Academic journal article Irish Journal of Management

Strategic Choice in the Non-Profit Sector: Modelling the Dimensions of Strategy

Academic journal article Irish Journal of Management

Strategic Choice in the Non-Profit Sector: Modelling the Dimensions of Strategy

Article excerpt

ABSTRACT

This study examines the strategy choices and processes of 25 non-profit housing organisations in Ireland to establish an empirical basis for defining the elements of strategy for non-profit organisations and to identify contingency factors. This paper commences with a review of current literature on alternative approaches to strategy in both the private and non-profit sectors and proposes a framework for researching strategy in non-profit organisations. Using this framework, five key research questions are posed. Strategy in non-profits includes decisions in relation to mission, environmental analysis, strategic content, organisational structure and the process of strategy formulation. In addition to highlighting the detailed components of each of the five strategy elements for the 25 non-profit housing associations in Ireland, the research suggests that there are at least three potentially important contingencies in non-profit strategy:

1 A highly regulated and/or 'predictable' external environment is consistent with a 'systemic' approach to strategy;

2 Organisations in the midst of significant growth are more likely to be concerned with decisions around mission and structure, while those in a more competitive, lower growth environment will be more focused on environmental analysis and strategy content;

3 Human resource related elements have a higher 'visibility' in non-profit strategy than current strategy literature would suggest.

INTRODUCTION

Studies of strategy in non-profit organisations have proliferated in the last decade with research questions addressing the formulation, content and implementation of strategy using a multitude of different methodologies. Nevertheless, the field remains fragmented (Stone et al., 1999) and displays an over-reliance on dated approaches to researching and formulating strategy derived from the private sector (Courtney, 2001). Furthermore, the majority of studies are based in the US, with relatively few studies on strategy in European non-profits. In this paper, we seek to address both of these issues by, firstly, proposing a research model that integrates recent literature regarding the range of strategic management approaches with existing knowledge about the shape and content of non-profit strategic management and, secondly, using the resulting model to describe the strategic choices made by 25 non-profit housing organisations in the Republic of Ireland (ROI) and Northern Ireland (NI). The focus of this study is on identifying the key elements of strategy and any patterns arid/or possible contingencies in the non-profit organisations studied.

The first section of this paper presents our research model based on a review of current literature in the non-profit strategy domain as well as the current paradigms in mainstream strategy literature. This section concludes with the key research questions and the methodology used. The second section reports 011 the main findings of our research into Irish non-profit housing organisation strategy and compares these findings with existing theory. The implications for theory in relation to strategy in non-profit organisations are summarised in the final section, along with implications for practitioners and policy makers as appropriate.

RESEARCH MODEL AND METHODOLOGY

Stone et al. (1999) proposed a range of analytic categories for describing strategy in non-profit organisations based on their analysis of 65 empirically based journal articles relating to non-profit strategy. Courtney (2001) investigated strategy research and practice among non-profits in Ireland and England and proposed that the 'new pragmatic approach' (Nohria and Berkley, 1994) to strategic management was much more in tune with the culture and values of the non-profit sector than the classic planning approach that informs much of the research (and practice) discussed in Stone et al. (1999). Based on these two sources we determined that the relevant questions for an analysis of non-profit strategy are:

1 What are the choices that organisations make that could be considered 'strategic'? …

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