Aligning strategic processes in pursuit of firm growth

Strategy formation mode refers to the way organizations devise their strategies. While some organizations do so through an explicit, formalized, and planned method, other organizations unintentionally create patterns in their strategic decisions—a strategy formation route that is more emergent in nature. This research explores the relationship between strategy formation mode and firm growth. Further, this article explores two strategic processes—forecasting and long-range objective setting—and their efficacy in association with particular strategy formation modes. Primary and secondary data collected from 103 manufacturing firms were used to test the hypotheses. Results indicate that the relationship between strategy formation mode and firm growth is curvilinear (inverted-U shape). Further, a three-way interactive effect is found between strategy formation mode, forecasting, and long-range objective setting on firm growth.