Flexibility of Strategy in High-Tech Enterprises

Transcription

1 Soure: A. Zakrzewska Bielawska, Flexibility of strategy in high-teh enterprises [w:] M. Zhang (red., Eonomis, Business and Management. International Proeedings of Eonomis Development and Researh Vol. Flexibility of Strategy in High-Teh Enterprises Agnieszka Zakrzewska-Bielawska Department of Management, Tehnial University of Lodz, TUL Lodz, Poland Abstrat. The paper is an attempt to define the flexibility of strategy in the modern and dynamially developing high-tehnology setor. Assuming that, for high-teh ompanies, the most important fators are the development of tehnology, innovation, and knowledge, as well as the fast identifiation and exploitation of opportunities, a syntheti measure of the flexibility of strategy was proposed and verified. Qualitative researh was onduted in 61 medium and large high-tehnology ompanies based in Poland whih operate either in Poland or in the global marketplae. The study s results onfirmed that the more ompanies try to beome innovative and tehnologial leaders, the more flexible their strategy should be. Keywords: flexibility, strategy, high-teh enterprises, resoures, opportunities 1. Introdution Flexibility, next to effiieny and quality, is the fundamental measure of a modern organization management paradigm [1]. It also beomes a key requirement for the survival of the firm [2] beause it helps the ompany adapt to this onstantly hanging environment [3] and it is an important soure of ompetitive advantage for the firm [4]. This is a multidimensional onept and, therefore, it is diffiult to name one, ommonly approved definition [3]. Aording to the opinions from the literature, flexibility is the opposite of stability [5] and rigidity [6], and it is synonymous with the onept of adaptation, whih is often regarded as adustment, permanent in its effets and flexibility as agility, mobility, extensibility, i.e. the feature onneted with a short response time [7]. It seems, however, that flexibility inludes these two spae and time dimensions, i.e. both reation (or reation time and the degree of adustment in eah separate element and the whole organizational system [8]. Flexibility ertainly requires agility, versatility, and robustness [9], simultaneously being an important feature of an organization, whih onditions its existene, funtioning, and ontinued development. The polymorphi nature of flexibility is manifested in its different types [8], [10], [11]. It an refer to an enterprise as a whole or its separate elements. One of the basi measures of a ompany s flexibility, whih onsiderably influenes its further development, is the flexibility of the strategy. However, due to the ambiguity of the onept of strategy [12] and the speifi nature of high-teh enterprises (high demand for sientifi researh and the intensity of R&D expenditure, high level of innovativeness and the fast diffusion of tehnologial innovations, high level of employment of sientifi and tehnial staff and the fast proess of obsolesene of the prepared produts and tehnologies [13], the question arises as to how one should understand the flexibility of the strategy in this type of enterprises and what it depends on. This artile is an attempt to answer this question, and its main obetive is to propose a measure of highteh ompanies flexibility of the strategy, based on the analysis of 61 ompanies based in Poland whih operate either in Poland or in the global marketplae. The proposed measure allows to assess the flexibility of the ompany s strategy. It an be useful not only to high-teh ompanies but also other firms based on knowledge and highly innovation. 2. The onept of strategi flexibility for a high-teh ompany High tehnology ompany is defined as a business enterprise operating on the border of eonomy and siene, in the setor regarded as high-tehnology 1 and/or making produts lassified as high tehnology 1 Aording to NACE Rev.2 high-teh industries are: manufature of basi pharmaeutial produts and pharmaeutial 107

2 Soure: A. Zakrzewska Bielawska, Flexibility of strategy in high-teh enterprises [w:] M. Zhang (red., Eonomis, Business and Management. International Proeedings of Eonomis Development and Researh Vol. items [15]. Creating new tehnologial knowledge and its impliation in the form of numerous patent rights and lienses, identifying and using opportunities and reating new prodution and market spae these are the key harateristis of high-teh ompanies [16], whih require a flexible approah in strategi deision (hoie making. The strategy reation and implementation stages are interatively integrated. To a ompany, the most important element is the development of tehnology, innovativeness, and knowledge as a resoure [17] as well as the fast use of opportunities, whih stimulate the generation of strategies in produt-market ategories, defined by: (1 speialization or diversifiation, (2 external and/or internal way of growth, (3 vertial integration [18]. Flexible strategy should inlude ompetition between the various development diretions of an enterprise, as long as possible. Managers of high-teh ompanies have to deide whih resoures of an organization are essential and unique and then deide about the ompetitive advantage of the ompany, how to develop, aquire, and protet them. The key resoures in high-teh ompanies are knowledge and skills, in partiular ompetenes and talents of staff, tehnologial knowledge, know-how, patents and relations with the environment. The redundany of these resoures reates a speifi potential of an enterprise that supports the taking advantage of opportunities. Aording to K.M. Eisenhardt and D.N. Sull [19], the fast use of ephemeral opportunities is supported by a strategy omposed of simple rules (priniples. The results of the researh arried out by K. Obłó's team [20] show that market leaders (high-teh ompanies should aim at tehnologial leadership to not have an unambiguous operation strategy but rather to use a few simple rules, suh as: positive orientation toward the environment, innovativeness and experimentation, as well as prompt and flexible ations. Considering the above, the flexibility of the strategy in a high-teh ompany (F s was defined as the funtion of: 2 the ability to identify opportunities ( io establishing an environment monitoring system, whih enables the fast identifiation of events that the ompany ex ante defined as potential opportunities; the ability to experiment and generate ideas, innovations ( ei providing for onditions that support reativity and the generation of ideas; establishing an internal monitoring system in order to quikly identify events that the ompany ex ante defined as value innovation ideas; the ability to make key resoures redundant ( rr identifiation of key resoures (own and aess to external resoures and defining the intended redundany, whih will enable the use of opportunities; the ability to use opportunities ( uo solutions for the organization on the move, in partiular the effiieny of information and deision-making proesses, tendeny to take risks, flexibility of the organization proesses and struture, various systems of proedures, simulation systems; whih an be summarized as: F s = f { io, ei, rr, uo } Strategi flexibility (F s is greater if the ability to identify opportunities ( io, experiment and generate ideas ( ei, make key resoures redundant ( rr, and use opportunities ( uo is greater, whih results from the fat that the proposed funtion is multidimensional and unidiretional. For the purpose of simplifiation, the flexibility of the strategy funtion an be redued to a syntheti measure, as follows: 3 Fs = w1 iou + w2eiu + w3rru + w4 where: F s flexibility of the strategy syntheti standard uou preparations, manufature of omputer, eletroni and optial produts, manufature of air and spaeraft and related mahinery and high-teh knowledge-intensive servies are: teleommuniations, omputer programming, onsultany and related ativities, information servie ativities, sientifi researh and development [14]. 2 The proposed approah to high-teh ompanies flexibility of the strategy is the result of inspiration from the work of the valued strategy theoretiian, Professor Rafał Krupski [8]. 3 The proposed syntheti standard was prepared on the basis of a variables transformation method standardization, in order to bring all the variables to the range <0.1>. 108

3 Soure: A. Zakrzewska Bielawska, Flexibility of strategy in high-teh enterprises [w:] M. Zhang (red., Eonomis, Business and Management. International Proeedings of Eonomis Development and Researh Vol. io min( io iou = standardized value of the ability to identify opportunities; min eiu rru uou ( io ( io ei min( ei ( ei min( ei rr min( rr ( rr min( rr uo min( uo ( min( = standardized value of the ability to experiment and generate ideas; = standardized value of the ability to make key resoures redundant; = standardized value of the ability to use opportunities; uo uo = 1... n number of items, w 1 + w2 + w3 + w4 = 1, w1, w2, w3, w4 0;1 weights of the individual abilities. Assuming, after W. Ostasiewiz [21], the standard lassifiation thresholds of variable values from the range <0.1>, the following flexibility lasses were defined: from 0 to 0.2 sare flexibility (often assumed as non-existent, from 0.2 to 0.4 low flexibility, from 0.4 to 0.7 moderate flexibility, from 0.7 to 0.9 high flexibility, from 0.9 to 1 perfet flexibility. With suh a measure, an attempt was made to assess the flexibility of strategy in high-teh ompanies. 3. Methodology The study was arried out on a seleted sample of 61 high-teh ompanies in The ompanies were seleted on the basis of two riteria: high tehnology setor (aording to the OECD lassifiation setoral approah and the size of the enterprise (measured by the number of employees over 50. The monographi method was applied with the standardized interview tehnique 4 ; the respondents were representatives of the hief exeutive offiers (CEOs. The studied ompanies primarily represented the IT and teleommuniation setor (24, pharmaeutial (13 and in other ases (24 other different setors within high-teh. There were 47 medium-sized ompanies (from 50 to 249 employees and 14 large ompanies (over 249 employees. 29 ompanies operated in Poland and 32 operated in global marketplae. R&D Departments are present in all the studied ompanies. In addition, most of the ompanies (43 tend to ahieve innovation leadership, i.e. beome tehnologial leaders by reating new tehnologies and launhing new produts onto the market. Innovation followership was identified in the remaining 18 ompanies, whih aims at launhing produts based on imitation and learning from the experiene of tehnologial leaders. 4. Results and disussion In order to arry out an assessment of the flexibility of strategy in the studied ompanies with the use of the proposed measure, it was first neessary to define the weight for individual abilities. For this purpose, the respondents were asked about the importane of the flexibility of strategy. The results are shown in Table I. Aording to the respondents, the most important of these is the ability to use opportunities 32 persons delared that it was very important and 24 important for the flexibility of strategy. The ability to identify opportunities was important and very important aording to 58 persons, and the ability to experiment and generate innovations was important and very important aording to 57 persons. The respondents' opinions varied as regards the assessment of the ability to make key resoures redundant. The maority (42 persons delared that it was important and very important, 18 persons as quite important, and in one ompany as not 4 The interview tehnique made it possible for the researher and survey partiipants to ome to an agreement as to the understanding of the elements of the flexible of strategy. 109

4 Soure: A. Zakrzewska Bielawska, Flexibility of strategy in high-teh enterprises [w:] M. Zhang (red., Eonomis, Business and Management. International Proeedings of Eonomis Development and Researh Vol. very important. This was the ompany that frequently relies on tehnology transfer. Therefore, the ompany quite rarely reated redundant key resoures. Table I. Assessment of the ability to identify and use opportunities, the ability to experiment and make resoures redundant for the flexibility of strategy in the studied ompanies Total (all ompanies Desription not very quite very important important important important the ability to identify opportunities the ability to experiment, generate ideas, and innovate the ability to make (reate exess key resoures redundant the ability to use opportunities Soure: Own study Based on the respondents' opinions on the importane of individual abilities, their weights 5 in the syntheti measure of the flexibility of strategy were speified. The measure took the following form: F = 0,23 + 0,23 + 0,23 + 0, 31 s iou eiu Next, based on the value 6 presribed by the respondents to an individual ability, the standardized value of eah was alulated. By applying the obtained values to the syntheti measure F s, the assessment of the flexibility of strategy for eah of the studied ompanies was obtained. Table II ontains the results, grouped by the identified flexibility thresholds. Table II. Flexibility of strategy in the studied enterprises Flexibility lasses Total Innovation strategy (all ompanies innovation leadership innovation followership from 0 to 0.2 minute flexibility from 0.2 to 0.4 low flexibility from 0.4 to 0.7 moderate flexibility from 0.7 to 0.9 high flexibility from 0.9 to 1 perfet flexibility Total Soure: Own study 26 out of 61 studied ompanies showed high flexibility of strategy, inluding 9 with perfet flexibility. 24 enterprises showed moderate flexibility and 11 low flexibility, inluding 4 ompanies with minute flexibility. While arrying out the Kruskal Wallis one-way analysis of variane tests for the flexibility of strategy, depending on the trade, ompany size, range of operations, and innovation strategy, a one, statistially relevant differene, was found. The ompanies that aimed at innovative leadership showed muh higher flexibility of strategy than those that foused on innovative imitation. The data in Table II onfirm this statement. Out of 43 enterprises aiming at tehnologial leadership, 23 had high and 15 moderate flexibility of strategy. Only 5 ompanies showed a low level of flexibility. Whereas out of 18 ompanies that applied the imitation innovation strategy, half showed a moderate level of flexibility, 6 low and only 3 high (those that foused on reative imitation, i.e. using a new produt of an innovator in order to launh their own, improved produts. 5. Conlusion Flexibility is an important and required feature of modern enterprises, flexibility of strategy in partiular. In high-teh ompanies it should be viewed as the funtion of the ability to identify and use opportunities, the ability to experiment and make key resoures redundant. The results of the arried out researh indiate that the more often a ompany's aim is to ahieve the leader's position in the setor, by developing new tehnologies and launhing new produts, the more flexible its strategy should be, i.e. the ompany should have a higher level of individual abilities. This tendeny dominated regardless of the setor, size, or range of a ompany operation. rru uou 5 The average value of the respondents' opinions was applied for defining the weights. 6 The respondents gave marks to eah ability within their ompany strategy, using the 1-5 sale, whereas 1 means very low ability and 5 very high ability. 110

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