Constraints to Participation in Strategy-Making: Evidence from a State-Owned Enterprise in Ethiopia

Abstract

Strategy making has been considered the purview of top management. Hence, participation in strategy making is often considered a non-issue and not much research has been done on this topic. Even extant research on this subject is predominantly in the context of the developed countries. This paper explores the nature of participation in strategy making in a state-owned enterprise (SOE) in the context of a developing country, Ethiopia. Following a qualitative approach, involving in-depth interviews with managers and employees, the paper explores the dynamics of participation in the strategy making process. Our findings reveal that strategy making was a mere formality in the past. However, the recent liberalization of the sector and the entry of a competitor into the industry have forced the company to take strategy making seriously. Currently, there are attempts to engage the lower-level managers and employees in strategy making processes, at least in the input gathering stages. Our findings also show that participation is constrained by both organizational and socio-cultural factors. A hierarchical structure and decision-making processes limit the participation of a broader range of employees in strategy making processes. Socio-cultural factors further exacerbate these constraints, as high-power distance systematically discourages the participation of those in the lower ranks of the hierarchy.