Exploring the strategy-to-performance gap : the case of four South African life insurers

Abstract

Strategic management ensures organisational performance by creating and shaping effective strategy to outwit competition. Intended strategy and realised strategy do not necessarily coincide, resulting in a performance gap. Various reasons are advanced for this performance gap. Some researchers are of the opinion that this gap is attributable to formulation aspects, while others blame execution barriers. This paper reports on the perceptions of CEOs of four South African life insurers in connection with the strategy-to-performance gap experienced in their respective organisations. The findings illustrate that these organisations ranked the strategy formulation and execution activities in their organisations similarly. However, they ranked the reasons for the breakdown in strategy execution, as well as the factors that would have the greatest impact on the quality of strategy execution, differently. These rankings were not entirely coherent. This study is situated in the interpretivist research philosophy, combining a case study and descriptive survey as method of inquiry and using a questionnaire to collect data. The latter was one of the reported limitations of the study, since the use of a questionnaire prohibited cross-examination of responses. Nevertheless, the study contributes valuable information to organisations, especially life insurers, to minimise the strategy-to-performance gap.