Chapter 15
Leading Public Organizations Strategically
Richard M. Walker, Chan Su Jung, and Gong-Rok Kim
This chapter draws on Boyne and Walker (2004) and Walker (2013). We thank Rhys Andrews, George A. Boyne, Jennifer Law, Kenneth J. Meier, and Laurence J. O'Toole Jr. who have contributed to the development of evidence on strategic management in public service organizations.
Over recent decades, politicians, practitioners, and citizens have called for a focus on goals, planning processes, and innovation in public and nonprofit organizations. To fulfill these missions, public service delivery organizations need to acquire and align resources. The adoption of strategic management practices is a central way to address this focus because they seek to align the internal organization with its environment in order to attain higher levels of performance (Poister, Pitts, & Edwards, 2010). Scholars in public management have examined strategies put in place by practitioners in public service organizations since the early 1980s, much of it concerned with strategy processes, that is, how strategies are formulated or implemented (Bryson, 1995; Bryson, Berry, & Yang, 2010). This emphasis may reflect an assumption that processes of strategy formulation and implementation count more than the actual content of strategies, reflecting long-term concerns within public administration about organizational rules, procedures, and policies (Rainey, 2009). However, strategy content—the patterns of service provision that are selected and implemented by organizations—is at least as important as strategy processes and may be more so. Strategy content comprises a general approach that describes the organization's position and how it interacts with its environment, called strategic stances, and the specific steps that an organization takes to operationalize its stance, strategic actions. Organizations may have perfect processes of strategy formulation and implementation but still have a perfectly useless strategy that fails to deliver desired outcomes.
It is important to distinguish aims, strategy content, and strategy processes so that their theoretical and empirical connections can be explored. This chapter, focusing on strategy content, addresses three critical questions about strategic management in public organizations:
- Do strategic management frameworks in the generic management literature capture the variety of strategy content in public service organizations?
- How can the patterns between strategic stances and actions be explained?
- What are the implications that arise from the research evidence on different strategies—and combinations of stances and actions—for the attainment of higher levels of organizational performance?
These questions are given relevance by reforms to the public sector that over the past four decades have introduced competitive market structures and private sector management practices as a means to enhance organizational performance.
In the next section of this chapter, we examine the frameworks advanced by scholars on strategy content for public and private organizations. We then move on to examine the evidence derived from Boyne and Walker's (2004) framework of strategy content for public organizations in two parts. The first part of the synthesis of empirical studies examines strategic stances and proposes some variation to the prescriptions from the generic management literature. The second part of the synthesis of the research findings focuses on effective practices, that is, on relationships between stances and actions and organizational performance. We suggest that while the evidence on Boyne and Walker's argument is by no means comprehensive, it suggests that public managers should pay attention to the connections between the contingencies to achieve the best outcome from whatever strategy their organization has adopted. We end by setting out in five major findings the implications of the evidence presented on strategic management in public service organizations.
Knowledge about Effective Strategy Content Practices
A number of strategic management frameworks have been developed for public organizations (Wechsler & Backoff, 1986). These typologies pose false contradictions between strategic stances; are categorical and unidimensional; confuse goals, processes, and strategy content; and pay insufficient attention to the specific characteristics of public organizations. Based on these concerns, Boyne and Walker (2004) suggest that the generic frameworks offered by Miles and Snow (1978) and Porter (1980) are suited, with some adaptations, to public organizations.
Strategy researchers focus on the relationships among organizational environments, strategy processes, strategy content, and organizational performance. Strategy process refers to how objectives and actions are selected or formulated and implemented. The outcome of the process of strategy formulation is strategy content, which has been defined as “a pattern of action through which [organizations] propose to achieve desired goals, modify current circumstances and/or realize latent opportunities” (Rubin 1988, p. 88). Strategy content has two dimensions: strategic stances, the general approach that describes the organization's position and how it interacts with its environment, and strategic actions, which indicate the specific steps that an organization takes to operationalize its stance. Stances are somewhat enduring; actions are more likely to change in the short term.
Miles and Snow (1978) present competing classifications of organizational strategy proposing that managers develop enduring patterns of strategic behavior that seek to align an organization's aims, processes, content, and environment. Central to this framework are four main types of strategy:
- Prospectors, organizations that “almost continually search for market opportunities, and they regularly experiment with potential responses to emerging environmental trends” (Miles & Snow, 1978, p. 29). Prospectors are often pioneers in the development of new products.
- Defenders, organizations that take a conservative view of new product development and attempt to maintain a secure position in a narrow segment of the market. They typically compete on price and quality rather than on new products or markets and “devote primary attention to improving the efficiency of their existing operations” (Miles & Snow, 1978, p. 29).
- Analyzers, which represent an intermediate category, sharing elements of both prospector and defender. They are rarely first movers but instead “watch their competitors closely for new ideas, and . . . rapidly adopt those which appear to be most promising” (Miles & Snow, 1978, p. 29).
- Reactors, organizations in which top managers frequently perceive change and uncertainty in their organizational environments but typically lack any consistent strategy. A reactor “seldom makes adjustment of any sort until forced to do so by environmental pressures” (Miles & Snow, 1978, p. 29).
Organizational effectiveness will be enhanced with alignment between the strategy types and organizational environments, processes, and structures. Miles and Snow (1978) argue that the typology “specifies relationships among strategy, structure, and process to the point where entire organizations can be portrayed as integrated wholes in dynamic interaction with their environments” (p. 30). The relationships of strategy, structure, process, and environment reflect those sketched out in contingency theory (Thompson, 1967). However, not every strategy type is associated with effectiveness. Miles and Snow propose that alignment of strategy, structure, process, and environment is achieved successfully for prospectors, defenders, and analyzers, whereas reactors lack alignment, displaying inconsistent or no clear relationships, and consequently exhibit poorer performance. Alignment for prospectors is associated with incremental processes (formulation and implementation), decentralized structures and decision making, and more turbulent external environments. Defenders adopt rational approaches to formulation and implementation, are centralized, and operate most effectively in stable environments.
Porter's (1980) typology identifies three generic strategies for successful organizational outcomes:
- Cost leaders sell their products at prices below those of their competitors.
- Differentiation is a strategy of creating products that customers perceive as unique.
- Focus involves competing in a narrow segment of the market through either cost leadership or differentiation.
Porter argues that poor performance will be found when an organization does not choose one of these three approaches and becomes “stuck in the middle.” This typology corresponds closely to the notion of strategic actions or behaviors: an emphasis on quality or price/resources and a decision to aim for a narrow or wide market.
Boyne and Walker (2004) combine the typologies of Miles and Snow (1978) and Porter (1980) and address some problems in the existing systems for classifying strategy content in public and private organizations. The typologies can be combined because Miles and Snow provide a typology of generic strategic stances that accommodates all possible organizational responses to new circumstances: innovate (prospector), consolidate (defender), or wait for instructions (reactor). Porter provides a model of strategic behavior or actions that can be appropriate to the stances. For example a prospector may use a combination of changes in markets, products, and prices.
Scholars often express concern that the frameworks developed for private firms may have limited relevance to the external circumstances and internal characteristics of public organizations (Rainey, 2009). Public agencies are much more likely to be constrained for several reasons. For example, strategy content can be imposed, regulation can be stifling, external constraints can be overpowering, or turnover of political elites limits the impact of strategic decisions (Rainey, 2009). Such constraints may place limits on strategic decisions and inhibit public managers' entrepreneurial behavior (Boschken, 1988).
Boyne and Walker (2010) note that changes in public organizations raise new challenges for conceiving of strategy in public service organizations and they draw on Bozeman's (1987) notion of publicness to suggest that the breadth of organizations now found in the public sector means that a range of approaches to strategic management is applicable. In relation to Porter's strategic actions, products can be replaced with services and prices with revenues in order to match the strategic actions with the primary characteristics of public organizations. Boyne and Walker (2004) also extended Porter's typology to cover the external and internal attributes of agencies that provide public services. Thus, strategic actions conceptually cover the three logical categories of behavior that are available to an organization:
- Move to a different market, thereby changing the environment by, for example, providing existing services to new groups of citizens
- Alter services (new services to existing users), revenues, and the external organization (through collaboration, networks, partnerships, and outsourcing) to change the relationship with an existing environment
- Make modifications to internal organization and thus change itself through alterations to structure, culture, leadership, processes of formulation and implementation, and management practices
The relationships between the strategic responses to changes in circumstances that Miles and Snow outlined and Porter's strategic behaviors can be combined to offer the matrix of strategy content in table 15.1. We refer to the cell labels in the following section when we examine the evidence available on the relationships and begin with a discussion on strategic stances.
Table 15.1 Classification Scheme of Strategic Responses to Circumstances and Strategic Behaviors
| Strategic Responses to Circumstances | |||
| Strategic Behaviors | Innovate | Consolidate | Await Instructions |
| Change environment | I1 | C1 | AI1 |
| Change relationship with existing environment | I2 | C2 | AI2 |
| Internal change | I3 | C3 | AI3 |
Research Findings
We first provide evidence on the strategic stances and their effectiveness and then examine the literature on the relationship between stances and actions in the following section, noting that more research has been undertaken to connect strategy with internal organization (I3, C3, and AI3) and performance than with the changes in the environment (I1, I2, C1, C2, AI1, and AI2).
Research Findings on Strategic Stances
A Mix of Strategies Matters for the Improvement of Public Service Performance
Miles and Snow (1978) propose that organizations adopt a single strategic archetype as prospectors, defenders, analyzers, or reactors. Boyne and Walker (2004), along with other scholars, have noted conceptual and methodological concerns with these stances. Typologies should have mutually exclusive and exhaustive categories. Analyzers are an intermediate, taking characteristics from defenders and prospectors, and thus can be removed on the grounds of developing mutually exclusive typologies. The typology remains exhaustive after the removal of analyzers because organizations can still innovate, consolidate, or wait for instructions.
Boyne and Walker (2004) suggest that organizations pursue a range of strategies by mixing and combining them. They note the complex and multiple goals of public organizations and the resulting diversity of services provided. For example, multipurpose local governments can deliver a range of welfare and regulatory services and need a central administrative function. It is very likely that pressures from the organizational environment, which play a critical role in shaping strategic stances, will be differently experienced in social care for vulnerable people than in the food safety function of environmental health.
If strategy does not vary, it is operationalized as a category: for example, an organization can be only a defender or a prospector. In early research on Miles and Snow, scholars measured strategic stances by asking respondents to select one of a number of paragraphs, representing a defender, prospector, or reactor that best describes their organization (see Greenwood, 1987, for an example in the public sector). This approach was later adapted to scales that captured the strategic stance with decision rules used to identify a single stance for each organization (Conant, Mokwa, & Varadarajan, 1990). However, if it is accepted that strategic stances vary to capture this notion, measurement needs to move away from the use of descriptions that capture all features of the strategic stance in one statement or as a result of decision rules. Furthermore, social science research methodologies caution against categorical measurement and encourage the development of scales that capture variation in the phenomena being studied. This would suggest that strategic management researchers move toward scales that allow organizational respondents to express their opinions across a number of strategic stances that capture the complexity of their organization. Thus, based on the view that strategic stances vary across complex organizations and on good measurement principles that capture variation, the analyzer type becomes redundant because it is an intermediate between the somewhat opposite strategies of defending and prospecting.
Walker's (2013) review of the public service organization-relevant empirical evidence on Miles and Snow corroborates the importance of adopting a mix of strategies. Walker notes that when studies allow strategic stances to vary, they are more likely to uncover positive relationships between strategy stance and performance than when the categorical statement approach is adopted. The higher support for studies using scales that permit variation in strategic stance would imply that organizations can display characteristics of both defending and prospecting or that adding some innovation to a focus on core services is as valuable as adding extra weight to efficiency in the search for new markets and products. This departure from the Miles and Snow framework is important because a key characteristic of the public sector is frequent changes in political authority that affect the strategies of public agencies (Rainey, 2009; Wechsler & Backoff, 1986). Public managers must typically trade off different performance outcomes in the management of their organizations (Rainey, 2009; Walker, Boyne, & Brewer, 2010). Thus, adopting a single strategic stance may compromise these trade-offs. For example, defenders can enhance the efficiency of their organizations by focusing on the core business, but such a strategic stance may not be conducive to responsiveness or service outcomes as the organization pays less attention to new services or markets. Similarly, while turbulent organizational environments may call for a strategy of innovation to enhance effectiveness the disruption that this may bring could lead to managers focusing on their core goals and aims in order to ensure that services are equitably distributed to those in need.
Prospectors and Defenders Outperform Reactors
Miles and Snow (1978) argued that prospecting and defending strategies result in better organizational performance than reacting strategies. The public sector studies examining the relationship between strategy content and performance are consistent with this proposition (Boyne & Walker, 2010). The strategies related to prospecting, such as exploring new markets and services, and those related to defending, such as sticking with the existing pattern of services while trying to improve their efficiency, have been shown to link positively with performance (Meier et al., 2007). By contrast, reacting has proven to result in poor performance on many occasions (Walker, 2013). Such poor performance is attributable to a lack of consistency in orientation toward the environment that results in casual and random information gathering.
These findings indicate that public agencies are more likely to reach higher levels of organizational performance when they are given some freedom to determine the correct mix of prospecting and defending that suits their circumstances. Public organizations that primarily take instructions from major stakeholders' demands and organizations in the environment are likely to drift toward a reactor strategic stance and will likely see a decline in their performance. Scholars from a strategic management perspective have focused less attention on strategic actions, and studies that have examined actions in relation to stances have led to lackluster findings (Andrews, Boyne, & Walker, 2006).
Research Findings on Effective Practice
A consideration of effective practice requires an examination of the relationship between strategic stances and behaviors and organizational performance. To do this we elaborate table 15.1 and expand the strategic behaviors from the three identified in Porter's model of generic strategy to the five argued by Boyne and Walker (2004) to be suited to public service organizations. This is shown in table 15.2. The columns are drawn from Miles and Snow, and the rows relate the aspects of the framework drawn from Porter. Row one is concerned with changing the environment, for example, providing new services to new groups of citizens. Altering relationships with the external environment are shown in rows two, three, and four: changing services (new services to existing users), seeking revenues, and the external organization (through collaboration, networks, partnerships, and outsourcing). Making modifications to internal organization, as seen in row five, includes, structure, culture, leadership, processes of formulation and implementation, and management practices. We also indicate in the table the extent to which research has been undertaken on the identified relationships. What is immediately apparent is the number of cells where limited research has been undertaken, particularly in relation to the external environment. Given that the weight of the evidence is tilted toward internal actions we begin our discussion here.
Table 15.2 Extent of Evidence on Strategic Management and Performance
| Strategic Stance | |||
| Strategic Action | Defender | Prospector | Reactor |
| Change markets | Limited | Limited | Limited |
| Change services | Limited | Limited | Limited |
| Seeking revenues | Limited | Limited | Limited |
| External organization | Networking, partnerships, external regulation | Networking, partnerships, external regulation | Networking, partnerships, external regulation |
| Internal organization | Structures, processes | Structures, processes | Structures, processes |
Source: Adapted from Boyne and Walker (2004, pp. 243–244).
Alignment between Strategic Stances and Internal Actions Enhances Public Service Performance
The strategic management framework is contingent on relationships between strategy content and the internal organization (e.g., structure, process) as a route to higher levels of organizational performance. Most empirical evidence presented on the impact on performance is focused on questions of internal organization (Walker, Boyne, & Brewer, 2010). However, the majority of this literature examines independent effects between a management practice and performance, with only limited attention focused on bivariate relationships. We now review these studies that have examined strategy content together with strategy formulation, strategy implementation, and structure.
As Miles and Snow suggested (1978), a match between prospecting and incremental strategy formulation produces a strong performance effect. Andrews, Boyne, Law, and Walker (2012) provide empirical evidence to support this relationship. This suggests that a strategy of innovation can be supported by negotiation with key stakeholders inside and outside the organization that permits flexible responses to circumstances as they arise. These authors provide similar findings for strategy implementation, which concur with those of Govindarajan (1988), that low central control is associated with high performance for organizations that are developing new services. This may be because the broad and tentative planning process associated with an incremental implementation style allows staff to put forward their ideas, innovate, and learn by doing.
Similar findings are uncovered in relation to prospecting and strategy implementation (Andrews, Boyne, Law, et al., 2012). This is because incrementalism implies adapting to new circumstances and is associated with innovation. For example, a prospecting strategy has been shown to overcome rigidity in relation to the problems related to rules, rules gone wrong, and delays generated by red tape (Walker & Brewer, 2009). The findings suggest that as long as an organization has a deliberate strategic stance (i.e., defending or prospecting), it does not matter which formulation process it adopts. However, a good strategy requires appropriate implementation. Teasing out these findings points to the importance of implementation style and implies that less attention can be paid to formulation because the delivery of strategy content has a more direct relationship with outcomes than internal processes.
Andrews, Boyne, Law, et al. (2012) demonstrate the contingent relationship between decentralized structures and prospecting on performance. Involving staff in decision making may enable senior managers to more effectively identify opportunities for improving service delivery. Decision participation can maximize the points of contact between service managers and users, leading to a more responsive service development. This finding is consistent with Maynard-Moody, Musheno, and Palumbo's (1990, p. 845) argument: street-level bureaucrats “savvy about what works as a result of daily interactions with clients, should have a stake in the decision-making process.”
The argument for strategy stances that Miles and Snow advance is that centralized organizations provide the most fruitful approach for a defender, offering tight control over internal operations. A prospector would be better suited to decentralization, which would permit organizational subunits to respond in innovative ways to new circumstances and opportunities. Andrews, Boyne, Law, et al.'s (2012) results also provide support for Miles and Snow's hypothesis: organizations that adopt a defending strategy enhance their performance if they centralize authority and reduce decision participation. These findings are consistent with the arguments on the effectiveness of organizations in which power and processes are tightly controlled in pursuit of a fixed strategy of stability and efficiency (reviewed in Miles & Snow, 1978).
Andrews, Boyne, Law, et al. (2012) also demonstrate that a rational approach to implementation is positively associated with performance when it is combined with a defender orientation. This suggests that it is important for services to align their strategy with their implementation processes. This finding confirms the expectations that centralized control and specification and monitoring of tasks associated with a rational approach to implementation are associated with good performance for organizations (defenders) that are focusing on improving existing services.
There is also empirical research that concentrates on the moderating effects of strategic stances on the negative impacts of a common bureaucratic malady, red tape, in government agencies. Walker and Brewer's (2009) study suggests a pattern of varying relationships between different strategic stances and red tape. They report that the prospecting strategy is powerful and neutralizes the negative effect of red tape on performance, whereas reacting is related to higher levels of red tape and amplifies the harmful effects of red tape. Unlike these two strategic stances, defending has no substantive effect on the impact of red tape. The findings support Pandey and Moynihan's (2006) argument that a developmental culture, encapsulating the notion of risk taking and predicated on flexibility and adaptability, helps fight off red tape.
The research evidence on other internal organizational behaviors is limited; thus, more evidence is needed in relation to internal changes such as organizational culture and leadership. One of the few studies to examine stances and actions found that prospecting and reacting are positively and negatively associated with performance, respectively, but internal organizational action has no significant performance effect (Andrews, Boyne, & Walker, 2006, p. 20). This result can imply that where a general strategic stance has been adopted, internal organization neither reinforces nor hampers performance. The possibility was supported by no statistical significance of interaction terms between each strategic stance and internal organization. While this study suggested that the two dimensions, stances and actions, of strategy content influence performance independently rather than jointly, subsequent studies have provided increasing levels of support. However, when alignment across strategy, process, structure, and environment was placed under the empirical microscope, only a few relationships were uncovered, leading to less comprehensive findings. Thus, further studies need to use a wider set of measures of strategic stances (e.g., multi-item measure) and internal actions (e.g., culture, leadership, and human resource management policies).
Alignments between Strategy Stances and External Actions Matter for the Improvement of Public Service Performance
Changes in the environment are in relation to changing markets, services, revenues, and external environment. As with research evidence on internal actions, the majority of this focuses on independent relationships (see table 15.2). However, less attention has been given to the question of external actions largely because choices for public organizations are somewhat limited here. Some evidence on innovation shows a positive association between innovations in services and markets and performance. Revenues have not received substantial attention from public administration scholars in relation to performance, though some studies have examined the impact of slack resources, indicating that slack resources can influence which strategic stance government agencies adopt (Walker, Boyne, & Brewer, 2010). Andrews, Boyne, and Walker (2012) examined relationships between strategic stances and actions and budget by examining overspending and found that prospecting is associated with overspending, as were actions concerned with developing new services. They also found that reacting can be a good strategy and that the reacting strategic stance was associated with lower levels of overspending.
Changes in relationships in the external environment have been studied. Findings increasingly suggest that partnerships, networks, and collaboration are a force for good, but the evidence on contracting is more mixed. For example, Walker, Andrews, Boyne, Meier, and O'Toole (2010) find that interactions with different network nodes matter for performance in local governments rather than overall networking as an aggregate concept. First, managerial networking with elected members is associated with lower performance, but elected members ring out alarm bells in the face of poor performance. Second, networking with managers in other councils is conducive to performance, suggesting that they chime in to help remedy deteriorating performance. Third, user group representatives contribute to higher performance, since they consistently offer valuable information to public managers. However, fourth, central government officials may harm the performance of local government agencies by attending to the signals but striking chords of dissonance. Such patterns varying across different network nodes imply that networking is a particularly complicated action or process.
In relation to effects of external regulation, Andrews, Boyne, Law, et al. (2012) find some matching effects between strategic stances and external regulation types—inspection and regulatory support—on the performance of local governments, although there is no direct performance effect of these external regulations. More concretely, formal inspection, which imposes a burden to respond to the rigors of the regulatory process, undermines the relationship between prospecting and performance and between reacting and performance. By contrast, supportive regulation consisting of general advice on how to innovate successfully rather than the intense scrutiny of a potentially disruptive site visit has a positive effect on the relationships of prospecting and reacting with performance.
Alongside the consideration of specific strategic actions in relation to the environment, complex conditions in the external environment reduce the effectiveness of all types of strategy content, and performance falls for organizations engaged in prospecting, defending, and reacting (Andrews, Boyne, Law, et al., 2012; Owens & Kukla-Acevedo, 2012). This suggests that strategies work better when the technical environment is simple and offers support for Miles and Snow's argument that defending operates better in a straightforward environment. However, it contradicts their argument that prospecting works best in complex and dynamic environments. Boschken's (1988) research on port authorities in the United States analyzes that prospectors were the most effective in a turbulent environment but that reactors performed best in a protected environment. In further study, Andrews, Boyne, Law, et al. (2012) indicate that a reactor's performance falls further when the environment is dynamic, perhaps because in such an environment, managers are not able to read or respond to rapid change or keep apace of the shifting strategic priorities emanating from the external environment.
Evidence on Alignments between Stances and Internal and External Changes Is Limited
Table 15.2 clearly shows that evidence on internal and external change is very limited. Andrews, Boyne, and Walker (2006) empirically tested their framework and found that only independent effects in relation to stances of prospectors and defenders outperformed reactors. Analysis of strategic actions showed no significant performance effects from actions concerning service change, extra revenues, and external organizations but a positive effect of change markets on performance. Bivariate tests for relationships with stances and actions did not uncover any performance effects. One further study examined stances and a number of internal changes and the external environment but showed no significant results (Meier, Boyne, O'Toole, Walker, & Andrews, 2010).
Studies focusing on bivariate relationships do report findings of interest: incremental strategic implementation processes work better in complex and dynamic environments for prospectors, probably because of the adaptive and flexible nature of the incremental processes needed to deal with the challenges that emerge from these types of environments (Andrews, Boyne, Law, et al., 2012). In the face of resource scarcity and complex and dynamic environments, an absence of strategic implementation processes worsens performance outcomes, making this an ineffective implementation style. Again, this evidence points to the importance of examining strategy implementation, indicating the need for more systematic information on this facet of strategic management.
Implications
Miles and Snow (1978) propose that their strategic stance archetypes—search for something new (prospect), stick with the existing pattern of service (defend), and await instructions (react)—are generic. Porter (1980) suggested strategic actions that focus on changing the environment, changing relationships within the existing environment (by altering services, revenues, or external structure), or internal change (through modifications to internal structure). Boyne and Walker (2004) combined the frameworks of Miles and Snow (1978) and Porter (1980), suggesting that both strategic stances and actions should be considered for effective strategies or strategic management pursued by public organizations.
The evidence generated by this review implies the following road map for public organizations. Contrary to Miles and Snow and Porter, organizations should adopt a mixture of consistent and identifiable strategies that are selected based on an organization's desired actions rather adopting a strategy based on responding to voices in the external environment—for example, defenders and prospectors outperform reactors in the majority of cases. Adopting a mix of strategies also allows organizations and managers to trade off differing performance demands. Studies have shown how a mixture of prospecting and reacting can assist college-bound students but detract from the equity objectives associated with the attainment of black students (Meier et al., 2007). Furthermore, adopting a mix of strategies can help to contract out effectively and efficiently the different functions or services of public organizations.
A number of key internal strategic contingencies can be traced for prospectors and defenders. The contingencies can include strategy implementation processes (e.g., incremental strategy processes for prospecting) and organizational structures (e.g., centralized structure for defenders), as the evidence reviewed shows. Furthermore, some organizational culture and leadership types can be found more suited to each strategic stance. This can include supportive leadership, achievement-oriented leadership, and directive leadership, which can be compared to their matching relationship with each strategic stance. Considering the alignment of these contingencies can help to build developmental and innovative culture for effective organizational change or reform by reducing employees' resistance to the changes. Regarding environmental contingencies, strategies would appear to work best in stable environments, although incremental implementation styles overcome the difficulties associated with complex and dynamic environments.
The effectiveness of these strategies is dependent on their combination and the context in which they are implemented. They are a road map, not a prescribed route. Public managers should consider the effective connections between these contingencies in order to enhance organizational performance with whatever strategy is adopted. Given that these relationships are complex rather than simple and uniform, it is conceivable that different strategies will be equally effective, depending on the internal and external circumstances of public organizations. One important issue to emerge from this stream of work on strategic management is that strategy implementation matters, but more knowledge needs to be developed in this area.
The strategic management road map is reliant on a partially tested empirical framework; thus, the evidence reviewed here offers support for parts of Boyne and Walker's (2004) propositions. A full test of the framework would be demanding. This would require robust data that can withstand the inclusion of many moderated and mediated relationships in order to simultaneously tease out the large number of contingencies contained in the framework. Consequently, emphasis should be placed on testing facets that have received less attention along the way, most notably, the studies that examine the relationships between strategy content (including stances and actions) and the environment. In testing the validity of Boyne and Walker's (2004) framework, attention must be directed to questions of endogeneity to tease out whether high-performing organizations adopt alignment across strategies, processes, structures, and environment and whether high performance is led by this alignment.
Given the lack of studies on the relationships between strategy content and the environment, there have been a number of theoretical extensions relevant to the Miles and Snow framework that can be integrated into the public service organization model. Institutional environments (Scott, 2001), for example, have received only fleeting attention. Andrews, Boyne, Law, et al. (2012) show how regulatory regimes can disrupt the association between strategy content and performance, while a supportive institutional environment reinforces it. The institutional environment, specifically responding to norms and rules, is particularly important in the public sector and worthy of additional attention.
Considering that alignment remains pertinent to the management of public organizations, further studies need to test and find important dimensions of internal organizational actions in table 15.2 to match each strategic stance. Of strategic actions, the evidence is focused on implementation processes and organizational structure. Future studies can explore the joint effects between diverse organizational culture and leadership types and strategic stances on performance. Regarding external organizational changes in table 15.2, there is no empirical evidence on the relationship with strategic stances, although outsourcing (contracting out) services to private or nonprofit providers is now an established practice in public organizations (Boyne, 1998). These potential studies can help to elaborate on the effectiveness of Boyne and Walker's (2004) framework and develop a framework of strategic management for public organizations.
A comprehensive examination of strategic management in public organizations that can tease out the complex questions of alignment will necessitate large data sets that capture strategy, structure, process, environment, and performance. Such a data set would need to cover large numbers of organizations in different settings. It must also be sufficiently robust for multidirectional interactions of strategy stances, actions, and environment to be performed in multiple regression equations to test alignment or for some paths among the alignment components to be found in structural equation models. Furthermore, longitudinal or panel data covering sufficiently multiple years would be needed in order to check for endogeneity issue between alignment and performance. More fundamental, good measurement is also required. Many propositions have been developed and implemented regarding new ways to operationalize Miles and Snow's strategic archetypes. For example, the heteromethod measures for the same strategic stance will show different associations with performance. However, no systematic tests have been undertaken to examine this proposition. Thus, studies could examine and compare the reliability and validity of different measurement approaches—for example, Greenwood's (1987) paragraphing, Conant et al.'s (1990) multi-item scale to category, and Andrews, Boyne, Law, et al. (2012) multi-item scales using Likert scales and permitting strategy to vary.
Summary
Strategic management has been promoted as a function of public organizations as the introduction of competitive markets and managerial behaviors has made the public sector more like the private sector. Boyne and Walker (2004) integrated the strategic stances framework from the work of Miles and Snow (1978) with Porter (1980) to develop a strategy content approach that focuses on strategic stances and actions. Based on the available evidence, five major findings were identified.
The first finding from the public services strategic management research evidence identified departs from Miles and Snow's (1978) original formulation. Boyne and Walker (2004) have shown that strategy stances vary. Second, the research evidence supported the propositions from Miles and Snow that defenders and prospectors outperform reactors.
The remaining three findings focused on the relationship between strategic stance and actions. The third finding indicated that alignment between stances and internal actions has positive performance payoffs. Evidence was particularly clear in relation to prospecting and incremental processes of formulation and implementation, together with decentralized structures. For defending (stances), rational approaches to formulation have been shown to enhance performance, as have centralized structures. The evidence uncovered on reacting largely suggested inconsistent strategic behaviors and more often than not pointed to insignificant or negative relationships with performance.
Evidence on relationships between the environment and stances and between strategic management and internal and external context is somewhat thinner than the other areas reported by scholars. Changes in services and markets have been shown to reveal some performance benefits, as has changing the relationship with the organizational environment through partnership and collaboration. Finally, when it comes to examining the full range of contingencies between stances and internal and external change, the evidence base becomes very weak. At best, studies in these areas suggest that incremental implementation processes work best in dynamic environments for prospectors. Where studies have attempted to test the range of contingent relationships, they have largely produced lackluster results. These weak findings may reflect the complexities of the framework presented, together with the difficulties researchers find in developing data sets capable of withstanding the demanding statistical analysis necessary to tease out these complex relationships.
It is necessary to point out that the evidence based on effective practices is not comprehensive. Table 15.2 shows where evidence has been provided. The research findings have mainly linked the three strategic stances to internal organization actions, and external change has largely focused on understanding the impact of the organizational environment. Nevertheless, there is growing evidence pertinent to the management of public organizations and their strategies. The core argument is that organizations should choose the strategic stance that best suits their circumstances and combine the strategic behaviors that suit those circumstances in order to enhance organizational performance.