Middle Level Management Sensemaking Practices and Strategic Change: the role of Informal Practices and Formal Practices in emergent strategy

This qualitative study contributes to calls from the Strategy-as-practice perspective to identify the actual activities that managers engage in to accomplish their strategic work (Jarzabkowski, Balogun and Seidl, 2007;... [ view full abstract ]

This qualitative study contributes to calls from the Strategy-as-practice perspective to identify the actual activities that managers engage in to accomplish their strategic work (Jarzabkowski, Balogun and Seidl, 2007; Johnson, Melin and Whittington, 2003). Strategy-as-practice theorists reverse the conventional assumption that strategies are what organisations have and instead emphasise strategy as something that organisations do (Whittington, 2006: 613). This conceptual reorientation focuses research on the situated social practices that are enacted and re-enacted in the ‘doing’ of strategy (Rasche and Chia, 2009: 713). From this perspective, Rouleau and Balogun (2011) called for more research on middle level managers’ strategic roles in different contexts.

People create, implement and renew strategies (Mantere, 2008) and extant literature on middle manager involvement in strategizing has largely been functionalist (Mantere, 2008). Rouleau (2005) argues that we do not know enough about how middle managers draw on their practical knowledge to inform their practice, where practical knowledge is what we know without explicitly knowing we know it (Baumard, 2001). It is important to explore how middle level managers use practical knowledge in their daily activities as their strategizing roles are often informal and with less authority than those in formally recognised strategic roles (Rouleau and Balogun, 2007). There is still little known of the strategic practices through which actors account for themselves as strategists (Jarzabkowski, 2008) and there are opportunities to develop a further understanding of what individual practitioners do within their immediate locales (Jarzabkowski, 2008). The processes of sensemaking by middle level managers have been shown by research (Balogun and Johnson, 2004, 2005) to have intended and unintended change consequences, and they call for more research into middle level managers’ sensemaking activities that contribute to change outcomes (Balogun and Johnson, 2005).

Sensemaking (Weick, 1995) is generally conceptualised as a social process of meaning construction and reconstruction through which managers understand, interpret, and create sense for themselves and others of their changing organisational context (Balogun and Johnson,2004; Rouleau and Balogun 2011; Maitlis,2005; Maitlis and Sonenshein, 2010). Sensegiving is a reflection of sensemaking in that meaning is disseminated to others and influences understanding (Gioia and Chittipeddi, 1991; Maitlis and Sonenshein, 2010). Within the process of sensemaking and sensegiving it has been suggested that there is a dual, cyclical, and ongoing process of sense reading and sense wrighting where ‘wrighting’ is used in the same sense that a playwright ‘wrights’ (Mangham and Pye,1991: 27). In other words intertwined cycles of interpretation and action, where interpretation shapes action, and action shapes interpretation in a reciprocal relationship through time (Rouleau and Balogun, 2011) are also intertwined with and influenced by the simultaneous cycles of interpretation and action of others (Balogun, Pye and Hodgkinson, 2008). In their exploration of research on middle level managers’ practices in change situations, Rouleau and Balogun (2011) concluded that further research is required into middle level managers’ situated sensemaking. For this research, Middle Level Managers are those with one or two management levels above them and one level over workers and operational staff (Huy, 2001; Wooldridge and Floyd, 1990). More broadly defined, the middle level manager is the co-ordinator between daily activities of the units and the strategic activities of the hierarchy (Floyd and Wooldridge,1994: 48).

Arguably, change is the most important process within the discipline of strategic management as it is an ever-present element that affects all organisations, and change and strategy are interrelated (Burnes, 2004; Todnem By, 2005). Change continues to be of interest to researchers due to the significant challenges around successful implementation, as most attempts to implement change are unsuccessful (Higgs and Rowland, 2011; Kotter, 1996). A type of change that realigns an organisation’s strategy, structure and processes to fit within a new competitive context is strategic renewal (Worley, Hitchin and Ross, 1996). Strategic renewal can be regarded as a continuous process of first and second-order change (Barr, Stimpert and Huff, 1992), and designates processes that change the organisation fundamentally, overcoming strategic problems through diversity of processes (Mazzola and Kellermanns, 2010) to deliver strategic outcomes. It is emerging because it is one of the forms of change that is increasingly important to a firms’ success (Mazzola and Kellermanns, 2010). Evidence suggests that strategic renewal has a critical impact not only on individual firms and industries but on entire economies (Agarwal and Helfat, 2009). There are calls to better understand what strategic renewal consists of (Agarwal and Helfat, 2009; Crossan and Berdrow, 2003; Floyd and Wooldridge, 2000; Kwee, Van Den Bosch and Volberda, 2011).

This paper seeks to respond to gaps in the literature and calls for more understanding of middle level managers sensemaking practices in strategic renewal (Agarwal and Helfat, 2009; Balogun and Johnson, 2005; Kwee et al., 2011; Rouleau and Balogun, 2011; Floyd, Cornelissen, Wright and Delios, 2011;). There are calls for insight into the middle level managers’ strategic sensemaking role in practice (Rouleau and Balogun, 2007, 2011) and specifically within strategic renewal (Floyd et al., 2011). The question that is explored in this paper is:
‘What are middle level managers’ sensemaking practices within the strategic renewal process?’

The study reported was designed to identify middle level managers’ sensemaking practices regarding exploitation and exploration (Kwee et al., 2011) and intuiting and interpreting within the exploration sub-process of strategic renewal (Floyd and Lane, 2000). Exploitation sensemaking practices being routine and repetitive (March, 1991) and linked to implementation. Exploration practices being learning and change focused (March, 1991). This tension between exploitation (routine and repetition) and exploration (learning and change) was identified by March (1991). Recognising and managing the tension between exploration and exploitation is a ‘‘primary factor in system survival and prosperity’’ (March, 1991:71) and one of the critical challenges of strategic renewal (Crossan, Lane, and White, 1999).

At the individual level, Intuiting is the preconscious recognition of the pattern and/or possibilities inherent in a personal stream of experience and Interpreting is the explanation of an insight, or idea to one’s self and to others (Crossan and Berdrow, 2003:1090). Ideas are generated by individuals who have access to divergent information, and are motivated to attend to and reconcile divergent information with existing knowledge (Floyd and Wooldridge, 2000). The exploration, intuiting and interpreting, or put another way, sensemaking (Weick, 1995) activities are causal events that lead to emergent strategic initiatives (Burgelman, 1983; Mintzberg, 1978).

Key findings found a commonality of sensemaking practices amongst middle level managers in different contexts where sensemaking takes place in the interplay of interpretation and action (Weick, Sutcliffe and Obstfeld, 2005; Rouleau and Balogun, 2010). The middle level managers in this study were identified because they were involved in implementing radical change strategies and were in influential positions with direct access to senior management for upward influence (Dutton and Ashford, 1993). They also had a span of control with accountabilities for the management of direct or indirect resource teams of at least eight full time equivalents for downward influence (Balogun and Johnson, 2004). The middle level managers comprised of operations managers, customer service managers, IT managers and project managers.

This study found that the formal practices that involve interpretive (Rouleau and Balogun, 2007) sensemaking (Samra-Fredericks, 2005; Rouleau and Balogun, 2011) and sensegiving (Smith, Plowman and Duchon, 2010; Drori and Ellis, 2011) appear to be more linked to Exploitation within the strategic renewal context (Kwee et al., 2011; Lechner and Floyd, 2012) than informal practices. These formal practices were prevalent across the different contexts, and all the middle level managers interviewed used these mechanisms. Formal practices are those that are more exploitative as they are predominantly routine and repeated (March 1991). Practices identified as formal and interpretive included reports and briefings, workshops, plans and project documents. In addition a number of additional formal interpretive practices were identified including process mapping, benchmarking and intranets.

In contrast, informal themes are those that are embedded in informal networks, for example: social networks at multiple levels within the formal structure; and not documented (Ahearne, Lam and Kraus, 2014; Pappas and Wooldridge, 2007). Sensemaking practices where the managers understand, interpret and create sense for themselves and others of their changing organisational context and surroundings (Balogun and Johnson, 2004; Maitlis and Sonenshein, 2010; Rouleau and Balogun, 2011) were found to be mostly informal, whereas sensegiving practices, where the managers deploy their understanding and knowledge to legitimately influence others to understand the value of change were found to be mostly formal.

A common view held by the middle level managers in this study was the importance of informal sensemaking practices and mechanisms that take precedence over the formal mechanisms. It would seem that Intuiting sensemaking and sensegiving practices are stronger and have greater causality than formal practices. The study also found that high levels of informal sensemaking and sensegiving then gave rise to formal authority and formal sensegiving as antecedents to strategic renewal exploration and exploration sub processes. Middle level managers are embedded in formal structures and multiple informal networks (Floyd and Wooldridge, 1999; Huy, 2001; Pappas and Wooldridge, 2007) and research suggests that both these elements are important in strategy processes (Pettigrew, 1992; Soda and Zaheer, 2012).

middle level managers, strategic change, sensemaking, strategy as practice [ view full abstract ]

middle level managers, strategic change, sensemaking, strategy as practice