Strategy execution in emerging economies: assessing strategic diffusion in Mexico and Peru

Abstract

Purpose

Middle and lower‐level managers play a significant role in the strategic management process, primarily in the execution stage. However, strategic diffusion – the extent to which a strategy is effectively executed and becomes an integral part of the organization – varies across organizations. This paper aims to examine the strategic diffusion process in two emerging economies, Mexico and Peru.

Design/methodology/approach

Parnell's strategic diffusion scale (SDS) was adopted for this study. Respondents also completed Cook and Wall's nine‐item organizational commitment instrument and a three‐item scale measuring satisfaction with firm performance. Surveys were translated into Spanish and completed by 218 Mexican and 270 Peruvian managers.

Findings

Strategic diffusion was linked to performance satisfaction among both Mexican and Peruvian managers. Overall, Mexican managers produced higher scores on the strategic diffusion scale (SDS) than did their Peruvian counterparts. The link between strategic diffusion and organizational commitment among middle and lower‐level managers remains unclear.

Research limitations/implications

This study supports the strategic diffusion construct and the SDS. Three items in the scale were problematic in certain instances, however. The present study linked strategic diffusion to performance satisfaction in both Mexico and Peru. As expected, Mexican managers exhibited higher SDS scores than did their Peruvian counterparts. The link between strategic diffusion and organizational commitment was not strong, however. Additional research is needed in this area.

Practical implications

Middle and lower level managers in different countries have different views on the process of strategic diffusion. These distinctions are cause by a number of factors, including stages in the economic development cycle, organizational culture, and widely accepted management practices. Executives seeking to implement strategies should recognize the three key components of strategic diffusion – understanding, involvement, and commitment – and how they are influenced by national contexts.

Originality/value

There is a dearth of research assessing management behaviors in emerging nations. It is also important to learn more about processes associated with strategy execution in different organizations. This paper addresses both needs by assessing strategic diffusion in Mexico and Peru.

Citation

Parnell, J.A. (2008), "Strategy execution in emerging economies: assessing strategic diffusion in Mexico and Peru", Management Decision, Vol. 46 No. 9, pp. 1277-1298. https://doi.org/10.1108/00251740810911948