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Consensus on strategic decisions and core capabilities

Chris Roberts, University of Massachusetts Amherst

Abstract

Past research on Top Management Team (TMT) consensus has investigated relationships between consensus on strategic goals and means and organizational performance. The process of setting goals and selecting the means to compete is known as deliberate strategy. However, strategy making includes not only deliberate planning but also the interactive learning of top managers and others as they handle emergent events. Therefore, TMT consensus is important not only on deliberate strategies, but also on the underlying logic that guides emergent strategies.^ Recent theory suggests these are the two primary forms of consensus: consensus on goals and means and consensus on organizational capabilities. Consensus on goals and means is significant because of its influence on deliberate strategy, while consensus on organizational capabilities is important for managing emergent adaptation. Both forms of consensus play a key role in realizing a desired level of organizational performance, and the importance of one type of consensus or the other will vary depending upon certain contingencies.^ The purpose of this dissertation was to empirically test relationships between both forms of consensus and organizational performance while considering the influence of three contingencies: the environment, strategic discretion and strategic approach. Previous research provided the theoretical basis for the study and the anticipated relationships. The contingencies were used as a framework to develop propositions. Ten hypotheses were developed from these propositions.^ The research context was the hotel industry. Three dimensions of the environment in five hotel market segments were identified. Primary data were collected from TMT members at 44 hotels. When tested, three of four hypotheses concerning the environment were rejected, indicating the environment has less to do with consensus and organizational performance than suggested. Support for the hypotheses regarding strategic discretion was found, signifying the choice to franchise or not has a strong effect upon consensus. Clear support was found for three of the hypotheses regarding strategic approach. Unconfirmed, weak support was found for the fourth. The strategic approach results suggest that consensus surrounding primary strategies is closely linked with organizational performance. ^

Subject Area

Business administration|Management

Recommended Citation

Roberts, Chris, "Consensus on strategic decisions and core capabilities" (1995). Doctoral Dissertations Available from Proquest. AAI9541143.
http://scholarworks.umass.edu/dissertations/AAI9541143

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