The Impact of Employees’ Perceptions of Strategic Alignment on Sustainability: An Empirical Investigation of Korean Firms

Round 1

Reviewer 1 Report

Dear Authors,

thanks for the opportunity to read your interesting article on the relationships between strategic alignment, employee engagement, and organizational performance. This work is well-written and it offers a novel insight on the importance of role clarity and employee engagement as elements that mediate between strategic alignment and performance. My main doubts regard the following issues:

1) You say that "few empirical studies have been conducted on the behavioral outcomes of strategic alignment, and even fewer on Korean companies". Yes, this is true with respect to the existence of empirical studies about Korean firms, but there different studies on the relationships between strategic alignment and behavioral outcomes: they are just mainly qualitative studies (see Slack et al. (2015). Exploring Employee Engagement with (Corporate) Social Responsibility: A Social Exchange Perspective on Organisational Participation. Journal of Business Ethics 127(3)).

2) The data collection process is not completely clear, so the companies which have been selected. You write that (line 275) "performance managers and employees who had a good understanding of the variables were invited to participate in the study": how did you define the "good understanding of the variables"? Moreover, how did you select the 200 KOSPI- and KOSDAQ-listed companies determined to be operating a SPMS?

4) Even if you talk about financial sustainability (measured by using the ROE), I am not sure that it fits with the scope of this journal. Other indicators, as those related to the corporate social responsibility, are more appropriate.

5) I suggest to delete the discussion of your results from the Introduction (lines 72-77).

Good luck with the revision.

Author Response

Response Letter

This document contains detailed responses to the suggestions and insights of the reviewers. We sincerely thank all reviewers for taking the time to appraise our manuscript with a view to helping us improve its quality and contributions.

REVIEWER 1

(1) You say that "few empirical studies have been conducted on the behavioral outcomes of strategic alignment, and even fewer on Korean companies". Yes, this is true with respect to the existence of empirical studies about Korean firms, but there different studies on the relationships between strategic alignment and behavioral outcomes: they are just mainly qualitative studies (see Slack et al. (2015).

Response 1: Thank you for your comment. We have referred to the literature suggested by the reviewer and revised our manuscript accordingly. In addition, we have added the suggested studies as references in the manuscript.

p.2 (line 53-58): ... organizational performance [29,30]. On the other hand, empirical studies examining strategic alignment and employee behavioral outcomes are mostly qualitative research [Collier and Esteban, 2007; Duarte 2010; Slack et al. 2015]. For example, Slack et al. [2015] found that various factors affect employee engagement, which can be achieved by aligning the strategic goals of the organization with the personal goals of the employees; in particular, communication plays an important role. However, studies dealing with strategic alignment and employee behavioral outcomes in Korea are limited [10,11].

References:

• Collier, J.; Esteban, R. Corporate social responsibility and employee commitment. Business Ethics: A European Review 2007, 16(1), 19-33.
• Duarte, F. Working with corporate social responsibility in Brazilian companies: the role of managers: values in the maintenance of CSR cultures. Journal of Business Ethics 2010, 96(3), 355-368.
• Slack R. E.; Corlett S.; Morris R. Exploring Employee Engagement with (Corporate) Social Responsibility: A Social Exchange Perspective on Organisational Participation. Journal of Business Ethics 2015, 127(3), 537-548.

(2) The data collection process is not completely clear, so the companies which have been selected. You write that (line 275) "performance managers and employees who had a good understanding of the variables were invited to participate in the study": how did you define the "good understanding of the variables"? Moreover, how did you select the 200 KOSPI- and KOSDAQ-listed companies determined to be operating a SPMS?

Response 2: Thank you for your comment. The following content was added on p. 7 (lines 282–287) to further clarify the explanation in the manuscript.

p.7 (line 282): Second, performance managers of SPMS and employees

p.7 (line 284): This study randomly selected 200 companies and organizations which adopted the SPMS, from a population of companies and organizations identified as operating an SPMS based on periodicals, articles, article searches, and cooperation of SPMS-related consulting companies.

(3) Even if you talk about financial sustainability (measured by using the ROE), I am not sure that it fits with the scope of this journal. Other indicators, as those related to the corporate social responsibility, are more appropriate.

Response 3: Thank you for your comment. The reviewer's comments are sufficiently valid.

However, the ultimate goal of all corporate activities is to create profit to secure the sustainability of the company. It is also true that the most objective and representative indicator of the result of corporate activities is the financial performance index, as widely used in numerous studies. This is why we had selected the ROE, which is a representative financial performance indicator, as a proxy for final organizational performance to confirm employee behavioral outcomes through objective results. However, because identifying the financial performance of public organizations does not have much meaning due to their public nature, employee engagement was used as a proxy for organizational performance (p. 9, lines 338–357).

(4) I suggest to delete the discussion of your results from the Introduction (lines 72-77).

Response 4: We agree with the reviewer’s suggestion. Thus, lines 72–77 were deleted.

 

Finally, we sincerely appreciate your diligence and effort in reviewing our manuscript. Your suggestions and insights have been among the most helpful that we have received while authoring our recent papers. We thank you again for improving the quality of this work.

Author Response File: Author Response.pdf

Reviewer 2 Report

BRIEF SUMMARY

The authors argue the need for role clarity and employee engagement as two motivational mechanisms for strategic alignment to achieve better organizational performance. This is achieved by testing a research model through a conducted survey on 244 participants of 74 Korean companies. The partial least squares regression is used to conceive the results of the tested structural model.

BROAD COMMENTS.

The topic addressed in the paper is interesting and fits perfectly well with this Journal area of research. The paper is well-structured and methodically sound, as the conducted survey is supported with clearly defined rationale, objective and step-by-step methodology. The results are presented in a convenient manner and are consistent with the argument that cognitive and motivational mechanisms are helpful in explaining the effect of the management control system on organizational performance.

 SPECIFIC COMMENTS

Abstract:  The abstract is well written and incorporates the purpose and design of this paper, the main research findings and value.

Introduction: The introduction is satisfactory, but it is lacking a paragraph with clearly defined aim and objectives of the paper. Please elaborate on the last paragraph of this section, before stating how the paper is structured. Also, it is not recommended to provide results of your research in the introduction section (Lines 72-77).

Section 2: It is preferable to provide a small paragraph or sentence between the different heading levels, briefly presenting the following subsections (e.g. Between “2. Theoretical Framework” and “2.1. Strategic Alignment”). The same applies for every section in this paper. Moreover, it is not clear whether this section is a literature review on the three fundamental aspects of your research, or it proposes the theoretical framework on which you will be based for grounding your research model. You should either rename the section or provide the required justification of your selection.

Section 3: This section is well structured, presenting the research model and hypotheses. Nevertheless, it is preferable to present each developed hypothesis with the related justification. For instance, in subsection 3.2, you formulate five of your hypotheses in the end of the subsection and the reasoning of each hypothesis is not clearly determined.    

Section 4:  Consider omitting third level numbering of headings, as this is a relatively small section. Align the equations in lines 307 and 312. Erase the second “to” in line 310. In table 1, every line of the first column should be in bold (not only “Strategy Alignment”).

Section 5: The authors provide a detailed description of the sample and measurement model and presentation of hypothesis tests and contextual analysis. In line 497, use a bracket for references.

Discussion and Conclusion: This section presents the main research findings, along with the limitations of this work and future work. It is vital, though, to present the overall impact and contribution of the paper in contrary to similar research approaches.

Author Response

Response Letter

This document contains detailed responses to the suggestions and insights of the reviewers. We sincerely thank all reviewers for taking the time to appraise our manuscript with a view to helping us improve its quality and contributions.

REVIEWER 2

(1) Introduction: The introduction is satisfactory, but it is lacking a paragraph with clearly defined aim and objectives of the paper. Please elaborate on the last paragraph of this section, before stating how the paper is structured. Also, it is not recommended to provide results of your research in the introduction section (Lines 72-77).

Response 1: Thank you for your attention. We have revised the relevant content to clarify the explanation in the manuscript. Now it reads as:

p.2 (line 70-77): ....organizational performance [37-39]. On the other hand, while recent research shows that strategic alignment is used as a means for achieving a strategic advantage for sustainability, it somewhat has low impact on organizational performance [6,25]. In particular, Barek et al. [40] argued that only when strategic alignment is perceived as a strategic component rather than as a means to support strategic organizational operations can it positively impact organizational performance. Therefore, this study examines how strategic alignment, as a strategic component for organizational sustainability, can explain the relationship between strategic alignment, role clarity, employee engagement, and organizational performance.

p.4: We agree with the reviewer’s suggestion. Therefore, lines 72–77 were deleted.

(2) Section 2: It is preferable to provide a small paragraph or sentence between the different heading levels, briefly presenting the following subsections (e.g. Between “2. Theoretical Framework” and “2.1. Strategic Alignment”).The same applies for every section in this paper. Moreover, it is not clear whether this section is a literature review on the three fundamental aspects of your research, or it proposes the theoretical framework on which you will be based for grounding your research model. You should either rename the section or provide the required justification of your selection.

 

Response 2: Thank you for your attention. In accordance with the reviewer’s suggestion, we have added the following sentence in section 2 to enhance the reader’s understanding.

p.2 (line 87-91): The concept of strategic alignment stems from the fundamental proposition that the strategy an organization implements is the result of conformity between various factors, such as organizational structure, technology, culture, environment, and employee behavior outcomes. This section discusses strategic alignment, role clarity, and employee engagement while reviewing the literature on strategic alignment and employee behavioral outcomes.

p.2 (line 86): The title of section 2 has been changed from Theoretical Framework to Literature Review to further clarify its content.

(3) Section 3: This section is well structured, presenting the research model and hypotheses. Nevertheless, it is preferable to present each developed hypothesis with the related justification. For instance, in subsection 3.2, you formulate five of your hypotheses in the end of the subsection and the reasoning of each hypothesis is not clearly determined.

Response 3: We thank you for your valuable comments. We have rearranged H3–H7 in accordance with the reviewer’s suggestions.

 

(4) Section 4: Consider omitting third level numbering of headings, as this is a relatively small section. Align the equations in lines 307 and 312. Erase the second “to” in line 310. In table 1, every line of the first column should be in bold (not only “Strategy Alignment”).

Response 4: Thank you for your comment. In accordance with the reviewer’s comments, we have revised this section to clarify the basic explanations.

328. 8: We have deleted the second “to” from line 328.
329. 8: The equation was aligned in lines 317–322.
330. 8: We have deleted the third-level numbering of headings.
331. 9: All lines in the first column of Table 1, starting with line 360, are shown in bold.

(5) Section 5: The authors provide a detailed description of the sample and measurement model and presentation of hypothesis tests and contextual analysis. In line 497, use a bracket for references.

Response 5: Thank you for your attention. We have corrected the error on line 497.

(6) Discussion and Conclusion: This section presents the main research findings, along with the limitations of this work and future work. It is vital, though, to present the overall impact and contribution of the paper in contrary to similar research approaches.

Response 6: Thank you for your comment. We agree with the valuable comments of the reviewer. We have revised this section to enhance clarity. Now it reads as:

p.20: ... employee engagement. These results are consistent with the argument that cognitive and motivational mechanisms help explain the impact on organizational performance [39,57,60,65]. In particular, strategic alignment was found to affect employees’ perceptions and motivation, thus affecting organizational performance. As such, this study contributes to the literature on the direct and indirect effects of strategic alignment on organizational performance [6]. From a theoretical perspective, this study demonstrates that the development of a theoretical model that includes relevant cognitive and motivational variables can help improve our understanding of how strategic alignment affects employee behavioral outcomes. (lines 624-630)

 

Finally, we sincerely appreciate your diligence and effort in reviewing our manuscript. Your suggestions and insights have been among the most helpful that we have received while authoring our recent papers. We thank you again for improving the quality of this work.

Author Response File: Author Response.pdf

Reviewer 3 Report

I have reviewed this work with interest. I have read it and I realized that it is a document made with a lot of effort and time.

However, I am going to explain hard to change work design problems.

The mediation model are interesting, as well as the results that are achieved. However, my doubt reading the document was how this work included sustainability. In all the work there is no mention of the contextualization of sustainability until line 538 is reached.

The problem I find is not that it is sooner or later, not even that this contextualization is not found in the hypotheses, nor in the theoretical foundation. All of these issues could be remedied. The real problem is that the 74 companies of the 277 questionnaires received (or 158 - see figure 3) are subdivided into 6 types of organizations with pressure on sustainability, market uncertainty and profit or public organizations. I understand that it is about analyzing the difference between these companies and contextualizing sustainability, but these 3 contexts do not understand what relationship they have with sustainability. I do not understand the relationship that is established between these 3 types of external contexts, it is not developed in theory, and I cannot rationally establish the relationship.

I comment some other minor things that can help you to improve this work: bootstrapping is being accepted with 5,000 samples or even 10,000. The title I recommend that you simplify, it can help a better understanding of the work. The hypotheses have to be reviewed, perhaps it is best to describe each of the hypotheses separately to better argue the relationships that exist between them. And of course, find meaning in the making of the three types of division of organizations.

Author Response

Response Letter

This document contains detailed responses to the suggestions and insights of the reviewers. We sincerely thank all reviewers for taking the time to appraise our manuscript with a view to helping us improve its quality and contributions.

REVIEWER 3

(1) The mediation model are interesting, as well as the results that are achieved. However, my doubt reading the document was how this work included sustainability. In all the work there is no mention of the contextualization of sustainability until line 538 is reached.

Response 1: As many previous studies referred to strategic alignment as a means of sustaining competitive advantage for sustainability[Skinner, 1969, 1978; Hitt et al., 1982; Labovitz and Rosansky, 1997, 2012; Joshi et al., 2003; Schepereel 2006; Kaplan and Norton 2006; Kathuria et al., 2007; Painter et al., 2019; Haseeb et al., 2019; Sholihas et al., 2019], we derived a research model under the assumption that sustainability has a positive (+) effect on strategic alignment. Barek et al. [2011] and Pollalis [2003] argued that strategic alignment is a strategic component, not a tool to support organizational operations. Therefore, we take this notion as the starting point of our research, and the description of sustainability is therefore limited.

 

(2) The problem I find is not that it is sooner or later, not even that this contextualization is not found in the hypotheses, nor in the theoretical foundation. All of these issues could be remedied.

 

Response 2: We thank you for your valuable comments. The contextual analysis is an additional analysis and is not intended to be a key issue. Therefore, a separate hypothesis was not established. However, in accordance with the reviewer’s comments, we have further explained the theoretical content of the contextual analysis.

4. 17-18: Please refer to the Response 4.

(3) The real problem is that the 74 companies of the 277 questionnaires received (or 158 - see figure 3) are subdivided into 6 types of organizations with pressure on sustainability, market uncertainty and profit or public organizations.

Response 3: The data collection methods are described in the Descriptive Statistics on page 10 (lines 363–381). We sent five surveys (1 performance manager, 4 employees) each to 200 companies, of which a total of 318 responses (74 performance managers, 244 employees) were collected from 74 companies. A total of 244 responses of employees were used for analysis, while the responses from performance managers were used only to calculate the strategic alignment score. In addition, in the contextual analysis, financial performance (ROE) data could not be collected from 86 public organizations, so they were excluded from the analysis of sustainability pressure and market uncertainty. Meanwhile, all data were used in the organizational type analysis. This is also described in Table 7.

(4) I understand that it is about analyzing the difference between these companies and contextualizing sustainability, but these 3 contexts do not understand what relationship they have with sustainability. I do not understand the relationship that is established between these 3 types of external contexts, it is not developed in theory, and I cannot rationally establish the relationship.

Response 4: We would like to thank you for your valuable comments. We have revised our manuscript accordingly.

p.17: The second context was market uncertainty, which reflects the characteristics of the market. The expansion of the eco-friendly product market indicates an increase in demand, while the increased threat of substitute products may reflect a decrease in demand. In addition, market uncertainty affects the organization’s ability to align strategically [Bergeron et al. 2001; Chang et al. 2008; Huang 2009]. (lines 552-556)

p.18: .... strong in Korea. On the other hand, information on the classification of for-profit organizations and public organizations clarifies the differences between different organizational processes. Hence, the classification of organizational types was selected as a contextual variable and included in the analysis. (lines 564-567)

p.18: The classification of the three contexts into two groups enables us to compare and examine possible differences between them. (lines 567-568)

References:

• Bergeron F.; Raymond L.; Rivard S. Fit in strategic information technology management research: an empirical comparison of perspectives. OMEGA International Journal of Management Science 2001, 29(2), 125–142.
• Chang H. L.; Wang K.; Chiu I. Business-IT fit in e-procurement systems: evidence from high-technology firms in China. Information Systems Journal 2008, 18(4), 381–404.
• Huang L. K. The contingent role of innovation between IT management sophistication and strategic alignment. Journal of Global Information Management 2009, 17(2), 60–92.

(5) I comment some other minor things that can help you to improve this work: bootstrapping is being accepted with 5,000 samples or even 10,000.

Response 5: In accordance with the reviewer’s comments, we have revised our manuscript so that it reflects the results of bootstrapping (again) on 10,000 samples.

p.15 (line 465): Table 6

p.17 (line 540): Fig. 3.

p.18 (line 599): Table 7

(6) The title I recommend that you simplify, it can help a better understanding of the work.

Response 6: We agree with the reviewer’s comments. Therefore, if the editorial board allows, we wish to change the title of our paper as follows.

Old Title: The impact of employees’ perceptions of strategic alignment on role clarity, employee engagement, and organizational performance in sustainability: An empirical investigation of Korean firms

New Title: The impact of employees’ perceptions of strategic alignment in sustainability: An empirical investigation of Korean firms

(7) The hypotheses have to be reviewed, perhaps it is best to describe each of the hypotheses separately to better argue the relationships that exist between them. And of course, find meaning in the making of the three types of division of organizations.

Response 7: Thank you for your attention. In accordance with the reviewer’s comments, we have rearranged H3–H7.

Finally, we sincerely appreciate your diligence and effort in reviewing our manuscript. Your suggestions and insights have been among the most helpful that we have received while authoring our recent papers. We thank you again for improving the quality of this work.

Author Response File: Author Response.pdf

This manuscript is a resubmission of an earlier submission. The following is a list of the peer review reports and author responses from that submission.