Integrative Model of Strategic Environmental Scanning based on Crises Management Approach

Abstract

The aim of this study is to examine the way top managers scan environmental conditions to diagnose and interpret issues during periods of crisis. Despite each of these processes being widely and individually represented in the research literature, there is a lack of integrative models that examine their internal dynamics in-depth. In this study, structural equation modeling methodology (EQS 6.3) was applied to a sample of 120 top managers to examine how the cognitive orientation of scanning (rational vs. intuitive analysis of environment) may influence final issue categorizations. The overall findings of the current study show that strategic Environmental Scanning is conducted in UNRWA and has a stoical relation with crises management. This relation is weak and need to be strengthen especially during and after the crisis. The study suggest that strategic Environmental Scanning must be conducted permanently for external and internal environment to help UNRWA developing its strategic planning and to be to prepared to deal with potential crises in the future.

Introduction

I. INTRODUCTION

In today’s organizations environment, a complex political, social, economic, technological and cultural changes is order of the day. Any organization that is not aware of its environment is bound to run into some crises that will definitely arise from the increasing complexity of the environment in which such organization operates. Environmental scanning is the tool used in analysis of the environment and its effectiveness depends on some underlying factors. Opportunities and threats changing by an ongoing basis, not just the external environment of the organization, but also their interior environment. This change put the organization in a tough mission that require a fast adoption and cope with the external and internal environment to ensure survival and achieve their goals, otherwise it will be doomed to finish and disappearing. According to the rapid changes in the internal and external environment, the need for a strategic environmental scanning process increased.

The scanning process for the internal and external environment in light of the vision, mission and clear objectives of the organization is essential. Strategic and operational plans for the organization are important to success and survival. Crisis has also become a key feature also of contemporary organizations under this dynamic environment, and these crises threaten the continuity of the organization, survival and the ability to continue providing their services. Also crisis put organizations reputation and image in the community at stake, if those organizations not able to deal with crises through the effective management of the different stages of the crisis either before, during or after the fact. NGOs are no different from the rest of the business organizations according to that, the objective of this study is to examine the impact of UNRWA top management support for strategic environmental analysis on crisis management. The study raises the question of:

1. Does strategic Environmental Scanning used as an approach for crises management in UNRWA?
2. To which extent crisis management practicing in the UNRWA (before, during, after)?

II. LITERATURE REVIEW

Palestinian environment is unstable and unsecure with all means. Also suffer from the ongoing blockade and a lot of crisis. The international relief agency "UNRWA" in Gaza practiced strategic planning; there are shortcomings in dealing with crises. Microfinance program for SMEs has been reduced by 15% in 2012, teaching level is collapsing in dramatic way cause of extra students' number with shortage in facilities. Unemployed percent were 60% for youth in 2014 which represent the highest in the world. Crisis management in such changing environment is so difficult and without using multiple methods for treating with the crises, it will be a disaster. Strategic environmental analysis is an approach used to help top management in predicting and dealing with issues according to current, past and future accidents.

III. STRATEGIC ENVIRONMENTAL SCANNING

Crisis periods can be defined as “a moment of decisive intervention and not merely a moment of fragmentation, dislocation or destruction” (Hay 1999:317). In that contexts, top managers need to be constantly alert to changes to adapt, maintain, or change their current strategy (Floyd and Lane 2000). In general, the literature has posited that the broader the information scanning activities, the greater the organizational performance. This has emphasized differences in the way companies look for strategic information (Babbar and Rai 1993; Ebrahimi 2000). More recently, Danneels (2008) explained that scanning is a strategic capability that enables the absorptive capacity of the firm to increase.

The main objective of this process is to enable firms to forecast and identify the emergence of potential issues (Milliken 1990) by extracting the predominant traits of existing issues. Scanning is particularly relevant because it deals with vague and diffuse developments that have not yet achieved the status of a decision event (Dutton et al. 1983). This deliberative process entails different actions not only to obtain information on relevant events, but also to protect the company from uncertainty (Thompson 1967), to detect environmental changes (Sutcliffe 1994), and to align managers’ perceptions with the real environment (Bourgeois 1985).

Although environmental scanning may be considered an easy task, the literature defines diverse ways of performing this strategic process. For example, Gollner (1983) distinguishes between two main actions: issue scanning and issue monitoring. The former refers to a proactive behavior by which organizations identify events that may affect current or futures strategies. The latter concerns updated information relating to a previously identified issue.

Others, such as Hough and White (2004), refer to external and internal scanning, including the analysis of internal strengths and weaknesses of the company. Another proposal describes scanning as an active process, characterized as constant attention to the environment, rather than passive scanning, in which organizations maintain a state of alertness for non-routine and core information (Huber 1991).

In most cases, data collection activities precede issue interpretation (Daft and Weick, 1984), but do not necessarily result in organizational responses (Hough and White 2004:782). In fact, environmental scanning is often difficult to interpret; however, it provides the basis for better and deeper understanding of environments and guides strategic planning steps (Lester and Parnell 2008). In this vein, when scanning environments, managers should not only identify and relate different relevant factors, but also describe possible future developments to shape diverse potential scenarios (Ayres and Axtell 1996; Gausemeier et al. 1998; Jiang et al. 2017; Tiberius et al. 2020).

Because there are different ways to develop scanning activities, top managers’ capabilities play a crucial role in this regard in the survival of their firms. On the one hand, the information-processing approach posits that more information usually helps managers to develop interpretations and label issues, which enables better performance (Kuvaas 2002). Thus, when managers face uncertain and complex environments, they usually expend more effort on collecting data and seeking new information to clarify the context in which they act (Dutton and Jackson 1987). On the other hand, in certain contexts, they reduce scanning activities and base their decisions on their own experience and knowledge. This focus implies a direct and linear relationship between environment complexity and data collection processes (Hough and White 2004). However, these arguments are limited in explaining the reality of scanning behaviors.

To address these concerns, literature on social cognitive processes offers an alternative explanation, proposing that managers who spend too much time on gathering information tend to implement fewer changes relating to issue interpretation (Kuvaas 2002). The logic behind this argument suggests that “there is a strong tendency for subsequent information gathering to be biased towards confirming its correctness, rather than finding contradictory evidence […]” (Anderson and Nichols 2007:369). Therefore, as the literature suggests, scanning usually decreases in situations where there are important levels of certainty or uncertainty (March and Simon 1958).

This means that managers would prefer to make decisions based on their “gut feelings” and experiences. In uncertain contexts, it is possible that managers do not have access to information (May et al. 2000) or there may be too much information to be analyzed, resulting in managers having to cope with contradictory information (Hough and White 2004). Accordingly, Álvarez and Barney (2007) posit that creating opportunities is a better option to face uncertain contexts or sectors than discovering new businesses. In essence, “creating” implies that opportunities do not exist independent of entrepreneurs and they are not considered the result of market discontinuities and imperfections. In fact, information to foresee potential outcomes related to decision making may not yet exist in such a context.

IV. CRISIS MANAGEMENT

Crisis management involves quick decision-making in critical conditions, with the obligation of issuing a public report to the media. Crises therefore lead decision-makers into an urgent decision-making situation, with the obligation to minimize the potential consequences for a wide range of high-stake elements. There are many definitions for crisis management (Chollet et al., 2016). Jad Al-Rab (2010), Yamamoto & Sekeroglu (2011), & Panos (2013) define it as "Systematic attempt to define and identify potential crises, take action and measures to prevent and contain the impact and get rid of the effects". Crisis management in the organization process passed through several stages represent each stage of them to deal with the crisis basis, although each of these phases is characterized by a kind of autonomy in dealing with them depending on the nature of each of its stages. The main goal remains to find a solution to the crisis and come out from it with minimal losses. Sense of crisis and ignoring it is the first phase of the crisis because it is fast-moving, and vice versa, recognition, handling and treatment is the first stage of facing, treatment and reducing the negative effects. (Yarmohammadian et al., 2016), (Abu Moamer, 2011), (Al-Saeed, 2011) and (Jad Al-Rab, 2010) classified crisis into three stages: 1- Pre- crisis: prevent the crisis and prepare for it. 2- Response: deal and respond to the crisis. 3- Post-crisis: improve preparedness for future crises and record the flow of information which happened during the crisis and take advantage of any future crisis. Appropriate response toward the unexpected events requires providing facilities and suitable plans. Different societies always look for managing the damages of the unexpected events. Therefore, the organization’s manager always needs to be prepared to encounter the crisis and think to decrease the effects of crises on the organization (Yarmohammadian et al., 2016). As the main aim of the crisis management plan is to provide the most appropriate services to most of injured people, it is necessary to develop a specified plan with scientific and precise management at all stages before, in progress and after crisis by taking precautionary actions, establishing the crisis management committee, education familiarizing the staffs, and doing the periodical maneuver to get prepared and facing the crisis, giving an appropriate response while the crisis occurs and taking actions for rebuilding after the crisis occurs. These actions should be on the basis of the activities, strategies, knowledge and the crisis plans at the national level (Naghibosadat, 2008). Therefore, the following main hypothesis for the study: H1: There is a statistically significant relation between strategic environmental scanning and crisis management (before, during, after) in UNRWA- Gaza Strip. And that leads us to the next sub-hypotheses:

1. H1-1: There is a statistically significant relation between strategic environmental scanning and before crisis in UNRWA- Gaza Strip.
2. H1-2: There is a statistically significant relation between strategic environmental scanning and during crisis in UNRWA- Gaza Strip.
3. H1-3: There is a statistically significant relation between strategic environmental scanning and after crisis in UNRWA- Gaza Strip.

V. RESEARCH METHODOLOGY

A five-point Lekert scale of agreement was used for measurement, running from “Strongly Agree” to “Strongly Disagree”, with a Neutral category for scale midpoint.

1. Study Population and Sampling: The study performed in UNRWA- Gaza Strip Field– Palestine. UNRWA is the biggest supporter for Palestinian refugee all over the world in almost all fields. About (1.50 M) refugees live in Gaza Strip (for more information, http://www.unrwa.org). The UNRWA managers population in Gaza Strip Filed are (881), stratified random sample was(268) and the usable sample was (235).
2. Research Instrument: The instrument contains two dimensions. The first dimension in the instrument is about strategic environmental scanning and contain (6) statements. The second dimensions of the instrument which measure crisis management contain three sub-fields depending on other research literatures. Those statements were further revised and modified by experts in a subsequent stage before drafting the final version of the questionnaire.
3. Validity and Reliability Assessment: The study adopted Cronbach’s α to measure the internal consistence reliability of the questionnaire. The results showed that Cronbach’s α values for all dimensions were > (0.5). It indicated that the design of the questionnaire had a high internal consistency.
4. Statistical Procedures: Several statistical tools were used for data analysis and hypotheses testing, including reliability Correlation using Cronbach’s alpha, “ANOVA”, Pearson Correlation Coefficient, and Scheffe.

VI. DATA ANALYSIS AND DISCUSSION OF RESULTS

T test used to examine the dimensions and hypotheses. The results of the analysis are shown in table 1.

For the first dimension (strategic environmental scanning), the sample agree with the existence of strategic environmental scanning as the mean acreage was (73.15%). The second dimension (crisis management) has three sub-dimensions. The mean average for first sub-dimension (before crisis) was (66.30%) and for the third subdimension. Those results infer that strategic environmental scanning is not concentrating at crisis management for the period before and after crisis happened. Second sub-dimension (during crisis) was (73.11%), this mean that the UNRWA treat well with crisis only when it happened according to its strategic environmental scanning. The hypotheses test shows that there is a weak static relation between strategic environmental scanning and crisis management with Pearson Correlation Coefficient (0.431). This finding is shown in table 2.

Conclusion

UNRWA is a multi-service organization. It is role in the world is very operative, not just in Palestine, but it also serves millions of Palestinian refugees all around the world (Syria, Lebanon, Jordan). UNRWA human development and humanitarian services encompass primary and vocational education, primary health care, relief and social services, infrastructure and camp improvement, microfinance and emergency response, including in situations of armed conflict. With such responsibilities which been adopted since 1949, and with more than (5.3 M) refugee all over the world, and with a huge lack in finance and resources, crisis might form a real humanity disaster in the area. Strategic Environmental Scanning in UNRWA as a Framework for crisis management must be enhanced and practiced wider. Such organization cannot stop services cause of crises, to that one of it is basic priorities is to design a solid system to manage crisis before, during and after it happened. The current study shows some weak in crisis prediction, which might be normal thing in ordinary organizations, but for UNRWA this issue must be solved so fast.

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Copyright

Copyright © 2022 Honey Jain, Tanmayee Parbat, Rohan Benhal, Dr. Vinayak Musale. This is an open access article distributed under the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.