How to perform strategic change? A strategy as practice perspective

• Published in: Chinese management studies 2020-06, Vol.14 (3), p.811-832
• Main Authors: Wei, Zelong, Zhang, Linqian
• Format: Article
• Language: English
• Subjects: Boundary conditions; Causality; Causation; Competitive advantage; Hypotheses; Learning; Middle management; Organizational learning; Planning; Regression analysis; Strategy; Uncertainty
• ISSN: 1750-614X; 1750-6158
• DOI: 10.1108/CMS-04-2019-0140

Purpose In spite of the significance of the strategic change, its high rate of failure inspires us to explore how to successfully enact new strategic change in a different environment. Based on strategy as practice perspective and effectuation theory, this study aims to extend extant literature by identifying two approaches performing strategic change (e.g. causation strategic change or effectuation strategic change) and investigating their effects on firm performance and also boundary conditions (e.g. market uncertainty or technological uncertainty). Design/methodology/approach Based on a data set from 238 firms in China, the authors empirically test the hypotheses through regression analysis. Findings The findings indicate that causation and effectuation strategic changes can promote firm performance. However, the roles of the two approaches vary with the external environment. Specifically, market uncertainty strengthens while technological uncertainty weakens the positive effect of causation strategic change. In contrast, technological uncertainty strengthens the positive effect of effectuation strategic change on firm performance. Originality/value This study extends research literature of strategic change by identifying causation and effectuation strategic changes and investigating how their roles vary with market uncertainty and technological uncertainty. The findings guide firms to adopt a fit approach to perform a strategic change in different external environments.