Effect of strategy, strategic process, types of strategy on the personal well-being of small and medium enterprises’ strategy leaders

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Effect of strategy, strategic process, types of

strategy on the personal well-being of small and

medium enterprises’ strategy leaders.

Full name author: Martijn Pieter Lennart Kulk Student number: 10291733

Date of submission: 4 March 2018

Version: Final

Qualification study: Executive Programme in Management Studies – Strategy Track

Name of institution: University of Amsterdam, Amsterdam Graduate Business School

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Statement of Originality

This document is written by Student M.P.L. Kulk who declares to take full

responsibility for the contents of this document. I declare that the text and the work presented in this document is original and that no sources other than those

mentioned in the text and its references have been used in creating it. The Faculty of Economics and Business is responsible solely for the supervision of completion of the work, not for the contents.

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Abstract

This thesis is about how a strategy, strategic process, formalisation and reviewing the strategy and different types of strategic processes have an influence on personal well-being of entrepreneurs and management in charge of the strategy and strategic process of small and medium sized enterprises. Personal well-being can be

separated in satisfaction in business, satisfaction in life, mental stress and physical stress. The findings in the research show that having a strategy is highly positively associated with personal well-being. In general, the influence is determined for satisfaction in business and satisfaction in life. Influence on mental stress and physical stress is low or negative. The strategic process itself has a negative

influence on mental stress and physical stress which means that mental stress and physical stress become more when performing the strategic process. The

formalisation of the strategic process has no influence at all. While reviewing the strategy is a big recommendation for the strategy leaders. Reviewing the strategy has a positive relation with personal well-being. Especially for satisfaction in business and satisfaction in life. Seeing new opportunities and adopting them in the strategy is a must do for SME entrepreneurs and managers who want to have a high degree of personal well-being.

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Acknowledgement

I would like to thank my supervisor Jeroen Kraaijenbrink, who always had time for my questions and was very quick in feedback. Therefore the high pressure scheme for finishing my thesis was met.

Also my wife and children who gave me the power, time and courage to finish my Master thesis I thank them gratefully.

Have a pleasant read of my thesis. Yours sincerely,

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Appendix 6a: Multiple regression matrix different types of strategic process on well-being . 85 Appendix 6b: Multiple regression matrix different types of strategic process on satisfaction in business ... 87 Appendix 6c: Multiple regression matrix different types of strategic process on satisfaction in life 89

Appendix 6d: Multiple regression matrix different types of strategic process on mental stress 91

Appendix 6e: Multiple regression matrix different types of strategic process on physical stress 93

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1. Introduction

In the literature the most focus for strategy formulation and implementation is on large sized companies, while the largest part of the economy consists of small and medium sized enterprises. According to the law in the Netherlands small and medium enterprises (SME) are companies with assets up to € 20.000.000, an annual turnover of maximum € 40.000.000 and a maximum of 250 employees (BW2:9 art 395a, 396 en 397). This is 99 percent of total number of companies in the Netherlands

according to branch organization MKB Nederland (1_{). Also in the rest of the European}

Union (EU) the ratio of SME of total number of companies is over 99 percent according to the investigation of September 2015 (2_{). Since the global downturn of}

2007-2009 the economy in the Netherlands and the EU is performing with low or negative growth rates (3_{). Since SME are such a large part of the economy the}

influence of the SME on total economy must not be underestimated. To achieve sustainable growth in the Netherlands and the EU therefore it is needed to know what drives performance of SME and how performance can be improved.

For a good performance it is important to have a good strategy and strategic process. Kraus et al (2006) found a positive relationship between strategic planning process in SME and the rate of success of those SME. Where strategic planning is

characterised by a long term orientation, strategies in written form and evaluation and control of the chosen strategy. Kraus et al performed this research in Austria which is a part of the EU. Austria has the same western European culture and therefore it is likely the research is also applicable to the Netherlands, although this is not proven. Kraus et al suggest that the concepts of strategic planning in large firms might not apply to SME. Kraus et al suggest to tailor the strategic planning to the

circumstances of the SME. The question is therefore how to tailor the strategic planning process to the circumstances of the SME. Van Gelderen et al (2000) have studied strategic planning processes specifically aimed at SME companies. Van Gelderen et al noted that there are 5 different types of strategic planning processes

1_{http://www.mkbservicedesk.nl/569/informatie-over-midden-kleinbedrijf-nederland.htm}

2_{http://ec.europa.eu/eurostat/statistics-explained/index.php/Statistics_on_small_and_medium-sized_enterprises}

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that are used in SME’s. These different types of strategy processes are complete planning, critical point, opportunistic, reactive and habit. The strategy process types are explained in depth in chapter 2.

In the before mentioned papers the strategy and strategic planning process is linked with firm performance where performance is measured in (financial) numbers like return of investment, profit and revenue. What is missing in the literature is how a good strategic planning process in the definition of Kraus et al relates with personal well-being for the management of the SME. In particular the personal well-being for the entrepreneur or management being a leader in the strategic planning process of the SME before and after the entrepreneur or management are (continuously)

performing or have performed a strategic planning process. This is important to know because according to Diener (1984) philosophers throughout history considered happiness as the highest good and ultimate motivation for human action. Diener connects happiness with personal well-being. Also entrepreneurs become self-employed for reasons of personal well-being like “economic opportunity, authority, autonomy, challenge, self-realization, and participate in the whole process”

(Kolvereid, 1996). Therefore it is important that entrepreneurs have a good personal well-being and I want to find out if there are any effects of a strategic process on the personal well-being of the management of the SME.

Oswold et al (1994) found that strategic involvement is associated with upper level managers' psychological attachment to their organization and jobs. Specifically, the results indicate that the more involved managers were in strategy formulation, the more they were committed to the organization and satisfied with and involved in their work. Therefore their job satisfaction, job involvement and organizational

commitment where positively related. So for upper level managers being involved in the strategy process has a positive influence on job satisfaction. It is the question if this relates positive for managers and entrepreneurs of SME as well and not only for job satisfaction but also other factors that relates with personal well-being.

Leder (2015) did a test to find out how stress impacts the strategic decision making and concluded that stress impairs the strategic decision making. Therefore it is a need to know how a strategy process impacts personal well-being like stress factors of management and entrepreneurs of SME’s to see if there is a positive impact on

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the personal well-being from a strategic planning process to mitigate the risk of stress factors in the decision making. In the end this would lead to a better strategy and therefore better firms performance according to Kraus et al (2006).

Therefore the research question is: What effect does a strategic planning process

have on the personal well-being of small and medium enterprises’ management?

In the research question the strategy content isn’t mentioned. The strategy content is explicitly out of scope in this research. It is deemed to be impossible to include the quality of the strategy in this short term research because for the quality of strategy you need long term information of the SME’s to analyse the quality of the strategy. The scope of this research is only on the strategic process and how this relates with personal well-being of the SME management. In the research question the

Management is defined as the top management who are the leader and decisive in the strategic planning process. This includes the entrepreneur if the entrepreneur is still involved with the strategic planning process of the SME. But this also includes the hired manager who controls the SME under the responsibility of the original entrepreneur, founder and/or shareholder(s). Therefore management and entrepreneur will both be used depending on the situation in the quoted papers. Entrepreneurs and managers can also be written down as strategy leaders.

To research the research question some hypothesis will be stated and these

hypothesises will be tested using a diverse population of SME managers that will be inquired using a Likert scale questionnaire to assess whether and which type of strategic planning process the SME have in practice and the effects on the personal well-being the SME’s management received from the strategic planning process. Further this thesis will be build up as follows. In chapter two a literature review has been performed. In chapter three the research design and method of data collection is described. In chapter four the results and discussion of the results are given. In chapter five the research question is answered and concluded. As last in chapter six there is an overview of references used while performing the literature review.

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2. Literature review

2.1 Personal well-being

According to Diener (1984) philosophers throughout history considered happiness as the highest good and ultimate motivation for human action. Diener (1984) makes a connection between happiness and (subjective) well-being. Subjective well-being is the positive side of the influence on happiness according to Diener (1984). Diener (1984) describes this as follows: “A third meaning of happiness comes closest to the way the term is used in everyday discourse as denoting a preponderance of positive affect over negative affect (Bradburn, 1969). This definition of subjective well-being thus stresses pleasant emotional experience. This may mean either that the person is experiencing mostly pleasant emotions during this period of life or that the person is predisposed to such emotions, whether or not he or she is currently experiencing them.” Well-being can’t be measured objective because it is what one’s own opinion finds is well-being therefore it is called subjective well-being in the literature. For further use in this thesis subjective well-being is called (personal) well-being. Well-being can be influenced by someone’s education, environment, job, company, family, relationships and whatever else can influence someone’s well-being. The research question is about management and entrepreneurs that are in charge and decisive in the strategic planning process. These managers and entrepreneurs can be

distinguished in entrepreneurs and managers who founded the company and managers that are employed and who are appointed by the shareholders to run the company. The literature review is focused on well-being of entrepreneurs and

management of SME. In this part of the literature review I will first explore why people are willing to be an entrepreneur. After that the impact of being an entrepreneur (founder) to well-being (Boyd) will be discussed. In the end I will explore the research on well-being among entrepreneurs to find what constructs other researchers

(Andersson and Dijkhuizen) use for entrepreneurial research of well-being. And what these constructs say about well-being among entrepreneurs and managers.

Boyd (1983) et al started their research with the suggestion that it is one of the great dreams (in the United States) to start an own business. Kolvereid (1996) researched why someone would prefer an own business (self-employment) above organizational employment (having a job at someone else’s company). Kolvereid (1996) concluded

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that “security, social environment, work load, avoid responsibility, and career are reasons usually given for preferring organizational employment; while economic opportunity, authority, autonomy, challenge, self-realization, and participate in the whole process are reasons usually given for preferring self-employment.” According to Boyd (1983) there are some consequences for being self-employed. Their

research found that 55-65% of entrepreneurs pay a price in their personal well-being for just being an Entrepreneur (self-employed). Because of stress factors the

entrepreneurs experience back problems, indigestion, insomnia and/or headaches. According to Boyd (1983) the stress factors are not influenced by the performance of the company, the stress factors are likely to be the same for entrepreneurs with thriving or struggling companies. The four sources of stress according to Boyd (1983) are Loneliness, Immersion in business, problems with employees (in Boyd (1983) terms people problems) and the need to achieve.

Andersson (2008) researched well-being among the self-employed in comparison with wage earners. Her research of well-being captured six factors: job satisfaction, life satisfaction, whether the job is stressful, whether the job is mentally straining, mental health problems and poor general health. Andersson (2008) concluded that the only result from her investigation is that self-employed have increased job satisfaction compared to the wage earners. This increased job satisfaction comes mostly from the independency in their decision making in comparison to wage

earners who are to follow the directions of their manager. Research have to find out if this independency can relate to the strategy process as well. Dijkhuizen (2016)

researched four types of well-being: work engagement, job satisfaction, exhaustion and workaholism among Dutch entrepreneurs. Where workaholism was differentiated in working compulsively and working excessively. Dijkhuizen (2016) just like

Andersson (2008) concluded that compared with employees, entrepreneurs scored higher on job satisfaction. Dijkhuizen (2016) concluded that work engagement, exhaustion and working compulsively where higher for entrepreneurs compared with employees. Dijkhuizen also found that working excessively related highly with high turnover, profits and number of employees.

In conclusion the authors Andersson (2008) and Dijkhuizen (2016) found that the work related factors that overall seems to influence the personal well-being are

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satisfaction in business, satisfaction in life and business related stress. Where business related stress can be differentiated in mental stress and physical stress. Therefore these factors are the factors that are taken into account as personal well-being.

2.2 Strategy

In general companies have to compete with other companies for their right of existence. It doesn’t matter if companies are really small or companies are very large, there is always a form of competition. “The essence of strategy formulation is coping with competition” (Michael E. Porter, 1979 P137). Thus, to compete with other firms the company’s management have to formulate a strategy.

Strategy is defined by Kenneth Andrews (1980) as follows: “Corporate strategy is the pattern of decisions in a company that determines and reveals its objectives,

purposes, or goals, produces the principal policies and plans for achieving those goals, and defines the range of business the company is to pursue, the kind of economic and human organization it is or intends to be, and the nature of the economic and non-economic contribution it intends to make to its shareholders, employees, customers, and communities (pp.18-19).” This is a strategy definition that is mostly related to large enterprises in a classical view on strategy. In their paper ‘Of Strategies, Deliberate and Emergent’ Mintzberg en Waters (1985) used a short definition where strategy is “a pattern in a stream of decisions”. What can be

explained as “what the leaders of an organization 'plan' to do in the future” Mintzberg (1958). For this research strategy is what the leaders, in example the entrepreneurs or top management, of the SME plan to do for the future.

2.3 Strategy process

Mintzberg & Waters (1985) define strategy process as “a pattern in a stream of decisions”. Mintzberg & Waters (1985) explain that the strategy process has been seen as “an analytic process for establishing long-range goals and action plans for an organisation where formulation of the strategy is followed by the implementation of the strategy” and that this is too limited. There is a difference between the intended strategy and the realized strategy. Therefore Mintzberg & Waters (1985) stated that

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strategic processes are in the continuum from deliberate on the one side and emergent on the other side. Deliberate strategies are strategic processes that are being realized exactly as intended. This can be done in the perfect situation that the company has precise intentions. These precise intentions must be known by all actors in the company. And at last the company must also control all external factors. Emergent strategies are processes that have a total absence of intentions. The external environment directly imposes the organization. It is impossible to meet the requirements of both types of strategies. The real strategic processes are

somewhere in between, in the continuum, of deliberate and emergent.

In his work Rethinking strategic planning Mintzberg (1994) describes the pitfalls of corporate planning, although these pitfalls are based on G. Steiners work on large companies the logical behind the pitfalls can contribute to a view on pitfalls for SME as well. The pitfalls that have been described by Mintzberg (1994) are shown in table 1.

“

# Description of pitfall

1 Top management’s assumption that it can delegate the planning function to a planner.

2 Top management becomes so engrossed in current problems that it spends insufficient time on

longrange planning, and the process becomes discredited among other managers and staff.

3 Failure to develop company goals suitable as a basis for formulating long-range plans. 4 Failure to assume the necessary involvement in the planning process of major line personnel. 5 Failing to use plans as standards for measuring managerial performance.

6 Failure to create a climate in the company which is congenial and not resistant to planning.

7 Assuming that corporate comprehensive planning is something separate from the entire management

process.

8 Injecting so much formality into the system that it lacks flexibility, looseness, and simplicity, and restrains

creativity.

9 Failure of top management to review with departmental and divisional heads the long-range plans which

they have developed.

10 Top management’s consistently rejecting the formal planning mechanism by making intuitive decisions

which conflict with the formal plans. Table 1: G. Steiners Pitfalls,” Mintzberg (1994)

In Good strategy/bad strategy, Rumelt (2011) also noted some pitfalls in the strategy process. First Rumelt (2011) describes that a good strategy “is a coherent set of

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analyses, concepts, policies, arguments, and actions that respond to a high-stakes challenge”. A Good strategy has a “Diagnosis that explains the nature of the

challenge and identifying which aspects of the situation are critical obstacles to overcome”. As second a good strategy has a “Guiding policy for dealing with the challenge” As third and last a good strategy has “a set of coherent actions that are required to carry out the guiding policy”. According to Rumelt (2011) a bad strategy “is long on goals and short on policy or action”. Rumelt (2011) notes four signs of a bad strategy. The first is that the strategy is so called “Fluff” which means as much that the strategy in form is very pretty but this has to hide that the strategy content is bad or has some deficiencies. The second bad thing if strategy is “the failure to face the challenge. The “failure to face the challenge” can be caused that the strategy comes from a “fill-in-the-blanks template” that misses each link with “the challenge or purposes for the strategy”. In the third place Rumelt (2011) noted that companies “mistake goals for strategy”. This means that companies assume that when they have goals for the future like having an increase in revenue of 20% the company thinks this is a strategy. The fourth and last indication of a bad strategy are the bad strategic objectives. Rumelt (2011) describes these objectives as “dog’s dinner objectives and blue sky objectives”. Dog’s dinner objectives are “uncoordinated actions and objectives” that are put in a plan with no “aforethought”. Blue sky objectives are objectives that are “either unachievable or that restate the desired state of affairs leaving the organisation no better off”.

When reflecting the pitfalls of Mintzberg (1994) and the bad strategy markers from Rumelt (2011) there is an overlap in the identified shortcomings around the strategic process. These pitfalls of the strategic process could influence the personal well-being of the entrepreneurs while performing the strategy process when the entrepreneur is falling into these pitfalls when performing the strategic process. To make a step from the strategic process in larger companies to the research topic of SME it is important to get knowledge of strategic processes in SME’s. The SME company’s objectives, purposes and goals are normally set by the entrepreneur who started the company. Smith (1998) notes “The formulation of strategies in the new small firm was examined by direct reference to the firm’s mission, objectives,

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strategies and policies. The mission of a business is a statement of what the business stands for, what it hopes to achieve, its directions, aims and ambitions.” Kraus et al (2006) suggest that a strategic planning process of a SME is being

tailored to the circumstances of the SME. Van Gelderen (2000) researched the types of strategic planning processes in SME’s and concluded that there are 5 types of strategic planning processes used within SME companies in the degree of depth of strategy formulation, implementation and periodic review of the strategy. The 5 types are Complete Planning Process, Critical Point Strategy, Opportunistic strategy,

Reactive strategy and Habit Strategy. The 5 types are further explained. “Reactive Strategy implies that one is driven by the situation, makes little proactive use of information and that actions are not planned. In contrast, a person using a Complete Planning Strategy plans ahead and actively structures the situation. Thus, Complete Planning Strategy implies a comprehensive representation of the work process, a long time frame to plan ahead, a large inventory of signals, clear knowledge and anticipation of error situations, and a proactive orientation. An Opportunistic Strategy starts out with some form of rudimentary planning. The person using an Opportunistic Strategy deviates from these plans easily when opportunities occur plans are

constantly being adjusted. Thus, this strategy is not top-down and systematic. On the other hand, Opportunistic Strategy is not completely driven by the situation as is the Reactive Strategy. It is much more proactive. The Critical Point Strategy starts out with the most difficult, the most unclear, and the most important point and plans and acts departing from this main point without any planning of other points. Only after solving the first critical point, further steps may be taken. Thus, one has a clear goal in mind and one concentrates on it and on the main issues of one's tasks - it can be conceived of as main-issue-planning.” (Van Gelderen et al, 2000, page 167). Frese and Zapf (1994) had some pilot interviews and concluded there is an extra category. People sometimes rely only upon their routines without any explicit decision for a strategy. For this reason they added routine or habit as an extra strategy. This category refers to a standardized approach that has been developed in redundant environments. When using this approach, there is little learning, because one essentially does things "the same way as always". There is no fine-tuning to

changing environmental circumstances. A summary of strategy type and description is presented in table 1. In table 1 there is also a connection between the degree of

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deliberate and emergent strategic process according to Mintzberg (1985) and the types of strategic processes identified by Van Gelderen (2000).

Strategy type Description Mintzberg

(1985) Deliberate Complete

Planning Strategy

Complete Planning Strategy implies a comprehensive

representation of the work process, a long time frame to plan ahead, a large inventory of signals, clear knowledge and anticipation of error situations, and a proactive orientation.

Critical Point Strategy

Critical Point Strategy starts out with the most difficult, the most unclear, and the most important point and plans and acts departing from this main point without any planning of other points.

Opportunistic Strategy

Opportunistic Strategy starts out with some form of rudimentary planning. One deviates from these plans easily when opportunities occur therefore plans are constantly being adjusted.

Habit Strategy In a habit strategy, there is little learning, because one essentially

does things "the same way as always.

Reactive Strategy

Reactive Strategy implies that one is driven by the situation, makes little proactive use of information and that actions are not planned.

Emergent

Table 1: Overview strategy type and description and link with Mintzberg (1985).

Van Gelderen et al (2000) noted that business owners that perform poorly mostly employ a Reactive strategy. A Reactive strategy leads to poor performance leading to increased use of reactive behaviour and therefore negative influence on

performance in the long term. Also Van Gelderen et al (2000) noted that high

performing business owners started out focussing on the most crucial issues they are facing in their company, the so called Critical Point Strategy. After a while the high performance is leading to a more top-down approach of strategy, the so called Complete Planning strategy. Van Gelderen et al (2000) stated that strategy use is dependent upon the type and level of environmental uncertainty. In fast changing environment and more complex environments the Complete Planning strategy is used less frequently. Companies that use opportunistic Strategy and are high

performing are normally doing business in a relatively low complex environment. The Reactive Strategy is used more frequently in a non-munificent environment (Van Gelderen et al, 2000).

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Kraus et al, 2006 researched the relationship between planning formalization and successfulness in the smaller enterprise. They concluded that more control in the form of comparing current developments with previously anticipated developments allow a timely and thus cost-efficient adaption of plans and strategies in case of a deviation.

Kraus et al, 2006 also suggest that in research there is paid little attention to the performance impact of control aspects of strategic planning. An exception is

Wijewardena (2004) who has concluded that there is an important role for a planning and control on firm performance. Although this survey was extended in Sri Lanka and mostly to do with manufacturing SME’s.

Having a formalized and periodically reviewed strategy can be seen as attention by the company’s management. Where attention in an organizational context can be understood as “the noticing, encoding, interpreting, and focusing of time and effort by organizational decision-makers on both (a) issues: the available repertoire of

categories for making sense of the environment: problems, opportunities, and threats; and (b) answers: the available repertoire of action alternatives: proposals, routines, projects, programs, and procedures” (Ocasio 1997, p. 189).

Ocasio 1997, concludes on attention on strategy: “Finally, the paper advances our understanding of firm strategy and behaviour by emphasizing how selective attention both facilitates and inhibits perception and action. Previous attentional perspectives in the organization's literature stressed the inhibitory aspects, as selective attention leads to departures from the model of omniscient rationality in economic theories of choice. But the focusing of attention by organizational decisionmakers allows for enhanced accuracy, speed, and maintenance of information-processing activities, facilitating perception and action for those activities attended to. Whether attentional processes facilitate or inhibit organizational adaptation and performance is contingent on whether the firm's procedural and communication channels and attention

regulators focus and distribute the attention of organizational decisionmakers in directions that are congruent with the firm's environmental opportunities and constraints.”

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From the phrase above I conclude that the more attention and therefore more periodic reviews the better the strategic planning process.

2.4 Research model and hypotheses

This thesis has as a goal to research if management or entrepreneur of the SME (together as management) has benefits in personal well-being from strategic

involvement, if it is in strategic content or strategic process or both. For this research the strategic content is excluded because it is deemed to be impossible to exclude the quality of the strategy from one’s personal well-being. So it is assumed that the strategic content is not of any impact on the personal well-being although it is known the quality of the strategic content has large impact on the firm performance.

In the research model the (financial) results of the company are explicit out of scope. The research model is presented in figure 1.

Figure 1: Research model

The hypotheses that together form the research model are explored and further explained hereafter.

In the literature review we noted that when a SME have a strategy this has a positive influence on firm performance. Although Boyd (1983) noted that firm performance itself has no influence on the personal well-being of the SME’s management or entrepreneur it might be that a strategy has a positive influence on personal

well-Managements / entrepreneurial personal well-being A strategic process is in place Type of strategic process Formalization and review of strategy H3a,b H4, H5, H6, H7, H8. The company has

a strategy

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being just like it has on firm performance. According to Porter (1979) “The essence of strategy formulation is coping with competition” and according to Rumelt (2011) strategy is about “dealing with the challenges of a company”. To see these two statements in relation with Kolvereid (1996) who concluded that people choose to become employed to have opportunity, authority, autonomy, challenge, self-realization, and participate in the whole process it is expected that having a strategy relates positively with personal well-being. So, the first hypothesis is:

H1: Having a strategy has a positive influence on management’s personal well-being.

In hypothesis H1 the research is if having a strategy has a positive influence on personal well-being. To develop a strategy SME’s management or the entrepreneur start with a thought of why to start the company. To develop a working strategy there should be done some extra effort. This extra effort is the strategic process. Although it cost time it is helpful to have a strategic process. According to van Gelderen et al (2000) there are different types of strategic processes who all have their own type of influence on firm performance. The individual impact will be researched in later hypothesis. According to Rumelt (2011) a good strategy has a strategic process. According to Mintzberg (1994) pitfall’s there have al something to do with a shortcoming in the strategic process. Therefore is having a strategic process is better for the company and therefore probably a positive influence on personal well-being.

H2: Having a strategic process has a positive influence on management’s personal well-being.

Kraus et al, (2006) concluded that more control in the form of comparing current developments with previously anticipated developments allow a timely and thus cost-efficient adaption of plans and strategies in case of a deviation. Also they noted that in reality the comparison between reality and expected developments has been done too little. Ocasio (1997) concludes that more attention and therefore more periodic reviews gives a better strategic planning process. Mintzberg (1994) concludes that a pitfall in the strategic planning process is that top management fails to review the long range plans that have been developed. To have the ability to make a

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comparison between the reality and the expected developments you need to write down the strategy so you can make a comparison with the strategy as has been formulated. I want to distinguish between the formalisation of the strategy and the periodic review of the strategic process. Therefore the third hypothesis is divided into two hypothesises:

H3a: Formalizing the strategy has a positive influence on management’s personal well-being.

H3b: Periodically reviewing the strategy has a positive influence on management’s personal well-being.

Rumelt (2011) defined a good strategy as “a coherent set of analyses, concepts, policies, arguments, and actions that respond to a high-stakes challenge”. This has a high degree of similarity with the complete planning process as described by Van Gelderen (2000). Van Gelderen (2000) also notes that having a complete planning process has a positive influence on SME (financial) performance. Although Boyd (1983) noted no relation between firm performance and personal well-being it is the expectation that as a result the SME’s management or entrepreneur would also benefit from this structured approach for the personal well-being. Therefore the fourth hypothesis is:

H4: Applying a complete planning process has a positive influence on management’s personal well-being.

Mintzberg (1994) suggest that spending insufficient time on the long range planning is one of the failures in the strategic process. Rumelt (2011) notes that a part of a good strategy is identifying the critical obstacles which have to be overcome. So the focus when short in time is to focus on the critical parts in the strategic process. Then there is a strategic process and it’s clear what the critical obstacles are for the SME. Although Boyd (1983) noted no relation between firm performance and personal well-being it is the expectation that as a result the SME’s management or entrepreneur would also benefit from this critical point approach for the personal well-being. Therefore the fifth hypothesis is:

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H5: Applying a critical point strategy has a positive influence on management’s personal well-being.

According to van Gelderen (2000) we noted that having an opportunistic strategy has a consequence of switching to every new opportunity. Because strategy is about having a long term plan for the future (Mintzberg, 1985) and performing the plan I expect that being opportunistic will increase the uncertainty of the SME’s

management or entrepreneur. In his later paper Mintzberg (1994) notes that a failure in the strategic process is that management makes intuitive decisions that conflicts with the formal plans. Being opportunistic is relatively the same as being

opportunistic. Rumelt (2011) also notes that having “uncoordinated actions and objectives” leads to a bad strategy because there will be no focus but tens to hundreds of incoherent actions. All these different actions can lead to uncertainty. Uncertainty relates with stress factors and therefore I assume that being

opportunistic relates negatively with personal well-being. Therefore the sixth hypothesis is:

H6: Applying an opportunistic strategy has a negative influence on management’s personal well-being.

Rumelt (2011) noted that a company needs to know what the challenges are for the long term and have to plan actions to overcome these challenges. Mintzberg (1994) adds up that it is a pitfall when a company fails to develop suitable goals for a long range planning. Van Gelderen (2000) noted that having a habit strategic process is like doing the same as always. Although management can feel really nice about doing the same as always a strategy must be “an analytic process for establishing long-range goals and action plans for an organisation where formulation of the strategy is followed by the implementation of the strategy” (Mintzberg 1985). The combination of a pitfall noted by Mintzberg and a shortcoming of knowing your challenges by Rumelt I conclude a negative impact on SME (financial) performance. Although Boyd (1983) noted no relation between firm performance and personal well-being it is the expectation that as a result the SME’s management or entrepreneur in long term get the same feeling as in a reactive strategy that the management

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H7: Applying a habit strategy has a negative influence on management’s personal well-being.

Mintzberg (1994) suggests that a pitfall in the strategic process is that management is so “engrossed in current problems that it spends insufficient time on long range planning”. In the good strategy/ bas strategy paper Rumelt (2011) notes that a good strategy is “a set of coherent actions that are required to carry out the guiding policy” and a bad strategy is “short on policy or action”. Applying the reactive strategy

process according to van Gelderen (2000) means that no goals or process is in place to make a plan for the future but the strategic process is all about reacting on the current developments. This means that the manager is in the pitfall of Mintzberg and according to Rumelt has a bad strategy. The expectation that as a result the SME’s management or entrepreneur would also have a disadvantage from this reactive approach for the personal well-being. Therefore the eighth hypothesis is:

H8: Applying a reactive strategy has a negative influence on management’s personal well-being.

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3. Data and method

3.1 Introduction research design

In chapter 3 8 hypotheses have been formulated. These hypotheses are developed to give answer to the research question of chapter 1. The conceptual model of 2.4 is a schematic representation of the hypothesis that are distracted from the literature review. In this chapter the conceptual model will be operationalized for empiric research of the hypothesis. I start this chapter with the research design in section 3.2.

In section 3.3 there will be explained how the data is collected. In section 3.4 the variables will be further explained. The Cronbach’s Alpha of the variables will assessed in section 3.5. In section 3.6 the statistical conditions of the data will be tested. In section 3.7 the process of analysing the data will be explained.

3.2 Research design

For scientific purposes a hypothesis has to be deducted from the theory (Saunders (2009, page 124). This hypothesis need to be tested using descriptive and inferential statistics. I want to obtain large numbers of data from a as large as possible

population. In the combination of a survey and statistical sampling it is possible to generate findings which are representative for the population that is tested. The collected data needs to allow easy comparison between respondents and needs to give insights in relation between answers. According to Saunders (2009, page 144) a survey is the most suitable research strategy. A survey leads to a quantitative

research approach.

The type of survey must be derived from the wish to determine the degree of (dis)agreement with certain statements. I want to test the correlation between the statements so they must be collected in a way that they can be measured. Therefore the research design of the survey must provide insight into the extent to which the respondents (dis)agree with the statement. Therefore I need an ordinal scale in the survey because an ordinal scale has a natural qualitative order in the scaling which creates a good way to measure how much someone (dis)agrees with the question. This is without the exact quantitative differences like an interval or ratio scale which

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would give a false certainty on the degree of (dis)agreeing with the statements. An ordinal scale can be measured using a Likert-style scale rating (Saunders 2009, page 594). This gives a limitation to my research. For everyone the numbers in a Likert-style scale are subjective therefore there will be gathered some subjective information.

In this questionnaire I will first try to find out if the inquired SME company has a strategy, if the strategy is formalized, if they review the strategy periodically, and if so how many times a year or less than a year. After that questions have been asked about the personal benefits for the management, control over the growth of their firm and most important the personal well-being.

3.3 Data collection

The empirical part of my research is based on a quantitative research using a Likert style scale survey. This survey have to answered by as many entrepreneurs and managers as possible. I have gathered over 5.000 possible respondents from an extraction of companies in the chamber of commerce. These companies are mostly in Services, ICT and Automotive industry. These three industries are a large part of the Dutch economy and therefore a reflection of the Dutch SME. Because there are off course a lot of other industries in the Dutch economy there is a confinement in the conclusions that can be made from the findings. The conclusion would be reduced to the mentioned industries in the country the Netherlands. To gain extra surveys I asked my LinkedIN network and relations of my LinkedIn network to fill the

questionnaire to gather extra responses outside this chamber of commerce extract. I received 62 surveys out of 5.000 sent out surveys. The response rate is therefore 1,24%. The average age of the respondents in the survey is 43 years, with a range of minimal 25 and maximal 67. The respondents were in SME’s which existed from 1 to 129 years where the average is 23,66 years. The respondents were working in the SME’s from 1 to 49 years and in average for 10,53 years. Forty-two of the

respondents are also the founder of the SME and 20 are the owner manager from a later point on. The respondents were mostly highly educated (44 respondents, see table 2). The respondents have their small and medium-sized businesses in different sectors of business (see table 3).

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Wat is uw opleidingsniveau?

Frequency

Valid Lager beroepsonderwijs 1

Middelbaar beroepsonderwijs 17

Hoger beroepsonderwijs 22

Universitair onderwijs 21

Postdoctoraal onderwijs 1

Total 62

Table 2: Level of education from respondents survey

In welke branche zijn uw bedrijfsactiviteiten?

Frequency

Valid Dienstverlening excl. IT 21

Handel 7 IT-dienstverlening 7 Productie 6 Automotive 2 Anders 19 Total 62

Table 3: Sector of business the SME operates

3.4 Variables

The survey has given information about the main variables:

- The level of strategy formulation to find out if the company has a strategy and in what way it has been made;

- The type of strategy process to find out in what way the strategy is incorporated in the company;

- How many times a year the strategy is reviewed and adjusted when needed; - The degree of involvement in strategic process;

- What personal benefits in well-being the company’s management receive from participating in the strategic process.

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The conceptual model as presented in section 2.4 has one dependent and four independent variables. The first independent variable is that there is a strategy. The second independent variable is that there is a strategic process. The third independent variable is that there is a formalisation and review of the strategy. The fourth and last independent variable is the type of strategic process. This last variable consist of the five types of strategic processes which all will be independently

evaluated. The dependent variable is management’s personal well-being because we want to measure the influence of other variables on management’s personal well-being. The expected influence of each independent variable on personal well-being is explained in section 2.4 where the hypothesis are explained. In an overview the variables are presented in table 4. The link between the questionnaire and the variables has been added. The questionnaire has been added as appendix 1.

Variable conceptual model Description Survey question number

Measure

Company has a strategy Examine if there is a strategy in place.

8-9 Ordinal

Strategic process in place Examine if there is a strategic process in place.

11 Ordinal

Formalization and review of strategy

Examine the type of formalization and periodicity of review of strategy

10, 18-20 Ordinal

Type of strategic process Examine the type of strategic process.

13-17 Ordinal

Managements / entrepreneurial personal well-being

Examine the personal well-being

21-44 Ordinal

Control variables Age, Education, Branche SME, Year in SME, Year at SME, Founder, Years in charge, In charge of goals. 1 2 3 4 5 6 7 12 Discrete, Ordinal, Nominal, Discrete, Discrete, Descriptive, Ordinal, Ordinal. Table 4: Overview variables.

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3.5 Reliability

The reliability of the variables in the survey will be measured with a Cronbach’s Alpha. Cronbach’s Alpha is ‘the number of items (N) squared multiplied by the average covariance between items divided by the sum of all the elements in the variance – covariance matrix’ (Field 2009). According to field 2009 a value of 0,7 a 0,8 is good indicator of the scale reliability. The Cronbach’s Alpha for all variables with multiple questions in the survey is calculated with the use of SPSS. See tables 5, 6, 7, 8, 9 and 10 for output.

The Cronbach’s Alpha of the variables Company has a strategy (0,884), Satisfaction in business (0,896), Satisfaction in life (0,907) and Physical stress (0,838) are in top of the range as mentioned by Field (2009). Mental stress (0,552) and Formalization and review of strategy (0,674) is little below the range as mentioned by Field (2009). There are little number of items per variable and a low N therefore the calculated Alpha’s are reliable for further use in statistical analysis as being around the range as mentioned by Field (2009).

Case Processing Summary Reliability Statistics

N % Cronbach's Alpha N of

Items

Cases Valid 62 100,0 ,884 2

Excludeda ₀ _0,0

Total 62 100,0

a. Listwise deletion based on all variables in the procedure.

Table 5: Output Cronbach’s Alpha variable Company has a strategy

Items

Cases Valid 62 100,0 ,552 3

Excludeda ₀ _0,0

Total 62 100,0

Table 6: Output Cronbach’s Alpha variable Formalization and review of strategy

Items

Cases Valid 62 100,0 ,896 6

Excludeda ₀ _0,0

Total 62 100,0

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Table 7: Output Cronbach’s Alpha Satisfaction in business

Items

Cases Valid 62 100,0 ,907 5

Excludeda ₀ _0,0

Total 62 100,0

Table 8: Output Cronbach’s Alpha Satisfaction in Life

Items

Cases Valid 62 100,0 ,674 5

Excludeda ₀ _0,0

Total 62 100,0

Table 9: Output Cronbach’s Alpha Mental stress

Items

Cases Valid 62 100,0 ,838 4

Excludeda ₀ _0,0

Total 62 100,0

a. Listwise deletion based on all variables in the procedure.

Table 10: Output Cronbach’s Alpha Physical stress

3.6 Conditions for a statistical analysis

The statistical conditions of the data will be tested. So there is no doubt of the usability of the obtained data for statistical purposes. According to Field 2009 (page 133) the statistical conditions should be met that the date is normally distributed, there is a homogeneity is variance, the data is at least on the interval level and as last that there is a independence between the participants in the sample.

All the data, except for three that are discrete, that have been derived from the questionnaire are ordinal or nominal. The order of data is nominal, ordinal and scale, where scale can be divided in interval and ratio. Therefore the condition of at least an interval level haven’t been met. Therefore no further research have been done for the other three conditions.

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Pearson’s correlation coefficient can only be applied to data with at least interval type which meat the parametric conditions. Consequently the correlation testing have to be done using a non-parametric correlation test. Spearman’s correlation coefficient is a non-parametric statistic test for correlation between ordinal scales.

3.7 Analysing data

In this section I describe the analyses that has been made to evaluate the data in the questionnaires.

We use the data for a Spearman correlation test. The Spearman correlation test will explained further in this section in detail. For the Spearman correlation test the data from the survey should all have the same direction of formulation and answering. In the survey there are 9 questions (numbers 34-38 and numbers 40-43) that have been negatively formulated instead of positively like all other questions. These 9 questions are recoded where a 1 became a 5, a 2 became a 4 and 3 is unchanged to make the negatively formulated questions positively and therefore make them

comparable in a correlation test.

In the survey there are two questions which have been answered in consecutive groups of years (question 7) and periodicity (question 18). These are both ordinal data and the data is recoded in ordinal data that fit with SPSS. The groups and periodicity is recoded from low value to high value with respectively one to one extra for each extra group or periodicity. Because the periodicity is better when it is more often (Ocasio 1997) this is also recoded with a reverse of the numbers.

After the preparations to get usable data descriptive statistics will be applied. With descriptive statistics the mean, median, variance, minimum, maximum and number of observations are presented and explained. I want to determine that the data is

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The correlation between the degree of strategy formulation, type of strategic process, formalization, periodic review and the managements personal well-being will be measured using the Spearman’s rho. Spearman’s correlation coefficient is ‘a

standardized measure of the strength of relationship between two variables that does not rely on the assumptions of a parametric test. It is Pearson’s correlation coefficient performed on data that have been converted into ranked scores’ (Field 2009).

We want to understand the relation between independent variables and the

dependent variables. The key question is which independent variable has the most influence on the dependent variable. According to Field (2009) a multiple regression is the statistical method to “predict an outcome by a linear combination of two or more predictor variables”. Therefore also a multiple regression will be performed.

From all the hypothesis (see section 2.4) I assume that there is a direction in the relationship. Therefore according to Field (2009 page 54) a one tailed test will be performed.

Some special attention for managements/entrepreneurial personal well-being is needed because the managements/entrepreneurial personal well-being has been separated in the survey in 4 types of personal well-being. As mentioned in section 2.1 these four types are satisfaction in business, satisfaction in life, mental stress and physical stress. These are all measured in an ordinal scale. The four types are

questioned in the survey using a range of 4 to 6 questions each. The means of the questions per type will be calculated for the first view on the direction of the

correlation between the dependent and independent variables. A more detailed analysis on each type can be performed in case there is any reason.

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4. Results

4.1 Introduction results

In this chapter I will test the hypothesis. In this chapter the statistical results from the questionnaires will be set forth. This chapter is organized as follows. In section 4.2 the descriptive statistics as mentioned in 3.7 will be noted. Finally, the hypotheses are discussed in section 4.3.

4.2 Descriptive statistics

De outcomes of the descriptive statistic is shown in Appendix 2. In Appendix 2 the descriptive statistics is separated in N, Mean and standard deviation and skewness and kurtosis due to the amount of data.

Missing values

The total number of cases in the sample is 62. That number reconciles with the number of cases which filled the questionnaire. Each question has 62 cases, so we can conclude that there are no missing values.

Outliers

In the data there are no outliers that can’t be explained.

Skewness

According to Field (2009 page 139) a Skewness value larger than 1,96 in absolute value is significant at the 95% level. In table 6 there are no values that are in

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Kurtosis

According to Field (2009 page 139) a Kurtosis value larger than 1,96 in absolute value is significant at the 95% level. In table 6 there are four variables that are in absolute numbers above 1,96. These four variables are:

- “Hoeveel jaar bent u werkzaam in het bedrijf?” - “Ik ben gelukkig.”

- “Gemiddelde van satisfaction in life.”

- “Ik heb het gevoel de controle over het bedrijf kwijt te zijn.”

In the following figures you find the histogram of the above mentioned four variables who have an abnormal distribution Kurtosis. In the question “Hoeveel jaar bent u werkzaam in het bedrijf?” there isn’t an expectation of a normal distribution because you can’t state that the time of leadership of a company can be normally distributed. In the sample there aren’t any responses in the category 16-20 years. For the other 3 variables the conclusion is that a lot of respondents are in good mental health

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Correlation table Correlations G e m id d e ld e v a n s a ti s fa c ti o n i n b u s in e s s G e m id d e ld e v a n s a ti s fa c ti o n i n l ife G e m id d e ld e v a n M e n ta l Stre s s G e m id d e ld e v a n Ph y s ic a l s tre s s G e m id d e ld e v a n we ll-b e in g Spearman's rho

Gemiddelde van de strategie Correlation

Coefficient

,386**_,453** _,200 _,232*_,377**

Sig. (1-tailed)

,001 ,000 ,059 ,035 ,001

Ik heb voor mezelf een proces om aan mijn strategie te werken en mijn strategie te bepalen.

Correlation Coefficient ,254*_,311** _,202 _,299**_,313** Sig. (1-tailed) ,023 ,007 ,058 ,009 ,007

De totstandkoming en uitvoering van de strategie van mijn onderneming is een gestructureerd proces waarin we doelgericht vooruit plannen, afwijkingen signaleren en hierop acteren. Correlation Coefficient ,281*_,392** _,059 _,144 _,248* Sig. (1-tailed) ,014 ,001 ,325 ,132 ,026

De totstandkoming en uitvoering van de strategie van mijn onderneming is gefocused op een aantal vooraf gedefiniëerde kritische punten.

Correlation Coefficient ,222*_,367** _,073 _,124 _,238* Sig. (1-tailed) ,042 ,002 ,285 ,169 ,031

De totstandkoming en uitvoering van de strategie van mijn onderneming is een reactie op hetgeen ik dagelijks meemaak. Correlation Coefficient ,271*_,308** -,007 ,170 ,219* Sig. (1-tailed) ,016 ,007 ,478 ,093 ,044

De totstandkoming en uitvoering van de strategie van mijn onderneming komt voort uit hetgeen ik altijd al gewend was om te doen.

Correlation Coefficient ,274* _,205 -,141 ,098 ,140 Sig. (1-tailed) ,016 ,055 ,138 ,224 ,139

De totstandkoming en uitvoering van de strategie van mijn onderneming is wel gebaseerd op kansen die ik zie in de markt. Correlation Coefficient ,556**_,632** _,150 _,337**_,505** Sig. (1-tailed) ,000 ,000 ,123 ,004 ,000

Gemiddelde van formalisatie en review Correlation

Coefficient

,477**_,418** _,291* _,263*_,450**

Sig. (1-tailed)

,000 ,000 ,011 ,019 ,000

**. Correlation is significant at the 0.01 level (1-tailed). *. Correlation is significant at the 0.05 level (1-tailed).

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4.3 Hypothesis testing

The influence of the independent variables on the dependent variable according to the research model as shown in figure 1 is ,597 and significant (,000) for explaining differences in personal well-being. According to the multiple regression as shown in table 11a and 11b the changes in the dependent variable personal well-being is explained for ,597 by the independent variables.

Model Summary Model R R Square Adjusted R Square Std. Error of the Estimate Change Statistics R Square Change F Change df1 df2 Sig. F Change 1 ,773a _,597 _,477 _,49737 _,597 _4,970 ₁₄ ₄₇ _,000

Table 11a: Multiple regression all independent variables on personal well-being (total table refer to appendix 4a)

Coefficientsa Model Unstandardized Coefficients Standardized Coefficients t Sig. B Std. Error Beta 1 (Constant) 2,874 ,797 3,605 ,001

Hoeveel jaar heeft u de leiding in het bedrijf?

-,012 ,052 -,024 -,229 ,820

Mijn onderneming heeft een strategie voor de toekomst.

,240 ,117 ,353 2,048 ,046

Ik denk er over na hoe de strategie moet worden uitgevoerd.

-,390 ,139 -,507

-2,810

,007 Ik heb voor mezelf een proces om

aan mijn strategie te werken en mijn strategie te bepalen.

,012 ,090 ,019 ,129 ,898

Ik ben leidend in het bepalen van de doelen van de onderneming als eigenaar of management.

,151 ,082 ,220 1,837 ,073

De totstandkoming en uitvoering van de strategie van mijn onderneming is een gestructureerd proces waarin we doelgericht vooruit plannen,

afwijkingen signaleren en hierop acteren.

-,010 ,085 -,016 -,114 ,910

De totstandkoming en uitvoering van de strategie van mijn onderneming is gefocused op een aantal vooraf gedefiniëerde kritische punten.

,034 ,088 ,053 ,389 ,699

De totstandkoming en uitvoering van de strategie van mijn onderneming is een reactie op hetgeen ik dagelijks meemaak.

-,069 ,070 -,119 -,985 ,330

De totstandkoming en uitvoering van de strategie van mijn onderneming komt voort uit hetgeen ik altijd al gewend was om te doen.

,032 ,074 ,052 ,433 ,667

De totstandkoming en uitvoering van de strategie van mijn onderneming is wel gebaseerd op kansen die ik zie

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in de markt.

Ik denk …….. na over de strategie van mijn bedrijf.

-,132 ,111 -,256

-1,190

,240 Bij nieuwe inzichten over de

strategie pas ik mijn strategie aan.

,199 ,108 ,319 1,847 ,071

De aangepaste strategie werk ik schriftelijk bij in de oorspronkelijke strategie.

-,103 ,166 -,161 -,624 ,535

Gemiddelde van formalisatie en review

,140 ,366 ,163 ,383 ,703

a. Dependent Variable: Gemiddelde van well-being

Table 11b: Multiple regression all independent variables on personal well-being (total table refer to appendix 4a)

The significant independent variables are having a strategy (sig: ,046) which has a positive influence (,353) on personal well-being. The factor thinking about strategy has a negative influence (-,507) on personal well-being (sig: ,007). All other factors aren’t significant although the influence of adopting new insights in the strategy with a positive influence of ,319 and a significance of ,071 is an influencer which has to have some extra attention in the deeper analysis of personal well-being (refer to appendix 4a for all tables).

Personal well-being is built up out of four components: satisfaction in business, satisfaction in life, mental stress and physical stress.

Satisfaction is business is being positively influenced by being in charge of the strategy process (,319 and sig: ,005) and being able to adjust the strategy for new insights (,565 and sig: ,001) (refer to appendix 4b). Satisfaction in life is significant influenced (,035) to adjust the strategy for new developments and possibilities (,355) (refer to appendix 4c). Both in mental stress and physical stress the significant factor is also the negative factor for personal well-being. Thinking about the strategy of the company has negative relation with the stress factors of -,595 and -,632 and sig ,011 and ,005 (refer to appendix 4d and 4e). So thinking about strategy creates extra stress both mental and physical when excluded for other independent variables. In a correlation test the factor thinking of strategy relates positively with personal well-being in general (,282 sig: 0,013) but also on the mental and physical stress factors there is a little positive influence (0,092 and ,156) which isn’t significant (,239 and ,113) (refer to appendix 3). The survey does not give any indication about the causes of the possible stress factors. Therefore some further research can be done on why thinking of strategy could cause some stress factors.

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To distinguish between having a strategy, a strategic process and formalization and review of the strategy and the type of strategic process in place in the SME a split has been made in the evaluation by running separate multiple regressions. One multiple regression with the strategy, strategic process and formalization and review influence on personal well-being and one multiple regression with the different types of strategy and the personal well-being.

When modelling only the strategy, strategic process and formalization and review of the strategic process the model explains ,540 change in personal well-being. The model is significant with ,000 see table 12a and 12b.

Model Summary Model R R Square Adjusted R Square Std. Error of the Estimate Change Statistics R Square Change F Change df1 df2 Sig. F Change 1 ,735a _,540 _,480 _,49573 _,540 _9,051 ₇ ₅₄ _,000

Table 12a: Multiple regression strategy, strategic process and formalization on personal well-being (total table refer to appendix 5a)

Coefficientsa Model Unstandardized Coefficients Standardized Coefficients t Sig. B Std. Error Beta 1 (Constant) 3,579 ,481 7,439 ,000

Mijn onderneming heeft een strategie voor de toekomst.

,292 ,108 ,429 2,707 ,009

Ik denk er over na hoe de strategie moet worden uitgevoerd.

-,398 ,132 -,517 -3,022 ,004

De strategie leg ik schriftelijk vast. ,084 ,088 ,146 ,952 ,345

Ik heb voor mezelf een proces om aan mijn strategie te werken en mijn strategie te bepalen.

-,023 ,078 -,038 -,298 ,767

Ik denk …….. na over de strategie van mijn bedrijf.

-,185 ,060 -,361 -3,094 ,003

Bij nieuwe inzichten over de strategie pas ik mijn strategie aan.

,335 ,079 ,537 4,221 ,000

De aangepaste strategie werk ik schriftelijk bij in de oorspronkelijke strategie.

-,093 ,088 -,145 -1,059 ,294

a. Dependent Variable: Gemiddelde van well-being

Table 12b: Multiple regression strategy, strategic process and formalization on personal well-being (total table refer to appendix 5a)

In this model having a strategy for the SME has a positive influence with ,429 and significance of ,009. Being able to adjust the strategy for new insights also has a positive (,537) significant (,000) influence on the personal well-being. The personal well-being is again negatively influenced by in general thinking about the strategy

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(-,517 and sig: ,004) and also by periodically thinking about strategy. The more often someone’s thinks about strategy the worse someone’s personal well-being. The influence is with -,361 it is significant with ,003 (refer to appendix 5a).

More in depth in the four types of personal well-being the satisfaction in business shows the same direction of influences as overall personal well-being. Although having a strategy and periodically thinking about strategy aren’t significant with ,053 and ,065 (refer to appendix 5b). For satisfaction in life having a strategy has a

significant (,016) positive influence (,427) as well as being able to adjust the strategy for new insights (,403 and sig: ,005) (refer to appendix 5c). For both mental stress and physical stress thinking about strategy (-,512 resp. -,559) and thinking

periodically about strategy (-,484 resp. -,302) has a significant negative influence (,021; ,009 resp. ,002 ,036) (refer to appendix 5d and 5e). For physical stress there is also a positive relationship (,396 resp. ,359) for having a strategy and being able to adjust the strategy for new insights (refer to appendix 5e).

In the survey five types of strategy processes are questioned. The five types of strategic processes are complete planning, critical point, reactive, habit and opportunistic. The model with the five types of strategic processes in relation to personal well-being is significant with ,000 and explains ,362 of variance in personal well-being. See table 13a and 13b.

Model Summary Model R R Square Adjusted R Square Std. Error of the Estimate Change Statistics R Square Change F Change df1 df2 Sig. F Change 1 ,602a _,362 _,305 _,57304 _,362 _6,366 ₅ ₅₆ _,000

Table 13a: Multiple regression types of strategic processes on personal well-being (total table refer to appendix 6a) Coefficientsa Model Unstandardized Coefficients Standardized Coefficients t Sig. B Std. Error Beta 1 (Constant) 2,265 ,338 6,708 ,000

De totstandkoming en uitvoering van de strategie van mijn onderneming is een gestructureerd proces waarin we doelgericht vooruit plannen, afwijkingen signaleren en hierop acteren.

,064 ,084 ,108 ,767 ,447

De totstandkoming en uitvoering van de strategie van mijn onderneming is gefocused

Effect of strategy, strategic process, types of strategy on the personal well-being of small and medium enterprises’ strategy leaders