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Bjom12038_Relationships Between Design Characteristics and Outcomes of Strategy Workshops

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  Off to Plan or Out to Lunch? Relationshipsbetween Design Characteristics andOutcomes of Strategy Workshops* Mark P. Healey, Gerard P. Hodgkinson, 1 Richard Whittington 2 andGerry Johnson 3 Manchester Business School, University of Manchester, Manchester M13 9QH, UK,  1 Warwick BusinessSchool, University of Warwick, Coventry CV4 7AL, UK,  2 Saïd Business School, Park End Street,Oxford OX1 1HP, UK, and  3 Lancaster University Management School, Lancaster University,Lancaster LA1 4YX, UKEmail: mark.healey@mbs.ac.uk Strategy workshops, also known as away days, strategy retreats and strategic ‘off-sites’,have become widespread in organizations. However, there is a shortage of theory andevidence concerning the outcomes of these events and the factors that contribute to theireffectiveness. Adopting a design science approach, in this paper we propose and test amultidimensional model that differentiates the effects of strategy workshops in terms of organizational, interpersonal and cognitive outcomes. Analysing survey data on over 650workshops, we demonstrate that varying combinations of four basic design characteris-tics – clarity of goals and purpose, routinization, stakeholder involvement and cognitiveeffort – predict differentially these three distinct types of outcomes. Calling into questionconventional wisdom on the design of workshops, we discuss the implications of ourfindings for integrating further the strategy process, strategy-as-practice and strategiccognition literatures, to enrich understanding of the factors that shape the nature andinfluence of contemporary strategic planning activities more generally. Introduction Strategy workshops – also known as strategyaway-days, strategy retreats and strategic ‘off-sites’ – are a common practice in organizations. Inthe UK, nearly four out of five organizations useworkshops for strategizing (Hodgkinson  et al  .,2006) and they are part of the executive calendarin both the USA (Frisch and Chandler, 2006) andmainland Europe (Mezias, Grinyer and Guth,2001). Carrying high expectations for influencingstrategy formulation and implementation, theyrepresent significant resource investments.In response to calls to reinvigorate research intothe activities and practices of contemporary strat-egy making of all forms (Jarzabkowski, 2003;Jarzabkowski and Balogun, 2009; Johnson, Melin Earlier versions of this paper were presented at the 2010Annual Meeting of the Academy of Management (Mon-treal, Canada) and the 2008 Strategy, Practices andOrganizations Strategy-as-Practice Symposium (AstonBusiness School, Aston, UK). We gratefully acknowl-edge the financial support of the UK ESRC/EPSRCAdvanced Institute of Management Research, undergrant numbers RES-331-25-0028 (Hodgkinson) andRES-331-25-0015 (Johnson), and the Millman ResearchFund (Whittington). We are also grateful to the Char-tered Management Institute for their assistance with thedata collection.*A free Video Abstract to accompany this article is avail-able at: http://onlinelibrary.wiley.com/journal/10.1111/(ISSN)1467-8551.Correction Note: This article was first published onlineon the 9th of September 2013, under a subscription pub-lication licence. The article has since been made Online-Open, and the copyright line and licence statement wastherefore updated in June 2014. bs_bs_banner British Journal of Management, Vol. ãã, ãã–ãã (2013) DOI: 10.1111/1467-8551.12038 © 2013 The Authors. British Journal of Management published by John Wiley & Sons Ltd on behalf of BritishAcademy of Management. Published by John Wiley & Sons Ltd, 9600 Garsington Road, Oxford OX4 2DQ, UK and350 Main Street, Malden, MA, 02148, USA.This is an open access article under the terms of the Creative Commons Attribution License, which permits use,distribution and reproduction in any medium, provided the srcinal work is properly cited.  and Whittington, 2003; Johnson  et al  ., 2007;Whittington, 1996), workshops are receivingincreased attention from management scholars(Jarratt and Stiles, 2010; Jarzabkowski and Spee,2009; Jarzabkowski, Balogun and Seidl, 2007;Johnson  et al  ., 2010; MacIntosh, MacLean andSeidl, 2010; Whittington  et al  ., 2006). Descriptivedata show that workshops are seen as integral tothe strategic planning process, are largely the pre-serve of top-level managers and are undertakenfor various purposes, from creating space toreflect on current strategies to stimulating debatesabout the future and tackling organizationaldevelopment needs (Hodgkinson  et al  ., 2006).From a theoretical standpoint, workshops areof particular interest because they represent animportant type of ‘strategic episode’ (Hendry andSeidl, 2003). That is, these events provide a rareopportunity to suspend normal structures toreflect on current policies and engage in new stra-tegic conversations. Currently, however, there islittle systematic theory or evidence linking thestructure and conduct of workshops to their effec-tiveness. Accordingly, in this paper we examinethe critical success factors associated with work-shops, introducing a design-based theory of strat-egy workshop effectiveness to understand betterhow these events impact upon organizations. Inso doing, we address three issues in the growingliterature on workshops as a key type of strategicepisode.First, the few empirical studies of workshopspublished to date have tended to use small-scale,case-based methods (Bowman, 1995; MacIntosh,MacLean and Seidl, 2010; Mezias, Grinyer andGuth, 2001; Whittington  et al  ., 2006). Forinstance, Hodgkinson and Wright’s (2002) caseanalysis of scenario planning practices centred ona single workshop-based intervention. Similarly,Johnson  et al  .’s (2010) study of workshops asritual was based on cases in just four organiza-tions. As Huff, Neyer and Moslein (2010) haveobserved of research on strategy practices ingeneral, a heavy reliance on small-scale, ethno-graphic methods has produced a somewhatnarrow evidence base. These authors suggestedanalysing larger data sets to widen the breadth of information on strategy practices and increase thegeneralizability of findings. Heeding this advice,we report results from a large-scale field survey of over 650 workshops conducted across a range of settings.Second, studies of workshops to date construethe outcomes of these events in a largely undif-ferentiated manner, evaluating effectiveness interms of the event’s contribution to strategic con-tinuity and/or strategic change (Jarzabkowski,2003; Whittington  et al  ., 2006). Although suchorganizational-level outcomes are an importantpart of the effects of workshops, they do not tellthe whole story. In this paper, we extend strategyprocess research (Grant, 2003; Ketokivi andCastaner, 2004; Mintzberg, 1994) to suggest thatthe benefits of workshops also lie in people-related or interpersonal outcomes. Additionally,we posit that there is an important cognitivedimension to workshop outcomes, given the roleof intervention techniques in enhancing strategicthinking (Bowman, 1995; Grinyer, 2000;Hodgkinson and Healey, 2008). Hence, we offer amore nuanced view of the impact of workshops bydistinguishing theoretically and empiricallybetween three distinct types of outcome  −  organi-zational, interpersonal and cognitive.Third, the extant literature considers only anarrow range of factors that influence workshopeffectiveness, often restricted to the behaviours of facilitators or influential individuals (Hodgkinsonand Wright, 2002; Whittington  et al  ., 2006). Hith-erto, no study has examined comprehensivelyhow basic design features relate to workshop out-comes, although there have been calls for suchwork (Hendry and Seidl, 2003; Jarzabkowski andSpee, 2009). Studies that have looked explicitly atdesign issues have focused on a limited set of fea-tures (Johnson  et al  ., 2010; MacIntosh, MacLeanand Seidl, 2010). Extending this line of inquiry, weadopt a design science approach to develop andtest a series of hypotheses that link systematicallya range of workshop design characteristics (e.g.the extent of preparation, the variety of stake-holders involved, the analytical tools adopted) tothe various outcomes alluded to above.Although design characteristics influence theeffectiveness of all workgroup practices, includingthose in the upper echelons of organizations(Cohen and Bailey, 1997), the embryonic litera-ture on workshops (and indeed strategic episodesmore generally) provides little detailed guidanceon which design features are important or howthey are important. Accordingly, we turn tovarious additional literatures to posit multiplegenerative mechanisms that contribute to work-shop (in)effectiveness.2  M. P. Healey  et al. © 2013 The Authors. British Journal of Management published by John Wiley & Sons Ltd on behalf of BritishAcademy of Management  In design science research, it is appropriate anddesirable to draw on a range of theories to gener-ate and test hypotheses that substantiate designprinciples (van Aken, 2004, 2005; Hodgkinsonand Healey, 2008; Hodgkinson and Starkey, 2011,2012; Pandza and Thorpe, 2010). Groundingdesign propositions in generative mechanismsunderpinned by robust social science theoryincreases their efficacy (Dunbar and Starbuck,2006; Romme and Endenburg, 2006; Simon,1969). Based on this logic, we ground our hypoth-eses in various bodies of theory, from work moti-vation and ritual theory to managerial andorganizational cognition.Adopting a design approach enables us tospeak directly to outstanding questions posed byHendry and Seidl’s (2003, p. 194) social systemstheory concerning the effectiveness of a given stra-tegic episode, such as ‘who should participate . . .whether or by whom it should be facilitated, orwhat provision should be made in advance foraddressing its outcomes’. Given the limitedcurrent evidence base, identifying the design char-acteristics that yield positive outcomes (e.g.changes to the business plan, enhanced interper-sonal relations, improved strategic understand-ing) and mitigate negative ones (e.g. interpersonalconflict, strategic inertia) should provide firmerfoundations for future design activity (cf.Christensen, 1997; Frisch and Chandler, 2006).Figure 1 provides a visual representation of ourhypotheses linking various design characteristicsto workshop outcomes; next, we explain our con-ceptualization of outcomes before presenting thearguments underpinning the hypotheses. Conceptualizing the outcomes of strategy workshops Workshops are often criticized because of a basicconfusion about what these events are tryingto achieve (Johnson  et al  ., 2010; MacIntosh,MacLean and Seidl, 2010). In this section, weposit that workshop outcomes fall into the threetypes enumerated above. We derive this three-foldclassification from a conceptual analysis of theliterature on workshops and related strategic epi-sodes, supplementing this where necessary withinsights from strategy process and strategic cog-nition research. Organizational outcomes We define organizational outcomes as the impactof workshops on the organization’s strategicdirection, including its vision, values, espousedstrategy, business plan and attendant businessprocesses. Hence, in this context organizationaloutcomes concern actual changes to the organiza-tion and its direction that are distinct fromfinancial performance outcomes. This definitionfits with evidence that workshops and relatedpractices can either bolster strategic continuityor, alternatively, stimulate strategic change(Jarzabkowski, 2003; Whittington  et al  ., 2006).Indeed, attaining such ends is the espousedpurpose of many workshops (Johnson  et al  .,2010). For example, Lorsch and Clark (2008)observed how board retreats at Philips Electron-ics helped directors decide to forgo their dwin-dling position in the semiconductor market andconcentrate on the growing health technologymarket. Other accounts suggest that outcomes of this magnitude are exceptional; many off-sitesleave little lasting impression on the organization(Bourque and Johnson, 2008; Frisch andChandler, 2006; Mintzberg, 1994).Anecdotal evidence suggests that where work-shops do influence firms’ strategic direction this isbecause the formal event provides a rare forumfor examining and changing strategy content – forexample, refining the organization’s goals ormission, adjusting its strategic plan or communi-cating a new vision (Campbell, Liteman andSugar, 2003; Fahey and Christensen, 1986; Ready Figure 1. Theorized model of strategy workshop design charac-teristics and outcomes Design Characteristics and Outcomes of Strategy Workshops  3 © 2013 The Authors. British Journal of Management published by John Wiley & Sons Ltd on behalf of BritishAcademy of Management  and Conger, 2008). Returning to the Philipsexample, it was ‘open and frank discussions’ con-cerning the ‘long-term logic’ of the business thatstimulated the decision to switch strategic focus(Lorsch and Clark, 2008, p. 110). At other times,the aim is to bolster commitment to the status quoor maintain an existing imperative. For example,Whittington and colleagues (2006) observed howthe chief executive of a large charity used work-shops to bolster support for her plan to centralizecontrol. Although workshops may fail to influ-ence wider organizational strategizing, the extentto which they  do  exert such influence, as reflectedin noticeable impact on strategy content, is thus akey indicator of effectiveness. Interpersonal outcomes Strategy workshops are often instigated withpeople-related outcomes in mind, such asteam-building and organizational development(Campbell, Liteman and Sugar, 2003; Frisch andChandler, 2006; Hodgkinson  et al  ., 2006). Hence,our second indicator of workshop effectivenessconcerns the interpersonal outcomes obtained,which we define as potential impact on relationsamong key actors. We maintain that workshopscan exert a direct impact on relations among thoseexecutives, managers and employees involved inthe formal proceedings.First, bringing together individuals to collabo-rate on common issues facilitates interpersonalcontact, building a shared sense of purpose andidentity that fosters cohesion (Anson, Bostromand Wynne, 1995; Hodgkinson and Healey, 2008;HoggandTerry,2000);conversely,managersmaysuffer disengagement if a workshop brings to lightirreconcilable differences within the executiveteam (Hodgkinson and Wright, 2002).Second, involvement in planning can instil ashared feeling of organizational appreciation(Ketokivi and Castaner, 2004), which fostersbehavioural integration (see also Kim andMauborgne, 1993; Wooldridge, Schmid andFloyd, 2008). From both a processual(Hutzschenreuter and Kleindienst, 2006) andstrategy-as-practice (Johnson  et al  . 2010) perspec-tive,thebenefitsofplanningresideasmuchinsuch‘soft’ outcomes as in performance-focused out-comes. Highly ritualized workshops, in particular,promote ‘communitas’ or group bonding, at leastwithin the workshop event (Johnson  et al  ., 2010). Cognitive outcomes The third type of workshop outcome we identifyconcerns the potential impact on participants’understanding of strategic issues, which we termcognitive outcomes. This includes understandingof the organization’s strategic position and direc-tion, the strategic issues it faces, and the widerbusiness environment.Workshops are commonly viewed as a way of taking decision makers beyond their day-to-dayconcerns to participate in higher-level debates, thegoal being to stimulate creativity and enhance‘blue skies’ thinking (Hodgkinson and Healey,2008; Hodgkinson  et al  ., 2006). According toBowman (1995, p. 6), the goal of many workshopsis to ‘surface the intuitive core of beliefs which isframing and constraining strategic debate’. Simi-larly, Grinyer (2000) outlines how firms use work-shops to reveal and challenge top managers’implicit assumptions – embedded in schemas,dominant logics and other knowledge structures – thereby overcoming cognitive inertia, the over-reliance on outmoded mental models of thefirm’s strategic situation (Barr, Stimpert andHuff, 1992; Hodgkinson and Wright, 2002).Through formal analysis, externalization andinformation exchange workshops can help refineparticipants’ understanding of key strategic issuessuch as who the organization’s competitors are,how products and services are contributing tocompetitiveness, and the robustness of futureplans to industry prospects (Frisch and Chandler,2006; van der Heijden, 1996).Although it is plausible that cognitive andorganizational outcomes are related, we assumehere that they constitute distinct effects. Forinstance, a workshop might influence how man-agers think about their strategy (a cognitiveoutcome) but not produce direct changes to thestrategic plan or business activities (organiza-tional outcomes). Moreover, organizational out-comes concern effects on realized strategy thatmay only be noticeable some time after theformal event. In contrast, both cognitive andinterpersonal outcomes constitute more immedi-ate effects, i.e. those experienced within or soonafter the event. Having delineated the differenttypes of outcomes, the next section providesthe theoretical rationale for the hypothesizedlinks with the design characteristics shown inFigure 1.4  M. P. Healey  et al. © 2013 The Authors. British Journal of Management published by John Wiley & Sons Ltd on behalf of BritishAcademy of Management

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