Speed and Scope of Strategic Response to an Environmental Change: The Case of the United States Trucking Industry's Deregulation
Kim, Eonsoo
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https://hdl.handle.net/2142/72309
Description
Title
Speed and Scope of Strategic Response to an Environmental Change: The Case of the United States Trucking Industry's Deregulation
Author(s)
Kim, Eonsoo
Issue Date
1993
Doctoral Committee Chair(s)
Duhaime, Irene M.
Department of Study
Business Administration
Discipline
Business Adminstration
Degree Granting Institution
University of Illinois at Urbana-Champaign
Degree Name
Ph.D.
Degree Level
Dissertation
Keyword(s)
Business Administration, Management
Transportation
Abstract
This study empirically investigates strategic change in terms of how different organizations responded to the same, new environment. This study takes the mid-range approach between the two extremes of determinism and voluntarism views, accepting the influence of the external environment on organizations and yet believing in organizations' freedom and ability to cope with the changing environment.
A model is developed which incudes prior strategy and slack as the major--and controllable--factors and other factors such as size and age of organizations, prior performance, and change in top management. The model is used to test the influence of each factor on the dynamics between the inertial nature of organizations and the changing force caused by industry deregulation, resulting in different speed and scope of strategic change.
This study produced major findings about the relationship between dimensions of strategic change, the role of strategy, and the role of organizational slack. The results highlight the complexity of the strategic change concept and the slack concept. Though many firms were found to have used an unfocused strategy in the regulated environment, massive transition to a focused strategy by the sample firms after deregulation shows that a focused strategy is pursued by more firms in a competitive environment. Focused strategies were found to facilitate further strategic change, making faster and broader change possible. This study also found that slack can buffer organizations from the environment and provide sources of proactive change at the same time, an important finding because research on slack to date has focused on one or the other of two functions. In addition, this study's conformation that different types of slack can play different roles in strategic decisions making is also a significant finding. The final important finding is that speed and scope have distinctly different relationships with key strategic variables; this suggests that the effect of various factors on 'strategic change as a simple concept' may be misleading, unless different dimensions of strategic change are distinguished and specified.
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