Original Research

Viewing ‘open strategy’ as a viable approach to the management of strategy

Geoff A. Goldman, Jonathan Kruger

Received: 21 May 2020; Accepted: 28 Oct. 2020; Published: 28 Jan. 2021

Copyright: © 2021. The Author(s). Licensee: AOSIS.
This is an Open Access article distributed under the terms of the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.

Abstract

Orientation: Sound strategic management is vital for the longevity and sustainability of organisations. Yet, strategy execution remains problematic, in part due to prolific changes in the business environment.

Research purpose: To explore the views of South African managers toward Open Strategy, to gauge whether managers will consider Open Strategy as viable strategic management approach.

Motivation for the study: As organisations grapple with the challenges of Fourth Industrial Revolution (4IR), it is apparent that conventional thinking on strategy is losing relevance. Alternative approaches to strategy are being explored that are better suited to the changing business environment.

Research design, approach and method: The study was conducted from an Interpretive perspective, employing a qualitative survey design. Semi-structured interviews were conducted with 12 middle and senior managers of South African companies. Data were analysed through thematic content analysis, employing Creswell’s four-stage process of qualitative data analysis.

Main findings: Five themes emerged, highlighting that conventional thinking on strategic management pervades. Research participants acknowledged that they were unaware of Open Strategy, although evidence suggested that elements of Open Strategy were present in their approaches to strategy formulation and execution. These were categorized into evidence relating to transparency, inclusivity and IT-enabledness.

Practical/managerial implications: From the findings of the study suggestions were provided on how South African organisations could pursue a greater degree of openness in their management of strategy.

Contribution/value-add: The study provides valuable insights in terms of opening up strategic practices to be more prepared for the challenges laid down by 4IR.

Keywords: inclusivity; open strategy; qualitative research; strategic management; transparency.

Introduction and background

Literature abounds with evidence that organisational longevity and sustainability stems from proper management of strategy, and thus strategy is imperative for organisational performance (Grant et al. 2011; Ramaseshan, Ishak & Kingshott 2013). Organisational performance measures include financial performance measures, market performance measures and shareholder returns. However, despite sound strategy formulation measures and solid plans for strategy implementation, strategic failure is highly probable, which is mainly because of the highly unpredictable nature of the environment the contemporary organisation operates within. As this environment becomes ever more volatile and unpredictable, changes that occur in this environment produce ‘wicked problems’, which are highly complex, and to which there is no singular or definite solution. This makes traditional approaches to management and in this instance, the management of strategy, are less effective and call for an alternative, more innovative and more pragmatic approaches. This study, therefore, seeks to explore an alternative approach to strategic management – namely open strategy (OS) – and seeks to uncover whether South African managers are willing to initiate such alternatives which can potentially yield more desirable results.

Despite the emphasis on strategy implementation as pivotal in the management of strategy, literature purports that strategy implementation seems to be the proverbial ‘Achilles’ heel’ of strategy, with unsuccessful strategy implementation rates as high as 90% in certain cases (Ceptureanu & Vlad 2017; Holowka 2015; Hosseini et al. 2016; Ivancic et al. 2017). Coupled with the aforementioned increase in volatility of the environment that organisations operate in, it is increasingly apparent that strategy needs to be more proactive, flexible and adaptive (Borkowski 2015; Ferell & Hartline 2014; Granados & Gupta 2013; Pittz & Adler 2016). Resultantly, the effectiveness of more conventional approaches to the management of strategy is questioned (Cingöz & Akdoğan 2013).

Over the past two decades, approaches such as Blue Ocean Strategy, Strategy-as-Practice (SAP) and OS have surfaced within the strategic management discourse to make strategy more relevant in an era of heightened uncertainty (Downs 2014; Marietto, Ribeiro & Ribeiro 2016). Of particular interest in this article is the concept of OS, which suggests a more open approach to strategy that values aspects such as transparency and inclusivity in the strategic management process of organisations (Whittington, Cailluet & Yakis-Douglas 2011). This provides an opportunity for more effective implementation of strategy through collective commitment and a better all-round understanding of stakeholder requirements (Gegenhuber & Dobusch 2017).

However, despite the emerging approaches to the management of strategy, as mentioned in the previous paragraph, entering the strategic management discourse, it would appear that in practice, conventional thinking about strategic management, and management in general, still pervades, utilising management principles that can be traced back to the ‘Classical’ School of management thought (Nadrifar, Bandani & Shahryari 2016; Nhema 2015). However, changes in the business environment have been such that it is apparent that management thinking – and this includes thinking about strategy – cannot rest on principles introduced in the ‘Classical Era’ of management thinking alone. These seem to be less relevant today than they have ever been, especially in terms of strategic management (Ganson 2013; Khashei & Ashofteh 2016). Furthermore, conventional approaches to strategy have been found to suffer from a lack of pragmatism and being too rigid and accordingly, their relevance is taken into question (Ganson 2013; He 2012).

Purpose of the study

Against the backdrop of the scenario outlined above, this study is positioned within the following problem statement: The tempo, scope and pervasiveness of change has laid bare the need for a change in the management of strategy, as conventional approaches to strategy are seemingly losing their relevance and are criticized mainly for their lack of flexibility. Alternative, emerging approaches to strategy, such as Open Strategy, which are seen as more flexible, adaptive, inclusive and transparent, have the potential to be of great value for the management of strategy. These emerging approaches could improve roll-out and implementation of strategic plans and initiatives.

Resultant from this problem statement, the primary objective of this study is: To explore the views of South African managers toward Open Strategy as an emergent approach to the management of strategy, with the eye on understanding the propensity of managers to explore Open Strategy as viable strategic management approach for South African organisations.

Many organisations spend valuable time on developing complex strategies that involve numerous tangible, intangible and human resources: resources that could be otherwise utilised to increase profitability and competitiveness. Despite this, numerous strategies fall short during implementation (Kalali et al. 2011). This study provides a potentially viable alternative to the situation highlighted above. Firstly, the value of emerging approaches to strategy, in this case OS, over more conventional approaches to strategy will be highlighted. Secondly, the challenge laid down by the fourth industrial revolution (4IR) necessitates a different view of and approach to strategy in order for organisations to remain relevant, sustainable and competitive. Emerging approaches to strategy, such as OS, could live up to the challenges laid down by the 4IR. Lastly, the findings of this study have the potential to put South African managers and business owners in a position to assess an organisation’s readiness and appetite for a more open strategic management approach that can strengthen its competitive position.

It must be noted that this particular article reports on findings that are part of a larger study concerning OS. The greater study aimed to explore the feasibility of OS in the South African context and was undertaken by the first author of this article as a Magister Commercii study, with the second author of this article being the supervisor.

Overview of relevant literature

The environment within which organisations operate is changing so rapidly, and with such intensity and pervasiveness, that it is fundamentally changing the way organisations approach and conduct business. It would therefore be logical to assume that the way strategy is approached and managed should reflect this. That is what this literature review aims to establish. However, in order to show this, it is necessary to firstly introduce emergent views on strategy, in this case OS, and juxtapose it to more ‘traditional’ views on strategy. Thereafter both OS and conventional thinking on strategy will be offset against the realities of the contemporary business environment in an effort to demonstrate that OS is suited to meet these challenges.

A brief introduction to open strategy

It would seem as though flexibility and pro-activeness have risen to prominence as important characteristics of approaches to the management of strategy in modern times (Grant et al. 2011). These approaches acknowledge that all stakeholders play a role in the management of strategy, are acutely aware of the impact the environment has on the functioning of the organisation, acknowledge that strategy is not only the domain of top management, and realise the importance of organisational learning (Ghofar & Islam 2015; Milakovich & Gordon 2013; Senge & Kleiner 2011).

Strategy-as-practice as an emergent strategy marks an important advance in thinking on strategic management (Golsorkhi et al. 2015; Marietto et al. 2016). Firstly advocated by Richard Wittington in 1996 (Downs 2014; Whittington 1996), SAP is remarkably different in that it focuses on the tools, workers and works of strategy (De La Ville & Mounoud 2015). Thus, strategy is derived from existing organisational practice, instead of the conventional outlook of deriving practice from pre-determined strategy.

Friis (2015) purports that conventional thinking about strategy discouraged competition by erecting barriers to competition, thereby entrenching the competitive position of an organisation. This implies a ‘closed’ outlook on strategy, where competitive information and the rationale behind strategic decision-making is the domain of top management only, and not shared with the stakeholders of the organisation. Although this worked well in the past, contemporary thinking calls for a more ‘open’ approach to strategy (Hautz, Seidl & Whittington 2017), where multiple stakeholders are involved in the strategy process. This more ‘open’ approach to strategy increases both the amount of and sources of information available to the organisation that can be used to base strategic decisions on (Van Haverbeke et al. 2016; Whittington et al. 2011). Furthermore, heightened volatility in the business environment has necessitated collaboration and cooperation between organisations in an effort to face this challenge, and to take advantage of competitive opportunities that arise (Luedicke et al. 2017; Morton et al. 2015; Morton, Wilison & Cooke 2016; Tavakoli, Schagwein & Schoder 2015). This is only possible where organisations have an outlook of openness (Tavakoli, Schagwein & Schoder 2017).

Emergent strategies such as SAP and OS reject the notion that strategy is the domain of top management only. The involvement of a variety of stakeholders, both internal and external, in the strategic management process implies that all these stakeholders become strategy practitioners, in one form or another (Friis 2015; Stander & Pretorius 2016; Vaara & Whittington 2012). Furthermore, emergent strategy approaches such as SAP and OS incorporate practices that have a broader societal and social reach and application (Hautz et al. 2017), thereby transforming the relationships and responsibilities of the organisation. The organisation thus becomes more of an ‘active citizen’ and reduces the distance that often exists between an organisation and society that surrounds it. Also, emergent strategies translate micro-level practice into macro-level plans (Hautz et al. 2017). By paying attention to daily practices and activities that have strategic significance, SAP, for example, urges top management to translate these into future strategic plans.

The concept of OS seemingly builds on the principles of SAP (Hutter, Nketia & Fuller 2017). Also referred to as ‘open-source strategy’, ‘democratising strategy’ and ‘SAP of thousands’ (Hutter et al. 2017), OS is defined as (Hautz et al. 2017):

… A dynamic bundle of practices that affords internal and external actors greater strategic transparency and/or inclusion, the balance and extent of which respond to evolving contingencies derived from both within and without organizational boundaries. (p. 2)

In its simplest form, OS provides for higher transparency and inclusivity of the different stakeholders of the organisation in the strategic management processes (Hautz et al. 2017; Yakis-Douglas et al. 2017). This implies not only an engagement between the organisation and its stakeholders but also between the stakeholders themselves, which enables the organisation to utilise some, if not all, of the aptitudes and capabilities of these stakeholders to pursue competitiveness (Malhotra, Majchrzak & Niemiec 2017).

As transparency and inclusivity are seen as two vital aspects of OS, it would be prudent to expound upon them briefly. Transparency relates to making the inner workings of the organisation visible to internal and external stakeholders, whereas inclusivity refers to the degree of consultation with stakeholders regarding decision-making processes (Hautz et al. 2017; Tavakoli et al. 2015). Thus, transparency allows for insight into processes and decisions, whereas inclusivity permits greater participation in the strategy process. Transparency manifests as, inter alia, access to annual results by external shareholders, information on the organisation being made available, insight into strategic practices and social media platforms (Gegenhuber & Dobusch 2017; Hautz et al. 2017; Mack & Szulanski 2017). Inclusivity, on the other hand, refers to efforts such as heightened engagement with stakeholders, involvement of all organisational levels in decision-making and an increased emphasis on ‘bottom-up’ strategic approaches (Appleyard & Chesbrough 2017; Gegenhuber & Dousch 2017; Malhotra et al. 2017).

Open strategy can potentially tap into a massive amount of data, pooled with technical expertise and specialised skills, thereby improving the substance of strategic initiatives (Hutter et al. 2017; Nketia 2016; Tavakoli et al. 2017). This pooling of data allows for the sourcing of creative, unique ideas through collaboration with multiple individuals and groupings (Hautz et al. 2017). This all-inclusive approach of OS creates a collective identity that participants feel comfortable with, and become attached and committed to. In turn, stakeholders’ understanding of the strategic decisions taken is facilitated, and stakeholders’ resistance to these decisions is diminished, which ultimately affects the implementation of strategy positively (Mack & Szulanski 2017; Tavakoli et al. 2017; Whittington et al. 2011). Open strategy also provides the organisation with an opportunity to create a strong, positive perception of itself in the eye of the general public, thereby bolstering the overall reputation of the organisation (Gegenhuber & Dobusch 2017)

However, OS is very resource intensive (Hautz et al. 2017; Tavakoli et al. 2017). Apart from investment into digital communication channels for engagement with stakeholders, OS requires constant interaction with a variety of key participants and groups, and it is therefore time and labour intensive as well. Furthermore, there is an opportunity cost inherent to OS, in that it can divert skills away from direct competitive initiatives at any given point in time (Hutter et al. 2017; Malhotra et al. 2017; Tavakoli et al. 2017). Furthermore, when communicating with large and diverse audiences, the speed of communication could actually reduce. This could result in a loss of control over the whole OS approach if there is too much reliance on external participants in the strategy process (Hutter et al. 2017). However, the biggest hindrance to OS is that the competitive position of the organisation gets compromised if the approach is too open (Appleyard & Chesbrough 2017; Whittington et al. 2011).

Open strategy as an improvement on conventional approaches to strategy

Open strategy, as an emergent strategy, can be seen as an improvement on conventional thinking about strategy. It is, firstly, more in tune with the environment within which it operates (Hutter et al. 2017; Whittington et al. 2011). Instead of merely observing the business environment and attempting to interpret and understand these observations, as is the case with more conventional approaches to strategy, OS necessitates organisations to be more in tune with their surrounding environments (Hautz et al. 2017; Hutter et al. 2017). By being more open and ‘giving’ more of itself to its stakeholders and ultimately to the business environment, it also receives a lot more from these stakeholders and the environment (Whittington et al. 2011). Therefore, instead of observing and analysing the business environment, an organisation pursuing OS is ‘in sync’ with its’ environment, almost as if it is a living extension of the environment.

Secondly, OS has the potential to yield higher implementation success than conventional approaches to strategy. Traditionally, strategy has been developed by top management, but the implementation and roll out of strategy has been seen as the responsibility of all levels of the organisation (Greer, Lusch & Hitt 2017). The disconnect here is obvious, and therefore buy-in to the strategy as well as constant and clear communication about the strategy are vital in roll-out and implementation of strategy, according to conventional views on strategy (Shimizu 2017). Unfortunately, this is overlooked by conventional approaches to strategy. By being more transparent and inclusive, OS overcomes the problem of implementation success associated with more ‘conventional’ approaches to strategy.

Robbins et al. (2015) posits that conventional approaches to strategy fail to include cross-functional relationships, resulting in poor communication across functional domains of the organisation. Open strategy, in contrast, encourages greater collaboration and draws in more people to the strategic management process (Hautz et al. 2017). This aids in aligning operations to strategy, as stakeholders are more likely to support strategies with which they have been involved with and understand. Also, conventional approaches to strategy rely on a top-down logic, which has been shown to result in a lack of commitment by internal stakeholders (Nieuwenhuizen 2019). Open strategy, in contrast, has the propensity to incite greater levels of commitment, because of its greater emphasis on inclusivity, which results in a greater feeling of ownership towards the strategies of the organisation (Hutter et al. 2017; Mack & Szulanski 2017; Tavakoli et al. 2017; Whittington et al. 2011).

One of the biggest failures of conventional thinking on strategy, and of management in general, is the inability of management to acknowledge that individuals are complex beings with aspirations and expertise (Sirdhar 2016). In so doing, the organisation has failed to utilise this resource to its fullest potential (Denhardt, Denhardt & Aristigueta 2012; Freedman 2013). Open strategy taps into this under-utilised source of information, thereby utilising a greater pool of collective wisdom for the development and execution of strategy (Gegenhuber & Dobusch 2017; Hautz et al. 2017; Nketia 2016; Whittington et al. 2011).

Strategy has traditionally been seen as the domain of top management, with the final responsibility lying with the CEO. As such, strategy is seen as a process based on exclusivity, entrusted to top management as the ‘elite few’ who act in secrecy, with little, if any information about strategy being shared with internal or external stakeholders (Baptista et al. 2017; Dobusch, Seidl & Werle, 2015; Heracleous, Gobwein & Beaudette 2017; Dobusch et al. 2015; Whittington et al. 2011). This creates a situation where top management is not very open to information and suggestions relating to strategy forthcoming from the diverse stakeholder groups of the organisation (Dobusch et al. 2015). In fact, conventional approaches to strategy view the management of strategy as a purely internal functionality (Whittington et al. 2011). Open strategy challenges this notion and welcomes the sharing and receipt of information, and encourages inputs and involvement from various stakeholder groups in the development and execution of strategy (Baptista et al. 2017; Morton et al. 2016; Pittz & Adler 2016; Tavakoli et al. 2017).

Apart from the dimensions of transparency and inclusivity, alluded to earlier, Tavakoli et al. (2015), suggest that a third dimension, information technology (IT)-enabledness, has risen to prominence, especially in the context of the vast technological proliferation brought about by 4IR. Conventional strategic management wisdom has viewed IT as a support function that assists the organisation in meeting its objectives. However, OS sees IT as an enabling function and cannot be successful without it (Tavakoli et al. 2015). Technology allows for mass participation in OS through social media platforms (Tavakoli et al. 2017). Social media thus becomes an integral part of strategy formulation and implementation (Morton et al. 2016).

Research methodology employed

This study adopted an interpretative paradigm, as the study set out to explore the views of South African managers towards OS to understand whether South African managers would be willing to explore OS as an alternate approach to the management of strategy in South Africa. Consequently, the study also adopted a qualitative research approach, as it is best suited to exploratory studies as well as studies aiming to understand the meanings ascribed to social phenomena (Creswell 2009). More specifically, this study pursued a qualitative survey design. As the study was interested in the views of South African middle and top-level managers concerning OS, this was deemed an appropriate design.

The research population for this study, as alluded to above, consisted of middle and top-level managers of South African companies. The reason for selecting only these levels of the management corps is that individuals on these levels are actively involved in both the crafting ad implementation of strategy; thus they have experience of being involved in the strategic processes of the organisation. Their position on the organisational hierarchy provides lived experience and understanding of strategy, which is invaluable to the study. The research participants were selected on a purposive basis from the professional network of the first author of this article. As the first author is a general manager of a South African electronic security company based in Johannesburg, he has exposure to a network of individuals who occupy middle and top-level management positions in various industries. Drawing research participants from his professional network had the added advantage that the research participants were familiar with the first author, which facilitated conversation on the topic under investigation. However, familiarity with participants can lead to not reporting negative sentiment towards the participant (Bernard 1994), which should be guarded against. A sample of 12 research participants was selected from seven industries, ranging from banking and insurance to security and real estate. However, the number of research participants was not fixed, and more research participants could have been selected if data saturation had not been reached by the 12th interview.

Data collection comprised of semi-structured interviews, where the data were captured by means of audio recording and note taking. Note taking accommodated non-verbal responses as well as the researcher’s thoughts during interviews (Fox & Bayat 2007). Qualitative content analysis, specifically Thematic Content Analysis, was the technique employed to analyse the collected data. In this regard, Creswell’s four-stage process of qualitative data analysis guided the analytical process (Creswell 2009):

Step 1. Organise and prepare data: All recordings were transcribed.

Step 2. Peruse through the data to gain an overall understanding of the views expressed and to develop themes based on these views.

Step 3. Begin a detailed analysis with a coding process: Here, the emphasis is on describing, classifying and interpreting. This is the start of the coding process, entailing:

• Reading the transcripts, noting the topics forthcoming
• Compiling a list of all topics. Similar topics were grouped together, resulting in common, unique and leftover topics
• Descriptive words from transcripts were identified for each topic, turning them into categories. Categories were also reduced by regrouping and merging topics that related to one other.

Step 4. Use a coding process to generate descriptions: This involves displaying generated data, based on the themes appearing as major findings of the qualitative survey. This means interpreting what the data uncovered, as well as what literature purports on the issue. Coding entailed careful inspection of the data with the goal of breaking down the data into units of meaning (or categories) (Burden 2006), thus examining the data and ascribing labels that constitute categories to concepts as they present themselves in the data (Babbie & Mouton 2004).

Finding and ensuring discussion

For this study, the analytical process revealed five main themes, which will be discussed in turn. In the interest of brevity, only a small number of supportive excerpts from interviews are presented. More evidence is available upon request from the authors.

Theme 1 – Current strategy practices

When briefed as to what OS was, and then probed as to whether they thought it was a relevant approach to strategy, research participants tended to juxtapose OS to more ‘traditional’ approaches to strategy. In fact, the greater majority of research participants were familiar with either the term ‘conventional approach to strategy’ or the practices associated with it, which is indicative of the pervasiveness thereof. Adversely, the fact that all research participants needed to be briefed as to what OS was, suggests that more emergent views of strategy are unknown, or at best known by very few people, in practice. This strongly suggests that, as far as the management of strategy is concerned, people merely ‘follow in the footsteps of others’ rather than being exposed to new, emergent views about strategy. As a result, strategic management practices remain inflexible, with little innovation or rejuvenation injected into these processes over time. Organisations therefore tend to be left with strategic management practices that are not only outdated but are also left with a bastardised approach to strategy, based mainly on what predecessors believed to be correct.

More traditional approaches were seen as being dated, inflexible and struggling to find relevance in the contemporary era, as an increase in technological innovation had resulted in a need for organisations to be more flexible. Research participants even referred to more traditional approaches to strategy (or at least the way it was applied in that specific context) as ‘dictatorial’, limiting input from various levels of the organisation in the strategic process, and thereby disregarding valuable input that could accrue from across the organisation. In summarising, the research participants voiced seven issues relating to more conventional strategic management approaches:

• It is an outdated, antiquated way of thinking
• It was successful in the past, but currently losing relevance
• It is inflexible to rapid and volatile change
• It is controlled by top management
• It lacks input from multiple stakeholders
• It inhibits competitiveness
• It is still the dominant approach.

These excerpts from interviews corroborate the views presented:

‘The world is changing too quickly to rely on traditional strategy. It’s impossible to compete with traditional as it is too slow. We are 7 Directors and there are mixed opinions. Older execs are generally more rigid/traditional as well. Also, we can’t get away from traditional strategic templates required from the parent company (listed company) so its required.’ (Participant 2)

‘For myself, the realisation came many years ago that a strategy on a wall means absolutely nothing unless you can walk up to the call centre agent and they can tell you what the strategy is of the company. So, it didn’t necessarily have a name, but I understood the concept. I am two-minded about it. Somebody needs to be the boss. Somebody needs to set the vision. As long as within that, you allow for collaboration and input, then it’s fine. But, you know, there needs to be an “I” that drives it. So, it’s not all bad that strategy is driven top-down, but I think the tools and mechanisms that are put in place for the people at the lower levels is critical.’ (Participant 7)

‘I don’t think it allows the business to grow. I think that the people who are on the lower levels don’t get the opportunity to give input to management in this approach. I don’t believe that a company is solely determined by a single group of people at the top. With the technological environment as it is, a company needs all the input it can get and cannot just rely on a few people.’ (Participant 9)

From the views forthcoming from research participants, it would seem as though, although it has worked in the past, conventional approaches to strategy simply are not relevant anymore, a sentiment echoed by Friis (2015). Furthermore, Ganson (2013) as well as Zaremba (2010) purport that conventional approaches to strategy seem to fall short under conditions of heightened complexity that require flexibility. The business environment that has manifested itself in the 4IR, typified by technological proliferation, heightened complexity and far-reaching change, has proven to be unnavigable with conventional thinking about strategy (Ivancic et al. 2017). Despite a groundswell of evidence and opinion, conventional approaches to strategy still pervade and remain the dominant approach to the management of strategy. Nonetheless, it would seem as though there is a realisation that thinking about strategy and the management thereof needs to change as organisations grapple with the realities posed by 4IR.

Theme 2 – Knowledge and awareness of open strategy

On being briefed about OS, very few research participants indicated knowing the term or having knowledge about it. This was anticipated, as OS is an emergent approach and has not been around for a long time. Some research participants, however, did indicate that the approach to strategic management followed at their organisations contained some of the elements mentioned in the brief on OS. This was especially evident amongst research participants from smaller and younger organisations.

Research participants generally considered OS to be more suited to the contemporary business environment. Without exception, research participants felt that OS represented a fresh and welcome alternative to the current strategic management approaches followed in South African companies, as it welcomed engagement with multiple stakeholders and encouraged ideas from all organisational levels, which could be used in the management of strategy. Furthermore, research participants also opined that OS seemed as though it was a more flexible approach that could respond to environmental challenges quicker and that potentially it could yield more successfully implemented strategies than conventional approaches.

The quotations from the interviews below serve to back-up these claims:

‘Having dealt with the strategic forum I am a part of, I’ve been made aware of OS through the consultants we have employed. The new approach will make the organisation more successful in the next year or year and a half. I think OS is listening to more people around the table and using that info. The strategic forum is driving “opening up” of the (organisation) strategy.’ (Participant 5)

‘Yes, I have actually heard of this term from a colleague in the marketing department. Although I don’t know the exact details. From you have explained, I love it. I think it works well with modern times. here you are able to rely on all of the resources out there to be able to make better decisions. I think that so many people would be happier if they are able to voice their opinion and actually have what they say used in a company. People will be more engaged. There are some smart people out there, they just don’t always have the platform to get their ideas across.’ (Participant 8)

‘Don’t know it, but I like the concept, it gives the business the opportunity to consider things that we might not have considered before. I think it can allow us to get fresh ideas from the guys on the ground. In the right forum, this could be very useful IF the information can be filtered in the correct way. Otherwise I think it can result in a huge timewasting exercise.’ (Participant 9)

Dobusch et al. (2015) suggest that organisations are becoming more ‘open’ with their strategies and approaches to strategic management, thereby sharing more information with stakeholders and involving them in the strategic management process. This openness has also witnessed a marked shift away from a strict top-down approach to a strategy that is more participatory and inclusive, embracing a bottom-up approach (Morton et al. 2015). The opinions of the research participants clearly indicate that such elements are being interwoven into their current strategic practices, thus mirroring these sentiments. This is also indicative of a distinct search for a more relevant and comprehensive approach to the management of strategy amidst the 4IR.

Theme 3 – Transparency of South African organisations

Evidence of transparency within South African organisations can provide meaningful insights as to how susceptible South African organisations are towards OS. From the interviews, it is apparent that larger organisations were more transparent in terms of financial reporting, as this is a legal requirement in South Africa. However, smaller organisations did not share their financial information with external stakeholders. It is evident that the sharing of financial information was not voluntary, but rather an act of legal compliance. The term ‘transparency’ was not considered as a way to build trust, nor was it identified as a contributing factor to the culture of the organisation, but was rather seen as something related to legal and regulatory compliance.

Research participants from smaller organisations indicated that they were more actively sharing their strategy with both internal and external stakeholders. One research participant stated that not only were they actively sharing their strategy externally but also they were not concerned with competitors replicating their strategy, stating that even if competitors had replicated their strategy, the execution thereof was the key and that their competitors would most likely fail in that aspect, thereby negating the threat. However, research participants in larger organisations believed that sharing too much information may either result in stealing proprietary information or a misinterpretation of the information by external stakeholders. Research participants from larger organisations also indicated that often the strategy was internally transparent, but that externally, very little is shared, apart from high-level strategy information found in annual reports and company websites.

Thus, the data indicate that smaller organisations tend to be more transparent than larger ones. However, larger organisations are slowly becoming more transparent internally. However, secrecy surrounding strategy still persists and is more prevalent in larger organisations. It would therefore seem as though larger organisations are more ‘traditional’ in their approach to strategic management than smaller organisations are.

The extracts below from the interviews confirm these findings:

‘Financials are not shared outside of the company. Financials are shared internally in terms of turnover, margins etc. Both internal and external stakeholders are aware of the strategic direction for the business/products. Strategy is shared with customers to show what we have to offer and how it will benefit them. Customer can then also tell us if they are not happy with this.’ (Participant 4)

‘We are very transparent with everyone in our business. We show everyone our strategy, how we got to it and how we believe it will address our challenges. We do a slide show and strategy meeting to do this. We share our financials with everyone in the business as well. We do share our strategy with our clients to keep our clients in the loop regarding our product/service developments however not on a financial level. We also share our strategy with our business partners who implement our products.’ (Participant 8)

‘Financials, high level transparency. Strategy, very transparent. I believe that just because my competitor finds out what our strategy is, the key is in execution. So, they can try to execute the way I do, but I know that they won’t just get it right. Besides, every business works differently, so if they try the same thing, it might not even work. Again, our team knows the strategy well. We don’t hold back anything here. We want everyone to know where we are going and how we are going to get there. We want buy in, buy in, buy in!’ (Participant 10)

These findings seem to be supported in the literature, as Zaremba (2010) purports that conventional strategic management practices exhibit a lack of transparency and restrict information sharing. According to Mack and Szulanski (2017), the intentional lack of transparency in centralised organisations may be an effort by top management to retain and entrench their positions of power. However, such an outlook is counter-productive, as the benefits of transparency far outweigh the lack thereof. Transparency is also viewed favourably by the greater public, thereby enabling the organisation to build a favourable and positive reputation (Hautz et al. 2017).

Theme 4 – Inclusivity

The degree of inclusivity exhibited by organisations is also indicative of how well suited they are to be susceptible to emergent strategic management practices such as OS. Research participants from both smaller and larger organisations indicated levels of inclusivity especially for external stakeholders. However, more inclusivity was exhibited by smaller organisations than by larger ones. Although large organisations do see the need to be more inclusive, it would seem as though they are grappling with the practical mechanics of being more inclusive. All research participants indicated that by engaging external stakeholders, valuable information would be forthcoming that can be used to make meaningful adjustments in current and future strategies, thereby increasing the likelihood of successful roll-out of strategy.

The extracts below support the claims presented:

‘Around 20% of comments by internal and external stakeholders are used as input to form the strategy. Workshops are used for the 20%. We then decide what will/will not be used.’ (Participant 3)

‘We are very inclusive internally as I said before that we really try to take everyone’s valuable opinions and use them where we can. We also get input from our business partners as they work very intimately with our product and therefore know what changes need to be made to remain competitive. We are also very inclusive with our clients as their comments aid us in adjusting our strategy and moving forward in a direction that would benefit them and ultimately us.’ (Participant 8)

‘As I’ve said before, we aren’t really inclusive in that way, but we are trying to include our staff more going forward as well as engage with the consumers and suppliers to get feedback on what we can adjust and do differently. At the end of the day, at our level, we are there because we know what it takes to run a business and that will always be the foundation, but there is a drive to change this perspective and involve people more in our decisions.’ (Participant 9)

From these findings, it can be deduced that inclusivity brings diversity along with it. The more stakeholders one includes, the more diverse the composition of the pool from which ideas and inputs are generated from. This could prove invaluable in terms of organisational flexibility, where diversity of inputs and views could prepare organisations better for environmental challenges. Inclusivity also breeds a more committed workforce who, in turn, will be more likely to provide valuable inputs which can be absorbed into the strategic practices of the organisation. The findings of the study seem to echo the sentiments in the literature that stakeholder inputs could lead to more unique ideas, participation, commitment, teamwork and the ability to garner a positive outlook by external stakeholders (Gegenhuber & Dobusch 2017; Hautz et al. 2017).

Theme 5 – IT-Enabledness of South African organisations

For organisations to employ a more open approach to strategic management, IT-enabledness is pivotal to ensuring that the organisation remains agile and able to communicate with all its stakeholders. As alluded to, IT-enabledness can also be seen as an indicator of the susceptibility of organisations to adopt more emergent strategic management approaches. Research participants were unanimous that IT infrastructure is a key component in the successful operation of their organisations. Furthermore, all research participants stated that they actively used technology for communication within the organisation and that various technologies were used for this, ranging from standard e-mail to cloud-based software and customer relationship management (CRM) software. Most of the research respondents also indicated that increasingly, the potential of IT, and especially social media, is being explored to communicate and engage with external stakeholders.

The following extracts from the interviews conducted corroborate the claims presented:

‘We use cloud software for sharing of ideas. Campaigns are published on the cloud software and all stakeholders can comment and give input into this. Collaboration is fostered through the cloud software. We use Facebook, emails and cell phones to communicate with the community through surveys. We are very reliant on digital communication. No above the line billboards are used or anything, without digital, we will fail. When we experience IT problems, we take heavy strain.’ (Participant 2)

‘(Organisation) is very integrated. The guys have figured out very early that nothing can be accomplished without the 2 components of HR (change management) and providing the tools for that change. So, without it, you cannot implement the strategy. (Organisation) is a very innovative (organisation). There is nothing you can do to move forward without IT by your side. Digitisation is at the core of (organisation’s) strategy. Intranet, emails, remote-connectivity software including verification to allow for secured off site working. Many more that I cannot think of right now. (Organisation) is ahead of the game in this area. New entrants will struggle to compete with us here.’ (Participant 5)

‘We are very IT-enabled. Our IT team is very qualified and capable. They work with the technical team as well in order to get feedback to constantly build and test their systems. We use CRM mainly which allows for communication in the business over and above emails as this could be tracked. We also use this as a knowledge base where people can list ideas and view other ideas that can then be reviewed by ourselves. We use social media quite a lot in order to reach more customers and gain their input as well as share our developments and strategy. We use social media quite a lot in order to reach more customers and gain their input as well as share our developments and strategy. We also have an intranet where we share information throughout the business quite proactively. This is especially useful for ongoing strategy updates and getting input from our staff.’ (Participant 8)

Literature purports that OS relies on IT as an enabler for its success (Tavakoli et al. 2015). Therefore, investment in IT infrastructure is essential (Morton et al. 2015). The findings of this study have shown that all organisations represented in the study do invest heavily in IT infrastructure and are continually exploring the capabilities of new IT applications. This shows that organisations are IT-enabled, albeit that they are currently still applying technology more for purposes of operational efficiency.

Recommendations and managerial implications

Although organisations still cling to conventional wisdom where strategic management is concerned, there is some evidence in this study that elements of more emergent approaches to strategic management, such as OS, have found their way into the strategy practices of some South African companies. This study has indicated that more emergent approaches to strategy, such as OS, are better suited to address the challenges presented by a 4IR world than more conventional approaches to strategy are. Thus, it is recommended that organisations start laying the foundation for more openness in their approach to strategy. From the findings of the study, it is evident that investment in IT is essential to enable greater openness of strategy. On the back of this investment in IT, management can lay the foundation for transparency and inclusivity through the encouragement of the following initiatives:

• Blogging: Sharing of general strategic information, gathering opinions through engaging stakeholders and including them in decision-making processes.
• Jamming: Host online collaborative events, allowing a defined group of participants to engage through posting ideas, discussion and voting on ideas that are most applicable to particular issues.
• Strategy presentations: Visually present the strategy and related aspects to a wide range of stakeholders.
• Crowdsourcing: Consulting with many individuals from the different stakeholder groupings, thereby tapping into a large pool of ideas, information and experience to base decisions on.
• E-mail and e-mail lists: Share strategy related information as well as request internal and external input via email to problems identified in the strategic management process.
• Employee listening programmes: Record the issues and concerns of employees in order to find solutions.
• Idea contests and competition platforms: Reward stakeholders for solutions or productive ideas.
• Online surveys: Analyse the sentiments of stakeholders, and identify trends through online surveys which can be fed back into the strategic forum.
• Social Media Platforms: Utilise social media to gather rich data for strategy creation and implementation whilst engaging with stakeholders. This also allows for monitoring current market trends which can be acted upon in future.

More openness in the management of strategy will contribute to the flexibility required of the modern organisation. Additionally, internal and external stakeholders could act as control mechanisms for the organisational strategy, by constantly providing feedback for management to act upon, ultimately enabling the organisation to remain competitive through more successful strategy implementation.

Avenues for future research

This study was limited in terms of the industries involved in the study, as research participants emanated from the electronic security industry. Therefore, expanding the study to other industries could reveal more insights as to the viability of OS as a meaningful approach to strategy in South African companies. It could also be beneficial to embark on an inquiry into specific OS activities to determine the effectiveness thereof in the overall strategic management process. This could reveal which activities have the greatest strategic impact whilst also reducing unnecessary expenditure. Lastly, as OS is still very much under-explored, future research could help bridge the existing gap between theory and practice on OS.

Concluding remarks

This study set out to determine whether OS could be a viable alternative to more conventional approaches to strategic management in South Africa. Not only does OS seem to be a viable alternative, it also seems as though certain elements of OS are being used, although unknowingly, in South African organisations. The onset of 4IR has made it abundantly clear that change is literally the only constant, and therefore organisations need to ensure that they remain flexible enough to adapt to this change. It is now, more than ever, blatantly evident that conventional thinking around strategy is not geared for a 4IR world. In this regard, Bob Dylan’s words are very fitting:

‘If your time to you is worth savin

And you better start swimmin

Or you’ll sink like a stone

For the times they are a-changin.’

Acknowledgements

The authors have declared that no competing interests exist.

All authors contributed equally to this work.

This study is part of a larger ‘Master’s degree research project. Ethical clearance for the study was obtained from the University of Johannesburg (ethical clearance code: 2019BM91). Furthermore, research participants were assured that the data would be treated with the necessary sensitivity and responses would remain anonymous.

This research received no specific grant from any funding agency in the public, commercial or not-for-profit sectors.

The data that were gathered for this study are available, upon request, from the authors.

The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of any affiliated agency of the authors.

References