- 1. 1 STRATEGY FORMULATION AND IMPLEMENTATION IN ZIMBABWE FOOD MANUFACTURING SECTOR (2006 -2013) SYNOPSIS OF THE Ph. D THESIS Submitted by: EMMANUEL KATSVAMUTIMA Scholar Registration Number: 1140016 FACULTY OF COMMERCE CENTRE FOR RESEARCH CHRIST UNIVERSITY, BANGALORE, INDIA FEBRUARY 2014 GUIDE : Doctor Jeevananda (India) Co-Guide :Doctor Silas Rusvingo (Zimbabwe)
2. 2 TABLE OF CONTENTS 1 Introduction 1 2 Need for the Study 2 3 Review of Literature 3 4 Overview of the Chapters 8 5 Title of the Study 9 6 Operational Definitions 9 7 Objectives of the Study 10 8 Conceptual Equations and Hypothesis 14 9 Design of the Study 20 10 Tools use for Collection of Data 23 11 Field Work Details 23 12 Statistical Techniques 25 13 Validation Procedures 26 14 Data Analysis 27 15 Major Findings 37 16 Structural Model Developed 46 17 Conclusion 48 18 Implications of the Study 52 19 Limitations of the Study 53 20 Suggestions for further Research 57 21 Bibliography 58 3. 3 LIST OF FIGURES Figure No Title Page No Fig 9.1 Model with Path Coefficients 12 Fig 17.1 STRUCTURAL MODEL DEVELOPED 46 Fig 17.2 Conceptual Model 47 LIST OF TABLES Table No Title Page No Table 8.1 The Variables Representing Different Constructs used in this Study 12 Table 10.1 Research Design at glance 20 Table 10.2 Analytical Techniques Used 21 Table12.1 Sample Cluster of the Study 23 Table 15.1 Reliability of the Scales 27 Table 15.2 KMO and Bartlettss Test for Variable 27 Table 15.3 Component Matrix for Cost- Related Variables 28 Table 15.18 Item-Total Statistics 33 Table 16.1 Summary of the Results Obtained by Testing the Hypotheses 40 4. 4 1. INTRODUCTION A key preoccupation of strategic management for competitive advantage as a field of study is the identification of sources of heterogeneous performance among food manufacturing firms in Zimbabwe in terms of their competitiveness. The main theories of the study of strategy formulation and implementation in the Zimbabwes food manufacturing sector includes contingency theory, Porter's positioning theory, resource-based view and its derivatives and environmental theories and offer varying views explaining the potential reasons for deriving superior rent. Empirical studies in the field of strategic management have mainly focused on two main streams of research: (i) the relationship between how strategy is formulated in a firm and firm performance and (ii) the relationship between the content of strategy and firm performance. A third area of interest is strategy implementation, but unlike the other two areas, strategy implementation in the food manufacturing organisations has not received much empirical interest. The results of the previous studies examining the relationship between strategy formulation and corporate performance and marketing strategy content and performance have been inconclusive. Some studies have reported positive relationships, while others found no relationship. The previous studies also suffered from a number of methodological inadequacies such as inconsistent operationalization of the constructs, unclear definition of industry sectors and small sample size. Only a few studies have focused on Zimbabwean based organizations. In addition there is a dearth of empirical research using Zimbabwean based food manufacturing organizations. Based on the literature review a conceptual model of strategy formulation and implementation in food manufacturing organizations in Zimbabwe was proposed and the hypotheses to be tested were derived. These hypotheses were classified into two groups namely (i) hypotheses for validating the findings of previous studies and (ii) hypotheses which have not been tested in previous studies. Hypotheses in the first group have examined the impact of strategy formulation, business-level strategy and strategy implementation on organizational competitive performance in the manufacturing sector. Hypotheses in the 5. 5 second group have examined the interrelationships between strategy formulation, business- level strategy and strategy implementation. 2. NEED FOR THE STUDY Key reasons for the need to study the present study are stated here: a) Study has Practical significance. Variable like business strategy, objective fulfilment, competitive implementation performance, implementation strategy, cost-related, differentiation variables, focus variables and environment variables are increasingly recognised as important form of food manufacturing industry in Zimbabwe as sources of competitive advantage. b) To apply key strategic management concept to food manufacturing industry. The issue of strategy formulation and implementation towards competitive advantage in the food manufacturing industry in Zimbabwe has received considerable attention in the strategic management literature. It is thought that some of these key strategy formulation and implementation concepts could be applied to any sector of the economy for competitive advantage. c) Study addresses methodological shortcomings of the previous studies This study also addresses some of the methodological shortcomings of the previous studies by clearly defining the industry sectors, using a good sample size and by using properly validated constructs. It gains significance mainly due to its focus on Zimbabwean based organizations and helps theory development because a robust theory is crucially dependent on empirical studies representing the food manufacturing industry in different geographical regions. d) Knowledge transfer to Zimbabwes food manufacturing sector Knowledge transfer to Zimbabwes food manufacturing sector from countries with best practice such as Japan, India, China and the United States. This study helps in the promoting of the industrialization drive and the promotion of import substitution, policy consistency, an audit of the skills, innovation and development on technology and machinery to match competition and value addition e) To overview the performance of the manufacturing sector during 2006 and 2013 and asses whether there are differences in strategy formulation and implementation in the 6. 6 food manufacturing sectors and whether the difference in constructs lead to superior performance and competitive advantage. f) To establish whether competitive performance heterogeneity in organisations in the food manufacturing industries in Zimbabwe be explained in terms of their emphasis on rational strategy formulation? g) Does the environment have a moderating effect on the relationship between business- level strategy implementation and competitive performance in the food manufacturing industry in Zimbabwe? h) Is there a relationship between the type of organisational structure and business strategy? If strategic types are associated with structure types, then does this association explain performance heterogeneity? i) To evaluate government policy on provision of ground rules, to set directions and strategy and support the activity of business and other institutions in their creative endeavours. The present study thus, endeavours to fill the gap in the strategy formulation and implementation literature (and particularly in manufacturing industry literature) by reporting insights obtained in an extensive investigation. 3. REVIEW OF LITERATURE The concept of strategy formulation and implementation in the food manufacturing industries in Zimbabwe is central to the competitiveness of this sector. The operationalisation of strategy process requires multidimensional models because of the complexities associated with the process. Rajagopalan, Rasheed & Datta (1993), Hart (1992) and Bailey, Johnson & Daniels (2000) have made significant contributions to the literature by developing integrative models of strategy making encompassing a multitude of factors which affect the strategy process. Huff & Reger (1987) had identified nine different streams of strategy process research. However, none of the strategy making models has taken into consideration the theoretical roots of strategy process while defining the strategy making modes. Gregory G. Dess and Nancy K. Origer (2009) conducted a study on (Environment, Structure, and Consensus in Strategy Formulation: A Conceptual Integration) Their findings suggested an integrative framework for research on consensus in strategy formulation performance relationships. Their proposed model has two components. First, a descriptive 7. 7 component explores the environmentconsensus relationship in which the environment is conceptualized along the dimensions of munificence, complexity, and dynamism. Second, a normative component investigates the role that the match between environment, consensus, and integrating structure plays in explaining differences in organizational performance. Hannu Salmela, And Ton A.M. Spil et al (2010) conducted a study on Dynamic and emergent information systems strategy formulation and implementation The thrust of their study was an early attempts to formulate information systems (IS) strategies concentrated on the analytical task of deriving IS strategies from business plans. The limitations of the static plans that often resulted from these formal studies were, however, soon discovered. The critics suggested informal and incremental planning to ensure flexibility, creativity and strategic thinking to comprise emergent strategies as well as planned strategies. K.W. Platts et al., 2012 conducted a study on Characteristics of methodologies for manufacturing strategy formulation Findings were that although the need for companies to develop competitive manufacturing strategies is widely accepted, the processes or methodologies by which such strategies are developed are not well understood. The research described identities and describes four common characteristics of methodologies used successfully in the formulation of strategy. The results of this research can be applied by both industrialists and academics.