The influence of NGOs on the strategy process in conflict zones : an institutional theoretical perspective

Abstract

The strategy process of a firm has been identified as an important area in the field of strategic management. It has been argued that understanding the process of how strategy is generated and executed is vital for the success of firms; particularly for Multinational Corporations (MNCs) who are expanding into new regions, having to adapt their strategy process to address local demands. This has led to a growing interest on how the strategy process changes within turbulent geographical regions, such as conflict zones. Sharing the same operational region, Non-Governmental Organisations (NGOs) have been recognised as influential institutions but have been rarely considered. Hence, there was a need to understand how firms account for institutional pressures in their strategy process within a conflict context. Drawing on institutional theory, this study explores external organisational influences on firm strategy. This thesis reviews the theoretical concept of legitimacy and power to understand how NGOs can pass the firm legitimacy filter and influence firm strategic decision-making. In connection, it was necessary to comprehend which actors within NGOs possess an influential ability, developing the notion of agency. To gain a comprehensive perspective of NGO influence on the strategy process, the research design was based on a multilevel method of analysis. Three research questions were aligned with a macro, meso and micro perspective. Empirical data was collected from twenty-one semi-constructed interviews with senior managers in MNCs and NGOs. The context of study was based in the Middle East and North Africa (MENA) economic zone. This thesis provides a contribution to strategy process literature and institutional theory. Firstly, this study extends the strategy process literature to conflict zones providing a contextualised conceptual framework. The main implications recognised were feasibility indicators and an institutional rank of importance. Secondly, theoretical contributions have been made to sources of legitimacy, institutional control and embedded agency. NGOs gain legitimacy from ‘institutional value’ or ‘interception’, ultimately enforcing power by ‘disturbing the bottom-line’. NGOs would need to impact the firm’s financial flow or business operations. Two types of actors within NGOs can influence strategy: a specialist authoritative partner or a prominent micro actor.