For my Capstone I worked on a project studying the link between organizational planning, learning and performance. In the study I looked at four different industries in the Midwest. These industries were financial services, manufacturing of electronics parts, newspapers, and metal stamping. A survey was sent to each of the companies in these four industries after a phone call was made to each of them. As the surveys were received they were entered into a computer program for regression analysis. There were four main hypotheses that were looked at and the following are the results of those hypotheses. A strong support was shown for a relationship between strategic planning and level of organizational learning. There was also a positive relationship between learning and performance. No relationship was found between strategic type and the learning/performance relationship. There was a relationship between level of environmental hostility and learning, but not for environmental hostility and sales.B.S. (Bachelor of Science

Carr, Dawn M.

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NORTHERN ILLINOIS UNIVERSITYDoes Organizational Planning Improve the Learning in theOrganization and Does that Enhanced Learning Result inHigher Levels of Organizational Performance?A Thesis Submitted to the University Honors ProgramIn Partial Fulfillment of theRequirements of the Baccalaureate DegreeWith University HonorsDepartment of ManagementBy Dawn CarrDeKalb, IllinoisMay 8, 1999Student Name:Approved By:Department Of:Date:Approval Page((HONORS THESIS ABSTRACTTHESIS SUBMISSION FORMAUTHOR: Dawn Marie CarrTHESIS TITLE: Link Between Planning, Learning, and PerformanceADVISOR: Dr. Luis G. Flores ADVISOR'S DEPT: MGMTDISCIPLINE: MGMT YEAR: SeniorPAGE LENGTH: 11 BIBLIOGRAPHY: NO ILLUSTRATED: NOPUBLISHED: NOCOPY AVAILABLE: Hard CopyABSTRACT:For my Capstone I worked on a project studying the link between organizationalplanning, leaming and performance. In the study I looked at four different industries inthe Midwest. These industries were financial services, manufacturing of electronicsparts, newspapers, and metal stamping. A survey was sent to each of the companies inthese four industries after a phone call was made to each of them. As the surveys werereceived they were entered into a computer program for regression analysis.There were four main hypotheses that were looked at and the following are theresults of those hypotheses. A strong support was shown for a relationship betweenstrategic planning and level of organizationalleaming. There was also a positiverelationship between leaming and performance. No relationship was found betweenstrategic type and the leaming/performance relationship. There was a relationshipbetween level of environmental hostility and leaming, but not for environmental hostilityand sales.IntroductionFor my capstone project I have worked on a project that it studying the linkbetween organizational planning, learning, and performance. Performance is somethingthat all businesses are interested in today. Without good performance a business is sureto fail. Because of this fact this is a very important area of study. In order to have goodperformance, first it must be understood as to what yields good performance. There aremany studies that have been done that have tried to link organizational planning toperformance, but they have been inconclusive.Because these other studies where inconclusive, Dr. Flores and his team decidedto study this subject further. In this paper I will be discussing the hypotheses oftheproject, methodology, procedure, the results thus far, what part I took in the project, andwhat I learned from doing the project.HypothesesThere are four hypotheses that we are trying to prove in this study. Hypothesis 1:Business organizations which have greater sophistication of strategic planning processeswith achieve higher levels of organizational learning than those with lesser sophisticationof their strategic planning processes. Hypothesis 2: Business organizations, whichachieve higher levels of organizational learning, will achieve higher levels ofperformance than those with lower levels of organizational learning.Hypothesis 3: Business organizations which achieve higher levels oforganizational learning will achieve a higher level of performance than those with lowerlevels of organizational learning contingent upon their strategic type. Hypothesis 4:Business organizations which achieve higher levels of organizational learning willachieve higher levels of performance than those which achieve lower levels oforganizational learning contingent upon the level of environmental hostility.MethodologyIn order to do this study; the sample needed to be narrowed down from everycompany in the United States for obvious reasons. In order to do this four differentindustries where chosen to sample. They were selected using the four digit SIC industrycode. Two of the industries, financial services and manufacturing of electronic parts,were very dynamic. While the other two industries, newspapers and metal stamping,were much less dynamic. In order to get the lists of these companies we used the 1998edition of the Ward's Business Directory. The area of the United States that was chosento sample was the Midwest Region. This includes the states of Illinois, Indiana, Iowa,Michigan, Minnesota, Missouri, Ohio, and Wisconsin. This area was chosen because ofour location being in the Midwest.ProcedureA survey was sent out to each of the companies from the four industries that werelocated in the Midwest. The survey was broken into 4 different sections. These sectionswere; Strategic Processes, Strategic Orientation, Business Context, and Demographics.The survey contained many questions taken from previously used surveys. The surveyhad 11 questions from Wood & LaForge's survey, that relate to formal planning. Eightother questions were added to measure how in depth the planning was. Also questions2from a survey developed by Catalanello and Redding were used to measurecharacteristics of learning organizations planning processes and learning methods.Organizational archetypes were identified by using questions off of Conant, Mokwa, andVaradarajan's scale. Slevin and Covin's environmental hostility scale was also used. Asfor the performance questions on the survey, asking the executives questions about fourperformance indexes identified them. These were sales growth, profitability, return oninvestment, and overall company performance.In order to make sure that this was a good survey, 15 executives tested it beforewe used it. After the final version of the survey was done (Appendix A) it was sent totwo senior executives in each of the companies that we had listed. These two executiveswere usually the President or CEO and the CFO, Vice-president, or the Controller. Inorder get the names of these executive phone calls were made to each of the companiessurveyed. After a phone call was made to each of the companies a letter explaining theproject further and a copy of the survey was sent (Appendix B). Ifwe received noresponse from the company within three weeks of the mailing, a phone call was made tosee if they were still interested and to persuade them to take part in this project. As soonas the data was received it was entered in the computer and analyzed using regressionanalysis.ResultsWhile this project is not finished yet regression analysis has been run on theresults that we have received thus far in the project. So far we have received a total of150 responses from 122 different organizations. Strong support was shown for3hypothesis I, which relates to the level of sophistication of strategic planning and level oforganizational learning. There was a strong positive relationship between learning andall four performance measures. This supports hypothesis 2 that predicted a relationshipbetween level of organizational learning and the level of organizational performance.Hypothesis 3 was only partially supported. There was a relationship between level ofenvironmental hostility and learning, but not for environmental hostility and salesgrowth. No relationship was found between strategic type and the learning/performancerelationship. Therefore, hypothesis 4 was not supported.My Part in the ProjectI came into this project after the idea had been conceived. The project hadalready been started also. Only companies from Illinois had been contacted and somesurveys from Illinois had been returned. When first beginning helping on this project Dr.Flores gave me a good explanation of what had been done already and what the projectwas all about.The first task that I performed in the project was transferring all the data from theWard's Business Directory into spreadsheets in order to keep track of the surveys andcompanies. Each company was given a number and each executive was either labeledeither a or b. Also each of the four industries was given a number. This was to make iteasier to put the data into the computer to be calculated; we could easily enter it in andkeep track of what companies had responded. The names of the company, the industry,their address, phone number, and executive names were all put into this spreadsheet. Anexample of this can be found in Appendix C.4After I composed the spreadsheet, I then needed to call the companies and verifythe information and get the name of a second executive. With some of the companies wewould find out at this point that they would not be interested in doing our survey. Iwould do this process for each of the states except for Illinois, which was already donebefore I started on the project. I also did follow-up calls to companies that we hadreceived the survey from one of the executives and not the other. I would let them knowthat we needed two responses from each of the companies in our sample and that theother person had already filled it out. This would work pretty well because they knewthat the other executive had taken the time to do it. We would then send out anotherletter (Appendix D) and another copy of the survey.Also for this project I helped with sending the information out to the executives.We would send out a letter explaining the project and persuading them to participate, acopy of the survey for them to fill out, and a return envelope for them to return the surveyto us. Each survey needed to be labeled with the number of the company and theexecutive.In addition to the actual work that I did on this project, I also attended periodicmeetings that Dr. Flores set up. At these meetings we would discuss where we were asfar as responses and number of surveys sent. We would also talk about things that wecould do in order to improve our response rate. In the meeting new goals would be set asto where the project should be by a certain time. We have been having some problemswith getting the number of responses that we need so this was a definite topic ofdiscussion. Dr. Flores would answer any questions that I or any ofthe other peopleworking on the project had.5What I LearnedThis project was very complex and a lot of hard work went in to it on my part, aswell as others on the team. The first thing that I learned from working on this project ishow much work goes into a research project like this. I use projects like this in myschool papers all the time and never have I thought about how much work went intocollecting all that data. It was not easy to get the companies to do the survey, becausethey were not getting anything for doing it. Some companies would do it with outcoercion, but others we had to offer the results of the survey. Some would simply not doit at all. This could be very frustrating after calling all ofthe company and sending all theletters out and then only receiving a few responses.I also learned more about strategic planning. I had always just assumed that itwould result in better performance, but I never thought about all the things that couldaffect performance. Things that I learned about that also affect this link are things likestrategic type and environmental hostility, which were in our hypotheses. I never thoughtabout the link between planning and learning either. These are all issues that I havegotten a much better understanding of because of working on this project.Lastly, I learned the basics of doing a research project. While I was not aroundfor when the sample was decided upon, Dr. Flores filled me in on these things. Thechoosing of the sample industries and area they were taken from was a very importantpart of a study. This is something that could greatly affect the validity of your results.From looking through the survey that we sent out to the companies, I learned about whattypes of questions would be good to put in a survey and how best to get the answers you6are looking for. Because of computer programs analyzing the data has become a mucheasier process. All of the data can be looked at from the computer. There are many stepsthat must be followed when doing a research project and a lot of planning. These are twovery important things that I learned from working on this project.ConclusionI think that the time that I spent on this project was very productive. Not only didI help Dr. Flores get farther on his study, but I also learned a lot from it. I enjoyedworking on this project and it was a great opportunity for me. I think that the linkbetween planning and learning and its affect on performance should be important toevery field of study. This is something that affects the business as a whole and couldmean the difference between a profitable and unprofitable company.7Appendix APlanning, Learning andPerformance:An International StudyLuis G. Flores, Ph.D.&Ralph F. Catalanello, Ph.D.Department of ManagementNorthern Illinois UniversityDeKalb, Illinois 60115Please contact Luis Flores at (815) 753..6307 (Telephone), (815) 753..6198 (Fax),or i£1ores@niu.edu (E..mail) if you have any questions regarding survey.8Appendix BFebruary 18, 1999Dear Ms Schueler:I am contacting you in regards to a research study I am participating in as a graduate studentat Northern Illinois University. This study is being conducted to detennine the relationshipbetween strategic learning processes and how they are associated with performance indifferent business environments.In order to fulfill the data, a few honors students and I are working together to contact twoassociates from each chosen company in the Midwest to complete our survey. We are alltrying to meet our deadline to finish our project by March 1 to present it at the end of thesemester.We realize the questioIinaire is a few pages, but we feel the information we need is adequatefor the material we have distributed. Also, please note that our questionnaire is comparingthe years 1994 and 1997, even though we have entered 1999. We are greatly depending onyour completion of the questionnaire in order to fulfill our data. Your time is sincerelyappreciated for our research project. Please respond to the questionnaire by February 28.Either myself or one of the students working with me will contact you soon to follow up onthis matter.Sincerely,Jennifer BakerGraduate student, NIU9coco0>0>IINN..-..-II00I/)..-..-CI)-c:-e0<1><1>Z(f)(f)I.-<1>~en0EI/)m,~-~CJ~~-enc'C>-0..cro000<1> N>0«N("I')eL.C)'00~e0()<IienI/)~<1>I/)~CI)~...wro't:JI'-~'t:JI'-~<I'-«Z<1><1>~~ro~~..-~Ne("I')>-ro'<:tCI~mL.C)c..I.-CDroI'-E-Ien'<:t0I.-..-0LL'<:t~..-......-I/):J't:J.Ero00~..-......000NNI-::>0pediw-'~-'«LLZZ0(f)«w0I()cocoI-cocoCOco()cocoI-0(f)0>0>()0>0>0>0>W0>0>0>-~IIWIIIIIIWWNNZNNNN~NNWm()za:::..-..-0..-..-..-..-..-..-Zw«a..IIIIII()IIa:::00()000000a:::zm::>>-..-..-(f)..-..-..-..-:J..-::>0-'I--'------a..c: c:I--'Zee0eeee::>0«w<1><1><1><1><1><1><1><1>Wa:::0(f)(f)'*'=(f)(f)(f)(f)0(f)(f)a:::z()l.-I.-<1>~..c0e<1>0)<1>ro~..c,£:>-~()~(5t::~<1>UU'>ro>-rooO..ceeu>-<1><1>e0)0)()roc:0)ro<9~0E~(f)00)<1>I()I.--..cIro'Ca:::ro~<1> E~I.-.J(f)()l.-I-~>()00ro~I.-~EQ)0mt::a:::mmuu.im<90a:::,~E~<1>ro<1>-roI.-u~enu~<1><1><1>S0"SI.-en00e>eI.--~I.-~ro()<1>00rororo<1><1>rororo()i:5-'a:::-'~0'""')<9a..~0()a..L.C)N..-I'-0>("I')<1>0>000L.C)'<:t("I')NN("I')I'->N0«L.C)I'-..-("I')("I')'<:t("I')("I')L.C)0>L.C)L.C)L.C)I'-eL.C)0~0>'<:t("I')'<:t'<:t~~I'-~L.C)e~("I')(j)L.C)("I')I'-000L.C)uL.C)0>~("I')L.C)("I')>.0~()..-eroco~L.C)0<Ii0<Ii("I')0>en<1>-N~0coN<1>N<1>roI'-~<1>N'ro-''<:te-x~x~xmxe-~x<Ii~~x..cx00~0~0e00S:J0U0ro0-mromrommenrome(f)mem<1><1>:0u~~o~..-~'00e<1>a.000ro00ro("I')00<1>0a.a..~a..~0..<9a..~N~a..a:::LLa..Za..«en~«I.-ZI-«>-ueZro«ro«emz«~z'00eeZe«e0)'00roZ<1>00)em«<1>()l.-e'00e~en<90e<1>Z0~~()0)ro~en0e~Q)~e~()roea.0~0ro00«0en..-..c0ro..-L.C)0e0m000~0>()0mNa.0>~~Z«0roL.C)uNe00L.C)XI'-U("I')'<:t<1>("I')mCD0)("I')ro'<:t~CD0)..-WI'-<1>("I')<1>..-IIIIeIIIIIeL.C)enCDro("I')mNI'-e..-ro..-roNeL.C)0ro00CD<1> I'-'0("I')I.-L.C)mN("I')eN'0N("I')I'-N'<:troNNCD0>I'-I'-~I~I0I.-IenI~I0I0I~Ie'<:t'<:ten'<:tenco'<:te'<:t~0en0e0ro..-0..-en..-I.-0I.-..-ro..-NenNroNm'<:tZ'<:t«'<:tLLCDLL'<:tm'<:tZ0>«0>m0>..-..-..-..."-COUc:=nsC-COenen~-nsL1.-rooONN00NNrooO("I')("I')00NNrooO'<:t'<:t00NNrooOL.C)L.C)00NNrooOCDCD00NNrooOI'-I'-00NNrooOcoco00NNrooO0>0>00NNrooO00..-..-NN10Appendix DNovember 23, 1998Carol LeidViking Electronics Inc.1531 Industrial St.Hudson, WI 54016Dear Ms Leid:This is a follow-up letter in regards to the phone call you receivedNovember 23, 1998 !TomDawn Carr. She informed me that the surveywe had sent to you was misplaced, but you would fill out a new one if wesent another one to you. I am a graduate student, also working on thisstudy, and I am contacting you with the appropriate survey that you agreedto complete.We greatly appreciate your time and encourage you to enclose a businesscard with the return envelope in order for us to contact you with ourresults when they are finished. We hope to have interesting and sufficientresearch information.Sincerely,Jennifer BakerNIU Graduate Student11

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