STRATEGY FORMULATION, STRATEGY CONTENT AND PERFORMANCE: EMPIRICAL EVIDENCE FROM PRIVATE SECTOR ORGANIZATIONS IN PAKISTAN

Abstract

This study tests the effects of strategy formulation and strategy content on the organizational performance by using the framework suggested by Andrews, Boyne, Law and Walker (2009). The independent variable strategy formulation includes rational planning, logical instrumentalism and strategy process absence; whereas the independent variable strategy content, following the study of Miles and Snow (1978), includes prospecting, defending and reacting. Three hundred and twenty five questionnaires were distributed of which two hundred and seventeen were selected for inclusion in the study. The sample drawn was from organizations spread across Pakistan. The unit of analysis was departments as each department has a different strategy. Results show that rational planning affected positively while logical incrementalism and strategy absence negatively affect organizational performance. While for strategy content, prospector, defenders and reactors were found to be positively significant with organizational performance. Implications and future recommendations are provided.