interview that is open since a lot of details
on strategic thinking are lost through closed ended questions in a questionnaire. In addition,
much as the correlation between strategic planning and organizational performance was
negative in this study, there is need to draw a distinction between public and private health
facilities since the drive between the two sets are different. Finally, it is important to design
a study that will make management of health institutions less sensitive about the information
they offer. This is so since many, especially the privately-owned health institutions guarded
the information they could share because it was competitive in nature.
vii
DEDICATION
To my late father, I dedicate this research paper to you posthumously in recognition of your
motivation and support throughout the study period.
viii
ACKNOWLEDGEMENT
I acknowledge the presence of God the Almighty in my life. For giving me the strength and
wisdom to have been able to prepare for the execution of this research project and finalizing
the research paper.
My sincere gratitude goes to my supervisor Dr. P. N. Kiriri for his guidance, advice and
effective timely response at each stage in the preparation and execution of this research paper
for examination. Thank you for your support and inspiration.
I would like to thank my dear family, friends and supervisors for their understanding,
resource input, endless love and encouragement throughout the research project execution
to the end.
Not to forget the top management of the health institutions and health facilities interviewed,
for without their corporation, the completion of this research paper would not have been
possible.
May God, bless you all.
ix
TABLE OF CONTENTS
STUDENT’S DECLARATION ......................................................................................... iii
COPYRIGHT ..................................................................................................................... iv
ABSTRACT ......................................................................................................................... v
DEDICATION ................................................................................................................... vii
ACKNOWLEDGEMENT ............................................................................................... viii
LIST OF TABLES ............................................................................................................. xii
LIST OF FIGURES .......................................................................................................... xiv
CHAPTER ONE .................................................................................................................. 1
1.0 INTRODUCTION ..................................................................................................... 1
1.1 Background of the Problem...................................................................................... 1
1.2 Statement of the Problem ......................................................................................... 6
1.3 Purpose of the Study ................................................................................................ 8
1.4 Research Questions .................................................................................................. 8
1.5 Rationale of the Study .............................................................................................. 9
1.6 Scope of the Study.................................................................................................. 10
1.7 Definition of Terms ................................................................................................ 11
1.8 Chapter Summary ................................................................................................... 12
CHAPTER TWO ............................................................................................................... 13
2.0 LITERATURE REVIEW ....................................................................................... 13
2.1 Introduction ............................................................................................................ 13
2.2 Strategic Thinking and Organizational Performance ............................................. 13
2.3 Strategic Planning and Organizational Performance ............................................. 22
2.4 Strategy Implementation and Organizational Performance ................................... 27
2.5 Chapter Summary ................................................................................................... 31
CHAPTER THREE ........................................................................................................... 32
x
3.0 RESEARCH METHODOLOGY ........................................................................... 32
3.1 Introduction ............................................................................................................ 32
3.2 Research Design ..................................................................................................... 32
3.3 Population and Sampling Design ........................................................................... 33
3.4 Data Collection Methods ........................................................................................ 34
3.5 Research Procedures .............................................................................................. 35
3.6 Data Analysis Methods .......................................................................................... 36
3.7 Chapter Summary ................................................................................................... 37
CHAPTER FOUR ............................................................................................................. 38
4.0 RESULTS AND FINDINGS ................................................................................... 38
4.1 Introduction ............................................................................................................ 38
4.2 General Information ............................................................................................... 38
4.3 Strategic Thinking and Organizational Performance ............................................. 42
4.4 Strategic Planning and Organizational Performance ............................................. 49
4.5 Strategy Implementation and Organizational Performance ................................... 58
4.6 Organizational Performance ................................................................................... 61
4.7 Bivariate Analysis .................................................................................................. 61
4.8 Chapter Summary ................................................................................................... 63
CHAPTER FIVE ............................................................................................................... 64
5.0 DISCUSSION, CONCLUSION AND RECOMMENDATIONS ........................ 64
5.1 Introduction ............................................................................................................ 64
5.2 Summary ................................................................................................................ 64
5.3 Discussion .............................................................................................................. 65
5.4 Conclusion .............................................................................................................. 69
5.5 Recommendations .................................................................................................. 70
REFERENCES .................................................................................................................. 72
xi
APPENDICES .................................................................................................................... 97
Appendix I: Cover Letter .............................................................................................. 97
Appendix II: Questionnaire .......................................................................................... 98
xii
LIST OF TABLES
Table 3.1: Population Distribution ...................................................................................... 33
Table 4.1: Gender of Study Respondents ............................................................................ 38
Table 4.2: Designation of Study Respondents .................................................................... 39
Table 4.3: Health Institutions’ KEPH Level ....................................................................... 41
Table 4.5: Health Institution Ownership ............................................................................. 42
Table 4.6: Health Institutions Carrying out Systems Perspective during Strategic Thinking
............................................................................................................................................. 43
Table 4.7: Perspective if System Perspective Improves Organizational Performance........ 43
Table 4.8: Actual Implementation of Intent Focused .......................................................... 44
Table 4.9: Perception if Intent Focused Improves Organizational Performance ................ 45
Table 4.10: Actual Implementation of Thinking in Time ................................................... 45
Table 4.11: Perception if Thinking in Time Improves Organizational Performance .......... 46
Table 4.12: Actual Implementation of Hypothesis Driven.................................................. 46
Table 4.13: Perception if Hypothesis Driven Improves Organizational Performance ........ 47
Table 4.14: Actual Implementation of Intelligent Opportunism ......................................... 47
Table 4.15: Perception if Intelligent Opportunism Improves Organizational Performance 47
Table 4.16: Actual Implementation of Strategic Thinking .................................................. 48
Table 4.17: Perception if Strategic Thinking Improves Organizational Performance ........ 48
Table 4.18: Comparison Between Actual Practice and Perception if Strategic Thinking
Improves Organizational Performance ................................................................................ 48
Table 4.19: Actual Implementation of System Perspective ................................................ 51
Table 4.20: Perception if System Perspective Improves Organizational Performance ....... 53
Table 4.21: Actual Formulation of Strategies based on Situational Analysis ..................... 54
Table 4.22: Perception if Strategy Formulation Improves Organizational Performance .... 54
Table 4.23: Strategic Management Techniques in Use Stratified by Health Institution
Ownership ............................................................................................................................ 55
xiii
Strategic Management Tool ................................................................................................ 55
Table 4.24: Actual Implementation of Strategic Planning .................................................. 57
Table 4.25: Perception if Strategic Planning Improves Organizational Performance ......... 57
Table 4.26: Comparison Between Actual Practice and Perception if Strategic Planning
Improves Organizational Performance ................................................................................ 57
Table 4.27: Actual Implementation of Strategy in Health Institutions................................ 58
Table 4.28: Perception if Strategy Implementation Improves Organizational Performance
............................................................................................................................................. 59
Table 4.29: Actual Implementation of Strategy .................................................................. 60
Table 4.30: Perception if Strategy Implementation Improves Organizational Performance
............................................................................................................................................. 60
Table 4.31: Comparison Between Actual Practice and Perception if Strategy Implementation
Improves Organizational Performance ................................................................................ 60
xiv
LIST OF FIGURES
Figure 2.1: Elements of Strategic Thinking......................................................................... 16
Figure 2.2: Analyzing and Understanding the Situation ..................................................... 26
Figure 2.3: Intended Versus Realized Strategy ................................................................... 29
Figure 4.1: Distribution of Respondents’ Age..................................................................... 40
Figure 4.2: Distribution of Respondents’ Duration in post ................................................. 40
Figure 4.3: Correlation between Strategic Thinking and Organizational Performance ...... 61
Figure 4.4: Correlation between Strategic Planning and Organizational Performance ....... 62
Figure 4.5: Correlation between Strategy Implementation and Organizational Performance
............................................................................................................................................. 62
CHAPTER ONE
1.0 INTRODUCTION
1.1 Background of the Problem
Strategy purpose is to determine the basic objectives of an organization and allocating
resources to their success. Strategy specifies the necessary direction that an organization
needs to move to meet its mission. Strategic management means that the management team
is going to direct employee activities towards the achievement of specific goals and
implementation plans (Bianca, 2017). A shared sense of strategy is of fundamental
importance to managers because it is essential for positioning an organization to face a
complex and uncertain future. Effective managers can use strategy to focus attention and
effort on real priorities, provide a consistent framework to guide decisions and actions, and
give an organization a new or renewed sense of purpose (Nutt & Backoff, 1992).
Strategic planning is concerned with formulating strategy, a “disciplined effort to produce
fundamental decisions and actions that shape and guide what an organization (or other entity)
is, what it does, and why it does it” (Bryson, 2004). It is a “big picture” approach that
addresses the most fundamental issues facing an organization in an attempt to promote the
best “fit” with the environment and ensure the organization’s long-term vitality and
effectiveness (Kemp, Funk, & Eadie, 1993) (Poister & Streib, 1999). Strategic management
is the broader process of managing an organization in a strategic manner on a continuing
basis. Strategic planning is a principal element of strategic management, which also involves
resource management, implementation, and control and evaluation (Steiss, 1985).
Numerous researchers and executives advocate strategic planning. Armstrong (1982), for
example, argued that an explicit planning process rather than haphazard guesswork results
in the collection and interpretation of data critical to creating and maintaining organization-
environment alignment. Similarly, Ansoff (1991) argued that planning generally produces
better alignment and financial results than does trial-and-error learning. Despite the intuitive
appeal of these arguments, several researchers have countered that explicit strategic planning
is dysfunctional, or at best irrelevant. Without using strategic management, decision-making
2
can be reactionary, which can lead to costly mistakes. These might include managers and
employees making decisions that aren't in line with the organization’s goals, money being
spent on unnecessary expenses and customers having different experiences each time they
interact with the organization (Bianca, 2017).
There are significant number of researches as well as more practical experiences in business
prove that an efficient and effective strategic planning can increase profitability. More recent
experimental proof indicates that corporates that adopt planning system perform well and
achieved their goals in terms of sales and profit growth more than the other corporates that
do not. Therefore, it’s obvious that practicing the strategic planning in any business will
show better performance compared with to non-planning system, also it helps the corporates
to get back on track and to enhance the business ability to predict changes in the
environment. The strategic planning should be a people process more than paper process (Al
isa, 2017).
Organizational performance on the other hand, is about creating values for the primary
beneficiaries of the organization (Al isa, 2017). A number of definitions of organizational
performance have been proposed by organizational and management scholars, all influenced
by the particular organizational perspectives held by the authors or proponents. Thorndike
(Thorndike, 1949) first noted the general trend among researchers to assess organizational
performance using a univariate model that focused on an ultimate criterion, such as profit or
productivity. This approach directed attention toward outcomes and viewed the organization
as a rational system that enables the attainment of certain objectives. Georgopolous and
Tannenbaum (1957) shifted the focus from univariate to multivariate by expanding the
criteria to include organizational flexibility and intraorganizational strain. Performance
under this conceptualization focused on how well an organization can achieve its objectives,
given certain resource constraints, without placing undue strain on its members. In the
following decades, organizational researchers conceptualized organizations in a variety of
ways, including rational entities in pursuit of goals (Latham & Locke, 1991), coalitions
reacting to strategic constituencies (Pfeffer & Salancik, 1978), garbage cans (Cohen, March,
& Olsen, 1972), open systems (Katz & Kahn, 1978), social contracts (Keeley, 1980),
political arenas (Gaertner & Ramnarayan, 1983), psychic prisons (Morgan, 1986), dynamic
networks (Miles & Snow, 1986), complex adaptive systems (Bennet & Bennet, 2004), and
complex responsive processes (Stacey, 2010). Each of these conceptualizations highlights
3
or reveals organizational phenomena that were overlooked by other definitions and serves
to frame the evaluation in a different perspective, particularly with respect to the values used
to assess an organization’s performance. Despite the numerous metaphors and perspectives
used to describe organizations, three conceptual frameworks continue to be used as primary
guides to empirical investigations of organizations: rational, natural, and open systems
(Scott, 2003). These conceptual frameworks evolved over the decades as new theories of
organization moved to a higher level of analysis, from social psychological to structural to
ecological. However, the underlying tenets of the models of organization have not changed,
and it is from these three conceptual frameworks that organizations can be further examined,
analyzed, and evaluated (Martz, 2013).
Strategic management concepts have been employed within health care organizations only
in the past 25 to 30 years. Indeed, many of the management methods adopted by healthcare
institutions, both public and private, were developed in the business sector. In many respects
health care has become a complex business using many of the same processes and much of
the same language as the most sophisticated business corporations (Swayne, Duncan, &
Ginter, 2006). Strategic management provides the momentum for change. Organizational
change is a fundamental part of survival. Because strategic managers understand the
relationship between change and survival, there have been many management approaches to
changing organizations. As health care leaders change and manage their organizations, they
chart new courses into the future.
In the field of healthcare: having the right strategic management tools and techniques that
can predict precise, timely and accessible information is essential to monitoring the services
offered to the population. Access to public health information is key to identifying
environmental exposure to diseases, as well as to tracking intervention development and
effectiveness. The efficiency of measures and techniques depends on the availability of
databases and analysis tools to generate helpful information to researchers, professionals,
decision-makers, politicians, and society in general. Generally speaking, public health
organizations collect considerable volumes of data; the challenge lies in identifying the
essential information within it and prioritizing problems, developing and evaluating policies
and measures, organizing their implementation, monitoring and controlling the delivery of
health services (Rogério, et al., 2016).
4
A shared sense of strategy is of fundamental importance to public managers because it is
essential for positioning an organization to face a complex and uncertain future. Effective
public managers can use strategy to focus attention and effort on real priorities, provide a
consistent framework to guide decisions and actions, and give an organization a new or
renewed sense of purpose (Nutt & Backoff, 1992). Strategic planning is concerned with
formulating strategy, a “disciplined effort to produce fundamental decisions and actions that
shape and guide what an organization (or other entity) is, what it does, and why it does it”
(Bryson, 2004). It is a “big picture” approach that addresses the most fundamental issues
facing an organization in an attempt to promote the best “fit” with the environment and
ensure the organization’s long-term vitality and effectiveness (Kemp, Funk, & Eadie, 1993)
(Poister & Streib, 1999). Strategic management is the broader process of managing an
organization in a strategic manner on a continuing basis. Strategic planning is a principal
element of strategic management, which also involves resource management,
implementation, and control and evaluation (Steiss, 1985) (Vinzant & Vinzant, 1996b).
The three activities of strategic management – strategic thinking, strategic planning, and
strategic momentum –provide many benefits to health care organizations. However, because
strategic management is a philosophy or way of managing an organization, its benefits are
not always quantifiable. Overall, strategic management: ties the organization together with
a common sense of purpose and shared values; improves financial performance in many
cases; provides the organization with a clear self-concept, specific goals, and guidance as
well as consistency in decision making; helps managers understand the present, think about
the future, and recognize the signals that suggest change; requires managers to communicate
both vertically and horizontally; improves overall coordination within the organization; and
encourages innovation and change within the organization to meet the needs of dynamic
situations (Swayne, Duncan, & Ginter, 2006).
In Kenya, dramatic changes in the healthcare industry that began in 2013, marked by the
implementation of new Constitution of Kenya that devolved healthcare service delivery from
national government to county governments. As a result, both public and private healthcare
institutions continue to face a turbulent, confusing, and often threatening environment.
Significant change comes from many sources including: national, county, and local health
care legislative and policy initiatives; international as well as domestic economic and market
5
forces; demographic shifts and lifestyle changes; technological advances; and healthcare
delivery changes within the industry.
In order to survive, healthcare institutions are taking steps to expand by accessing new
markets; making services and price more attractive; satisfying customers; developing new
strategies. Thus, managers and executives of the healthcare institutions looking for a suitable
tools and techniques in order to investigate the internal and external cost of the
products/service, get market information, product costs, analyze customer needs and wishes,
predict and assess organizational performance, as well to ensure competitive advantage in
production activities. Certainly, the healthcare systems in both public and private, as well as
other faith based institutions, have had to adapt to these changes and in the future, may have
to reinvent themselves once again. Healthcare institutions will have to effectively manage
change and become “masters of renewal” in this dynamic environment (Afonina, 2015).
Organizational performance is obviously a central issue in strategic management research.
Several authors have analyzed the organizational performance in terms of corporate strategy
(Chenhall & Langfield-Smith, 2007) (Carton & Hofer, 2006). Hamon (2003) defined
organizational performance as a variable used to measure the degree of organizational
performance in achieving organizations’ objectives, efficiency, and effectiveness in
achieving their goals (Robbins & Coulter, 2002). In addition, Ho (2008) defined
organizational performance as an indicator to measure the efficiency of an organization to
accomplish its objectives, in terms of achieving organization market orientation and
financial goals (Li, Ragu-Nathan, Ragu-Nathan, & Rao, 2006).
There are a number of indicators used to measure organizational performance since 1900;
however, among the popular indicators in the financial performance (FP) construct of
organizational performance were profit growth rate, return on sales (ROS), return on assets
(ROA), and overall performance (Hancott, 2005). Furthermore, Li et al. (Li, Ragu-Nathan,
Ragu-Nathan, & Rao, 2006) mentioned that organizational performance can be measured in
terms of market performance (MP) and FP, which consists of organization’s profits, return
on investments (ROI), market share, and also growth of sales (Chee-Hua, May-Chiun, &
Ramayah, 2013). Performance measurement refers to the choice of the appropriate measures
to evaluate performance. It is generally thought that it is difficult to choose the appropriate
measures for firm performance (Venkatraman & Grant, 1986). The issue related to the
6
pertinence of using exclusively financial rather than nonfinancial measurement is an
important one. For example, financial performance measurements may only reflect a part of
the firm’s profitability (Falshaw, Glaister, & Tatoglu, 2006).
In effect, they create new beginnings, new chances for success, new challenges for
employees, and new hopes for patients. Therefore, it is imperative that health care managers
understand the changes taking place in their environment; they should not simply be
responsive to them, but strive to create the future. Health care leaders must see into the
future, create new visions for success, and be prepared to make “quantum improvements”
(Efendioglu & Karabalut, 2010).
1.2 Statement of the Problem
Over the past three decades, strategic management has become a common part of executives’
lives. Whether trying to boost revenues, innovate, improve quality, increase efficiencies or
plan for the future, executives have looked for strategic management to help them. The
current environment of globalization and economic turbulence has increased the challenges
executives face and, therefore, the need to find the right strategies to meet these challenges.
To do this successfully, executives must be more knowledgeable than ever as they sort
through the options and select the right strategies for their companies. The selection process
itself can be as complicated as the business issues they need to solve (Casey & Goldman,
2010). They must choose strategies that will best help them make the business decisions that
lead to enhanced processes, products and services—and result in superior performance and
profits. Successful use of strategic management requires an understanding of the strengths
and weaknesses of each strategy as well as an ability to creatively integrate the right
strategies, in the right way, at the right time. In the absence of objective data, groundless
hype makes choosing and using strategic management a dangerous game of chance (Bain &
Company, 2017).
Long devised and implemented to deal with the ‘industrial dynamic’ marked by ‘competitive
behavior’ (Porter M. , 1982), strategy is now considered a field that makes it possible for the
leaders of public and private organizations to ‘take options on the future’ (Williamson,
1999). However, despite increasingly sophisticated training programs and highly advanced
academic research on strategic contents, processes, options and actions, the eff ectiveness of
7
public strategy is still a source of major controversies (Mazouz, Rousseau, & Hudon, 2016).
At best, the strategic thinking and tools do not seem to have been sufficiently adapted to the
context of public organizations (McHugh, 1997). At worst, the strategic exercise seems to
be incompatible with the non-competitive environment in which public administrations
traditionally operate. Despite the skepticism of researchers and practitioners, many public
administrations of Organization for Economic Co-operation and Development (OECD)
countries are now subject to legislation and regulations that have turned results based
management and strategic planning into tools that make it possible to intelligently combine
the purposes, objectives, means and resources required to steer states’ administrations
towards tangible results (Mazouz B. , 2014).
Undoubtedly, this renewed interest in strategic processes (Andrews R. , Boyne, Law, &
Walker, 2009) can be explained partly by the growing institutionalization of formal
approaches and frameworks of objective-based management (Charih, 2000) (Levine, 1985)
and, more recently, of results-based management (Emery, 2005) (Mazouz B. , 2014). This
is the case, for instance, of the GPRA in the US, of the LAP in Quebec and the Loi organique
sur les lois de finances (LOLF) in France.
Several recent works have highlighted the criticality of performance as a dependent variable,
with some persuasively arguing that the most obvious and useful set of research questions
should address the linkage between strategy and performance. Further, there is need to
identify enterprise level factors which influence organizational performance. A review of
organizational structure (Dalton, Todor, Spendolini, Fielding, & Porter, 1980) argued that
organizational performance is the single most important dependent variable in both the
public and private sector.
Strategic management can be applied in different areas, such as: general management,
marketing management, operations management, financial management, human resource
management, information technology, management science, planning and resource
allocation and, efficiency and effectiveness (Armstrong M. , 1993).
In the literature, there are findings focused on the relationship between strategic management
and organizational performance (Afonina, 2015). It should be noted that studies, which
examine the relationship between strategic management and organizational performance
remain uncertain. Some of the studies have argued that utilization of management influences
8
organizational performance (Indiatsu, Mwangi, & Mandere, 2014) (Iseri-Say, Toker, &
Kantur, 2008). While other studies concluded that there was no clear relationship between
strategic management and organizational performance (Rigby & Bilodeau, 2007)
(Efendioglu & Karabalut, 2010). Thus, in the literature there is very little empirical support
to justify this relationship. For example, Rigby (Rigby D. K., 1994) reflected the effect of
strategic management on organizational performance by considering five performance
categories (financial results, organizational integrity, performance capability, customer
equity and competitive advantage).
Given these mitigated results, studies examining the direct bivariate relationship between
rational strategic management and firm performance have been strongly criticized. Some
researchers have argued that context plays a considerable role in explaining the relationship
between firm processes and outcomes (Child, Elbanna, & Rodrigues, 2010). Therefore,
several contingency factors, such as the organizational structure, the nature of the
environment, and the size of the organization, have been introduced in the study of the
relationship between strategic planning and firm performance (Miller, Burke, & Glick,
1998). It has equally been suggested that some factors may have a mediating role in this
relationship (Rudd, Greenley, Beatson, & Lings, 2008). This study will test the role of
strategic management on organizational performance.
1.3 Purpose of the Study
The purpose of this study was to determine the effects of strategic management on
organizational performance in health institutions in Nairobi County.
1.4 Research Questions
1.4.1 What is the effect of strategic thinking on organizational performance of health
institutions in Nairobi County?
1.4.2 What is the effect of strategic planning on organizational performance of health
institutions in Nairobi County?
9
1.4.3 What is the effect of strategy implementation on organizational performance of
health institutions in Nairobi County?
1.5 Rationale of the Study
Benefits accrued from conducting the study and the relevance of the problem both to the
practice and theory is that its findings will assist healthcare leaders deal with important,
complex, and sometimes conflicting issues and trends. It shall help them in deciding on
which strategic management tools and techniques are most apt for the Kenyan setting.
It is likely that there will be new opportunities and threats to healthcare institutions that have
yet to be identified or fully assessed. Even more sobering, it seems certain that there will be
more change in the healthcare industry in the next ten years than there has been in the past
ten. Dealing with rapid, complex, and often discontinuous change requires leadership and
the right mix of strategic management. Successful healthcare institutions have leaders who
understand the nature and implications of external change, the ability to develop effective
strategies that account for change, and the will as well as the ability to actively manage the
momentum of the institution. Strategic management is fundamental in effective leading
institutions in dynamic environments.
1.5.1 Managers of Health Institutions
This study provided evidence of the relationship between strategic management and
organizational performance in healthcare since this had not sufficiently examined in previous
studies. The study explored if use of strategic management led to an integrated, systematic
approach to improving organizational performance to achieve strategic aims and promote a
health institution’s mission and values to attain what they needed to do.
1.5.2 Ministry of Health & County Governments
Devolution of healthcare has transformed the landscape of service delivery to create 47
County Governments and one National Government all involved in healthcare. Planning and
strategy have been approached from a formal perspective and this study found the impact of
strategic management on the performance of government health institutions.
10
1.5.3 Patients and Other Stakeholders
Patient satisfaction is a central concept and critical goal in the healthcare industry. This study
explored the impact of use of strategic management had towards improving patient
experience through improved service quality and strengthening re-purchase intention of
patients. This was measured by the number of patients who sought services in the health
institutions.
1.5.4 Academia and Research
This study provided empirical evidence about the use of the strategic management by health
institutions in an emerging market context. This has been a gray literature that has not been
published or shared more so in the Kenyan context. Since the advent of devolution of health
service delivery, the environment has undergone a lot of transformation and this study shed
light as to the new frontiers and how best to tackle the emerging challenges.
1.6 Scope of the Study
The study was conducted among health institutions that were KEPH Level 4, 5 and 6 within
Nairobi County. The population that was eligible for enrollment into the study was the
management for the aforementioned health institutions. The study was conducted between
August – October 2017. In view of these contributions, this study had limitations that need
to be accounted for in light of its research design. First, was existence of some degree of bias
in selection of sample of managers (convenient). Needless to say, as engaged scholars and
in the true spirit of Personal Construct Theory, all participants were asked to ‘tell it as it is’,
based on their lived experience, in terms of what they thought about their use of the tools
(Kelly, 1955). They were informed that the study was not looking for ‘right’ or ‘wrong’
answers, but are more interested in their experience per se, whether or not the tools in
question helped them perform better analysis for better decision-making. All participants
gained equal credit for sharing their experience, whether they describe good or bad
experiences with the tools. Hence, given the structured learning approach of the study
design, there was no indication of rater bias on the part of the participants.
11
1.7 Definition of Terms
1.7.1 Strategy
Strategy is defined as large scale, future oriented plans interacting with the competitive
environment to achieve an organization’s objectives (Swayne, Duncan, & Ginter, 2006).
1.7.2 Organizational Performance
Performance is often presented as a multidimensional concept (Venkatraman & Grant,
1986). Two types of measures of firm performance can be distinguished: on the one hand,
financial (and relatively objective) measurements such as return on assets (ROA), return on
sales (ROS), and return on investment (ROE) and, on the other hand, nonfinancial (and
relatively subjective) measurements, for example, shareholder satisfaction, employee
satisfaction, and customer satisfaction (Ong & Teh, 2009) (Venkatraman & Grant, 1986).
1.7.3 Strategic Thinking
Strategic thinking is defined as an individual intellectual process, a mindset, or method of
intellectual analysis that asks people to position themselves as leaders and see the “big
picture” (Swayne, Duncan, & Ginter, 2006). Strategic thinking is a process of utilizing
previous experiences in a coherent framework and showing the best reaction in vital
situations (Noubar, Orangi, & Mejarshin, 2014).
1.7.4 Strategic Planning
Strategic planning is a rational and systematic process to evaluate an organization’s goals,
explore its competitive context, analyze its strategic alternatives, coordinate its activities,
and formulate the policies that will guide its decisions and actions (Andersen & Nielsen,
2009). Strategic planning is the periodic process of developing a set of steps for an
organization to accomplish its mission and vision using strategic thinking (Swayne, Duncan,
& Ginter, 2006). The result of the strategic planning process is a plan or strategy.
1.7.5 Strategy Implementation
Strategy implementation is the day-to-day activities of managing the strategy to achieve the
strategic goals of the organization (Swayne, Duncan, & Ginter, 2006). Strategy
implementation is defined as “the communication, interpretation, adoption, and enactment
of strategic plans” (Andrews R. , Boyne, Law, & Walker, 2011).
12
1.7.6 Health Institution
A health institution is defined as any hospital, convalescent hospital, health maintenance
organization, health clinic, nursing home, extended care facility, or other institution devoted
to the care of sick, infirm, or aged person (Lectric Law Library, 2017).
1.7.7 Kenya Essential Package for Health (KEPH)
This is a basic and expandable package consisting of the following clusters: Health
promotion, environmental health, disease prevention and community health initiatives,
including epidemic and disaster preparedness and response; Maternal and Child Health;
Prevention, management and control of communicable diseases and non-communicable
diseases; that has been defined and consists of the most cost-effective priority healthcare
interventions and services, addressing the high disease burden, that are acceptable and
affordable within the resources available for the health sector (Ministry of Health, 2014).
1.8 Chapter Summary
Chapter one presents the background information to the research problem, identifies the
problem statement, states the purpose of the study and lists the research questions addressed
in the research project. In addition, it also presents the rationale, scope and definition of
terms used. Chapter two focuses on literature review. It lays out the strategic management
conceptual framework, then discusses the existing literature on effects of strategic thinking,
strategic planning and strategy implementation on organizational performance. Theories,
empirical data and other studies are discussed, supported and critiqued too, providing a firm
theoretical background for the study. Chapter three presents the research methodology used
this study. It details the research design, population and sampling, data collection methods,
research procedures and data analysis methods. Chapter four presents the results and findings
of the study. Chapter five presents the discussion, conclusion, and recommendations for
action and further research.
13
CHAPTER TWO
2.0 LITERATURE REVIEW
2.1 Introduction
This chapter covers review of the existing literature on strategic management conceptual
framework and its effects on organizational performance. The chapter discusses in depth the
effect of strategic thinking, strategic planning and strategy implementation on the
organizational performance.
2.2 Strategic Thinking and Organizational Performance
The necessity of evolution in governmental and privately held organizations and companies
is the inevitable consequence of not only global changes but also of citizen and customers’
expectations of the organizations. Despite the existence of performance management in the
public sector for a quarter of century, there are still major problems and the expected
improvements in performance, accountability, transparency, and the quality of services have
not been made (Fryer, Antony, & Ogden, 2009). Today, setting and defining goals as well
as producing and assessing performance are the major challenges of top managers (Farhangi
& Dehghan, 2010). Attaining the best performance and achieving desired results is not
possible if there is not a formulated plan in an integrated system. This system should be able
to plan the performance, devise and implement its plans through an appropriate
administrative system, and assess the results using evaluation procedures in order to improve
the performance (Pirouz, Razavi, & Hashemi, 2009). There are different views on
performance. It can be only regarded as the obtained results. Individually, it refers to the
success and achievements of a person (Armstrong & Baron, 2005). Performance is “the
record a person has which is gained regardless of the goal, it is also defined as results of
work because they have the strongest connection with the strategic goals of organization,
customer satisfaction, and financial gains. One of the factors that affect an organization
reaching its goals is the employees’ thinking and commitment to the company.
14
Strategic thinking is a representation of attitude and results from the person’ value system.
In recent decades, strategic thinking has received a lot of attention and it is claimed that it
distinguishes successful organizations from non-successful ones. In fact, the considerable
success of thriving companies stems from some powerful intangible factors in their
organizational culture and employees’ beliefs and values (Khalili, Armani, Rahimi,
Jamshidi, & Jamshidi, 2015).
Strategic thinking is considered as a very valuable and important component in the macro
management of organizations and businesses. Generally, strategic thinking is “an
understanding of and insight into the current situation and seizing opportunities”. This vision
helps with the proper and timely understanding of the market and its rules so that creative
and effective solutions would be suggested in response. In other words, opportunity involves
things that have not been attended to or there is a need for responding to them in the market,
and strategy is having suitable plans and vision to achieve the goals of the organization with
regard to meeting that need while considering interactions and chaos in the today’s relations
of business and companies. Strategic thinking enables managers to realize what factors are
effective in attaining desired goals. It involves real understanding of the market rules and
responding creatively to them; this is very important in the changeable environment of
business because without strategic thinking, companies cannot pursue the formulated
strategies effectively. The main characteristic of strategic thinking is having a wide
perspective on the organization’s future and environment. This requires understanding of the
relation between different issues and topics as well as of the way a solution to a problem in
a certain area influences another area or solution. Based on strategic thinking, a framework
would be suggested that enables the organization to reach its goals with a strategic vision
and to institutionalize it (Khalili, Armani, Rahimi, Jamshidi, & Jamshidi, 2015).
Strategic thinking is a process of utilizing previous experiences in a coherent framework and
showing the best reaction in vital situations (Noubar, Orangi, & Mejarshin, 2014). However,
what may look challenging regarding this issue is the degree of durability and stability of
planning and strategic management within the organization, and therefore a strategic
thinking of managers and employees is an assurance to the mentioned matter, and creation
of strategic thinking in managers of companies plays more important role than presenting
strategic plans since existence of such a thinking is a strong support for strategic plans within
any company. Strategic thinking is process which requires time and effort; it cannot be
15
bought and only can be earned through experience. In simple words, strategic thinking is a
logical development of thoughts (Fairholm & Card, 2009).
Strategic thinking helps the managers face changes, create plans for future developments
and absorb new opportunities. According to Mitzberg (2004) strategic thinking is an
integrated view from a business in manager’s mind. Seeing beyond is quite different from
seeing in front, because the first one lets you create the future. Strategic thinking in its lowest
level is a reaction to changes in environment and in its highest level is the reason to
emergence of new changes and values (Noubar, Orangi, & Mejarshin, 2014).
Having strategic thinking is advantageous for organizations since: it helps and directs
different levels of management in identifying goals, it makes designation of opportunities
and threats easier, it reinforces the management’s logics regarding the required assets and
workforce of company, it replaces the act with react within companies and help business to
be prepared for future changes. Like every process, strategic thinking has challenges and
obstacles such as: lack of systematic vision, lack of using collaborative management,
unavailability of exact information, lack of institutional trust, lack of organizational
encouraging culture (Noubar, Orangi, & Mejarshin, 2014).
Strategic thinking is consisted of several main elements: systems thinking, breaking down
organization to smaller systems collaborating with each other, creativity, developing new
solutions and business ideas to gain competitive edge, having vision, realizing the reasons
of company existence, its values and goals and having long term plans leading to those goals
(Pandelica, Pandelica, & Dumitru, 2009).
Several templates have been introduced by researchers to implement strategic thinking such
as: The Liedtka Model of the Elements of Strategic Thinking (Liedtka, 1998), Leading the
Revolution (Hamel G. , 2002), and The Fifth Discipline (Senge, 2006). The Fifth Discipline
template focuses on internal dimensions of organization and offers a framework that helps
institutions to solve problems using systems thinking method. These five disciplines are as
follows: Continue deepening and clarifying mangers vision, mental models refining to have
clear picture of our world in order to understand our environment and take proper actions,
building shared vision - a practice of unearthing shared pictures of the future that foster
genuine commitment and enrollment rather than compliance, team learning starts with
dialogue, the capacity of members of a team to suspend assumptions and enter into genuine
16
thinking together, and systems thinking - The Fifth Discipline that integrates the other four
(Senge, 2006).
Figure 2.1: Elements of Strategic Thinking
Source: Liedtka (1998)
There are weaknesses with regard to strategic thinking in both principle and practice. Top
managers’ lack of strategic thinking has been identified as the biggest obstacle to companies’
performance in the studies done about countries and industries (Khalili, Armani, Rahimi,
Jamshidi, & Jamshidi, 2015). There is a concern that this weakness will continue. Bonn
(Bonn, 2005) states that a group of experts have identified strategic thinking as one of the
ten important future areas of research. Moreover, leadership and strategy theoreticians have
shown that strategic thinking is required in multiple levels of an organization (Goldman &
Casey, 2010). The demand for information and thinking skills, which once were the subject
of debate among top managers, has deepened because all people need the ability to interpret
complex information and create their own realities (Khalili, Armani, Rahimi, Jamshidi, &
Jamshidi, 2015). In newer theories of strategic thinking, the focus is on organizational
procedures and routine tasks. This indicates that strategic thinking is useful for those who
work more closely with clients (Wooldridge, Schmid, & Floyd, 2008). According to
Wheatley (2006), the need for information and thinking skills that were once the purview of
17
top leaders is moving deeper into organizations, as everyone needs to be able to interpret
complex information and create their own realities.
The strategic thinking gap is due to a lack of understanding of the concept overall (Bonn,
2005) (Liedtka, 1998) (Mintzberg H. , The Rise and Fall of Strategic Planning: Reconceiving
Roles for Planning, Plans, Planners, 1994) and limited development of it among
organizational leaders (Bonn, 2005). Practitioners and theorists wrongly use the terms
strategic thinking, strategic planning, and strategic management interchangeably. This has
resulted in significant historical confusion in the literature, with the aforementioned terms
being used not only as substitutes but also as both nouns and verbs (Steiner, Miner, & Gray,
1982). Strategic thinking has been recognized as an individual activity influenced by the
context within which it takes place (Liedtka, 1998).
Research has found a statistically significant and positive relationship between strategic
thinking and organizational creativity (Khalili, Armani, Rahimi, Jamshidi, & Jamshidi,
2015). In addition, there is a significant relationship between organizational creativity and
the five components of strategic thinking including systems perspective, intent focused,
intelligent opportunism, hypothesis-driven, and thinking in time. Monovarian did a
descriptive survey titled ‘assessing strategic thinking among managers of the municipality
of Tehran’. Using Leidtka’s model which includes five elements of systems perspective,
intent focused, intelligent opportunism, hypothesis driven, and thinking in time, they
investigated strategic thinking among managers in the municipality of Tehran. Based on
experts’ views and available resources, the researchers created 29 sub-elements and
investigated the significance and current condition of all through a questionnaire distributed
among the managers in the municipality of Tehran. Analyzing the data through the Friedman
test and paired t-test revealed that despite some important measures like preparing strategic
documents in the municipality of Tehran, there is a significant gap between the significance
of the elements and their current condition in the organization that deserves attention
(Monavarian, Asgari, & Ashena, 2007).
A study conducted about the effects of top managers’ ability to think strategically on the
success of small and medium companies in Azarbaijan-e-shraghi. Five components of
strategic thinking were specified, and to assess the achievement of companies, the rise in
sales in three consecutive years was considered. The findings showed that the top managers’
18
ability to think strategically has a substantial effect on the success of small and medium
companies although in practice they do not use it enough (Sadegh, Yazdani, & Behrang,
2011). Research carried out on the crucial factors in strategic thinking. The results suggested
16 key variables in four main dimensions including systems perspective, individual factors,
organizational factors, and intuitive ones. All these dimensions are effective in the
realization of strategic thinking, so they can be considered for improving and promoting
strategic thinking in organizations (Khalili, Armani, Rahimi, Jamshidi, & Jamshidi, 2015).
2.2.1 Intent Focused
Hamel and Prahalad (Hamel & Prahalad, 1994) define strategic intent as a term (that) implies
a particular point of view about the long-term market or competitive position that a firm
hopes to build over the coming decade or so. Hence, it conveys a sense of direction. A
strategic intent is differentiated; it implies a competitively unique point of view about the
future. It holds out to employees the promise of exploring new competitive territory. Hence,
it conveys a sense of discovery. Strategic intent has an emotional edge to it; it is a goal that
employees perceive as inherently worthwhile. Hence, it implies a sense of destiny. Direction,
discovery, and destiny. These are the attributes of strategic intent.
Liedtka (1998) puts it this way: Strategic intent provides the focus that allows individuals
within an organization to marshal and leverage their energy, to focus attention, to resist
distraction, and to concentrate for as long as it takes to achieve a goal. In the disorienting
swirl of change, such psychic energy may well be the scarcest resource an organization has,
and only those who utilize it will succeed. Therefore, strategic thinking is fundamentally
concerned with, and driven by, the continuous shaping and re-shaping of intent (Lawrence,
1999).
2.2.2 A Systems Perspective
Strategic thinking is built on the foundation of a systems perspective. A strategic thinker has
a mental model of the complete end – to – end system of value creation, and understands the
interdependencies within it (Liedtka, 1998). Peter Senge also stresses the significance of
mental models in influencing our behavior. According to him: “New insights fail to get put
into practice because they conflict with deeply held internal images of how the world works,
images that limit us to familiar ways of thinking and acting. That is why the discipline of
19
managing mental models - surfacing, testing, and improving our internal pictures of how the
world works - promises to be a major breakthrough” (Senge, 2006).
The mental model of how the world works must incorporate an understanding of both the
external and internal context of the organization. According to James Moore these mental
models must lead to the perception of a business in a context larger than that of the industry
in order to facilitate innovation. As he puts it: “I suggest that a company be viewed not as a
member of a single industry but as part of a business ecosystem that crosses a variety of
industries. In a business ecosystem, companies co-evolve capabilities around a new
innovation: they work co-operatively and competitively to support new products, satisfy
customer needs, and eventually incorporate the next round of innovations” (Moore, 1993).
Thus, the ability to manage in these converging arenas requires that managers think
strategically about the alliances they make within these competing networks and how they
position themselves within this ecosystem. In addition to understanding the external business
ecosystem in which a firm operates, strategic thinkers must also appreciate the inter-
relationships among the individual internal parts that, together, constitute the whole, as well
as the fact that the whole is greater than the sum of its parts (Lawrence, 1999).
Senge (2006) uses the term systems thinking to describe the same phenomenon, and suggests
that it is arguably the most critical of the five disciplines of the learning organization. He
advocates that systems thinking is what makes all other types of learning work in harmony
and points out that a fundamental problem for business organizations is the failure to see
problems as elements of systems failures because “most of an organization’s problems are
not unique errors but systems issues.”
The systems perspective enables individuals to clarify their role within the larger system and
the impact of their behavior on other parts of the system, as well as on the final outcome.
This approach addresses, therefore, not only the fit between the corporate, business, and
functional levels of strategy, but very importantly, the person level (Lawrence, 1999).
According to Liedtka (1998): “It is impossible to optimize the outcome of the system for the
end customer, without such understanding. The potential for damage wrought by well-
intentioned but parochial managers optimizing their part of the system at the expense of the
whole is substantial.”
20
Thus, from a vertical perspective, strategic thinkers see the linkages in the system from
multiple perspectives and understand the relationship among the corporate, business, and
functional levels of strategies to the external context, as well as to the personal daily choices
they make. From a horizontal perspective, they also understand the connections across
departments and functions, and between suppliers and buyers (Lawrence, 1999).
2.2.3 Thinking in Time
The third element of strategic thinking is referred to as thinking in time. According to Hamel
and Prahalad (Hamel & Prahalad, 1994), strategy is not solely driven by the future, but by
the gap between the current reality and the intent for the future. According to them: Strategic
intent implies a sizeable stretch for an organization. Current capabilities and resources will
not suffice. This forces the organization to be more inventive, to make the most of limited
resources. Whereas the traditional view of strategy focuses on the degree of fit between
existing resources and current opportunities, strategic intent creates an extreme misfit
between resources and ambitions.
Thus, by connecting the past with the present and linking this to the future, strategic thinking
is always “thinking in time.” Neustadt (Neustadt & May, 1986) states that: Thinking in time
(has) three components. One is recognition that the future has no place to come from but the
past, hence the past has predictive value. Another is recognition that what matters for the
future in the present is departures from the past, alterations, changes, which prospectively or
actually divert familiar flows from accustomed channels. A third component is continuous
comparison, an almost constant oscillation from the present to future to past and back,
heedful of prospective change, concerned to expedite, limit, guide, counter, or accept it as
the fruits of such comparison suggest (Lawrence, 1999).
In a nutshell, strategic thinking connects the past, present, and future and in this way, uses
both an institution’s memory and its broad historical context as critical inputs into the
creation of its future. This oscillation between the past, present, and future is essential for
both strategy formulation and execution. Thinking in time needs both a sense of continuity
with the past and a sense of direction for the future to maintain a feeling of control in the
midst of change (Lawrence, 1999).
21
2.2.4 Intelligent Opportunism
The essence of this notion is the idea of openness to new experience which allows one to
take advantage of alternative strategies that may emerge as more relevant to a rapidly
changing business environment. Mintzberg (1999) sees this approach as underscoring the
difference between emergent strategy and deliberate strategy. In practicing intelligent
opportunism, it is important that organizations seriously consider the input from lower level
employees or more innovative employees who may be instrumental in embracing or
identifying alternative strategies that may be more appropriate for the environment. For
example, Intel’s predominant role in the microprocessor industry was largely the result of a
renegade band of scientists acting in defiance of senior management’s stated strategic
objectives. Given this, one can well imagine the loss to industry if the focus is only on rigidly
defined and mandated top-down strategies to the exclusion of other emerging strategies and
voices of dissent (Lawrence, 1999).
2.2.5 Hypothesis-driven
Like the “scientific method”, strategic thinking embraces hypothesis generation and testing
as core activities. According to Liedtka (1998), this approach is somewhat foreign to most
managers: Yet in an environment of ever-increasing information availability and decreasing
time to think, the ability to develop good hypotheses and test them efficiently is critical, the
ability to work well with hypotheses is the core competence of the best strategy consulting
firms.
Because strategic thinking is hypothesis-driven, it circumvents the analytical-intuitive
dichotomy that has dominated much of the debate on the value of formal planning. Strategic
thinking is both creative and critical, although accomplishing both types of thinking
simultaneously is difficult, because of the requirement to suspend critical judgement in order
to think more creatively (Lawrence, 1999).
Nonetheless, the scientific method is able to accommodates both creative and analytical
thinking sequentially through its use of iterative cycles of hypothesis generating and testing.
Hypothesis generation poses the creative question, “What if?” Hypothesis testing follows
up with the critical question, “If then.” And evaluates the data relevant to the analysis. Taken
together and repeated longitudinally this process allows an organization to pose a variety of
hypotheses, without sacrificing the ability to explore novel ideas and approaches. The effect
22
is an organization that can transcend simplistic notions of cause and effect and pursue life-
long learning (Lawrence, 1999).
Liedtka (1998) states that, “Taken together, these five elements describe a strategic thinker
with a broad field view that sees the whole and the connections between its pieces, both
across the four vertical levels of strategy and the horizontal elements of the end-to-end value
system.”
2.3 Strategic Planning and Organizational Performance
The process of strategic planning defines where the organization is going and sometimes
where it is not going. It defines the organization and provides focus. At the same time, the
plan sets direction for the organization and – through a common understanding of the vision
and broad goals – provides a template for everyone in the organization to make consistent
decisions that move the organization toward its envisioned future. Strategic planning, in
large part, is a decision-making activity. Although these decisions are often supported by a
great deal of quantifiable data, strategic decisions are fundamentally judgmental. Because
strategic decisions cannot always be quantified, managers must rely on “informed judgment”
in making this type of decision (Swayne, Duncan, & Ginter, 2006). Rather, it must consider
the nature of the future environment in which planning decisions and actions are intended to
operate.
Planning is a process that does not end when a plan is agreed upon rather, it must be
implemented. Also at any time during the implantation and control process, plans may
require modification to avoid becoming useless or even damaging, implying that decisions
must be made at many points in the planning process. For instance, managers must decide
which predictions in such areas as the economy, and the actions of competitions are likely
to be most accurate. They must also analyze organizational resources and decide how to
allocate them to achieve their goals most effectively (Olusanya, Olumuyiwa, Adelaja, &
Chukwuemeka, 2012). Again, Koontz et al (Koontz, O'Donnell, & Weibrich, 1980)
introduces an issue known as the nature of planning which can be highlighted by for aspects
of planning. These aspects are contributions to purpose and objectives‟ primacy of planning,
pervasiveness of planning and efficiency of plans.
23
Two distinct approaches to strategy making have attracted the attention of practitioners and
researchers: the rational approach and the adaptive approach (Grant R. , 2003). The adaptive
approach, which is a process of making strategy based on intuition, creativity, and learning
(Mintzberg H. , 1994), is gaining more interest in today’s dynamic environment. In contrast,
rational strategic planning has been known since the 1950s through the work of Selznick
(Selznick, 1957). It is “a systematic process through which an organization agrees on
priorities that are essential to its mission and are responsive to the environment” (Allison &
Kaye, 2005). Indeed, rational strategic planning is based on the idea that organizations adapt
to changes in their environment by making rational decisions (Chaffee, 1985). Rational
strategic planning is a formal, logical, systematic, and continuous process (Hough & White,
2003) with the following steps: definition of the mission and long-term objectives of the
organization, analysis of its environment, generation and evaluation of strategic alternatives,
implementation of the chosen strategy, and finally, monitoring of the results (Crittenden &
Crittenden, 2000). It is a normative and rational approach to strategy making (Hough &
White, 2003), even though it has been strongly criticized for its uncertain effects on firm
performance (Robinson & Pearce, 1983). Indeed, the proponents of the adaptive approach
to strategy making criticize rational strategic planning, arguing that it bridles creativity and
spontaneity, creates rigidity, and encourages excessive bureaucracy (Mintzberg H., 1994)
therefore reducing the organization’s ability to quickly adapt to change. Nonetheless,
rational strategic planning has many proponents (Ansoff, 1991) (Robinson & Pearce, 1988).
According to them, rational strategic planning is much more effective than an informal
process because it involves the collection and analysis of pertinent information allowing an
organization to make more informed and fact-based strategic decisions and therefore to be
more aligned with its environment.
Also, rational strategic planning enables an organization to determine its strategic direction
(Porter M. , 1996), identify relevant opportunities and effectively seize them (Hough &
White, 2003), and anticipate change and create strategic options to deal with change (Rudd,
Greenley, Beatson, & Lings, 2008). More recently, Casey and Goldman (2010) found that
participation in organized strategic planning processes and involvement in developing
strategic plans enhances strategic thinking. Also, Elbanna (2012) showed that a
comprehensive strategic planning process is a vital tool for improving performance.
24
The most important organizational decisions, such as entering a market, introducing a new
service, or acquiring a competitor, although based on information and analysis, are
essentially judgments. Decision consistency is central to strategy; when an organization
exhibits a consistent behavior, it has a strategy (Al isa, 2017). The requirements of decision
consistency suggest that a strategy is the means an organization chooses to move from where
it is today to a desired state sometime in the future. Thus, strategy also may be viewed as a
set of guidelines or a plan that will help assure consistency in decision making and serve as
a map to the future. Strategic plans indicate what types of decisions are appropriate or
inappropriate for an organization. Developing the road map (strategic plan) requires
situational analysis, strategy formulation, and planning the implementation of the strategy
(Swayne, Duncan, & Ginter, 2006).
Strategic planning has received special attention in strategic management research,
particularly in terms of its relationship with financial performance and its role in strategic
decision-making (Grant R. , 2003). In fact, researchers have made considerable efforts to
study the relationship between strategic planning and firm performance because
understanding the nature of this relationship is crucial to organizations. However, the results
of these studies are considered uncertain and contradictory with no clear conclusions
(Falshaw, Glaister, & Tatoglu, 2006) (Grant R. , 2003) (Mintzberg H., 1994). For instance,
Sarason and Tegarden (2003) found a positive relationship between rational strategic
planning and firm performance, Fredrickson and Mitchell (1984) a negative relationship, and
Robinson and Pearce (Robinson & Pearce, 1983) no significant relationship at all.
Given these mitigated results, studies examining the direct bivariate relationship between
rational strategic planning and firm performance have been strongly criticized. Some
researchers have argued that context plays a considerable role in explaining the relationship
between firm processes and outcomes (Child, Elbanna, & Rodrigues, 2010). Therefore,
several contingency factors, such as the organizational structure, the nature of the
environment, and the size of the organization, have been introduced in the study of the
relationship between strategic planning and firm performance (Miller, Burke, & Glick,
1998). It has equally been suggested that some factors may have a mediating role in this
relationship (Rudd, Greenley, Beatson, & Lings, 2008) (Ouakouak & Ouedraogo, 2013). In
this research, we are testing the role of strategic planning on organizational performance.
25
2.3.1 Situational Analysis
Analyzing and understanding the situation is accomplished by three separate strategic
thinking activities: external environmental analysis; internal environmental analysis; and the
development or refinement of the organization’s directional strategies. The interaction and
results of these activities form the basis for the development of strategy. These three
interrelated activities drive the strategy (Swayne, Duncan, & Ginter, 2006).
A closer look at these three-interrelated strategic thinking and planning activities is presented
in Figure 2.2 below. These influences must be understood before a strategy can be
formulated, as they represent the organization’s situation. Forces in the external environment
suggest “what the organization should do.” That is, success is a matter of being effective in
the environment – doing the “right” thing. Strategy is additionally influenced by the internal
resources, competencies, and capabilities of the organization and represents “what the
organization can do.” Finally, strategy is driven by a common mission, common vision, and
common set of organizational values and goals – the directional strategies. The directional
strategies are the result of considerable thought and analysis by top management and indicate
“what the organization wants to do.” Together, these forces are the essential input to strategy
formulation. They are not completely distinct and separate; they overlap, interact with, and
influence one another (Swayne, Duncan, & Ginter, 2006).
26
Figure 2.2: Analyzing and Understanding the Situation
Source: Luthans, Hodgetts, & Thompson, 1990
2.3.2 Strategy Formulation
Strategy formulation refers to the process through which a firm defines its overall long-term
direction and scope. It involves establishing the way a company creates value through the
configuration of its activities and resources in the markets in which it operates. Strategy
formulation is a purposeful, deliberate exercise to develop a company’s competitive
advantage and thus enhance its performance (Gimbert, Bisbe, & Mendoza, 2010) (Collis &
Montgomery, 2005) (Porter M. , 1996).
The way organizations formulate strategy has become one of the most contested areas of
debate in the strategic management field. In the conventional approach (the so-called
‘prescriptive’ or ‘design’ school of thought), strategy development is mainly the result of a
systematic, rational process of deliberate planning by a top management team, which is then
communicated to the organization for implementation. In large companies, this process
typically occurs through formal strategic planning systems. An alternative approach, based
27
on descriptive studies of strategy formation, sees strategy as the result that emerges from a
complex, multi-level process of organizational decision-making. The realized strategy is
thus the outcome of two simultaneous processes: on the one hand, the execution of the
strategy as conceived by the top management team (deliberate strategy) and, on the other,
the cumulative effect of day-to-day decision-making in a changing environment which
eventually results in the formation of emergent strategies (Mintzberg & Waters, 1985).
Central to the continued survival of any organization is the ability to formulate and execute
an effective strategy despite the limitations of organizational resources and the constraints
of the external environment. Private-sector firms must plan to face challenges from
competitors, rulings of regulatory bodies, shifts in the commercial context including changes
in interest rates and economic activity, and shortages of personnel and supplies. Public-
sector organizations also face many of these challenges but in different forms, as well as the
additional considerations of an election cycle that may cause changes in leadership, a wide
variety of stakeholders with competing agendas, and the subjective nature of success given
these diverse perspectives (Rose & Cray, 2010).
2.4 Strategy Implementation and Organizational Performance
The third element of strategic management shown in Figure 2.2, strategic momentum
(strategic implementation), concerns the day-to-day activities of managing the strategy to
achieve the strategic goals of the organization. Thus, once plans are developed, they must be
actively managed and implemented to maintain the momentum of the strategy. Strategic
thinking and periodic planning should never stop; they become ingrained in the culture and
philosophy of a strategically managed organization. As part of managing the strategy,
strategic momentum: is the actual work to accomplish specific objectives, concerns decision-
making processes and their consequences, provides the style and culture, fosters anticipation,
innovation, and excellence, evaluates strategy performance through control, is a learning
process, and relies on and reinforces strategic thinking and periodic strategic planning
(Swayne, Duncan, & Ginter, 2006).
Strategic planning activities are common in all types of organizations. Top managers come
together to develop a strategic plan, often using strategic thinking, and many important issues
28
are discussed and documented. However, sometimes a strategic plan is created and everyone
enthusiastically returns to the organization only to find “business as usual” – nothing really
changes, the strategic momentum is lost, and plans are never implemented. This is a critical
issue for all organizations, as many have noted before, implementing strategy is often more
difficult than formulating it, and it is widely accepted to be an aspect of management where
many organizations fail (Hrebiniak, 2006) (Nutt P. , 1999). As next year rolls around, it is
once again time for the annual strategic planning retreat and the cycle repeats itself. This is
an example of strategic planning without strategic momentum. Alan Weiss, in his irreverent
book, Our Emperors Have No Clothes, explains that in these situations the problem is that,
“Strategy is usually viewed as an annual exercise at best, an event that creates a ‘product,’
and not a process to be used to actually run the business” (Weiss, 1995). Moreover, much of
the process literature focuses on the effects of strategy formulation, and there is very little
evidence on the processes that organizations use when implementing their strategies and the
consequences for performance (Bantel & Osborn, 2001) (Dobni & Luffnan, 2003).
Strategic implementation ensures an ongoing philosophy for developing and managing the
plans, actions, and control of the organization. It attempts to continually orchestrate a fit
between the organization’s external environment (political, regulatory, economic,
technological, social, and competitive forces) and its internal situation (culture, organization
structure, resources, products and services, and so on). In some cases, orchestrating the fit
may mean responding to external forces; in other cases, the organization may attempt to
actually shape its environment (change the rules for success). External change is inevitable;
often the shifts may be subtle, other times they can be discontinuous and extremely
disruptive. When such dramatic changes occur, new opportunities emerge and new
competencies are born, while others die or are rendered inconsequential. Inevitably, the basic
rules of competing and survival will change (Mische, 2001).
For many organizations, strategic planning is the easiest part of strategic management and
the planning process receives the greatest attention. However, plans must be implemented
to create momentum and to realize strategic intent. Poor implementation or lack of
implementation has rendered many strategic plans as worthless. Whereas the strategic plan
and its underlying strategic thinking must be viewed as important, they fall apart without
implementation and the decision-making guidelines provided for managers at all levels in
the organization (Swayne, Duncan, & Ginter, 2006).
29
If the strategy is not actively managed, it will not happen. Sometimes it is difficult for
managers to plan or envision the long-term future of an organization in a dynamic
environment. Managers often need to react to unanticipated developments and new
competitive pressures. Different environmental characteristics and different organizational
forms require new and different ways of defining strategy (Camillus, 1996).
Strategy becomes an intuitive, entrepreneurial, political, culture-based, or learning process.
In these cases, maps are of limited value. Managers must create and discover an unfolding
future, using their ability to learn together in groups and interact politically in a spontaneous,
self-organizing manner. However, learning is difficult in organizations. Learning requires
engagement, mastering unfamiliar ideas, and adopting new behaviors. Engaged learning
demands that executives share leadership, face harsh truths, and take learning personally. It
requires them to fundamentally change the way they manage (Linder, 2000).
As a result, strategy emerges spontaneously from the chaos of challenge and contradiction,
through a process of real-time learning and politics. For these uncharted, complex situations,
a compass indicating a general direction, steadied by leadership, may be more appropriate
than a map of known events, territories, and ideas. Clearly, rational strategies do not always
work out as planned (an unrealized strategy). In other cases, an organization may end up
with a strategy that was quite unexpected as a result of having been “swept away by events”
(an emergent strategy) (Swayne, Duncan, & Ginter, 2006).
Figure 2.3: Intended Versus Realized Strategy
Source: Mintzberg H. , Patterns in Strategy Formation, 1978
30
Mintzberg added several possible outcomes to those presented in Figure 2.5. For example,
he discussed strategies that, as they were realized, changed form and became, in part at least,
emergent; emergent strategies that were formalized as deliberate ones; and intended
strategies that were over-realized. It is quite possible that a strategy may be developed and
subsequently realized. However, we must be realistic enough to understand that when we
engage in strategic management the theoretical ideal (strategy developed, then realized) may
not, and in all probability, will not, be the case. A great deal may go wrong (Mintzberg H. ,
Patterns in Strategy Formation, 1978).
One factor that may mediate the impact of implementation style on performance is the
strategy of the organization. The argument that organizations should adapt their internal
characteristics to reflect their strategies has a venerable status in the management literature,
and research on private organizations broadly supports the view that a fit between strategies
and processes is associated with better performance (Donaldson, 1996) (Govindarajan,
1988). Miles and Snow’s (1978) seminal model of strategic management suggested that
strategies fall into a small number of ideal types and that to achieve success, they should be
consistently related to the organization’s internal processes. Our conceptualization of
strategy is based on Miles and Snow’s typology of four ideal types of organizational
strategies. Prospectors are organizations that “almost continually search for market
opportunities, and regularly experiment with potential responses to emerging environmental
trends” (Miles & Snow, 1978). In the public sector, prospectors often seek to expand budgets
and pioneer the development of new products and services. Defenders are organizations that
take a conservative view of new product development. They typically compete on price and
quality rather than on new products or markets and “devote primary attention to improving
the efficiency of their existing operations” (Miles & Snow, 1978); in short, they seek better
performance on a limited number of core products and services.
Public sector defenders are likely to focus on low-risk strategies designed to enhance the
efficiency of their existing services. Analyzers represent an intermediate category, sharing
elements of both prospector and defender. Reactors are organizations in which top managers
frequently perceive change and uncertainty in their organizational environments but lack a
consistent and stable strategy. A reactor “seldom makes adjustment of any sort until forced
to do so by environmental pressures” (Miles & Snow, 1978). Reactors in the public sector
lack a strategy of their own but wait to be cajoled or coerced by external forces, such as the
31
interventions of regulators. Boyne and Walker (Boyne & Walker, 2004) evaluated the
relevance of the Miles and Snow (1978) framework to public organizations. They criticize
most prior research on strategy content for placing organizations in mutually exclusive boxes
and assuming that each organization has only a single strategic orientation and is, for
example, just a prospector or a defender. Boyne and Walker argued that organizations’
strategies are messy and complex rather than neat and simple. A mix of strategies is likely
to be pursued at the same time, so it is inappropriate to categorize organizations as belonging
solely to a single type (e.g., reactor or prospector).
2.5 Chapter Summary
Chapter Two presents the literature review. It discusses the existing literature on strategic
management tools and techniques, their use and effect on organizational performance. The
discussion tackles all the research questions posed and provides a firm theoretical
background for the study. The next chapter, Chapter Three covers the methodology used in
the study.
32
CHAPTER THREE
3.0 RESEARCH METHODOLOGY
3.1 Introduction
This chapter presents the research methodology. The chapter covers research design,
population and sampling design, data collection methods, research procedures, data analysis
methods and chapter summary.
3.2 Research Design
Research design constitutes the blueprint for the collection, measurement, and analysis of
data. It aids the researcher in the allocation of limited resources by posing crucial choices in
methodology (Cooper & Schindler, 2011). The function of a research design is to ensure that
the evidence obtained enables us to answer the initial question as unambiguously as possible
(Vaus, 2005). It is a plan and structure of investigation so conceived as to obtain answers to
research questions. The plan is the overall scheme or program of the research. It includes an
outline of what the investigator will do from writing hypotheses and their operational
implications to the final analysis of data. Research design expresses both the structure of the
research problem – the framework, organization or configuration of the relationships among
variables of a study - and the plan of investigation used to obtain empirical evidence on
those relationships (Cooper & Schindler, 2011).
This study was descriptive and the study design was cross – sectional. The study was
designed to capture utilization of strategic management in health institutions in Nairobi,
representing a snapshot of one point in time. Being descriptive in nature, it will help find out
who, what, where, and by whom. The study looked at strategic thinking, strategic planning
and strategy implementation in health institutions, and how the health institution
management committees or boards are involved in strategy. The study described and
explained phenomena that observations reflected measure social reality or describe what was
in use in health institutions in Nairobi. The independent variables were strategic thinking,
33
strategic planning and strategy implementation, while the dependent variable was
organizational performance.
3.3 Population and Sampling Design
3.3.1 Population
Population is a collection of persons, objects, or items of interest (Black, 2012), while
Saunders and Lewis define population as the complete set of cases or group members
(Saunders, Lewis, & Thornhill, 2012). The definition of the word population according to
Cooper and Schindler is the most comprehensive one; a population is the total collection of
elements about which we wish to make inferences (Cooper & Schindler, 2001). The study
population was the management at health institutions that are Kenya Essential Package for
Health (KEPH) Level Four, Five and Six, and are in Nairobi County. The population was
composed of hospitals, major laboratories and a national blood transfusion center. The
ownership of these health institutions varied from Government (Ministry of Health, Armed
Forces), Private Enterprise and Faith – Based (Kenya Episcopal Conference-Catholic
Secretariat and Christian Health Association of Kenya).
Table 3.1: Population Distribution
Health Institution KEPH Level Number Percentage
Level 4 30 82%
Level 5 4 11%
Level 6 3 8%
Total 37 100%
Source: Ministry of Health Master Health Facility List (2017)
34
3.3.2 Sampling Design
3.3.2.1 Sampling Frame
Sampling frame is a list of elements in the population from which the sample is actually
drawn from (Cooper & Schindler, 2001), while Saunders and Lewis state define a sampling
frame as, the complete list of all the cases in the population, from which a probability sample
is drawn (Saunders, Lewis, & Thornhill, 2012). For this study, the sampling frame was the
list of all health institutions that were KEPH level four or five or six, and in Nairobi County
based on the Kenya Master Health Facility List (Ministry of Health, 2017). The health
institution was the sampling unit.
3.3.2.2 Sampling Technique
Sampling technique is the scientific procedure of selecting those sample units which would
provide the required estimates with associated margins of uncertainty, arising from
examining a part not the whole (George Mason University, 2017). A census was used to
enroll every health institution into this study since they are few, and the unit of analysis was
the health institution. Census is an attempt to collect data from every member of the
population being studied rather than choosing a sample (SAGE, 2017). This was settled on
since the number of the population is small.
3.3.2.3 Sample Size
Having the total number of health institutions that are KEPH level four or five or six in
Nairobi County being 37 (population size, N) according to the Kenya Master Health Facility
List, the entire population was enrolled into the study since it was a census.
3.4 Data Collection Methods
Primary data for this study was collected using a structured self-administered questionnaire
administered to the study prospective participants after they had been recruited and enrolled.
The questionnaire had closed ended questions. In addition, Likert scales were used to capture
ordinal level of data. Further, nominal, interval and ratio levels of data were captured too.
The questionnaire was structured into five sections covering the demographic information
of the interviewee and health institution, strategic thinking, strategic planning, strategy
35
implementation and organizational performance. The questionnaire used in the study
captured both qualitative and quantitative data.
Data was collected using a structured self – administered questionnaire for the following
reasons: allows contact with otherwise inaccessible respondents (e.g. CEO), often the lowest
– cost option, expanded geographic coverage without increase in costs, required minimal
staff, perceived as more anonymous, allowed respondents time to think about questions,
more complex instruments can be used, fast access to the computer literate, rapid data
collection, visuals may be used (Cooper & Schindler, 2001). Additional benefits were:
cheaper and quicker to administer (to widely dispersed populations), absence of interviewer
effects and variation and convenient for respondents (University of Zagreb, 2017).
3.5 Research Procedures
Pilot test refers to mini-versions of a full-scale study (also called ‘feasibility’ studies), as
well as the specific pre-testing of a particular research instrument such as a questionnaire or
interview schedule (van Teijlingen & Hundley, 2002). The questionnaire was pilot tested
among 10 participants to detect weakness in design and instrumentation. The tool was
reviewed after the pilot and refined further with feedback from the pilot.
The traditional criteria for validity find their roots in a positivist tradition, and to an extent,
positivism has been defined by a systematic theory of validity. Within the positivist
terminology, validity resided amongst, and was the result and culmination of other empirical
conceptions: universal laws, evidence, objectivity, truth, actuality, deduction, reason, fact
and mathematical data to name just a few (Winter, 2000). Validity in quantitative research
is defined as “construct validity”. The construct is the initial concept, notion, question or
hypothesis that determines which data is to be gathered and how it is to be gathered. They
also assert that quantitative researchers actively cause or affect the interplay between
construct and data in order to validate their investigation, usually by the application of a test
or other process. In this sense, the involvement of the researchers in the research process
would greatly reduce the validity of a test (Golafshani, 2003).
To establish how representative the study was and suitability of the questions, the feedback
from the supervisor was sought that improved the content and structure of the questionnaire.
36
Reliability is defined as the extent to which results are consistent over time and an accurate
representation of the total population under study is referred to as reliability and if the results
of a study can be reproduced under a similar methodology, then the research instrument is
considered to be reliable (Golafshani, 2003). Embodied in this citation is the idea of
replicability or repeatability of results or observations. There are three types of reliability
referred to in quantitative research, which relate to: the degree to which a measurement,
given repeatedly, remains the same; the stability of a measurement over time; and the
similarity of measurements within a given time period (Kirk & Miller, 1986). The researcher
selected a pilot group of ten managers at three health institutions who did not participate in
the main study to test the stability of the questionnaire. In order to test the reliability of the
questionnaire, internal consistency techniques will be applied using Cronbach’s alpha. The
pilot data was not included in the actual study.
The questionnaire was converted to an online platform. Data was collected from 28th July
2017 to 15th September 2017. Further, to improve response rates, the study participants were
assured of anonymity and feedback from the results of the study.
3.6 Data Analysis Methods
The data from the study was stored on a private web – based platform (https://ona.io) from
where it was downloaded in excel spreadsheet format. Once downloaded, the data was coded
and cleaned. The cleaned data was then analyzed using descriptive statistics, i.e. measures
of central tendency and of variability, and inferential statistics using regression. After
analysis, the data was then presented in tables and figures. Stata 12 ® is the statistical
software that was used to analyze the data.
Output from the Likert Scales were converted to a binary format by aggregating agree and
strongly agree as “agree” and the rest as “disagree”. In addition, various variables under
each of the broad sections of strategic thinking, planning and implementation were then
aggregated and cut off points established at the mid – points so as to determine if the health
institution carried out strategic thinking, planning and strategy implementation or no, and
what their attitudes were. Further, comparisons were made between actual practice of
strategic thinking, planning and implementation and attitudes if they improved
organizational performance.
37
The study measured organizational performance as numbers of outpatients, inpatients seen
or samples processed. To standardize them, the change between the years 2016 and 2014 as
the base year (reference point), was measured and converted to percentage.
Pearson correlation was used as a bivariate analysis method to measure the strengths of
association between two variables and the direction of the relationships. The dependent
variable of the study was organizational performance, while the independent variables were
strategic thinking, planning and strategy implementation. This was used to measure the
strength and direction of relationships.
3.7 Chapter Summary
Chapter Three presents the research methodology used in this study. It details the research
design, population and sampling, data collection methods, research procedures and how data
collected is to be analyzed. The next chapter, Chapter Four presents the study findings.
38
CHAPTER FOUR
4.0 RESULTS AND FINDINGS
4.1 Introduction
This chapter presents the key results and findings of the research study. The questionnaires
administered aimed to answer the three research questions on the effect of strategic thinking,
planning and strategy implementation on organizational performance of health institutions
in Nairobi County. The results and findings as derived from the responses are discussed here.
In addition, the chapter closes with a summary.
4.2 General Information
A total of 24 questionnaires were administered to the sample elements of 37 health
institutions across Nairobi County, giving a response rate of 65%. The completed
questionnaires were cleaned, coded, then analyzed using Stata 12 ®.
4.2.1 Gender of Study Respondents
The descriptive statistics show that the gender split is 14 (58%) for male respondents and 10
(42%) for female respondents as captured in Table 4.1 below.
Table 4.1: Gender of Study Respondents
Variable Number (%)
Gender Male 14 (58%)
Female 10 (42%)
Total 24 (100%)
39
4.2.2 Designation of Study Respondents
Of the study respondents who participated in the survey, 22 (92%) were top-tier management
(CEO, CFO, COO, Chief Matron, Medical Superintendent, Hospital Administrator) and 2
(8%) Mid-level Management. This is captured in Table 4.2 below.
Table 4.2: Designation of Study Respondents
Variable Number (%)
Designation of
Respondents
Top-tier management
(CEO, CFO, COO, Chief Matron, Medical
Superintendent)
22 (92%)
Mid-level Management 2 (8%)
Other 0 (0%)
Total 24 (100%)
4.2.3 Age of Study Respondents
The study was interested in knowing the age of respondents. The distribution of the
respondent age was normal as shown in Figure 4.1 below, with the mean age of the 24
respondents as 39.83 years, with a standard deviation of 7.57 years.
40
Figure 4.1: Distribution of Respondents’ Age
4.2.4 Respondents’ Duration in Post
The study was interested in knowing the duration the respondents had lasted in post. The
distribution the 24 respondents had taken in – post was skewed to the right as shown in
Figure 4.2 below, with a median duration of 3 years and an IQR of 2.0 – 5.5 years.
Figure 4.2: Distribution of Respondents’ Duration in post
01
23
45
Fre
que
ncy
20 30 40 50 60Repondent Age (Years)
Distribution of Respondent Age
05
10
15
20
Fre
que
ncy
0 5 10 15 20Duration in-post (Years)
Distribution of Duration in-post
41
4.2.5 Health Institutions’ KEPH Level
Of the health institutions that participated in the survey, 3 (13%) were Level 6, 1 (4%) Level
5 and 20 (83%) Level 4. This is captured in Table 4.3 below.
Table 4.3: Health Institutions’ KEPH Level
Variable Number (%)
KEPH Level Level 6 3 (13%)
Level 5 1 (4%)
Level 4 20 (83%)
Total 24 (100%)
4.2.6 Health Institutions Type
Of the health institutions that participated in the survey, 4 (17%) were laboratories, 15 (63%)
primary care hospitals, 2 (8%) secondary care hospitals, 2 (8%) comprehensive and referral
hospitals, and 1 (4%) dispensaries and outpatient only. This is captured in Table 4.4 below.
Table 4.4: Health Institutions Type
Variable Number (%)
Health Institution
Type
Laboratory 4 (17%)
Primary Care Hospital 15 (63%)
Dispensaries and clinic-out patient only 1 (4%)
Secondary Care Hospital 2 (8%)
Comprehensive Teaching & Referral 2 (8%)
Total 24 (100%)
42
4.2.7 Health Institution Ownership
As regards ownership, of the health institutions that participated in the survey, 9 (38%) are
owned by Government (National and County), 12 (50%) private, and 3 (12%) faith based.
This is captured in Table 4.5 below.
Table 4.5: Health Institution Ownership
Variable Number (%)
Health Institution
Type
Government 9 (38%)
Private 12 (50%)
Faith Based 3 (12%)
Total 24 (100%)
4.3 Strategic Thinking and Organizational Performance
4.3.1 Systems Perspective
To test if the health institutions had mental models of the complete system of value creation
from beginning to end, and that understood the interdependencies within the chain, the study
checked if top executives were assigned formal responsibility for strategic thinking, strategic
planning was a top priority and if the institution followed a designed set of standard operating
procedures in the strategic thinking. Further, it was explored on the perceptions of the
institutions if the above-mentioned parameters improved organizational performance.
In the health facilities that participated in the survey, all i.e. 24 (100%) had strategic planning
as a top priority, while 22 (92%) top executives are assigned formal responsibility for
strategic planning and 17 (71%) followed a defined set of procedures during strategic
planning process. This is captured in table 4.6 below.
43
Table 4.6: Health Institutions Carrying out Systems Perspective during Strategic
Thinking
Health Institutions carrying out Systems Perspective
Yes No
Top executives assigned formal responsibility 22 (92%) 2 (8%)
Strategic planning a top priority 24 (100%) 0 (0%)
Follow a designed set of procedures 17 (71%) 7 (29%)
In the health facilities that participated in the survey, all i.e. 24 (100%) agreed that assigning
top executives formal responsibility for strategic planning improves organizational
performance, while 23 (96%) agreed that having strategic planning as a top priority improves
organizational performance and 21 (88%) agreed that following a defined set of procedures
during strategic planning process improves organizational performance. This is captured in
table 4.7 below.
Table 4.7: Perspective if System Perspective Improves Organizational Performance
Perception if Systems Perspective improves Organization Performance
Agree Disagree
Top executives assigned formal responsibility 24 (100%) 0 (0%)
Strategic planning a top priority 23 (96%) 1 (4%)
Follow a designed set of procedures 21 (88%) 3 (12%)
44
4.3.2 Intent focused
In this study, strategic intent implied a particular point of view about the long-term market
or competitive position that a health institution hoped to build over the coming decade or so.
Hence, it conveyed a sense of direction. Strategic intent was differentiated; it implied a
competitively unique point of view about the future. In the study, it was measured by
provision of resources for strategic planning, awareness of strategy among management and
higher-level staff, and if the institution had written goals that allowed individuals within an
institution to marshal and leverage their energy, to focus attention, to resist distraction, and
to concentrate for as long as it takes to achieve them.
Of the health institutions that participated in the survey, 21 (88%) provided resources (time,
money, staff support) specifically earmarked for strategic planning, while 22 (92%) had their
management and higher-level staff aware of their institution's mission and understood it. In
addition, 20 (83%) had written goals (short or long term). Further, 19 (79%) had written
goals quantified with measurable targets (e.g. volume, market share, growth rate,
profitability). This is elaborated in table 4.8 below.
Table 4.8: Actual Implementation of Intent Focused
Health Institutions carrying out Intent Focused
Yes No
Provision of resources for strategic planning 21 (88%) 3 (12%)
Management & higher – level staff aware of mission 22 (92%) 2 (8%)
Written Goals 20 (83%) 4 (17%)
Written goals quantified with measurable targets 19 (79%) 5 (21%)
In the health institutions that participated in the survey, 23 (96%) agreed that provision of
resources (time, money, staff support) specifically earmarked for strategic planning
improves organizational performance, while 23 (96%) agreed that awareness among
management and higher-level staff of the institution's mission improves organizational
45
performance. In addition, 22 (92%) agreed that having written goals (short or long term)
improves organizational performance. Further, 23 (96%) agreed that having written goals
quantified with measurable targets (e.g. volume, market share, growth rate, profitability)
improves organizational performance. This is outlined in table 4.9 below.
Table 4.9: Perception if Intent Focused Improves Organizational Performance
Perception if Intent Focused improves Organization Performance
Agree Disagree
Provision of resources for strategic planning 23 (96%) 1 (4%)
Management & higher – level staff aware of mission 23 (96%) 1 (4%)
Written Goals 22 (92%) 2 (8%)
Written goals quantified with measurable targets 23 (93%) 1 (4%)
4.3.3 Thinking in time
Thinking in time connects the past, present, and future and in this way, uses both an
institution’s memory and its broad historical context as critical inputs into the creation of its
future. This oscillation between the past, present, and future is essential for both strategy
formulation and execution. This was measured by the level of participation of management
and higher – level staff in goal setting in view of the institution’s broad historical context.
Of the health institutions that participated in the survey, none (0%) had their management
and higher-level staff participating in goal setting. This is aptly captured in table 4.10 below.
Table 4.10: Actual Implementation of Thinking in Time
Health Institutions carrying out Intent Focused
Yes No
Management & higher – level staff participate in goal setting 0 (0%) 24 (100%)
46
All of the health institutions that participated in the survey, 24 (100%), agreed that
management and higher-level staff participation in goal setting improves organizational
performance. This is captured in table 4.11 below.
Table 4.11: Perception if Thinking in Time Improves Organizational Performance
Perception if Thinking in Time improves Organization Performance
Agree Disagree
Management & higher – level staff participation in goal setting 24 (100%) 0 (100%)
4.3.4 Hypothesis driven
In an environment of ever-increasing information availability and decreasing time to think,
the ability to develop good hypotheses and test them efficiently is critical, the ability to work
well with hypotheses is the core competence of the best institutions. The study measured if
the institutions’ strategic thinking were hypothesis driven by measuring if they compared
actual performance versus actual goals set. Of the health institutions that participated in the
study, 21 (88%) measured actual performance versus goals set. This is in table 4.12 below.
Table 4.12: Actual Implementation of Hypothesis Driven
Health Institutions carrying out Hypothesis Driven
Yes No
Measuring actual performance vs goals 21 (88%) 3 (12%)
Further, 21 (88%) of the health institutions that participated in the study agreed that
measuring actual performance versus goals set improves organizational performance. This
is in table 4.13 below.
47
Table 4.13: Perception if Hypothesis Driven Improves Organizational Performance
Perception if Hypothesis Driven improves Organization Performance
Agree Disagree
Measuring actual performance vs goals 21 (88%) 3 (12%)
4.3.5 Intelligent Opportunism
The study measured intelligent opportunism by checking how many had a written mission
statement and if it captured openness to new experience which allows the institution take
advantage of alternative strategies that may emerge as more relevant to a rapidly changing
business environment. In the health institutions that participated in the survey, 21 (88%) had
a written mission statement as indicated in table 4.14 below.
Table 4.14: Actual Implementation of Intelligent Opportunism
Health Institutions carrying out Intelligent Opportunism
Yes No
Written Mission Statement 21 (88%) 3 (12%)
Further, 23 (96%) of the health institutions that participated in the survey agreed that having
a written mission statement improves organizational performance as indicated in table 4.15
below.
Table 4.15: Perception if Intelligent Opportunism Improves Organizational
Performance
Perception if Intelligent Opportunism improves Organization Performance
Agree Disagree
Written Mission Statement 23 (96%) 1 (4%)
48
4.3.5 Summary of Strategic Thinking and Organizational Performance
In aggregate, 23 (96%) of the health institutions surveyed carry out strategic thinking while
7 (29%) agreed that strategic thinking improves organizational performance as captured in
tables 4.16 and 4.17 respectively.
Table 4.16: Actual Implementation of Strategic Thinking
Health Institutions carrying out Strategic Thinking
Yes No
Strategic Thinking 23 (96%) 1 (4%)
Table 4.17: Perception if Strategic Thinking Improves Organizational Performance
Perception if Strategic Thinking improves Organization Performance
Agree Disagree
Strategic Thinking 7 (29%) 17 (71%)
Of the 23 health institutions that were implementing strategic thinking, only 7 agreed that it
improves organizational performance, while the rest disagreed. This is captured in table 4.18
below.
Table 4.18: Comparison Between Actual Practice and Perception if Strategic
Thinking Improves Organizational Performance
Perception if Strategic Thinking
Improves Organizational
Performance
Agree Disagree Total
Actual Implementation
of Strategic Thinking
Yes 7 16 23
No 0 1 1
Total 7 17 24
49
4.4 Strategic Planning and Organizational Performance
Strategic planning is a decision-making and documentation process that creates the strategic
plan. In the study, this was further broken down to two broad areas namely: situational
analysis and strategy formulation.
4.4.1 Situational Analysis
Situation analysis refers to a collection of methods that managers use to analyze a health
institution's internal and external environment to understand its institution's capabilities,
customers, and business environment.
One of the greatest challenges for health care institutions is identifying the changes that are
most likely to occur and then planning for that future. This study grouped the health sector
environment into the following broad categories: legislative/political, economic,
social/demographic and competitive.
In the legislative/ political category, 20 (83%) of the health institutions that participated in
the survey assessed factors such as cost and availability of capital, government regulations
and state of the economy.
In the analysis of economic factors, 21 (88%) of health institutions had knowledge of and
access to sources of information about the health sector, markets, and other external factors.
In addition, 18 (75%) of health institutions analyzed profitability indicator trends (after-tax
earnings, return on assets, etc.).
In the social/ demographic category, 17 (71%) health institutions analyzed demographic,
behavioral and other consumer trends. In addition, 21 (88%) analyzed their pricing strategy
and its effects on customer behavior. Further, 22 (92%) analyzed quality of customer service,
satisfaction, loyalty and defection data.
In the situational analysis of competition, 20 (83%) health institutions periodically gathered
and analyzed data about the health market and other external factors which affect the
business. Of the health institutions surveyed, 22 (92%) identified key threats and
opportunities during market analysis, while 18 (75%) compared their performance and
operational characteristics with those of competitors. In addition, 20 (83%) assessed the
health sector as whole in terms of new competitors and concepts, new technologies,
50
procurement practices, price trends, labor practices. Further, 22 (92%) of health institutions
analyzed their key strengths and weaknesses, while 21 (88%) assessed its human resource
management and development programs.
After conducting the situational analysis, management of 23 (96%) health institutions had
access to the internal data discussed above. Key strategic issues (e.g. outlet expansion,
profitability improvement, positioning change) were identified in 17 (71%) health
institutions after conducting a situational analysis review. These are captured in table 4.19
below.
51
Table 4.19: Actual Implementation of System Perspective
Health Institutions carrying out Situational Analysis
Yes No
Assessment of factors such as cost and availability of capital,
government regulations and state of the economy
20 (83%) 4 (17%)
Knowledge of and access to sources of information about the
sector, markets, and other external factors
21 (88%) 3 (12%)
Profit trends analysis 18 (75%) 6 (25%)
Analysis of demographic, behavioral & other consumer trends 17 (71%) 7 (29%)
Analysis of pricing strategy and its effects on customer behavior 21 (88%) 3 (12%)
Analysis of quality of customer service, satisfaction, loyalty &
defection data
22 (92%) 2 (8%)
Market analysis 20 (83%) 4 (17%)
Threats & Opportunities 22 (92%) 2 (8%)
Comparison with competitors 18 (75%) 6 (25%)
Assessment of the sector as whole in terms of new competitors
and concepts, new technologies, procurement practices, price
trends, labor practices
20 (83%) 4 (17%)
Strengths and weaknesses 22 (92%) 2 (8%)
Assessment of human resource management and development
programs
21 (88%) 3 (12%)
Management access to internal information 23 (96%) 1 (4%)
Identification of key strategic issues after conducting a
situational analysis review
17 (71%) 7 (29%)
52
The study measured the perception if situational analysis improves organizational
performance. In the legislative/ political category, 22 (92%) of the health institutions that
participated in the survey agreed that assessment of factors such as cost and availability of
capital, government regulations and state of the economy improves organizational
performance.
As regards analysis of economic factors, 21 (88%) of health institutions surveyed agreed
having knowledge of and access to sources of information about the health sector, markets,
and other external factors improves organizational performance. In addition, 23 (96%) of
health institutions agreed that analysis of profitability indicator trends (after-tax earnings,
return on assets, etc.) improves organizational performance.
In the social/ demographic category, 19 (79%) health institutions agreed that analysis of
demographic, behavioral and other consumer trends improves organizational performance.
In addition, 22 (92%) agreed that analysis of pricing strategy and its effects on customer
behavior improves organizational performance. Further, 23 (96%) agreed that analysis of
quality of customer service, satisfaction, loyalty and defection data improves organizational
performance.
As regards analysis of competition, 22 (92%) health institutions agreed that periodically
gathering and analyzing data about the health market and other external factors which affect
the business improves organizational performance. Of the health institutions surveyed, all
24 (100%) agreed that identification of key threats and opportunities during market analysis
improves organizational performance, while 21 (88%) agreed that comparing their
performance and operational characteristics with those of competitors improves
organizational performance. In addition, 22 (92%) agreed that assessment of the health
sector as whole in terms of new competitors and concepts, new technologies, procurement
practices, price trends, labor practices improves organizational performance. Further, all 24
(100%) of health institutions surveyed agreed that analysis of their key strengths and
weaknesses improves organizational performance. Finally, 22 (92%) health institutions
agreed that assessment of their human resource management and development programs
improves organizational performance.
As regards management access to the internal data, all 24 (100%) health institutions
surveyed agreed that it improves organizational performance. In addition, 23 (96%) of health
53
institutions agreed that identification of key strategic issues (e.g. outlet expansion,
profitability improvement, positioning change) after conducting a situational analysis review
improves organizational performance. These are captured in table 4.20 below.
Table 4.20: Perception if System Perspective Improves Organizational Performance
Perception if Systems Perspective improves Organization Performance
Agree Disagree
Assessment of factors such as cost and availability of capital,
government regulations and state of the economy
22 (92%) 2 (8%)
Knowledge of and access to sources of information about the
sector, markets, and other external factors
21 (88%) 3 (12%)
Profit trends analysis 23 (96%) 1 (4%)
Analysis of demographic, behavioral & other consumer trends 19 (79%) 5 (21%)
Analysis of pricing strategy and its effects on customer
behavior
22 (92%) 2 (8%)
Analysis of quality of customer service, satisfaction, loyalty &
defection data
23 (96%) 1 (4%)
Market analysis 22 (92%) 2 (8%)
Threats & Opportunities 24 (100%) 0 (0%)
Comparison with competitors 21 (88%) 3 (12%)
Assessment of the sector as whole in terms of new competitors
and concepts, new technologies, procurement practices, price
trends, labor practices
22 (92%) 2 (8%)
Strengths and weaknesses 24 (100%) 0 (0%)
Assessment of human resource management and development
programs
22 (92%) 2 (8%)
Management access to internal information 24 (100%) 0 (0%)
Identification of key strategic issues after conducting a
situational analysis review
23 (96%) 1 (4%)
4.4.2 Strategy Formulation
Strategy formulation is the process by which a health institution chooses the most
appropriate courses of action to achieve its defined goals, based on the situational analysis.
The study evaluated if health institutions formulate strategies based on situational analysis
and what strategic management techniques and tools are in use. In addition, the study
evaluated the perceptions of the managers if strategy formulation based on situational
54
analysis and use of strategic management tools and techniques improve organizational
performance.
Of the health institutions surveyed, 19 (79%) formulated strategies based on situational
analysis as captured by table 4.21 below.
Table 4.21: Actual Formulation of Strategies based on Situational Analysis
Health Institutions Formulating Strategies based on Situational Analysis
Yes No
Use of situational analysis to formulate strategic plans 19 (79%) 5 (21%)
Among the 24 health institutions surveyed, 22 (92%) agreed that use of situational analysis
to formulate strategies improves organizational performance. In addition, all 24 (100%) of
them agree that use of strategic management techniques and tools improves organizational
performance. This is captured in table 4.22 below.
Table 4.22: Perception if Strategy Formulation Improves Organizational
Performance
Perception if Strategy Formulation improves Organization Performance
Agree Disagree
Use of situational analysis to formulate strategic plans 22 (92%) 2 (8%)
Strategic Management Techniques and Tools 24 (100%) 0 (0%)
Among the strategic management tools and techniques that the survey covered, mission and
vision statements (71%), benchmarking (67%) and customer relationship management
(63%) were the most popular in use across all health institutions irrespective of the
ownership.
55
Benchmarking (78%) and mission and vision statements (67%) were the two most popular
strategic management techniques and tools in use among health institutions owned by the
Government. In privately owned health institutions, customer relationship management was
the most utilized strategic management technique and tool at 83%, followed by social media
programs (67%), and mission and vision statements (67%). In the faith – based organization
owned health institutions, mission and vision statements was utilized in all of them (100%),
and there was a tie in the utilization of benchmarking, business process reengineering,
customer relationship management and outsourcing at 67%. These are captured in table 4.23
below.
Table 4.23: Strategic Management Techniques in Use Stratified by Health Institution
Ownership
Strategic Management Tool Government
n
Faith
Based
N
Private
n
Total
n
Balanced Scorecard 3 0 4 7
Benchmarking 7 2 7 16
Big Data Analytics 2 0 3 5
Business Process Reengineering 1 2 5 8
Change Management Programs 2 0 7 9
Complexity Reduction 0 1 0 1
Core Competencies 4 1 6 11
Customer Relationship
Management
3 2 10 15
Customer Segmentation 1 0 6 7
56
Decision Rights Tools 1 0 0 1
Downsizing 0 1 1 2
Employee Engagement Surveys 3 1 6 10
Mergers and Acquisitions 0 0 1 1
Mission and Vision Statements 6 3 8 17
Open Innovation 2 1 3 6
Outsourcing 2 2 6 10
Price Optimization Models 2 1 3 6
Satisfaction and Loyalty
Management
2 1 4 7
Scenario and Contingency
Planning
1 0 3 4
Social Media Programs 1 1 8 10
Strategic Alliances 0 1 3 4
Supply Chain Management 4 0 3 7
Total Quality Management 3 1 3 7
Zero based Budgeting 2 0 0 2
4.4.3 Summary of Strategic Planning and Organizational Performance
In aggregate, 15 (63%) of the health institutions surveyed carried out strategic planning,
while only 6 (25%) agreed that it improved organizational performance as indicated in tables
4.24 and 4.25 below.
57
Table 4.24: Actual Implementation of Strategic Planning
Health Institutions carrying out Strategic Planning
Yes No
Strategic Planning 15 (63%) 9 (37%)
Table 4.25: Perception if Strategic Planning Improves Organizational Performance
Perception if Strategic Planning improves Organization Performance
Agree Disagree
Strategic Planning 6 (25%) 18 (75%)
Of the 15 health institutions that were carrying out strategic planning, only 5 agreed that it
improves organizational performance, while the rest disagreed. This is captured in table 4.26
below.
Table 4.26: Comparison Between Actual Practice and Perception if Strategic
Planning Improves Organizational Performance
Perception if Strategic Planning
Improves Organizational
Performance
Agree Disagree Total
Actual Implementation
of Strategic Planning
Yes 5 10 15
No 1 8 9
Total 6 18 24
58
4.5 Strategy Implementation and Organizational Performance
Of the health institutions surveyed, 23 (96%) made strategic decisions and implementation
action plans based upon their strategic plans. In addition, 21 (88%) health institutions clearly
assigned lead responsibility for action plan implementation to a person or team. Twenty
(83%) of the health institutions allocated resources for strategy implementation, with 19
(79%) setting clearly defined key performance indicators for each action plan element.
Further, 18 (75%) had monitoring and evaluation system to track performance and 19 (79%)
rewarded individuals responsible for successful performance. These are captured in table
4.27 below.
Table 4.27: Actual Implementation of Strategy in Health Institutions
Health Institutions implementing strategy
Yes No
Strategic decisions (implementation action plans) based on
strategic plan
23 (96%) 1 (4%)
Clearly assigned lead responsibility for action plan
implementation to a person/ team
21 (88%) 3 (12%)
Allocation of resource for strategy implementation 20 (83%) 4 (17%)
Clearly defined key performance indicators 19 (79%) 5 (21%)
Monitoring and evaluation system in place to track
performance
18 (75%) 6 (25%)
Rewarding individuals responsible for successful
performance
19 (79%) 5 (21%)
Of the health institutions surveyed, 23 (96%) agreed that making strategic decisions and
implementation action plans based upon strategic plans improves organizational
performance. In addition, 21 (88%) health institutions agreed that clearly assigning lead
responsibility for action plan implementation to a person or team improves organizational
performance. All 24 (100%) of the health institutions surveyed agreed that allocating
59
resources for strategy implementation improves organizational performance, with all in
concurrence that setting clearly defined key performance indicators for each action plan
element improves organizational performance. Further, 23 (96%) agreed that having a
monitoring and evaluation system to track performance improves organizational
performance and 23 (96%) agreed that rewarding individuals responsible for successful
performance improves organizational performance. These are captured in table 4.28 below.
Table 4.28: Perception if Strategy Implementation Improves Organizational
Performance
Perception if Strategy Implementation improves Organization Performance
Agree Disagree
Strategic decisions (implementation action plans) based on
strategic plan
23 (96%) 1 (4%)
Clearly assigned lead responsibility for action plan
implementation to a person/ team
21 (88%) 3 (12%)
Allocation of resource for strategy implementation 24 (100%) 0 (0%)
Clearly defined key performance indicators 24 (100%) 0 (0%)
Monitoring and evaluation system in place to track
performance
23 (96%) 1 (4%)
Rewarding individuals responsible for successful
performance
23 (96%) 1 (4%)
4.5.1 Summary of Strategy Implementation and Organizational Performance
In aggregate, 10 (42%) of the health institutions surveyed carried out strategy
implementation, while only 3 (12%) agreed that it improved organizational performance as
indicated in tables 4.29 and 4.30 respectively.
60
Table 4.29: Actual Implementation of Strategy
Health Institutions carrying out Strategy Implementation
Yes No
Strategy Implementation 10 (42%) 14 (58%)
Table 4.30: Perception if Strategy Implementation Improves Organizational
Performance
Perception if Strategy Implementation improves Organization Performance
Agree Disagree
Strategy Implementation 3 (12%) 21 (88%)
Of the 10 health institutions that were implementing strategy, only 1 agreed that it improves
organizational performance, while the rest disagreed. This is captured in table 4.31 below.
Table 4.31: Comparison Between Actual Practice and Perception if Strategy
Implementation Improves Organizational Performance
Perception if Strategy Implementation
Improves Organizational
Performance
Agree Disagree Total
Actual Implementation
of Strategy
Yes 1 9 10
No 2 12 14
Total 3 21 24
61
4.6 Organizational Performance
The distribution of percentage change in organizational performance among the respondents
was skewed to the right, with a median duration of 17.3% and an IQR of 2 – 47%.
4.7 Bivariate Analysis
Pearson Correlation was used to measure the strengths of association between two variables
and the direction of the relationship. In this study, the dependent variable was the percentage
change in organizational performance, while the independent variables were strategic
thinking, planning and strategy implementation.
From the study, percentage change in organizational performance was positively correlated
to strategic thinking, but the strength of the relationship was weak since the value of the
correlation coefficient was 0.0801 as indicated in Graph 4.3 below.
Figure 4.3: Correlation between Strategic Thinking and Organizational Performance
On the other hand, organizational performance was negatively correlated with strategic
planning with the value of the correlation coefficient being – 0.4175 as indicated in Graph
4.4 below.
62
Figure 4.4: Correlation between Strategic Planning and Organizational Performance
From the study, strategy implementation was negatively correlated with organizational
performance with the value of the correlation coefficient being – 0.3164 as indicated in
Graph 4.5 below.
Figure 4.5: Correlation between Strategy Implementation and Organizational
Performance
63
The strength of the relationship between organizational performance and both strategic
planning and strategy implementation was stronger than with strategic thinking.
4.8 Chapter Summary
This chapter presents the results and findings of the study. Findings are presented in
frequency tables and graphs/ figures. The presentation is aligned to the research questions
and covers strategic thinking, planning, strategy implementation and organizational
performance in the 24 health institutions that participated in the survey.
64
CHAPTER FIVE
5.0 DISCUSSION, CONCLUSION AND RECOMMENDATIONS
5.1 Introduction
This chapter presents the discussion of research findings, conclusion and recommendations
of the study. The chapter sections are aligned with the research questions.
5.2 Summary
The purpose of this study was to determine the effects of strategic management on
organizational performance in health institutions in Nairobi County. The study had three
research questions on what was the effect of strategic thinking, planning and strategy
implementation on organizational performance of health institutions in Nairobi County.
This study was descriptive and the study design was cross – sectional. The study was
designed to capture utilization of strategic management in health institutions in Nairobi,
representing a snapshot of one point in time. The study described and explained phenomena
that observations reflected measure social reality or describe what was in use in health
institutions in Nairobi. The independent variables were strategic thinking, strategic planning
and strategy implementation, while the dependent variable was organizational performance.
The study population was the management at health institutions that are Kenya Essential
Package for Health (KEPH) level four, five and six, and are in Nairobi County. For this
study, the sampling frame was the list of all health institutions that were KEPH level four or
five or six, and in Nairobi County based on the Kenya Master Health Facility List (Ministry
of Health, 2017). The health institution was the sampling unit. Census was used to enroll
every health institution into this study since they are few, and the unit of analysis was the
health institution. Primary data for this study was collected using a structured self-
administered questionnaire, that captured both qualitative and quantitative data,
administered to the study prospective participants after they had been recruited and enrolled.
Stata 12 ® was the statistical software used to analyze the data from the study. Data was
presented in charts and graphs.
65
Of the health institutions surveyed, 23 (96%) carried out strategic thinking while 7 (29%)
agreed that strategic thinking improves organizational performance. From the study,
organizational performance was positively correlated to strategic thinking, but the strength
of the relationship was weak since the value of the correlation coefficient was 0.0801.
With regard to strategic planning, 15 (63%) of the health institutions surveyed carried out
strategic planning, while only 6 (25%) agreed that it improved organizational performance.
On the other hand, organizational performance was negatively correlated to strategic
planning with the value of the correlation coefficient being – 0.4175.
Of the health institutions surveyed, 10 (42%) carried out strategy implementation, while only
3 (12%) agreed that it improved organizational performance. Strategy implementation had a
negative correlation with organizational performance among health institutions in Nairobi
County with the value of the correlation coefficient being – 0.3164.
5.3 Discussion
5.3.1 Relationship between Strategic Thinking and Organizational Performance
The effect of managers' strategic thinking on organizational performance was explored in
this study. The findings indicated a positive correlation of managers' strategic thinking on
organizational performance. Having elucidated this relationship, though weak, it was shown
that all components of managers' strategic thinking have a positive effect on organizational
performance in health institutions in Nairobi County. In other words, it can be stated that
existence of strategic thinking and strategic vision among the managers is led to more
concentration and attention to the effective strategic factors on survival and growth of the
institution and therefore, gaining competitive advantage, increased innovation and creativity,
corporate entrepreneurship and patient numbers.
This finding is consistent with the results of Vafaei's study (Vafaei, Shad, & Rostami, 2016)
regarding the positive effect of strategic thinking on productivity, innovation, and
organizational performance. From a study on antecedents and outcomes of strategic thinking,
the results of empirical analysis provided evidence that there was a positive relationship
between strategic thinking and marketing performance with the standardized path
coefficients between strategic thinking, and profit, sales and market share being 0.233, 0.198
66
and 0.209 respectively (Moon, 2013). In addition, in a study evaluating the effect of strategic
thinking on corporate entrepreneurship (Vafaei, Shad, & Rostami, 2016), the findings
indicated the positive effect of managers' strategic thinking on corporate entrepreneurship.
Results of testing the main hypothesis illustrate the positive effect of managers' strategic
thinking on corporate entrepreneurship at confidence level 99%. Having confirmed the
research hypotheses, it was shown that all components of managers' strategic thinking have
a positive effect on corporate entrepreneurship. In other words, it can be stated that existence
of strategic thinking and strategic vision among the managers is led to more concentration
and attention to the effective strategic factors on survival and growth of the organization and
therefore, gaining competitive advantage, increased innovation and creativity, and corporate
entrepreneurship. This finding is consistent with the results of Marashi's study (2015)
regarding the positive effect of strategic thinking on productivity, innovation, and
organizational creativity. Also, it can be stated that managers who have strategic thinking
pave the way for the establishment of the culture of innovation and entrepreneurship. This
is also consistent with Chakraborty et al' study (Chakraborty, Thompson, & Yehoue, 2016).
In this regard, one of the tasks of experts and researchers in the field of human resources is
to expand the strategies of strategic thinking via training the concepts and principles of
employing strategic thinking among the managers and leaders and focusing on its positive
role in increasing of entrepreneurial atmosphere in the organization.
Dominance over strategic thinking is very important for health institutions which intend to
change their future as well as their environment. The topic of strategic thinking has highly
been considered in the field of strategic management in the last decade and the importance
of strategic thinking capability for managers has been mentioned in many studies. Improving
the capability of strategic thinking in managers as one of the key factors in the effectiveness
of strategic management process requires more attention. Strategic thinking is the process of
proposing and exploring hypotheses about the future which creates the foundation for
mission, purposes and strategies of the organization and contains an extensive range of
subjects. Strategic thinking is a vital management skill in the modern millennium; a skill
which requires empowerment of the organization for survival and growth in the current
competitive environment (Khalili, Armani, Rahimi, Jamshidi, & Jamshidi, 2015).
67
5.3.2 Relationship between Strategic Planning and Organizational Performance
The effect of managers' strategic planning on organizational performance was explored in
this study. The findings indicated a negative correlation of managers' strategic planning on
organizational performance. Having elucidated this relationship, though of moderate
strength, it was shown that all components of managers' strategic planning have a negative
effect on organizational performance in health institutions in Nairobi County. This finding
mirrors results of a study that evaluated if strategic planning enhanced or impeded innovation
and firm performance (Song, Im, van der Bij, & Song, 2011) that challenged the traditional
views of strategic planning. The evidence suggested that strategic planning impeded, not
enhanced, the number of new product development projects. The study found a negative and
significant relationship between strategic planning and the number of new product
development projects, in support of Moorman and Miner’s (1998a, 1998b) claim that
improvisation represents an experiential, emergent learning process rather than an
institutional process and therefore provides a viable path to generating new product
development projects. In addition, it indicated that larger firms benefited less, not more, from
strategic planning for improving firm performance.
On the contrary, there have been numerous studies that have shown a positive relationship
between strategic planning and organizational performance. Findings of a study that
evaluated the role of strategic alignment as a missing link between strategic consensus and
organizational performance (Walter, Kellermanns, Floyd, Veiga, & Matherne, 2013)
indicated a positive correlation between strategic alignment (strategic planning) and
organizational performance of 0.16. In addition, in a study that evaluated formal strategic
analyses and organizational performance by decomposing the rational model (Mueller,
Mone, & Barker III, 2007), the results indicated an interaction term consisting of formal
analysis for informational purposes and environmental dynamism approached statistical
significance (p = .12) and a positive relationship between the informational use of formal
analysis and performance in both low and high dynamism environments. Further, in a study
that evaluated different roles of middle level managers on organizational performance
(Dasgupta, 2015), found that the regression model shows a moderate association between
the combined eff ect of all roles in strategic planning and organizational performance (r =
0.508).
68
The basis of making a plan, is the integration of what the institution should do, wants to do,
and can do to provide a picture of the situation. It is a key activity to induce change, more
so in organizational performance. Being able to see, interpret, and handle the plan making
and other change-provoking phenomena in the broader context requires an analytic tool(s)
to make the work of managers more realistic and effective. In other words, this broader
context should not be looked upon as an environment of fuzzy conditions and unpredictable
dynamics, with which managers have to cope for better or worse. Instead, this environment
must be a part of their professional field, with which they have to deal, but they also have to
be equipped ‘to accommodate uncertainty as a core ontological state of the world’ (Gunder,
2008). This is needed in order to break with the inclination to self referentiality, resulting in
denying the environment, as far as it does not support the reproduction of the current
routines.
The study found out that strategic planning activities are common across all the health
institutions. Top managers came together to develop a strategic plan, often used strategic
thinking, and many important issues are discussed and documented. However, sometimes
the strategic plan created and everyone enthusiastically returned to the organization only to
find “business as usual” – nothing really changes, the strategic momentum was lost, and
plans are never implemented (Rigby D. K., 2015).
Strategic planning is that process. Strategic planning provides the structure to consider issues
and reach consensus on how the organization should proceed. Having a periodic structured
process initiates a reconsideration, discussion, and documentation of all the assumptions.
Without planned process managers never quite get to it. Without a process, ideas are not
discussed, conclusions are not reached, decisions are not made, strategies are not adopted,
and strategic thinking is not documented.
5.3.3 Relationship between Strategy Implementation and Organizational Performance
The effect of managers' strategy implementation on organizational performance was
explored in this study. The findings indicated a negative correlation of managers' strategy
implementation on organizational performance. Having elucidated this relationship, though
moderate, it was shown that all components of managers' strategy implementation have a
negative effect on organizational performance in health institutions in Nairobi County.
69
These findings of a negative relationship are contrary to a case study conducted in the United
Arab Emirates to analyze comprehensive implementation of strategic plans in emerging
economies (Elbanna & Fadol, 2016) indicated that the comprehensiveness of the strategic
plan implementation was significantly influenced by three factors related to strategy
formulation, namely, the formulation mode, participation, and political behavior and that the
comprehensiveness of the strategic plan implementation was related positively to the
effectiveness of the strategic planning and organizational performance. In addition, a study
conducted to evaluate the effects of strategic planning on corporate performance in Babcock
University indicated that once organizations comply with strategic plans, there was
corresponding better corporate performance (Owolabi & Makinde, 2012).
Strategy implementation ensure an ongoing philosophy for developing and managing the
plans, actions, and control of the institution. It attempted to continually orchestrate a fit
between the institution’s external environment (political, regulatory, economic,
technological, social, and competitive forces) and its internal situation (culture, organization
structure, resources, products and services, and so on) (Bain & Company, 2017). In some
cases, orchestrating the fit may have meant responding to external forces; in other cases, the
institution may have attempted to actually shape its environment (change the rules for
success) (Mische, 2001). External change was inevitable; often the shifts were subtle, other
times they could have been discontinuous and extremely disruptive. When such dramatic
changes occurred, new opportunities emerged and new competencies were born, while
others died or were rendered inconsequential. Inevitably, the basic rules of competing and
survival changed. Therefore, strategic thinking and periodic planning did not cease. Strategic
implementation was how an institution constructively managed change, evaluated strategy,
and reinvented or renewed itself (Friedl & Biloslavo, 2009).
5.4 Conclusion
This study represents, in our opinion, an essential contribution to the literature on the effect
of strategic management on organizational performance. The study has used a model
developed to assess and diagnose the effects of various dimensions of strategic management,
i.e. strategic thinking, planning and strategy implementation on organizational performance
among health institutions in Nairobi County. It has contributed to a better understanding of
70
the relationship between variables presumed to influence the results of an organization and
its performance.
5.4.1 Strategic Thinking and Organizational Performance
From the findings and discussion, the study concludes that strategic thinking has a weak
positive relationship on organizational performance. This is consistent with a number of
studies that have been conducted.
5.4.2 Strategic Planning and Organizational Performance
From the findings and discussion, the study concludes that strategic planning has a negative
relationship on organizational performance among health institutions in Nairobi County.
5.4.3 Strategy Implementation and Organizational Performance
From the findings and discussion, the study concludes that strategy implementation has a
negative relationship on organizational performance among health institutions in Nairobi
County. This study has raised the specter of there being other underlying factors that have a
bearing on organizational performance among health institutions in Nairobi County.
5.5 Recommendations
5.5.1 Recommendations for Improvement
5.5.1.1 Strategic Thinking and Organizational Performance
This study has provided evidence of the relationship between strategic management and
organizational performance in health institutions. Going forward, much as the study found
that the relationship between strategic thinking and organizational performance was positive,
this will be best measured through a key informant interview that is open since a lot of details
on strategic thinking are lost through closed ended questions in a questionnaire.
5.5.1.2 Strategic Planning and Organizational Performance
Much as the correlation between strategic planning and organizational performance was
negative in this study, there is need to draw a distinction between public and private health
facilities since the drive between the two sets are different.
71
5.5.1.3 Strategy Implementation and Organizational Performance
Going forward, it is important to design a study that will make management of health
institutions less sensitive about the information they offer. This is so since many, especially
the privately-owned health institutions guarded the information they could share because it
was competitive in nature.
5.5.2 Recommendations for Further Studies
This study can be extended in several ways. We can repeat the study in one or two years
which will offer the possibility to do a comparative analysis and see how the analyzed firms
evolved over time and improved their performance. In order to increase the validity of our
results we can try combine the data collected through questionnaires with secondary data
(absolute values for different key performance indicators). Future research can examine the
effect of strategic management after standardizing organizational performance into key
performance indicators for key business processes within hospitals. The key performance
business processes that can be evaluated can be broken down to departments within the
hospital to include outpatient flow, emergency flow, inpatient flow, surgical services,
medication management, revenue cycle and access management.
72
REFERENCES
Abrahams, J. (2004). The Mission Statement Book: 301 Corporate Mission Statements from
America’s Top Companies. Ten Speed Press.
Afonina, A. (2015). Strategic Management Tools and Techniques and Organizational
Performance: Findings from the Czech Republic. Journal of Competitiveness, 19 -
36.
Al isa, K. (2017, June 2). Impact of Strategic Planning on Organizational Performance.
Retrieved from https://www.linkedin.com/pulse/impact-strategic-planning-
organizational-performance-khaled
Alai, D., Kramer, D., & Montier, R. (2006). Competency Models Develop Top Performance.
T + D, 47-50.
Al-khadash, H. A., & Feridun, M. (2006). Impact of Strategic Initiatives in Management
Accounting on Corporate Financial Performance: Evidence from Amman Stock
Exchange. Journal of Managing Global Transitions, 299 – 312.
Allison, G. (1983). Public and private management: Are they fundamentally alike in all
unimportant respects? Palo Alto, CA: Mayfield.
Allison, M., & Kaye, J. (2005). Strategic planning or nonprofit organizations: A practical
guide and workbook. Hoboken, NJ: Wiley.
Al-Mashari, M., Irani, Z., & Zairi, M. (2001). Business Process Reengineering: A Survey of
International Experience. Business Process Management Journal, 437-455.
Andersen, T., & Nielsen, B. (2009). Adaptive strategy making: The effects of emergent and
intended strategy modes. European Management Review, 94–106.
Andrews, R., Boyne, G. A., Law, J., & Walker, R. M. (2011). Strategy Implementation and
Public Service Performance. Administration & Society, 1-29.
73
Andrews, R., Boyne, G., Law, J., & Walker, R. M. (2009). Strategy, structure and process
in the public sector: A test of the Miles and Snow model. Public Administration,
732–749.
Anna, A. (2015). Strategic Management Tools and Techniques and Organizational
Performance: Findings from the Czech Republic. Journal of Competitiveness, 19 -
36.
Ansoff, H. I. (1991). Critical Evaluations in Business and Management.
Armstrong, J. S. (1982). The value of formal planning for strategic decisions: Review of
empirical research. Strategic Management Journal, 197-211.
Armstrong, M. (1993). A Handbook of Management Techniques. USA: Nichols Publishing
Company.
Armstrong, M., & Baron, A. (2005). Managing performance: performance management in
action.
Axelrod, R. H. (2000). Terms of Engagement: Changing the Way We Change Organizations.
Berrett-Koehler Publishers.
Ayers, J. B. (2006). Handbook of Supply Chain Management. Auerbach.
Backoff, R., & Nutt, P. (1992). Strategic Management of Public and Third Sector
Organisations. San Francisco, CA: Josey-Bass Publishers.
Bain & Company. (2017, May 27). Insights: Management Tools - Big Data Analytics.
Retrieved from Bain & Company:
http://www.bain.com/publications/articles/management-tools-big-data-
analytics.aspx
Baker, R. J. (2006). Pricing on Purpose: Creating and Capturing Value. John Wiley & Sons.
Bantel, K. A., & Osborn, R. N. (2001). The influence of performance, environment and size
on the identifiability of firm strategy. British Journal of Management, 235-248.
74
Bennet, A., & Bennet, D. (2004). Organizational survival in the new world: The intelligent
complex adaptive system. Boston: Butterworth-Heinemann.
Berenson, M. L., Levine, D. M., & Szabat, K. A. (2015). Confidence Interval Estimation:
Determining Sample Size. In M. L. Berenson, D. M. Levine, & K. A. Szabat, Basic
Business Statistics Conepts and Applications (pp. 320-322). Essex: Pearson
Education Limited.
Bernoff, J., & Schadler, T. (2010). Empowered. Harvard Business Review, 94–101.
Bianca, A. (2017, June 2). The Impact of Strategic Management on Organizational
Performance. Retrieved from Chron: http://smallbusiness.chron.com/impact-
strategic-management-organizational-performance-69836.html
Black, K. (2012). Estimating Parameters for Single Populations: Estimating Sample Size. In
K. Black, Applied Business Statistics (pp. 281-283). John Wiley & Sons, Inc.
Blenko, M., Mankins, M. C., & Rogers, P. (2010). Decide & Deliver: Five Steps to
Breakthrough Performance in Your Organization. Harvard Business Press.
Bonn, I. (2005). Improving strategic thinking: a multilevel approach. Leadership &
Organization Development Journal, 336-354.
Boyd, A. E. (2007). The Future of Pricing: How Airline Ticket Pricing Has Inspired a
Revolution. Palgrave Macmillan.
Boyne, G., & Walker, R. (2004). Strategy Content and Public Service Organizations. Journal
of Public Administration Research and Theory, 231-252.
Brogan, C., & Smith, J. (2010). Trust Agents: Using the Web to Build Influence, Improve
Reputation, and Earn Trust. Wiley.
Bryson, J. M. (2004). Strategic planning for public and nonprofit organizations. San
Francisco, CA: Jossey-Bass.
Camillus, J. C. (1996). Reinventing Strategic Planning. Strategy & Leadership, 6–12.
75
Camp, R. C. (2006). Benchmarking: The Search for Industry Best Practices That Lead to
Superior Performance. Productivity Press.
Campbell, A., & Sommers-Luch, K. (1997). Core Competency Based Strategy. International
Thompson Business Press.
Carton, R., & Hofer, C. (2006). Measuring Organizational Performance: Metrics for
Entrepreneurship and Strategic Management Research. Great Britain: Edward Elgar
Publishing.
Casey, A., & Goldman, E. (2010). Enhancing the ability to think strategically: A learning
model. Management Learning, 167–185.
CDC. (2017, May 28). EpiCalc: Sample Size for Frequency in a Population. Retrieved from
OpenEpi: http://www.openepi.com/SampleSize/SSPropor.htm
Chaffee, E. (1985). Three models of strategy. Academy of Management Review, 89–98.
Chakraborty, S., Thompson, J. C., & Yehoue, E. B. (2016). The culture of entrepreneurship.
Journal of Economic Theory, 288-317.
Charih, M. (2000). Government departmental strategies: A taxonomy of strategic behavior
in the Canadian government. Management international, 1-9.
Chee-Hua, C., May-Chiun, L., & Ramayah, T. (2013). Market Orientation and
Organizational Performance: The Moderating Role of Service Quality. SAGE Open,
1-14.
Chenhall, R. H., & Langfield-Smith, K. (2007). The Relationship between Strategic
Priorities, Management Techniques and Management Accounting: An Empirical
Investigation Using a Systems Approach. Journal of Accounting , Organizations and
Society, 243-264.
Chesbrough, H. W. (2006). Open Business Models: How to Thrive in the New Innovation
Landscape. Harvard Business School Press.
76
Chesbrough, H. W., & Garman, A. R. (2009). How Open Innovation Can Help You Cope in
Lean Times. Harvard Business Review, 68–76.
Child, J., Elbanna, S., & Rodrigues, S. (2010). The political aspects of strategic decision
making. In P. Nutt, & D. Wilson(Eds.). The handbook of decision making. Chichester:
Wiley.
Christensen, C. M., Anthony, S. D., Berstell, G., & Nitterhouse, D. (2007). Finding the Right
Job for Your Product. MIT Sloan Management Review, 38–47.
Clark, T. R. (2008). EPIC Change: How to Lead Change in the Global Age. Jossey-Bass.
Coers, M., Gardner, C., Higgins, L., & Raybourn, C. (2001). Benchmarking: A Guide for
Your Journey to Best-Practice Processes. American Productivity and Quality Center.
Cohen, M. D., March, J. G., & Olsen, J. P. (1972). A garbage can model of organizational
choice. Administrative Science Quarterly, 1–25.
Cohen, S., & Markowitz, P. (2002). Renewing Market Segmentation: Some New Tools to
Correct Old Problems. ESOMAR, (pp. 595–612).
Collins, J., & Porras, J. I. (1996). Building Your Company’s Vision. Harvard Business
Review, 65–77.
Collins, J., & Porras, J. I. (2004). Built to Last: Successful Habits of Visionary Companies.
Collins Business.
Collis, D. J., & Montgomery, C. A. (2005). Corporate Strategy: A Resource Based
Approach. New York: McGraw-Hill.
Collis, D. J., & Rukstad, M. G. (2008). Can You Say What Your Strategy Is? Harvard
Business Review, 82–90.
Cooper, C. L., & Burke, R. J. (2000). The Organization in Crisis: Downsizing,
Restructuring, and Privatization. Blackwell.
77
Cooper, D. R., & Schindler, P. S. (2001). Business Research Methods. Singapore: McGraw-
Hill .
Cooper, D. R., & Schindler, P. S. (2011). Business Research Methods. Singapore: McGraw-
Hill.
Critelli, M. J. (2005). Back Where We Belong. Harvard Business Review, 47-54.
Crittenden, W., & Crittenden, V. (2000). Relationships between organizational
characteristics and strategic planning processes in nonprofit organizations. Journal
of Management Issues, 150–168.
Dahlgaard, J. J., Kristensen, K., & Khanji, G. K. (2005). Fundamentals of Total Quality
Management. Routledge.
Dalton, D. R., Todor, W., Spendolini, M., Fielding, G., & Porter, L. (1980). Organizational
Structure and Performance: A Critical Review . Academy of Management Review,
49-64.
Dasgupta, M. (2015). Middle level managers and strategy: exploring the influence of
diff erent roles on organizational performance. Journal of General Management, 25-
43.
Davenport, T. H. (2009). Make Better Decisions. Harvard Business Review, 117–122.
Davenport, T. H., Harris, J. G., & Morison, R. (2010). Analytics at Work: Smart Decisions
Better Results. Boston, MA: Harvard Business School Press.
Day, G. S. (2004). Which Way Should You Grow? Harvard Business Review, 24–26.
De Meuse, K. P., & Lee Marks, M. (2003). Resizing the Organization: Managing Layoffs,
Divestitures, and Closings. Pfeiffer.
Deming, W. E. (1982). Quality, Productivity, and Competitive Position. MIT Press.
Denrell, J. (2005). Selection Bias and the Perils of Benchmarking. Harvard Business Review,
114–119.
78
Dixon, M., Freeman, K., & Toman, N. (2010). Stop Trying to Delight Your Customers.
Harvard Business Review, 116–122.
Dobni, C. B., & Luffnan, G. (2003). Determining the scope and impact of market orientation
profiles on strategy implementation and performance. Strategic Management
Journal, 577-585.
Donaldson, L. (1996). For positivist organizational theory: Proving the hard core. London,
England: SAGE.
Drejer, A. (2002). Strategic Management and Core Competencies: Theory and Applications.
Quorum Books.
Drucker, P. F. (2009). Managing in a Time of Great Change. Harvard Business Press.
Dyche, J. (2001). The CRM Handbook: A Business Guide to Customer Relationship
Management. Addison-Wesley Publishing Company.
Efendioglu, A., & Karabalut, A. (2010). Impact of Strategic Planning on Financial
Performance of Companies in Turkey. International Journal of Business and
Management, 3-12.
Elbanna, S. (2012). Slack, planning and organizational performance: Evidence from the
Arab Middle East. European Management Review, 99–115.
Elbanna, S., & Fadol, Y. (2016). An Analysis of the Comprehensive Implementation of
Strategic Plans in Emerging Economies: The United Arab Emirates as a Case Study.
European Management Review, 2-15.
Emery, Y. (2005). La gestion par les re´sultats dans les organisations publiques: de l’ide´e
aux de´ fis de la re´alisation. Te´lescope, 1–11.
Epstein, M., & Manzoni, J.-F. (1998). Implementing Corporate Strategy: From Tableaux de
Bord to Balanced Scorecards. European Management Journal, 190–203.
Fairholm, M., & Card, M. (2009). Perspectives of strategic thinking: From controlling chaos
to embracing it. Journal of Management and Organization, 17–30.
79
Falshaw, J. R., Glaister, K. W., & Tatoglu, E. (2006). Evidence on formal strategic planning
and company performance. Management Decision, 9–30.
Falshaw, J., Glaister, K., & Tatoglu, E. (2006). Evidence on formal strategic planning and
company performance. Management Decision, 9–30.
Farhangi, A., & Dehghan, N. M. (2010). The decisive factors in strategic thinking. Journal
of Marketing Management.
Feigenbaum, A. V. (1991). Total Quality Control. McGraw-Hill.
Fisher, M., & Raman, A. (2010). The New Science of Retailing: How Analytics Are
Transforming the Supply Chain and Improving Performance. Harvard Business
Press.
Frame, J. D. (2002). The New Project Management: Tools for an Age of Rapid Change,
Complexity, and Other Business Realities. Jossey-Bass.
Frazelle, E. (2001). Supply Chain Strategy. McGraw-Hill.
Fredrickson, J., & Mitchell, T. (1984). Strategic decision processes: comprehensiveness and
performance in an industry with an unstable environment. Academy of Management
Journal, 399–423.
Friedl, P., & Biloslavo, R. (2009). Association of Management Tools with the Financial
Performance of Companies: The Example of the Slovenian Construction Sector.
Journal of Managing Global Transition, 383- 402.
Fryer, K., Antony, J., & Ogden, S. (2009). Performance management in the public sector.
International Journal of Public Sector Management, 478-498.
Gaertner, G. H., & Ramnarayan, S. (1983). Organizational effectiveness: An alternative
perspective. Academy of Management Review, 97–107.
Gale, B. T. (1994). Managing Customer Value: Creating Quality and Service That
Customers Can See. Free Press.
80
Garvin, D. A., & Roberto, M. A. (2001). What You Don’t Know About Making Decisions.
Harvard Business Review, 108–116.
George Mason University. (2017, May 31). Basic Concepts of Sampling. Retrieved from
George Mason University:
http://cs.gmu.edu/cne/modules/dau/stat/data/sample_frm.html
Georgopolous, B. S., & Tannenbaum, A. S. (1957). A study of organizational effectiveness.
American Sociological Review, 534–540.
Geotz, N. (1949). Management and Planning, a propeller for organizational performance.
Journal of College of Management Goteburg University, 23-34.
Ghoshal, S. (2005). Bad management theories are destroying good management practices.
Academy of Management Learning & Education, 75–91.
Gimbert, X., Bisbe, J., & Mendoza, X. (2010). The Role of Performance Measurement
Systems in Strategy Formulation Processes. Long Range Planning: International
Journal of Strategic Management, 477-497.
Goetsch, D. L., & Davis, S. B. (2009). Quality Management: Introduction to Total Quality
Management for Production, Processing, and Services. Prentice Hall.
Golafshani, N. (2003). Understanding Reliability and Validity in Qualitative Research.
Toronto: University of Toronto.
Goldman, E. F., & Casey, A. (2010). Building a Culture That Encourages Strategic Thinking.
Journal of Leadership & Organizational Studies, 119–128.
Gossieaux, F., & Moran, E. (2010). The Hyper-Social Organization: Eclipse Your
Competition by Leveraging Social Media. McGraw-Hill.
Gottfredson, M., & Schaubert, S. (2008). Breakthrough Imperative: How the Best Managers
Get Outstanding Results. Collins Business.
81
Govindarajan, V. (1988). A contingency approach to strategy implementation at the
business-unit level: Integrating administrative mechanisms with strategy. Academy
of Management Journal, 828-853.
Grant, R. (2003). Strategic planning in a turbulent environment: evidence from the oil
majors. Strategic Management Journal, 491–517.
Grant, R. M., Shani, R., & Krishnan, R. (1994). TQM’s Challenge to Management Theory
and Practice. Sloan Management Review, 25–35.
Gunder, M. (2008). Ideologies of certainty in a risky reality: Beyond the hauntology of
planning. Planning theory, 186–206.
Hamel, G. (2002). Leading the Revolution. Havard Business School Press.
Hamel, G., & Prahalad, C. K. (1994). Competing for the future. Boston: Harvard School
Press.
Hammer, M., & Champy, J. (2003). Reengineering the Corporation: A Manifesto for
Business Revolution, revised and updated. Collins.
Hamon, T. T. (2003). Organizational effectiveness as explained by social structure in a faith-
based business network organization (Unpublished doctoral dissertation). Virginia
Beach, VA: Regent University.
Hancott, D. E. (2005). The relationship between transformational leadership and
organizational performance in the largest public companies in Canada. (Unpublished
doctoral dissertation). Minneapolis, MN: Capella University.
Harvard Business School. (2006). Harvard Business Review on Leading Through Change.
Harvard Business Press.
Ho, L. A. (2008). What affects organizational performance? The linking of learning and
knowledge management. Industrial Management & Data Systems, 1234-1254.
82
Hodgkinson, G. P., & Clarke, I. (2007). Exploring the cognitive significance of
organizational strategizing: a dual-process framework and research agenda. Human
Relations, 243–255.
Holden, R., & Burton, M. (2008). Pricing With Confidence: 10 Ways to Stop Leaving Money
on the Table. Wiley.
Horan, J. T. (1998). The One Page Business Plan: Start with a Vision, Build a Company!
One Page Business Plan Company.
Hough, J., & White, M. (2003). Environmental dynamism and strategic decision-making
rationality: an examination at the decision level. Strategic Management Journal,
481–489.
Hrebiniak, W. (2006). Obstacles to effective strategy implementation. Organizational
Dynamics, 12-31.
Hugos, M. H. (2006). Essentials of Supply Chain Management. Wiley.
Humby, C., Hunt, T., & Phillips, T. (2008). Scoring Points: How Tesco Continues to Win
Customer Loyalty. Kogan Page.
Imai, M. (1986). Kaizen: The Key to Japan’s Competitive Success. Random House.
Indiatsu, C. M., Mwangi, M. S., & Mandere, E. (2014). The Application of Porter’s Five
Forces Model on Organization Performance: A Case of Cooperative Bank of Kenya
Ltd. European Journal of Business and Management, 75-85.
Iseri-Say, A., Toker, A., & Kantur, D. (2008). Do popular management techniques improve
performance? Journal of Management Development, 660- 677.
Jarzabkowski, P. (2004). Strategy as practice: recursive, adaptive and practices-in-use.
Organization Studies, 529–560.
Jarzabkowski, P., & Spee, A. (2009). Strategy-as-practice: A review and future directions
for the field. International Journal of Management Review, 69–95.
83
Jarzabkowski, P., Giulietti, M., Oliveira, B., & Amoo, N. (2010a). We don’t need no
education: or do we? Management Education and Alumni Adoption of Strategy
Tools. Advanced Institute of Management Research AIM Research Working Paper
Series, 1–56.
Jarzabkowski, P., Mohrman, S. A., & Scherer, A. G. (2010b). Organization studies as
applied science: the generation and use of academic knowledge about organizations.
Introduction to the Special Issue. Organization Studies, 1189–1207.
Juran, J. (1992). Juran on Quality by Design: The Next Steps for Planning Quality into
Goods and Services. Free Press.
Kanter, R. M. (2009). Mergers That Stick. Harvard Business Review, 121–125.
Kaplan, R. S., & Norton, D. P. (2004). Strategy Maps: Converting Intangible Assets into
Tangible Outcomes. Harvard Business School Press.
Kaplan, R. S., & Norton, D. P. (2005). The Balanced Scorecard: Measures That Drive
Performance. Harvard Business Review, 71–79.
Kaplan, R. S., & Norton, D. P. (2006). Alignment: Using the Balanced Scorecard to Create
Corporate Synergies. Harvard Business School Press.
Kaplan, R. S., Norton, D. P., & Rugelsjoen, B. (2010). Managing Alliances with the
Balanced Scorecard. Harvard Business Review, 114–120.
Katz, D., & Kahn, R. L. (1978). The social psychology of organizations . New York: Wiley.
Keeley, M. (1980). Organizational analogy: A comparison of organismic and social contract
models. Administrative Science Quarterly, 337–362.
Kelly, G. (1955). The Psychology of Personal Constructs. London: Norton.
Kemp, E. J., Funk, J. R., & Eadie, D. C. (1993). Change in chewable bites: Applying strategic
management at EEOC. Public Administration Review, 129-134.
84
Kennedy, R. E., & Sharma, A. (2009). The Services Shift: Seizing the Ultimate Offshore
Opportunity. FT Press.
Kerlinger, F. N. (1986). Foundations of Behavioural Research. New York: Holt, Rinehart
& Winston.
Khalili, K., Armani, M., Rahimi, H., Jamshidi, F., & Jamshidi, Z. (2015). The Role of
Strategic Thinking in Organizational Performance: A Case Study of the Municipality
of Ilam. International Journal of Review in Life Sciences, 56-62.
Kinni, T. (2003). Setting the Right Prices At the Right Time. Harvard Management Update,
4-6.
Kirk, J., & Miller, M. L. (1986). Reliability and validity in qualitative research. Beverly
Hills: Sage Publications.
Koontz, H., O'Donnell, C., & Weibrich, H. (1980). Management in Broader Perspective:
Management of Multidisciplinary Study. McGraw-Hill.
Koteen, J. (1989). Strategic management in public and nonprofit organizations. New York,
NY: Praeger.
Kotler, P. (1999). Marketing Management: Analysis, Planning, Implementation and
Control. Prentice Hall Press.
Kotter, J. P. (1996). Leading Change. Harvard Business Press.
Kotter, J. P., & Cohen, D. S. (2002). The Heart of Change: Real-Life Stories of How People
Change Their Organizations. Harvard Business Press.
Koulopoulos, T. M., & Roloff, T. (2006). Smartsourcing: Driving Innovation and Growth
Through Outsourcing. Platinum Press, Inc.
Kumar, V., & Reinartz, W. (2005). Customer Relationship Management: A Databased
Approach. John Wiley & Sons.
85
Lajoux, A. R., & Elson, C. M. (2010). The Art of M&A Due Diligence: Navigating Critical
Steps and Uncovering Crucial Data. McGraw-Hill.
Latham, G. P., & Locke, E. A. (1991). Self-regulation through goal setting. Organizational
Behavior and Human Decision Processes. 212–247.
Lawler, E. E., & Worley, C. P. (2006). Built to Change: How to Achieve Sustained
Organizational Effectiveness. Jossey-Bass.
Lawrence, E. (1999). Strategic Thinking: A Discussion Paper. Canada: Research
Directorate, Policy, Research and Communications Branch, Public Service
Commission of Canada.
Lectric Law Library. (2017, June 7). From the 'Lectric Law Library's Lexicon HEALTH
CARE INSTITUTION. Retrieved from Lectric Law Library:
http://www.lectlaw.com/def/h005.htm
Levine, C. (1985). Police management in the 1980s: From decrementalism to strategic
thinking. Public Administration Review, 691–700.
Li, S., Ragu-Nathan, B., Ragu-Nathan, T., & Rao, S. S. (2006). The impact of supply chain
management practices on competitive advantage and organizational performance.
Omega, 107-124.
Liedtka, J. M. (1998). Strategic Thinking: Can it be Taught? Long Range Planning, 120-
129.
Linder, J. (2000). Paying the Personal Price for Performance. Strategy & Leadership, 22–
25.
Lindgren, M., & Bandhold, H. (2009). Scenario Planning: The Link Between Future and
Strategy. Palgrave Macmillan.
Lovallo, D., Viguerie, P., Uhlaner, R., & Horn, J. (2007). Deals Without Delusions. Harvard
Business Review, 92-99.
86
Luthans, F., Hodgetts, R. M., & Thompson, K. R. (1990). Social Issues in Business: Strategic
and Public Policy Perspectives. Upper Saddle River, NJ: Prentice-Hall.
MacMillan, I. C., & Selden, L. (2008). The Incumbent’s Advantage. Harvard Business
Review, 111–121.
Markey, R., du Toit, G., & Allen, J. (2006). Find Your Sweet Spot. Harvard Management
Update, 3–6.
Marks, M. L. (2002). Charging Back Up the Hill: Workplace Recovery After Mergers,
Acquisitions, and Downsizings. John Wiley & Sons.
Martin, J. (2006). Lean Six Sigma for Supply Chain Management. McGraw-Hill
Professional.
Martz, W. (2013). Evaluating Organizational Performance: Rational, Natural, and Open
System Models. American Journal of Evaluation, 385-401.
Mazouz, B. (2014). La strate´gie des organisations de l’E´tat (s/dir). Ste-Foy: Presses
del’Universite´ du Que´bec.
Mazouz, B., Rousseau, A., & Hudon, P.-A. (2016). Strategic management in public
administrations: a results-based approach to strategic public management.
International Review of Administrative Sciences, 411–417.
McDonald, M., & Dunbar, I. (2004). Market Segmentation: How to Do It, How to Profit
From It. Butterworth-Heinemann.
McHugh, M. (1997). Trouble in paradise: Disintegrated strategic change within a
government agency. International Journal of Public Sector Management, 433–443.
Miles, R. E., & Snow, C. C. (1986). Organizations: New concepts for new forms. California
Management Review, 62–73.
Miles, R., & Snow, C. (1978). Organizational strategy, structure and process. New York,
NY: McGraw-Hill.
87
Miller, C., Burke, L., & Glick, W. (1998). Cognitive Diversity among Upper-Echelon
Executives: Implications for Strategic Decision Processes. Strategic Management
Journal, 39–58.
Miller, E. L. (2008). Mergers and Acquisitions: A Step-by-Step Legal and Practical Guide.
Wiley.
Ministry of Health. (2014). Kenya Health Policy 2014 - 2030. Nairobi: Ministry of Health.
Ministry of Health. (2017, May 28). Kenya Master Health Facility List. Retrieved from
Kenya Master Health Facility List: http://kmhfl.health.go.ke/#/facility_filter/results
Mintzberg, H. (1978). Patterns in Strategy Formation. Management Science , 934.
Mintzberg, H. (1994). The Rise and Fall of Strategic Planning: Reconceiving Roles for
Planning, Plans, Planners. Free Press.
Mintzberg, H. (1999). Bees, flies, and CEOs; do we have too many bees making strategy and
not enough flies? Across The Board.
Mintzberg, H. (2004). Managers Not MBAs: A Hard Look at the Soft Practice of Managing
and Management Development. London: Financial Times Prentice Hall.
Mintzberg, H., & Waters, J. (1985). Of strategies, deliberate and emergent. Strategic
Management Journal, 257-272.
Mintzberg, H., Lampel, J., & Ahlstrand, B. (1998). Strategy Safari: A Guided Tour Through
The Wilds of Strategic Management. Free Press.
Mische, M. A. (2001). Strategic Renewal: Becoming a High-Performance Organization.
Upper Saddle River, NJ: Prentice Hall.
Monavarian, A., Asgari, N., & Ashena, M. (2007). Structural and content dimensions of
knowledge-based organizations. The first national conference of knowledge
management. Bahman.
88
Moon, B.-J. (2013). Antecedents and outcomes of strategic thinking. Journal of Business
Research, 1698-1708.
Moore, J. (1993). Predators and prey: a new ecology of competition. Harvard Business
Review, 76.
Morgan, G. (1986). Images of organization. Beverly Hills: Sage.
Mueller, G. C., Mone, M. A., & Barker III, V. L. (2007). Formal Strategic Analyses and
Organizational Performance: Decomposing the Rational Model. Sage Publications,
853-883.
Nagle, T. T., & Hogan, J. (2005). The Strategy and Tactics of Pricing: A Guide to Growing
More Profitably. Prentice Hall.
Nambisan, S., & Sawhney, M. (2007). The Global Brain: Your Roadmap for Innovating
Faster and Smarter in a Networked World. Wharton School Publishing.
Narayanan, V., & Raman, A. (2004). Aligning Incentives in Supply Chains. Harvard
Business Review, 94–102, 149.
Neilson, G. L., Martin, K. L., & Powers, E. (2008). The Secrets to Successful Strategy
Execution. Harvard Business Review, 61–70.
Neustadt, R., & May, E. (1986). Thinking in time: the uses of history for decision makers.
New York: Free Press.
Niven, P. R. (2005). Balanced Scorecard Diagnostics: Maintaining Maximum Performance.
John Wiley & Sons.
Niven, P. R. (2006). Balanced Scorecard Step-by-Step: Maximizing Performance and
Maintaining Results. John Wiley & Sons.
Nolan, T. N., Goodstein, L. D., & Goodstein, J. (2008). Applied Strategic Planning: An
Introduction. Pfeiffer.
89
Noubar, H. B., Orangi, M., & Mejarshin, A. S. (2014). Effect of Strategic Thinking on
Organizational Improvement (Iranian Mellat Banks) . MAGNT Research Report.
Nutt, P. (1999). Surprising but true: Half the decisions in organizations fail. Academy of
Management Executive, 75-90.
Nutt, P. C., & Backoff, R. W. (1992). Organizational publicness and its implications for
strategic management. Journal of Public Administration Research and Theory, 209-
231.
O’Hallaron, R., & O’Hallaron, D. (2000). The Mission Primer: Four Steps to an Effective
Mission Statement. Mission Incorporated.
Olusanya, S., Olumuyiwa, A., Adelaja, S., & Chukwuemeka, O. E. (2012). Effective
Planning and Organisational Productivity. (A Case Study Of Sterling Bank Nigeria
Plc). Journal Of Humanities And Social Science, 31-39.
Ong, T., & Teh, B. (2009). The Use of Financial and Non Financial Performance Measures
in the Malaysian Manufacturing Companies. Journal of Accounting Research, 23–
30.
Ouakouak, M. L., & Ouedraogo, N. (2013). The mediating role of employee strategic
alignment in the relationship between rational strategic planning and firm
performance: A European study. Canadian Journal of Administrative Sciences, 143–
158.
Owen, R., & Brooks, L. L. (2008). Answering the Ultimate Question: How Net Promoter
Can Transform Your Business. Jossey-Bass.
Owolabi, S. A., & Makinde, O. G. (2012). The Effects Of Strategic Planning On Corporate
Performance In University Education: A Study Of Babcock University . Kuwait
Chapter of Arabian Journal of Business and Management Review, 27-44.
Oxford Dictionary. (2017, June 7). English Oxford Living Dictionaries. Retrieved from
https://en.oxforddictionaries.com/definition/knowledge
90
Oxford Dictionary. (2017, June 7). English Oxford Living Dictionaries. Retrieved from
https://en.oxforddictionaries.com/definition/attitude
Pandelica, A., Pandelica, I., & Dumitru, I. (2009). What is market orientation and how did
it evolve during the time? What do the empiric findings show? The Business Review,
238–248.
Pfeffer, J., & Fong, C. T. (2002, September). The end of business schools? Less success then
meets the eye. Retrieved from Academy of Management Learning & Education:
http://www.aomonline.org/Publications/Articles/BSchools.asp
Pfeffer, J., & Salancik, G. R. (1978). The external control of organizations. New York:
Harper & Row.
Phillips, B. S. (1971). Social Research Strategy and Tactics. Macmillan Publishing.
Phillips, R. (2005). Pricing and Revenue Optimization. Stanford Business Books.
Pirouz, E., Razavi, S. H., & Hashemi, S. S. (2009). Designing and Stabilizing Performance
Evaluation System. Public Management Journal.
Poister, T. H., & Streib, G. D. (1999). Strategic management in the public sector: Concepts,
models, and processes. Public Productivity & Management Review, 308-325.
Poister, T. H., Pitts, D. W., & Edwards, L. H. (2010). Strategic Management Research in the
Public Sector: A Review, Synthesis, and Future Directions. The American Review of
Public Administration, 522 –545.
Poister, T., & Streib, G. (1999). Strategic management in the public sector: Concepts,
models, and processes. Public Productivity & Management Review, 308-325.
Porter, M. (1982). Choix strate´giques et concurrence. Techniques d’analyse des secteurs et
de la concurrence dans l’industrie. Paris: Economica.
Porter, M. (1996). What is strategy? Harvard Business Review, 61–78.
91
Porter, M. E. (1998). Competitive Strategy: Techniques for Analyzing Industries and
Competitors. Free Press.
Power, M. J., Desouza, K., & Bonifazi, C. (2006). The Outsourcing Handbook: How to
Implement a Successful Outsourcing Process. Kogan Page.
Ramirez, R., Selsky, J. W., & van der Heijdjen, K. (2010). Business Planning in Turbulent
Times: New Methods for Applying Scenarios. Earthscan Publications.
Reichheld, F. (2001). Loyalty Rules! How Leaders Build Lasting Relationships in the Digital
Age. Harvard Business School Press.
Reichheld, F., & Teal, T. (1996). The Loyalty Effect: The Hidden Force Behind Growth,
Profits, and Lasting Value. Harvard Business School Press.
Reider, R. (2000). Benchmarking Strategies: A Tool for Profit Improvement. John Wiley &
Sons.
Rigby, D. K. (1994). Managing the Management Tools. Journal of Planning Review, 20-24.
Rigby, D. K. (2011). Management Tools 2011: An Executive Guide. Boston, MA 02116:
Bain & Company, Inc.
Rigby, D. K. (2015). Management Tools 2015: An Executive's Guide. Bain & Company.
Rigby, D. K., & Ledingham, D. (2004). CRM Done Right. Harvard Business Review, 118–
129.
Rigby, D. K., Reichheld, F., & Schefter, P. (2002). Avoid the Four Perils of CRM. Harvard
Business Review, 101–109.
Rigby, D., & Bilodeau, B. (2007). Bain’s global 2007 management tools and trends survey.
Journal of Strategy & Leadership, 9 –16.
Rigby, D., & Bilodeau, B. (2013). Management Tools and Trends. Boston, MA: Bain &
Company.
92
Rigby, D., & Bilodeau, B. (2015). Management Tools & Trends 2015. Bain & company,
Inc.
Robbins, S. P., & Coulter, M. (2002). Management. Upper Saddle River: Prentice Hall.
Robinson, R., & Pearce, J. (1983). The impact of formalized strategic planning on financial
performance in small organization. Strategic Management Journal, 197–207.
Robinson, R., & Pearce, J. (1988). Planned patterns of strategic behavior and their
relationship to business-unit performance. Strategic Management Journal, 43–60.
Rogério, J. L., Vladimir, A. F., Paulo de Tarso, R. d., Luiz, M. C., Paulo, E. G., & Netto, C.
(2016). Development of an information system at the Strategic Management Support
Office of the Brazilian Ministry of Health. Revista Cubana de Información en
Ciencias de la Salud, 168 - 184.
Rogers, P., & Blenko, M. (2006). Who Has the D? How Clear Decision Roles Enhance
Organizational Performance. Harvard Business Review, 53-61.
Rose, W. R., & Cray, D. (2010). Public-sector strategy formulation. CANADIAN PUBLIC
ADMINISTRATION / ADMINISTRATION PUBLIQUE DU' CANADA, 453–466.
Rosenbaum, J., Pearl, J., & Perella, J. R. (2009). Investment Banking: Valuation, Leveraged
Buyouts, and Mergers and Acquisitions. Wiley.
Rudd, J., Greenley, G., Beatson, A., & Lings, I. (2008). Strategic planning and performance:
Extending the debate. Journal of Business Research, 99–108.
Sadegh, P., Yazdani, N., & Behrang. (2011). The impact of strategic thinking of senior
managers to the success of SMEs. Strategic Management Studies, 143-159.
SAGE. (2017, June 22). SAGE. Retrieved from Sage Research Methods:
http://methods.sagepub.com/reference/the-sage-dictionary-of-social-research-
methods/n18.xml
Sandberg, K. D. (2001). Reengineering Tries a Comeback— This Time for Growth, Not Just
Cost Savings. Harvard Management Update, 3–6.
93
Sarason, Y., & Tegarden, F. (2003). The erosion of the competitive advantage of strategic
planning. Journal of Business and Management, 1–21.
Saunders, M., Lewis, P., & Thornhill, A. (2012). Research Methods For Business Students.
Essex: Pearson Education Limited.
Scott, W. (2003). Organizations: Rational, natural, and open systems. Upper Saddle River:
Pearson.
Segil, L. (2004). Measuring the Value of Partnering: How to Use Metrics to Plan, Develop,
and Implement Successful Alliances. American Management Association.
Selden, L., & MacMillan, I. C. (2006). Manage Customer Centric Innovation—
Systematically. Harvard Business Review, 108–116.
Selznick, P. (1957). Leadership in administration. Los Angeles: University of California
Press.
Senge, P. M. (2006). The Fifth Discipline. Doubleday.
Shenkar, O., & Reuer, J. J. (2005). Handbook of Strategic Alliances. Sage Publications.
Slone, R. E. (2004). Leading a Supply Chain Turnaround. Harvard Business Review, 114–
121.
Sodhi, M. S., & Sodhi, N. S. (2007). Six Sigma Pricing: Improving Pricing Operations to
Increase Profits. FT Press.
Solis, B. (2010). Engage: The Complete Guide for Brands and Businesses to Build,
Cultivate, and Measure Success in the New Web. Wiley.
Song, M., Im, S., van der Bij, H., & Song, L. Z. (2011). Does Strategic Planning Enhance or
Impede Innovation and Firm Performance? Journal of Product Innovation
Management, 503–520.
Stacey, R. D. (2010). The science of complexity: An alternative perspective for strategic
change processes. Strategic Management Journal, 477–495.
94
Stauffer, D. (2003). Is Your Benchmarking Doing the Right Work? Harvard Management
Update, 1–4.
Steiner, G. A., Miner, J. B., & Gray, E. R. (1982). Management policy and strategy. New
York, NY: Macmillan.
Steinhilber, S. (2008). Strategic Alliances: Three Ways to Make Them Work. Harvard
Business School Press.
Steiss, A. W. (1985). Strategic management and organizational decision making. Lexington,
MA: D. C. Heath.
Sterne, J. (2010). Social Media Metrics: How to Measure and Optimize Your Marketing
Investment. Wiley.
Swayne, L. E., Duncan, W. J., & Ginter, P. M. (2006). The Nature of Strategic Management.
350 Main Street, Malden, MA 02148-5020, USA: Blackwell Publishing.
Terwiesch, C., & Ulrich, K. (2009). Innovation Tournaments: Creating and Selecting
Exceptional Opportunities. Harvard Business School Press.
Thorndike, R. L. (1949). Personnel selection: Test and measurement techniques. New York:
Wiley.
Trent, R. J. (2007). Strategic Supply Management: Creating the Next Source of Competitive
Advantage. J. Ross Publishing.
Trevor, C. O., & Nyberg, A. J. (2008). Keeping Your Headcount When All About You Are
Losing Theirs. Academy of Management Journal, 259–276.
University of Zagreb. (2017, May 31). Sveučilište u Zagrebu: Agronomski fakultet.
Retrieved from Univeristy of Zagreb:
http://www.agr.unizg.hr/multimedia/pdf/session4.pdf
Vafaei, V., Shad, F. S., & Rostami, N. A. (2016). Studying the effect of manager’s Strategic
Thinking on Corporate entrepreneurship. International Journal of Advanced
Engineering, Management and Science, 209-2014.
95
van Teijlingen, E., & Hundley, V. (2002). The importance of pilot studies. Nursing Standard,
33-36.
Vashistha, A., & Vashistha, A. (2006). The Offshore Nation: Strategies for Success in Global
Outsourcing and Offshoring. McGraw-Hill.
Vaus, D. A. (2005). Research Design in Social Research. Sage Publications.
Venkatraman, N., & Grant, J. (1986). Construct measurement in strategy research: A critique
and proposal. Academy of Management Review, 71–87.
Vinzant, D. H., & Vinzant, J. C. (1996b). Strategy and organizational capacity: Finding a fit.
Public Productivity & Management Review, 139-157.
Vitasek, K., Ledyard, M., & Manrodt, K. B. (2010). Vested Outsourcing: Five Rules That
Will Transform Outsourcing. Palgrave Macmillan.
Walsh, J. P., Tushman, M. L., Kimberly, J. R., & Starbuck, B. a. (2007). On the relationship
between research and practice: debate and reflections. Journal of Management
Inquiry, 128 – 154.
Walter, J., Kellermanns, F. W., Floyd, S. W., Veiga, J. F., & Matherne, C. (2013). Strategic
alignment: A missing link in the relationship between strategic consensus and
organizational performance. Sage Journals, 304-328.
Weiss, A. (1995). Our Emperors Have No Clothes. Franklin Lakes, NJ: Career Press.
Wheatley, M. J. (2006). Leadership and the new science: Discovering order in a chaotic
world. San Francisco, CA: Berrett-Koehler.
Williamson, P. (1999). Strategy as options on the future. Sloan Management Review , 117–
126.
Winter, G. (2000). A comparative discussion of the notion of validity in qualitative and
quantitative research. Toronto: University of Toronto.
96
Wooldridge, B., Schmid, T., & Floyd, S. W. (2008). The Middle Management Perspective
on Strategy Process: Contributions, Synthesis, and Future Research. Journal of
Management, 1190-1221.
Yankelovich, D., & Meer, D. M. (2006). Rediscovering Market Segmentation. Harvard
Business Review, 122–131.
Zook, C. (2007). Finding Your Next Core Business. Harvard Business Review, 66-75.
97
APPENDICES
Appendix I: Cover Letter
Dear Respondent
I am a post – graduate student studying towards my Masters in Business Administration
(Strategic Management) at the United States International University – Nairobi. The purpose
of this study is to determine the effects of strategic management on organizational
performance in health institutions in Nairobi County.
You are part our selected sample of respondents whose views we seek on the above-
mentioned matter. We would therefore appreciate it if you could answer a few questions. It
will take approximately thirty minutes of your time to fill in the questionnaire.
We guarantee you complete anonymity and there are no correct or incorrect responses.
Please answer the questions as accurately as possible. For each statement, circle the response
which best describes your experience or perception. Mark one answer for each statement and
attempt to answer all questions.
I guarantee that all information will be handled with STRICT CONFIDENTIALITY.
Thank you very much.
Dr. George Kadondi Kasera
USIU - AFRICA
98
Appendix II: Questionnaire
This questionnaire is designed to help you critique your strategic planning and management
process. It is structured to allow review of the process to determine which strategic planning
steps the organization now performs well, not so well, or not at all. Even if your organization
does no strategic planning at present, a review of this questionnaire should be instructive as
the individual questions identify those considerations that are primary in designing and
implementing an effective process.
99
SECTION A: GENERAL INFORMATION
Form Number
Date
Name of Respondent
Designation of Respondent
Respondent Gender
Respondent’s Age
Name of Health Institution
Health Institution KEPH Level
Health Institution Type
Health Institution Ownership
For each question below, circle the appropriate number to indicate the degree of agreement
or disagreement if the variable asked has improved organizational performance of your
organization.
SECTION B: STRATEGIC THINKING & ORGANIZATIONAL
PERFORMANCE
1a. Are top executives assigned formal responsibility for
your organization's strategic planning?
Yes O
No O
100
1b. Formal responsibility by top executives for the
organization’s strategic planning improves
organizational performance.
Strongly Agree O
Agree O
Neutral O
Disagree O
Strongly
Disagree
O
2a. Is strategic planning a top priority activity for your
organization?
Yes O
No O
2b. Strategic planning being a top priority activity,
performed on a regular basis, e.g., each year improves
organizational performance.
Strongly Agree O
Agree O
Neutral O
Disagree O
Strongly
Disagree
O
3a. Does your organization provide resources (time, money,
staff support) specifically earmarked for strategic
planning?
Yes O
No O
3b. Strongly Agree O
101
Providing resources (managers’ time, money, staff
support, etc.) earmarked specifically for strategic
planning improves organizational performance.
Agree O
Neutral O
Disagree O
Strongly
Disagree
O
4a. Does your institution follow a defined set of procedures
during strategic planning process?
Yes O
No O
4b. Following a defined set of procedures during strategic
planning process improves organizational performance.
Strongly Agree O
Agree O
Neutral O
Disagree O
Strongly
Disagree
O
5a. Does your organization have a written mission
statement?
Yes O
No O
5b. Having a written mission statement improves
organizational performance.
Strongly Agree O
Agree O
102
Neutral O
Disagree O
Strongly
Disagree
O
6a. Is the management and higher-level staff aware of your
organization's mission and understand it?
Yes O
No O
6b. Management and higher-level staff being aware of the
mission and understanding it improves organizational
performance.
Strongly Agree O
Agree O
Neutral O
Disagree O
Strongly
Disagree
O
7a. Does your organization have written goals (short or long
term)?
Yes O
No O
7b. Having written goals (short or long term) improves
organizational performance.
Strongly Agree O
Agree O
Neutral O
103
Disagree O
Strongly
Disagree
O
7c. Are the written goals quantified with measurable targets
(e.g. volume, market share, growth rate, profitability)?
Yes O
No O
7d. Having goals list quantified with measurable targets
(e.g., volume, market share, growth rate, profitability)
improves organizational performance.
Strongly Agree O
Agree O
Neutral O
Disagree O
Strongly
Disagree
O
8a. Does your organization systematically measure actual
performance vs goals set?
Yes O
No O
8b. Systematically measuring actual performance vs. goals
set improves organizational performance.
Strongly Agree O
Agree O
Neutral O
Disagree O
104
Strongly
Disagree
O
9a. Does your management and higher-level staff participate
in setting goals?
Yes O
No O
9b. Participation by management and higher-level staff in
setting goals improves organizational performance.
Strongly Agree O
Agree O
Neutral O
Disagree O
Strongly
Disagree
O
SECTION C: STRATEGIC PLANNING & ORGANIZATIONAL
PERFORMANCE
10a. Does your organization periodically gather and analyze
data about the market and other external factors which
affect the business?
Yes O
No O
10b. Periodically gathering and analyzing data about market
and other external factors which affect the business
improves organizational performance.
Strongly Agree O
Agree O
Neutral O
Disagree O
105
Strongly
Disagree
O
11a. Does your organization identify key threats &
opportunities during market analysis?
Yes O
No O
11b. Identification of key threats & opportunities during
market analysis improves organizational performance.
Strongly Agree O
Agree O
Neutral O
Disagree O
Strongly
Disagree
O
12a. Does your organization compare its performance and
operational characteristics with those of competitors?
Yes O
No O
12b. Comparison of the organization’s performance and
operational characteristics with those of competitors
improves organizational performance.
Strongly Agree O
Agree O
Neutral O
Disagree O
Strongly
Disagree
O
106
13a. Does your organization analyze demographic, behavioral
and other consumer trends?
Yes O
No O
13b. Analysis of demographic, behavioral, and other
consumer trends improves organizational performance.
Strongly Agree O
Agree O
Neutral O
Disagree O
Strongly
Disagree
O
14a. Does your organization assess the sector as whole in
terms of new competitors and concepts, new
technologies, procurement practices, price trends, labor
practices?
Yes O
No O
14b. Assessment of the sector as a whole in terms of new
competitors and concepts, new technologies,
procurement practices, price trends, labor practices
improves organizational performance.
Strongly Agree O
Agree O
Neutral O
Disagree O
Strongly
Disagree
O
15a. Yes O
107
Does your organization assess factors such as cost and
availability of capital, government regulations and state
of the economy?
No O
15b. Assessment of factors such as cost and availability of
capital, government regulations and state of the economy
improves organizational performance.
Strongly Agree O
Agree O
Neutral O
Disagree O
Strongly
Disagree
O
16a. Does your organization have knowledge of and access to
sources of information about the sector, markets, and
other external factors?
Yes O
No O
16b. Having knowledge of and access to sources of
information about the sector, markets, and other external
factors improves organizational performance.
Strongly Agree O
Agree O
Neutral O
Disagree O
Strongly
Disagree
O
17a. Yes O
108
Does your organization analyze its key strengths and
weaknesses?
No O
17b. Internal analysis to identify key strengths and
weaknesses improves organizational performance.
Strongly Agree O
Agree O
Neutral O
Disagree O
Strongly
Disagree
O
18a. Does your organization analyze profitability indicator
trends (after-tax earnings, return on assets, etc.)?
Yes O
No O
18b. Analysis of profitability trends improves organizational
performance.
Strongly Agree O
Agree O
Neutral O
Disagree O
Strongly
Disagree
O
19a. Does your organization analyze its pricing strategy and
its effects on customer behavior?
Yes O
No O
109
19b. Analysis of pricing strategy and its effects on customer
behavior improves organizational performance.
Strongly Agree O
Agree O
Neutral O
Disagree O
Strongly
Disagree
O
20a. Does your organization analyze quality of customer
service, satisfaction, loyalty & defection data?
Yes O
No O
20b. Analysis of quality of customer service, customer
satisfaction, loyalty & defection data improves
organizational performance.
Strongly Agree O
Agree O
Neutral O
Disagree O
Strongly
Disagree
O
21a. Does your organization assess its human resource
management and development programs?
Yes O
No O
21b. Strongly Agree O
110
Assessment of human resource management and
development programs improves organizational
performance.
Agree O
Neutral O
Disagree O
Strongly
Disagree
O
22a. Is the internal data discussed above easily accessible to
the management?
Yes O
No O
22b. Accessible internal data by the management improves
organizational performance.
Strongly Agree O
Agree O
Neutral O
Disagree O
Strongly
Disagree
O
23a. Does your organization identify key strategic issues (e.g.
outlet expansion, profitability improvement, positioning
change) after conducting a situational analysis review?
Yes O
No O
23b. Strongly Agree O
Agree O
111
Identification of key strategic issues after conducting a
situational analysis review improves organizational
performance.
Neutral O
Disagree O
Strongly
Disagree
O
24a. Does your organization use situational diagnosis to
formulate strategic plan options?
Yes O
No O
24b. Use of situational diagnosis to formulate strategic plan
options improves organizational performance.
Strongly Agree O
Agree O
Neutral O
Disagree O
Strongly
Disagree
O
25a. Which strategic management techniques has your organization used? (Select
Multiple)
a) Balanced Scorecard O
b) Benchmarking O
c) Big Data Analytics O
d) Business Process Reengineering O
112
e) Change Management Programs O
f) Complexity Reduction O
g) Core Competencies O
h) Customer Relationship Management O
i) Customer Segmentation O
j) Decision Rights Tools O
k) Downsizing O
l) Employee Engagement Surveys O
m) Mergers and Acquisitions O
n) Mission and Vision Statements O
o) Open Innovation O
p) Outsourcing O
q) Price Optimization Models O
r) Satisfaction and Loyalty Management O
s) Scenario and Contingency Planning O
t) Social Media Programs O
113
u) Strategic Alliances O
v) Supply Chain Management O
w) Total Quality Management O
x) Zero based Budgeting O
y) Don't Know O
25b. Use of strategic management techniques improve
organizational performance.
Strongly Agree O
Agree O
Neutral O
Disagree O
Strongly
Disagree
O
SECTION D: STRATEGY IMPLEMENTATION & ORGANIZATIONAL
PERFORMANCE
26a. Does your organization make strategic decisions
(implementation action plans) based upon the strategic
plan?
Yes O
No O
26b. Strongly Agree O
Agree O
114
Making strategic decisions (implementation action
plans) based upon the strategic plan improves
organizational performance.
Neutral O
Disagree O
Strongly
Disagree
O
27a. Has your organization clearly assigned lead
responsibility for action plan implementation to a person/
team?
Yes O
No O
27b. Clearly assigning lead responsibility for action plan
implementation to a person / team improves
organizational performance.
Strongly Agree O
Agree O
Neutral O
Disagree O
Strongly
Disagree
O
28a. Has your organization allocated resources for strategy
implementation?
Yes O
No O
28b. Allocation of resources for strategy implementation
improves organizational performance.
Strongly Agree O
Agree O
Neutral O
115
Disagree O
Strongly
Disagree
O
29a. Has your organization set clearly defined key
performance indicators for each plan element?
Yes O
No O
29b. Setting clearly defined key performance indicators for
each plan element improves organizational performance.
Strongly Agree O
Agree O
Neutral O
Disagree O
Strongly
Disagree
O
30a. Does your organization have a monitoring and evaluation
system to track performance?
Yes O
No O
30b. Having a monitoring and evaluation system for tracking
performance improves organizational performance.
Strongly Agree O
Agree O
Neutral O
Disagree O
116
Strongly
Disagree
O
31a. Does your organization reward individuals responsible
for successful performance?
Yes O
No O
31b. Rewarding individuals responsible for successful
performance improves organizational performance.
Strongly Agree O
Agree O
Neutral O
Disagree O
Strongly
Disagree
O
32a. Do you know the number of patients (samples) your
organization has seen over the past three years?
Yes O
No O
32b. Number of patients (samples*) seen in 2016
32c. Number of patients (samples*) seen in 2015
32d. Number of patients (samples*) seen in 2014