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Strategy and the


Strategy and the learning learning
organization: a maturity model for organization
the formation of strategy
353
John Kenny
School of Education, University of Tasmania, Launceston, Tasmania, Australia

Abstract
Purpose To develop a theoretical model for strategic change that links learning in an organization
to the strategic process.
Design/methodology/approach The model was developed from a review of literature covering a
range of areas including: management, strategic planning, psychology of learning and organizational
learning. The process of forming and implementing strategy in an organization was looked at critically
and then the links between learning and strategy were explored, particularly in relation to innovation
and radical strategic change.
Findings The degree of correspondence found across various strands of the literature implies a
general principle: that the development of strategy is closely linked with learning. The paper proposes
that, if appropriately designed, purposeful strategic activity will help to develop an organizational
learning culture. As the strategic planning process is widely accepted across all sectors of the
economy, it has the potential; to provide an effective means of directing resources in order to achieve
desirable learning within an organization towards its long-term viability.
Originality/value The paper develops a theoretical model of strategy formation, called The
maturity model for strategy formation, which describes a developmental continuum for strategy
based on the application of appropriate strategic approaches which are linked to suitable learning
approaches and a consideration of the roles of management and staff in the change process.
Keywords Strategic change, Innovation, Learning organizations
Paper type Research paper

Introduction
The first part of this paper considers a wide ranging review of literature from across a
number of strands of research: strategic change, management, project management,
educational psychology and learning organizations from which some common themes
emerge. In the final part of the paper, these themes identified are synthesized to into a
model for strategic change that acknowledges the developmental nature of change and
its links to learning.

Dealing with change


There is general acceptance in the literature that there have been dramatic changes in
the social and economic environment in which organizations operate. The globalized
modern economic environment is networked by new technologies and has been
described as volatile, fiercely competitive. As they become more reliant on gaining The Learning Organization
Vol. 13 No. 4, 2006
knowledge, new organizational structures are needed that are more flexible, responsive pp. 353-368
and less hierarchical (Grant, 2003; Chaffee, 1985; Rae, 1997; Mintzberg, 1994; Ansoff, q Emerald Group Publishing Limited
0969-6474
1994; Combe and Botschen, 2002; Whittington and Melin, 2003). DOI 10.1108/09696470610667733
TLO Barnett (2003, p. 3) used the term supercomplexity . . . characterized by the
13,4 presence of contestability, challengeability, uncertainty and unpredictability . . . an age
of conceptual risk.
McNiff (2000, p. 11) also called for new forms of organization, in which
organizational values are linked directly to the strategic vision and learning because
everything is part of a transformative order of emergence . . . She advocated new
354 generative transformational forms of learning to deal with an external reality in
which everything is constantly evolving or becoming (McNiff, 2000, pp. 140-141).
Tosey and Robinson (2002, pp. 105-106) studied the use of the term
transformational change in the management literature and recognized that the
form of change adopted (the means) in an organization related to the underlying
intention of the change (the ends). They presented a transformation matrix of
organizational change in which the ends ranged from simple survival, to increased
efficiency, to cultural change and ultimately to the development of potential. Each of
these ends had corresponding means which involved progressively less programmed
and controlled activities: ranging from outcome focused activities such business
process re-engineering and total quality management (TQM), through to more process
based activities involved in forming learning organizations and even spiritual
organizations. In these forms of transformational change, a leap of faith is required,
as the outcomes are unknown and there may be intense pain and struggle as values,
ideals and beliefs are questioned.
In the strategic change literature, Whittington and Melin (2003, p. 37) observed
similar trends, where the form of the organization is blurring and the process of
strategizing is becoming the key function. They proposed an organizational duality
where the organization is the strategy. By this they mean that the structure of the
organization is in a state of constant organizing flux, as social collectives form and
reform, organizations continuously mutate and there are no organizational end
states.
Stacey (1995, pp. 485-486) argued that organizations consist of both formal and
informal structures or networks. The formal networks exist to promote order and
stability and are represented by the officially sanctioned structures and constraints
established within an organization. The informal networks are a shifting network of
social and other informal contacts between people within an organization and across
its boundaries. Informal networks are the means by which organizations are able to
deal with rapid change and unpredictability and that for an organization to be truly
creative and innovative, it must operate in a state of bounded instability.
De Wit and Meyer (1999, pp. 120-121) pointed to the typically fragmented,
evolutionary and largely intuitive strategic change process that occurs in even well
managed major organizations. Whittington and Melin (2003, pp. 37-38) further argued
that such an organizational process cannot be controlled centrally: that successful
organizations will be those which are able to continually restructure and respond
effectively.
Thus flexibility and changeability in structure and process is widely regarded as a
necessary condition for organizations to function effectively in the highly volatile
modern environment. They have to be able to feel their way through strategic
problems and rapidly respond to unexpected and unpredictable circumstances as they
learn to deal effectively with the emergent aspects of the change. These learning Strategy and the
focused approaches, where strategies need to be made and re-made continuously, are learning
at odds with centralized annual planning processes and rigid organizational structures
(Whittington and Melin, 2003, p. 37). organization
A number of writers have explored the use of innovative project teams and how
they can be assured the freedom required to innovate and learn, while remaining
accountable to the organization (Sheasley, 1999; Leigh, 2003; Lester, 1998). 355
Tushman and Smith (2004, pp. 12) described the ambidextrous organization, as
one structured both to learn and incrementally build on its past. Such organizations
have two structural aspects: entrepreneurial units set-up for learning by doing to
develop or explore innovation; and more conventional units which are concerned with
incremental improvement and on-going operations. How these units interact with the
other parts of the organization is an important consideration because tensions arise at
the interface between the formal and the informal, as the conventional organizational
structures are concerned with establishing order and predictability, whereas
entrepreneurial are dealing with situations which are unknown and unpredictable.
There needs to be a holistic approach to the strategic process to address the
structural flexibility and learning aspects of change. This involves the creation
strategies and structures that can continually respond to the environment, and a
culture where managers will be more open to learning and less afraid to make changes
for improvement (Kleiner and Brown, 1997, pp. 57-58).

The strategic planning process


The strategic planning process has become synonymous with responsible and
accountable management and comprises systematic, formalized approaches to
strategy formulation (Grant, 2003, p. 491). It is in widespread use throughout all
sectors of the economy and is considered vital for the sustainability and growth of
organizations to enable them to deal with changing environments, even while the
substance of strategy remains unstructured, unprogrammed, non-routine, and
non-repetitive (Chaffee, 1985, p. 89; Crebert, 2000; Grant, 2003; Rothschild et al.,
2004; Kaplan and Norton, 2001).
Theoretical views on the nature of the formation of strategy fall into two distinct
groups: the rational design approaches and emergent approaches (Grant, 2003;
Harrington et al., 2004). They were also referred to as the strategic choice and the
ecological perspectives (Stacey, 1995, p. 477).
The rational approach is based on the view that organizations adjust to changes in
their environment by making rational decisions and choices. In the rational strategic
model strategy consists of integrated decisions, actions or plans that will set and
achieve viable organizational goals (Chaffee, 1985, p. 90). The assumption underlying
a rational strategic process is that the environment is relatively predictable or the
organization is well insulated from the effects of change. It further assumes that an
organization is tightly coupled, so that all decisions made at the top can be
implemented throughout the organization (Chaffee, 1985, p. 90). One could expect that
there will be problems with this approach to strategy formation, as its underlying
assumptions are clearly at odds with the volatile environment discussed earlier.
TLO The emergent approach is based on an ecological paradigm, in which organizations
13,4 continually respond to changes by adapting, in much the same way as living
organisms respond to their environments. Chaffee (1985) referred to this as the
adaptive strategic model where a continual process of adjustment occurs within the
organization (either reactive or proactive) aimed at co-alignment of the organization
with its environment (Chaffee, 1985, p. 91).
356 Chaffee (1985, p. 93) further elaborated the emergent approach to include an
interpretive strategic model, which is based on a view of an organization as a
collection of social agreements entered into by individuals of free will. The strategic
aim is to attract enough individuals to cooperate in mutually beneficial exchange,
and to deal with attitudinal and cognitive complexity. The interpretive approach is
one in which strategy is based on a social contract and the assumption that reality is
socially constructed by the interaction of the stakeholders of an organization. In this
model, the organization consciously sets out to enable communication within the
organization to come to a common understanding of the strategic problem. The
strategic process emphasizes the importance of symbol manipulation, developing
shared meaning and cooperative actions of individuals. The formation and
implementation of a strategy is a complex process that involves both conceptual as
well as analytical exercises (Chaffee, 1985, p. 89)

The strategy shortfall


The literature reviewed revealed the rational planning model is in widespread use and
that there are significant problems with it in practice. As alluded to above, this may be
due to the underlying assumptions behind this model do not apply in the modern
environment. Weitzel and Jonsson (1989, p. 98) argued that it is clear that a stable
environment, if it ever exists, is at most a temporary phenomenon. They called for
effective reorganization based around less directive leadership and greater
inclusiveness for those lower in the organization who may have valuable information
to add to decision making (Weitzel and Jonsson, 1989, pp. 102-103).
However, in many cases the strategic planning process has become a calendar
driven ritual (Grant, 2003 cited in Hamel, 1996, p. 70; Crebert, 2000; Nasi and Annula,
2003; Priesmeyer, 1992). Simpson (2002, p. 690) referred to a report by Fortune
magazine which revealed that less than 10 per cent of strategies are effectively
executed, that only 5 per cent of the work force understands strategy. It also reported
a significant lack of strategic alignment, as indicated by the fact that 60 per cent of
organizations did not link budgets to strategy and 92 per cent did not report on lead
indicators.
Thus the planning process has become rigid, inflexible and an end in itself. This
focus on planning works well so long as the actual outcomes are largely in line with
the assumptions, but, once a plan is in place, management can fall into planning
traps which limit the capability of businesses to respond to changing circumstance
(Briggs, 1998, p. 216).
The suitability of rational planning approaches for non-profit organizations has
also come under question, as these organizations operate from a value base quite
different to conventional businesses (Steane, 1999, p. 10). In the education sector, there
is suspicion surrounding strategic planning, which was seen as a means of ensuring
bureaucratic control over the activities of professional staff (Crebert, 2000; Fenske, Strategy and the
1980; Lines, 2000; Patterson, 2001; Rae, 1997; Ramsden, 1998). learning
Indeed Kleiner and Brown (1997, p. 505) described rational approaches as a means
for managers to gain control and domination of the workforce and, while this might
organization
be appropriate in some contexts, such as those requiring high levels of standardization
in output, it may break down in other contexts.
Typically, organizations have responded to these problems by making 357
modifications to the planning processes by setting difficult performance criteria, or
to attempting to better align organizational budgets with the strategic goals, and
thus ensuring the continuation of central control (Grant, 2003; Harrington et al., 2004;
Kaplan and Norton, 2001; Rothschild et al., 2004).
However, there is also a consistent call for managers and staff to take on a new form
of relationship within organizations in which learning from action and experience is
central to the process of forming and implementing strategy. Mintzberg (1994, p. 275)
called for staff to be seen as co-strategists, forming radical strategic change in an
organization, not just passive implementors of pre-determined strategy.
Combe and Botschen (2003, p. 43) also called for staff to be included in the decision
making process by contributing knowledge gained through practice. He noted that
knowledge flowing from the work of staff has the capacity to enhance
decision-making and the effectiveness of organizations (but). . .Enquiry of this
nature is not undertaken routinely, but in response to the need for empirically based
knowledge to contribute to issues regarded as strategic.
This form of involvement goes beyond implementing a pre-determined plan or the
development of a shared vision, it calls for the experience of staff to directly influence
strategic decisions, with the explicit purpose of contributing to the stock of its
working knowledge (Owen, 2003, p. 43).
Combe and Botschen (2002, p. 505) acknowledged that increased autonomy and
participation may raise fears in the minds of manager, leading to them resisting such
changes. Tosey and Robinson (2002, p. 107) also argued that managers may restrict
direct questioning of their control and power structures, which will constrain
significantly the types of action and learning that are legitimized by the change
process. Similar observations on the resistance of managers have been made by others
(McNiff, 2000; Leitch et al., 1996.
The dilemma is that the support of senior management has been identified as a
critical success factor for strategic change and innovation (Alexander et al., 1998;
McGill and Beaty, 2001; Lester, 1998; Zuber-Skerritt, 2001). Thus while managerial
support is vital to the change process, it can also effectively stifle it. It is little wonder
that when Grant (2003, p. 515) reported on an attempt at controlled centralized
innovation, it resulted in limited impact . . . on the quality of strategic decisions . . . and
little evidence that the systems of strategic planning were conducive to strategic
innovation.
To De Wit and Meyer (1999, pp. 33-34) strategic problems are wicked,
characterized by interconnectedness, complication, uncertainty, ambiguity, conflict
and constraints. They argued that to effectively tackle such problems required two
things: a broad participation in the policy making process and the use of a wider
TLO spectrum of information from diverse sources. Emergent strategic approaches are
13,4 clearly more suited to dealing with problems of this nature.

Strategy and learning in organizations


The process of learning is central to dealing with wicked problems, but what does it
mean for an organization to learn? Senge (1990, p. 14) identified three forms of
358 organizational learning: generative learning, survival (or adaptive) learning and
incremental learning. Actenhagen et al. (2003, pp. 79-81) identified a similar set of
learning cultures.
A generative learning culture is one committed to genuine renewal and research; an
adaptive learning culture aims to develop and adapt existing practices and ways of
thinking; an incremental learning culture focuses on improvement and efficiency
within the existing organizational framework. Each of these three forms of
organizational learning corresponds very well with one of the three models of
strategy referred to earlier: interpretive, adaptive and linear (Chaffee, 1985).
This degree of correspondence can also be seen, within the psychological learning
theory literature, where two major schools of learning theorists are the behaviorists
(positivists) and the constructivists (Jaramillo, 1996; Knight, 2002; Quay, 2003; Swain,
2003).
Behaviorists, such as B.F. Skinner and Gagne (1977), considered that there is
ultimate truth to which the learner can be taught using appropriately designed and
planned learning activities (Swain, 2003). Traditionally, this involved transmission
approaches to learning, where knowledge is passed from an expert to a student
(Jaramillo, 1996).
Constructivist approaches to learning, however, are characterized by experientially
based activities, in which students learn by doing and reflecting on the experience. In
this model, teachers act as facilitators of learning rather than transmitters of content
(Jaramillo, 1996). Action research and action learning are examples of learning
approaches based on this view. These two theoretical views of learning correspond
well to the rational and emergent schools for strategy discussed earlier.
The constructivist approach is appropriate for learning in the highly uncertain
situations surrounding radical change and innovation, as, by definition, no-one knows
what the solution will be: there is no expert to transmit the knowledge; it must be
created by the individuals within the organization. Indeed, many of the change
processes in the literature advocate learning which is clearly constructivist in nature
(Laurillard, 1997; Mintzberg, 1994; Leitch et al. 1996, Rogers, 1995; Senge, 1990).

Individual learning
Argyris and Schon (1996) pointed out that an organization can only accumulate
knowledge through the actions and capabilities of the individuals which make it up, so
individual learning is at the heart of organizational learning. In exploring individual
learning for professional practitioners, Kemmis and McTaggart (2000) referred to three
forms of inquiry: technical, practical and critical. Each form of inquiry is based on
action, but they differ according to the nature of purpose of the learning.
In a technical inquiry, the aim of the learning is efficiency: for example, to improve
an existing situation, policy, process or activity. This form of learning is concerned
with incremental improvement: the underlying content is not in question. Technical Strategy and the
inquiry is concerned only with the means, not the ends. Kemmis and McTaggart (2000) learning
considered processes such as quality assurance to fall within this category of inquiry.
Schon (1987) referred to this as single loop learning, while Eisner (2003, p. 41) used organization
the term first order learning. This form of learning clearly fits within an incremental
or improvement oriented learning culture.
In a practical inquiry, both the ends and means are problematic. This form of 359
inquiry is suited to understanding complex situations which may involve conflicting
sets of values. The aim of this form of learning is to educate the participants to make
informed decisions and become aware of the consequences. It acknowledges that the
different perspectives, reactions and behavior reflect the values of the participants
(Kemmis and McTaggart, 2000). Schon (1987) referred to this type of learning as
double loop learning, while Eisner (2003, p. 41) called it second order learning. This
clearly fits within an Adaptive organizational learning culture.
A critical inquiry addresses not only the means and the ends, but also the rationale
for the strategy. It takes an empowerment stance, and while it addresses elements of
both the technical and practical inquiry, it also examines the context of the situation
and where it might lead. In this form of learning, the practitioners question the status
quo as well as the historical and social contexts which brought it about. Sun and Scott
(2003, p. 203) described this as triple loop learning where the organizations mission,
vision, market position and cultures are challenged.
Learning at this level may well have political and power implications that may lead
to the discomfort for some managers referred to earlier McTaggart (1991, p. 40), but it
is also central to a generative learning culture and the creative processes which bring
about innovation and radical change.
A high level of correspondence between each of the three learning cultures, the three
strategic models and the individual learning approaches is evident from the preceding
discussion. This leads to the main contention of this paper: that the effectiveness the
formation and implementation of strategy, and by implication, organizational learning,
will be enhanced if these links are explicitly acknowledged and consciously built into
the strategic processes, structures and the roles of individuals and teams. It must be
accepted that strategic change requires holistic alignment of an appropriate
organizational culture, structures and processes which promote and reward learning.
What this means in practice is considered next.

The maturity model of strategy formation


In bringing together the major ideas discussed so far, it must be emphasized that, when
dealing with wicked strategic problems, much is unknown and unpredictable at the
outset and has to be learned. As opposed to the traditional rational approach to
strategic planning, the strategy cannot be clearly articulated, so the initial task is to
engage in learning that will enable a better understanding of the problem. As
understanding grows over time, the organization is more able to define its strategic
response. The formation of strategy thereby becomes a developmental process driven
by learning in which the strategy can be considered to mature as the situation comes
to be better understood.
TLO This process is represented in Figure 1, where the level of understanding of the
13,4 strategic problem (or alternatively the level of uncertainty associated with it) is linked
to the three models of strategy (Chaffee, 1985) and with each of the corresponding
learning approaches and learning cultures discussed earlier (Senge, 1990; Kemmis and
McTaggart, 2000).
In the initial stages of radical strategic change innovation, the uncertainty is very
360 high, so an interpretive strategic approach is appropriate. The associated
organizational learning model is generative, which this involves a critical or third
order individual learning approach. As understanding grows, a point will be reached
where a decision to implement a strategic solution can be made. By this stage, the
organization should have done significant learning and have a much clearer
understanding of the strategic problem it is facing.
However, on making the decision to implement a strategic solution or innovation, an
Adaptive strategic process then becomes appropriate. The organizational learning
model at this stage is therefore adaptive, while the associated individual learning
model to support this is practical or second order learning.
After a period of further learning and development, the strategic problem may reach
a point where it is sufficiently well understood, and its implementation is well
underway that a Rational strategic approach may be appropriate. The organizational
strategic goal at this stage focuses on continuous improvement and efficiency.
It must be noted that, as learning is an individual and situational process, different
parts of an organization will adjust to change according to their own unique
perspectives, rates of learning and capability sets. The change is unlikely to be uniform
across an organization, and different units may well be operating at different points on
this continuum. The operation of the maturity model calls for judgments to be made at
various stages during the formation and implementation of a strategy. The next
section considers in more detail how these practicalities of the model might operate.

Operational aspects of the maturity model of strategy formation


Senge (1990) viewed managers as designers of an organization, and as such they need
to be fully aware of the strategic goals at each stage so they can consciously design
suitable structures, including accountability processes, that support the strategic
learning required at each stage and ensure processes to capture the learning are in
place (Kenny, 2002, 2003). These stages in the model are outlined more fully below and
also in Table I.

Figure 1.
The maturity model for
strategy formation and
development
Maturity model for strategy
Stage Initiation Implementation (establishment) Implementation (consolidation)

Strategy process model Interpretive Adaptive Adaptive/linear


Strategic goals Monitoring the environment and develop Begin implementation process and Looking for improvements and
understanding to reduce uncertainty identify and respond to unforeseen issues efficiencies
Explore and evaluate innovative Clarifying the change through social Incorporating the change into normal
solutions interaction operations

Content of strategy Not well understood Partially understood Well understood


Context of strategy Very high uncertainty Medium to high uncertainty Low uncertainty
Learning culture Generative learning Adaptive learning Incremental learning
Organizational Transformational change, developing Adaptive change Evolutionary or continuous change
learning goals shared understanding of strategy Developing a shared vision Implementing the shared vision
Identifying staff capability requirements Building staff capability Building staff capability
Individual learning Third order or critical approach to Second order or practical approach to First order or technical approach to
model learning learning learning
Role of management Monitoring internal and external Monitoring internal and external Clarifying and communicating
environment environment performance goals
Developing a common understanding Building organizational shared vision of Building the change into normal
Gauging resource and capability change on-going operations
requirements Building staff capability Looking for efficiencies and
Supporting and facilitating learning Developing new workable processes improvements
Capturing, analyzing and Restructuring the organization as Building staff capability
communicating learning required Monitoring medium and long term
Evaluating progress Building alignment of processes performance
Evaluating progress Evaluating longer term benefits of the
Adjusting organizational processes, change
plans and structures to support the
change
(continued)
organization
learning

model for strategy


Summary of the maturity
Strategy and the

formation
361

Table I.
13,4

362
TLO

Table I.
Maturity model for strategy
Stage Initiation Implementation (establishment) Implementation (consolidation)

Role of staff Finding creative solutions Engaging and participating in change Developing awareness of change
Offering critical comment and feedback Participating in capability building Incorporation of change into normal
based on experience activities practice
Building capability and taking risks. Looking for improvements and making Looking for efficiencies
suggestions based on experience
Key learning activities Action learning projects, pilot projects, Building staff capability through formal Establishment of realistic performance
research, scenario planning, stakeholder training targets
consultations Action learning projects Building the strategy into normal
Evaluation of progress through Evaluation of progress through operations
discussion, formal feedback, discussion, formal feedback, Alignment of organizational processes:
communication, sharing of ideas communication, sharing of ideas budgets, plans
Documenting learning, understanding Adapting or designing suitable Continuous improvement activities and
implications and synthesizing ideas organizational structures, budgets, work reports
planning, recruitment, reward systems,
etc
Evaluation models Formative continuous evaluation and Formative continuous evaluation and Periodic evaluation of progress
feedback. feedback.
Key performance Identifying key success factors, risks and Response to formative evaluation and Evaluation of long-term costs/benefits of
measures resources requirements feedback data to monitor progress the change
Response to formative evaluation and Development of appropriate structures Achievement of performance targets
feedback data to monitor progress and processes
Recommendation of possible solutions Clarification of realistic performance
with a view to implementation targets, based on learning
The mechanism to operationalize the maturity model is based on a two stage approach Strategy and the
for the adoption of innovation, as proposed by Rogers (1995, p. 371). This process, learning
which involves an Initiation stage and an Implementation stage, has also been mapped
onto Figure 1. organization

Initiation phase
This is an early stage in the development of the strategic response. During the 363
initiation stage the situation is highly uncertain so the purpose is to explore
alternatives and reduce uncertainties, and thereby lower risks for the organization to a
level where management can make informed decisions. An interpretive strategic
approach is most appropriate at this stage.
The key strategic learning goal is to explore the range of possibilities and
continually monitor the environment in order to build organizational understanding of
the situation to a point where management is sufficiently confident to proceed to the
implementation phase. The emphasis is on encouraging individual and organizational
learning to increase understanding and reduce the uncertainties. A variety of related
activities such as scenario planning, research, pilot projects, feasibility studies,
stakeholder consultations, etc. can be used to good effect to increase the understanding
of the situation.
As described earlier, research and development teams may be formed and
quarantined from the constrictions of the formal bureaucratic processes to
maximize learning. It is essential that the staff involved in such teams take a third
order or critical approach to learning. Feedback and formative evaluation is
essential to provide the information and to lay the foundations for a common
understanding to develop in the organization (Kenny, 2003, 2002). The knowledge
gained should provide valuable information regarding the most appropriate
solutions, organizational processes, organizational structures and the level of
resources required to meet the strategic challenges of particular solutions.
Ultimately, based on this knowledge and the constant monitoring of the external
environment, management will be in a position to make a decision to move to the
implementation phase. This is a significant decision point as it is likely to involve a
considerable investment in technology, training and/or organizational structural
change.

Implementation phase (establishment)


The decision to implement an organizational solution brings with it its own
problems, so, in the maturity model, the implementation phase has been divided
into two sub-phases: the establishment and the consolidation. During the
establishment sub-phase, the strategic change is introduced to the operational
environment of the organization. There is still a great deal of learning to be done
as the implementation proceeds, so an adaptive strategy approach is most suitable
as both the organization and the strategic solution or innovation will need to
adjust to each other.
The strategic learning goal at this stage is to clarify the strategic direction and
develop a shared vision with a view to articulating the strategy more fully. A
second order or practical approach to learning is adopted. The learning is
TLO concerned with the development of effective organizational processes and
13,4 structures, refinement of the goals and building of staff capability to implement
the change.
During this phase, there are likely to be significant resource implications, so the
planning process will need to become more clearly defined. However, flexibility in
planning is needed to deal with unforeseen problems. It is possible that some limited
364 realistic strategic targets may be carefully introduced at this stage, although this
should be done with care. Formative evaluation processes are needed to capture the
learning.

Implementation phase (consolidation)


Ultimately the strategy may reach a point where it can be clearly articulated and the
associated uncertainty is low. At this point, as the situation is well understood and
predictable, a rational strategic approach may be appropriate, depending on the culture
of the organization. The key strategic goals are to monitor the cost benefit outcomes of
the change and to look for efficiencies and improved quality. A first order or technical
learning approach is suitable, with the emphasis on continuous improvement.
Traditional centralized planning processes and performance measurement practices
may be employed effectively. During this sub-phase, the strategic change becomes an
accepted part of practice within the organization, a process which Rogers (1995)
referred to this as Routinising.
Table I, outlines how the model could operate in practice at each of the stages in the
development of strategy. The table summarizes many of the aspects including: the
strategic goals, content and context of the strategy, the learning culture, the learning
goals, the roles of management and staff, the key learning activities, the evaluation
models and the key performance measures.

Conclusions
The strategic planning process is the means by which organizations come to terms
with the circumstances in which they operate, set directions and mobilize their
resources to meet their needs in the medium to long term. As a widely accepted
process, it is central to organizations survival.
Modern organizations operate in very uncertain and challenging times. The
demands of globalization, rapid technological change and increasing competitiveness
put enormous pressure on them to remain viable. To ensure long-term sustainability,
organizations have to develop appropriate strategic responses to change.
Traditional centralized rational strategic planning processes assume a high degree
of predictability and order, but the prevalence of these processes has led to a tendency
to modify them to deal with the increasing uncertainty. Such attempts tend to be
unsuccessful as the centralized processes are unable to respond rapidly to new
developments and learning from action. A more responsive strategic process is
required where managers establish of a culture of trust, encourage participation and
support individuals to learn from their experience and contribute their practice based
knowledge to formation of better strategic outcomes.
The maturity model of strategy formation outlines an approach to transformational
strategic change which is based on learning. Initially, a generative (third order)
learning culture must underpin the strategic process. The main strategic goal is to Strategy and the
increase understanding of the strategic problem, then, as understanding grows, the learning
strategy matures to a point where a solution can be implemented across an
organization. Here the strategic process is based on an adaptive (second order) learning
organization
process. At this stage, the strategic goals include developing shared visions,
developing plans, building capabilities and implementing workable processes and
structures across the organization. 365
Ultimately, the strategy and the associated new approaches may become
sufficiently mature to be fully incorporated into normal operations. It is at this stage
that a linear strategic planning model based on continuous (first order) learning may be
suitable. At this stage of development the strategic process will concentrate on
efficiency and continuous improvement and a more centralized formal planning
process may be suitable.
The maturity model presents managers with a framework to consciously design an
appropriate approach to the strategic change process. Armed with this knowledge, the
development and implementation of strategic change should prove to be far more
effective.

References
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Further reading
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Corresponding author
John Kenny can be contacted at: John.Kenny@utas.edu.au

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