The effects of task environment and organizational agility on perceived managerial discretion and strategy implementation in a pharmaceutical company

Abstract

Purpose This study aims to investigate the relationship between task environment, organizational agility, perceived managerial discretion and strategy implementation on unit performance. Design/methodology/approach Based on the literature review, a structural model was developed. A 74-item questionnaire was circulated among middle managers in sales and marketing. The data collection method used purposive sampling. A total of 228 valid responses were obtained. This study was conducted in a leading pharmaceutical company in Indonesia. The data were analyzed using structural equation modeling. Findings Based on the data analysis, this study shows that task environment and organizational agility act as antecedents of perceived managerial discretion, which drives strategy implementation resulting in unit performance. Originality/value Different from previous studies that examined the linkage of inertial forces and discretion, this research scrutinized the effects of organizational agility on perceived managerial discretion and the direct role of perceived managerial discretion on internal strategy implementation.

Organizational agility, dynamic managerial capability, stakeholder management, discretion, and project success: Evidence from the upstream oil and gas sectors

“…An organization's capability to operate in turbulent and uncertain conditions will lead managers at every level to perceive that they have broad latitude. This finding is in line with studies that have found that OA is an internal factor that affects PMD [ 2 , 5 ].…”

“…Managers have freedom of choice when establishing their work in a given situation [ 17 , 29 ]. They have discretion in achieving organizational goals [ 5 , 6 , [30] , [31] , [32] ]. With developed discretion, managers have a wider range of options to make decisions and, hence, greater latitude [ 33 , 34 ].…”

“…OA can help an organization accurately perceive changes in the external environment, strategize, and implement the necessary changes. OA, as an organization-level determinant, influences middle managers’ discretion [ 5 ]. Those that develop PMD enable an organization to respond to uncertainties in a timely manner.…”

“…To effectively address this situation, managers at all levels within organizations need to possess the ability to sense crises, manage organizational activities, and successfully navigate the challenges posed by specific conditions. One area that has attracted considerable interest among many scholars is discretion, which plays an essential role as a bridge between strategic implementation and organizational outcomes [ [3] , [4] , [5] ]. However, the discretion literature is mostly concerned with CEOs or other top management personnel.…”

“…The determinant factors are task environment, internal organization, and managerial characteristics. For research purposes, we consider stakeholder management (SM) in terms of task environment [ 5 , 19 ], organizational agility (OA) in terms of internal organization [ [20] , [21] , [22] ] and dynamic managerial capability (DMC) in terms of managerial characteristic [ 3 , 23 ]. Ultimately, this study investigates the effect of PMD on project success in the upstream oil and gas sectors.…”