Strategy Content and Organizational Performance: An Empirical Analysis

Authors


Rhys Andrews is a research associate in the Centre for Local and Regional Government at the School of City and Regional Planning, Cardiff University. His research interests are strategy, civil participation, and the performance of public organizations. E-mail:andrewsr@cardiff.ac.uk.

George A. Boyne is a professor of public-sector management in the Business School at Cardiff University. He is also a member of the Centre for Local and Regional Government Research. His research focuses on the determinants of performance in public organizations. E-mail:boyne@cardiff.ac.uk.

Richard M. Walker is an associate professor in the Centre for Urban Planning and Environmental Management at the University of Hong Kong and a professor of public management in the School of City and Regional Planning at Cardiff University. His research focuses on the determinants of performance in public organizations, management reform, and institutional change in China's public services. E-mail:rwalker@hkucc.hku.hk.

Abstract

This study presents the first empirical test of the proposition that strategy content is a key determinant of organizational performance in the public sector. Strategy content comprises two dimensions: strategic stance (the extent to which an organization is a prospector, defender, or reactor) and strategic actions (the relative emphasis on changes in markets, services, revenues, external relationships, and internal characteristics). Data were drawn from a multiple-informant survey of 119 English local authorities. Measures of strategy content are included in a multivariate model of interauthority variations in performance. The statistical results show that strategy content matters. Organizational performance is positively associated with a prospector stance and negatively with a reactor stance. Furthermore, local authorities that seek new markets for their services are more likely to perform well. These results suggest that measures of strategy content must be included in valid theoretical and empirical models of organizational performance in the public sector.

Ancillary