Key Words:

Service Quality Management, Complexity, Paradigms, Ideology,

Correspondence address:

Strategy theories can be applied uncritically to the management of quality. Opposing strategy paradigms are used as the basis of ideologically polar views with little consideration of any alternative points of view (see for example: Firat, 1985; Shrivastava, 1986; Venkatesh, 1985). Using an ideological approach to strategy that may not be appropriate for the environmental conditions in which a company operates can lead to company failure (e.g. Barr, Stimpert, & Huff, 1992).

The historical reasons for ideologically polar views of strategy are embedded in the types of debate that emerged out of the early strategic management literature. For example, a major early debate was developed by writers advancing one or another opposing strategy school of thought. One school advanced various forms of determinism, whereas the opposing school advanced various forms of rational choice (Bourgeois, 1984). This debate had the effect of polarising the strategy schools of thought into the domain of ideology by considering environmental determinism and rational choice to be mutually exclusive (Hrebiniak & Joyce, 1985; Lawless & Finch, 1989).

There have been calls to address the limitations of these ideological views of strategy to provide more comprehensive explanations of management practice (Bourgeois, 1984; Ginsberg, 1984; Jemison, 1981). Comprehensive explanations are required to deal with complexity, such as those experienced in the management of relational services in technological arenas dealing with intensely competitive changing environments (Evans, 1991). These environments are becoming more dominant due to increasing competition in a global information economy, and increasing competition in services promises to be a significant trend (Senge, 1990).

An integrational approach using different strategy paradigms has been suggested as a way forward to provide more comprehensive explanations to deal with such issues (Bailey & Johnson, 1992; Combe, 1999; Cravens, Greenley, Piercy & Slater, 1997; Hart, 1992; Hrebiniak & Joyce, 1985; Jemison, 1981; Mintzberg, 1994). In this article the implications and limitations of the ideological polar views of strategy for the management of quality are outlined. These limitations suggest that in complex situations such as encountered in relational services in intensely competitive changing environments an ideological reliance on any single strategy paradigm to manage quality is ineffective. To effectively deal with complexity managers are required to balance many issues to provide comprehensive strategies for the management of quality. In these circumstances an integration of multiple theoretical strategy paradigms is required in strategy practice.

To highlight the advantages of an integrated multi-paradigm approach to address complexity, the authors discuss fifteen different theoretical strategy paradigms within five schools of thought: Rationalism, Developmentalism, Determinism, Probabilism and Chaos. The advantages and limitations of these strategy paradigms for the management of quality are considered. The intention is to provide a more comprehensive view of strategies for the management of quality that can deal more fully with complex situations. The research implications are discussed and a case study is used to demonstrate the need for an integrative approach to the management of quality. The case study suggests that this integrative approach is especially required when managing complex relational services in technological arenas dealing with intensely competitive changing environments.

Quality is a complex phenomenon based on perception by individuals with different perspectives on products and services. These perceptions have been built up through the past experience of individuals and consumption in various contexts. Consequently, quality encapsulates time and other contextual dimensions that add to the complexity of what is essentially a subjective evaluation of the quality of good and/or service by the consumer. Strategies for managing quality therefore need to consider this inherent complexity, and build complexity into its models. Any single paradigm provides a too narrow view to capture complexity, and the multi-faceted nature of reality (Burrell & Morgan, 1979; Gioia & Pitre, 1990).

Writers have noted that that much of the management literature addressing the topic of quality is highly evangelical and universally prescriptive. This is especially stated in relation to the total quality management (TQM) literature (e.g. Drummond, 1995; Silvestro, 1998), with its roots in production of manufactured products. The service quality literature is less universally prescriptive and based more on academically rigorous empirical research (Silvestro, 1998). However ideological views, such as the rational functionalist view that service quality can be measured and managed through systematisation (Levitt, 1972), are still present. However, the core assumptions and beliefs underpinning these ideological views and the limitations of managing quality in this manner are given less prominence. These limitations become much more pronounced as complexity increases.

Complexity has started to receive considerable attention in the strategic management literature (e.g. Nutt, 1998; Parker & Stacey, 1994; Senge, 1990; Stacey, 1991; Stacey, 1995; Stacey, 2000). Senge (1990) discusses the distinction between two types of complexity; detail complexity and dynamic complexity. He suggests that the sophisticated tools of analysis, forecasting and planning are designed to deal with detail complexity, a type of complexity exemplified by a large number of variables. According to Senge (1990) these tools fail when confronted by the other type of complexity, dynamic complexity, where forces are in a state of change and cause and effects are subtle.

This assertion is supported by empirical evidence that suggests rational approaches to strategy are not effective in unstable environments (Fredrickson & Mitchell, 1984). In dealing with the dynamic type of complexity, obvious interventions produce non-obvious consequences, and even the same action can produce dramatically different effects over different time horizons (Senge, 1990).

Stacey (1995) discusses the properties of organizations in terms of non-linear network feedback systems, suggesting that these are the very properties that complexity theory was developed to help understand. To Stacey (1995) organizations are clearly feedback systems because every time two humans interact, the actions of one person will have consequences for the other, requiring a further response. These feedback loops are non-linear because they are based on perceptions that lead to over and under-reactions.

Due to factors such as intangibility and perishability managing quality in service settings is much more challenging than managing quality in product markets. It is even more challenging to manage quality in non-standardized relational service settings such as in professional services. In this type of service, quality can be determined by the network that the company provides for a client, and these networks can be formal and centrally established, or informal and based on chance encounters of individuals with similar or different interests and expertise. The complexity of managing quality in this type of service is further increased if there is continuous change in the external environment due to intense competition and changing customer needs.

The intention in this article is to help managers configure the advantages of different theoretical strategy paradigms so that their strategies are more appropriate to deal with complexity. We highlight the core assumptions and beliefs inherent in ideologically polar views of strategy for the management of quality and propose integrating the advantages of various theoretical strategy paradigms in practice to deal with detail and dynamic complexity.

Network theory is widely discussed in the management literature. Here we focus on the connectivity in networks because the nature of the interaction will greatly influence service quality. If a standardized service is appropriate to increase quality, formal centrally established networks would seem appropriate. However, this formal network may not be appropriate for professional services especially where innovation and creativity may be important to the client. It is unlikely that rational planning of networks would be effective in these circumstances.

However, problems arise in relation to service quality when networks are allowed to form informally. Granovetter (1973) for example, reports that a greater variety of behaviour would be expected if informal ties between people are weak. This greater variety of behaviour may contribute to a client's perception of lower service quality, because of contradictory points of view expressed by members of the network. Strong informal networks may increase uniform behaviour and this behaviour may have more positive connotations for the client.

It may not be the strength or weakness of individual ties that influences the variety of behaviour in a network. Stacey (1995) suggests an alternative: the number of random ties that exist; a large number of connections suggesting weak ties, and a small number of connections suggesting strong ties. The study of informal networks suggests that limited connectivity across a network produces emergent order that remains stable for lengthy periods (Stacey, 1995), and this limited connectivity may be appropriate for relational services in stable external environments. However, in changing unstable external environments a large number of random connections may be appropriate, because this form on connectivity is more likely to produce a changing variety of emergent patterns of behaviour to match external change.

Stability is inherent in the network when links are small in number and strong ties exist. Changeability is also a fundamental property of informal networks when links between individuals are numerous and weak. Thus this latter type of network may develop a highly flexible response to external environmental change appropriate for operating in highly competitive technological arenas.

Managing complexity is problematic. Stacey (1995) points out that the study of complexity in networks suggests order and patterns of behaviour that are emergent, because it focuses on random informal links between members of the network. The concept of spontaneous self-organizing emergent strategy may be, as Stacey (1995) contends, an integral property of organizations where informal networks exist, but managing quality (or not managing) by this process may be frightening to managers due to the lack of any control.

Senge (1990) offers an alternative solution to these systemic problems: that of the learning organization. This solution, at least, gives managers the hope that they may influence strategy if they follow Senge's (1990) advice and develop personal mastery and proficiency by learning.

We contend that an alternative solution to the problems articulated above: that of the multi-paradigm approach, requires investigation. Therefore we suggest that both the solutions offered above are partial solutions and can be incorporated into an integrated multi-paradigm framework. We further contend that as complexity increases the need for a multi-paradigm approach to manage quality becomes more necessary.

In summary, the above discussion highlights that complexity is inherent in informal networks, and these networks are important to managing quality in relational service settings. Some of the problems facing managers in dealing with different types of complexity are also highlighted. Theorists and empirical researchers provide evidence that rational approaches to strategy are not effective in dealing with increasing complexity. However, we do not suggest that rational strategy should be abandoned, because it is helpful in dealing with some issues in more stable environments. Consequently, we review fifteen theoretical strategy paradigms below, that provide different perspectives on how to manage quality. We suggest that to address complexity, an integration of these paradigms in strategy practice would benefit the management of quality. We therefore attempt to address complex problems with a comprehensive solution.

Theoretical strategies for the management of quality are no different from other strategies in so much as they advance core assumptions and beliefs that largely go unquestioned due to their implicit nature. Questioning the appropriateness of theoretical strategies based on these core assumptions and beliefs is an important task for a critical analysis of the application of theory. Unless it is proposed that theories can be universally applied without question, which we do not, the contextual factors that deem that a theory may be effectively applied or not applied in a particular context should be investigated by research.

To aid this investigation we use an integrational framework developed by Combe (1999). This framework, grouping paradigms into schools of thought based on their core assumptions and beliefs, is now used to distinguish between various strategies for managing quality and to highlight the core assumptions and beliefs associated with each. We profile fifteen different theoretical strategy paradigms considered within five schools of thought: Rationalism, Developmentalism, Determinism, Probabilism and Chaos.

We suggest that a reliance on only one of these theoretical paradigms by its whole-sale acceptance by managers can lead to an uncritical ideology within an organization in relation to its strategy for the management of quality. An alternative argument is developed in this article: that theoretical paradigms can be integrated in practice. We investigate the advantages and limitations of each so that these may be accepted and understood. We further suggest that managers should configure the advantages of different strategy paradigms to benefit the management of quality in their organizations, dependant on the contextual factors faced by the organization. The multi-paradigm view is further necessitated as complexity increases.

The main features of these theoretical strategy paradigms and the advantages and limitation for managing quality in services and goods are as follows:

This school of thought emphasises the human brain’s capability to receive, organize and interpret information. This cognition attempts to reduce and rationalize complexity to try to make sense of the environment. Thus one focus of attention can filter out the background "noise" from other sources of attention. The capacity to provide internal explanations by analysis of phenomena present in the environment, and to forecast these phenomena deliberately and proactively into the future are the main tenets of this school of thought. This school can be found implicitly in many concepts, theories and perspectives. Four major paradigms are evident in the literature. These are:

• The Rational Planning Paradigm

• The Functionalist Paradigm

• The Holistic Paradigm

The main advantages of this school are that it addresses the issues of cognitive analysis and proactive management and choice within the firm, and rational accountability to other stakeholders. However, the organizational behavioural literature such as Cyert & March (1963) and Simon (1957) argues that these advantages are based on the false premise of perfect rationality that does not exist due to cognitive limitations (Miller, 1956).

Another limitation is that this school requires some degree of stability within the internal and external environments for the analytical aspects of rationalism to be effective. The increasing demands of hyper-competition within a global information economy suggest that this stability may be lacking at present.

This School of thought emphasises developmental education and change both at an individual and organizational level. This school of thought is built on the capacity of humans to learn from undertaking tasks such as production processes and planning of strategy, and to adapt by learning from past experience. The main focus is on the building of knowledge, resources and internal capabilities within the firm whether this is done proactively or a consequence of other activity.

Three major paradigms are evident in the literature. These are:

• The Evolutionary (Lamarkian) Paradigm

• The Process (Developmental) Paradigm

• The Resource Based View

The main advantages of this school lie in addressing the issues associated with adaptive evolution of the firm in a way that holds up the hope that management and workforce can influence adaptive change, growth and long term survival. This school also addresses the role of the individual in providing skills and knowledge that are useful to the firm, to the mobility of labour and to society at large.

Difficulties associated with this school arise from the never-ending capacity to absorb more information, knowledge, capabilities and other resources. The window of opportunity can close before knowledge and capabilities are built up. Thus there is a need to balance the conflicting demands of exploration for more knowledge and capabilities, and the exploitation of existing knowledge and capabilities (Levinthal & March, 1993; Penrose, 1959). Another potential problem associated with this school is that its devotees can be focused too much on internal learning issues, and thus lose sight of changing customer needs externally.

This school considers that events are determined by preceding events, therefore freedom of choice is illusory. The application of determinism in strategic management, suggests that management has a passive role and is largely unable to influence change and long term survival. However, a more balanced view might consider that although the external environment acts on internal company resources in a deterministic fashion, these resources have been built up through past experiences and learning by a non-Darwinian process.

• The Evolutionary (Darwinian) Perspective

The main advantage of this school is that there is a comprehension of the influence of links between the external environment to the internal environment. The disadvantages are that it undermines the effectiveness of rational choice, learning and proactive development by management.

This school is based on the importance of the dynamic interactive nature of the environment. This school emphasises modification to strategy by interaction with other factors. Externally these may be due to changing competitors offerings and changing customer needs, whereas internally strategy is realized through interaction with cultural beliefs and political forces that cause barriers to change. This interaction means that both strategies for the management of quality, and indeed, the concept of quality itself, both need to take account of interactive contingent effects.

Five major probabilistic paradigms are present in the literature:

• The Ecological Paradigm

• The Process (Emergent) Paradigm

• Game Theory

• The Behavioural Paradigm

• The Societal Contextual Paradigm

The main advantage of this school is that it recognizes the issues of interaction and exclusion in a dynamic competitive environment. A recognition that the company is not isolated from the moves of its competitors, the behaviour of consumers or its social context is important. It also incorporates environmental complexity and speed of reaction to customer needs and competitive moves, which are consistent with the relentless pressures on firms in competitive markets. While this school seems to recognize the dynamic interactive nature of competitive business, it can lack the analysis of Rationalism/congnitivism and the long-term view of Developmentalism. Others, especially those associated with the Chaos school, would also suggest that ecological equilibrium either does not exist or will not exist for long in the business environment. These could be considered to be the main disadvantages of this school.

This school considers that management has to address complexity and unpredictability. The application of this school of thought in a management context can suggest that the consumer is unpredictable and fickle therefore rational strategy is of little value. Whereas another paradigm emphasises the inter-connectedness of phenomena so that a small change in one area can produce amplified chaos elsewhere. To overcome chaos organizations can focus internally on the internal responses to unpredictability such as creative individualism, reactive speed and organizational ideology, rather than traditional ideology.

• The Postmodernist Paradigm

• Chaos Theory

The main advantages of this school are that it recognizes the issues of unpredictable change that are especially pertinent as organizations contend with a move from national industrial economies to global information economies. The main difficulties associated with this orientation lie in developing solutions to deal with chaos. As Chaos Theory predicts, change at the societal or organizational level is not continually chaotic, but can enter into more predictable periods where other orientations may be more helpful.

Table 1, below, summarises the strategy schools of thought and adds the implications for the management of quality.

The previous discussion highlighted advantages and disadvantages of the various strategy paradigms that can be applied to the management of quality. It also suggests that in practice, organizations cannot rely on only one paradigm to effectively manage quality, because any one paradigm will possess limitations as well as advantages. These limitations need to be addressed from the perspective of alternative strategy paradigms.

The advantages and limitations of strategy paradigms highlighted in this article suggest that the context is the important consideration when deciding which paradigms may be more appropriately applied to the management of quality. Thus important contextual issues such as the level of external environmental change; the nature of the organization; the nature of the market/s served; the nature of the industry; and the level of competition, will deem some strategy paradigms more appropriate than others. Consequently, managers need to integrate various configurations of strategy paradigms to benefit from their various advantages.

We suggest that as complexity increases there will be a greater need to consider a multi-paradigm integrational view of strategy for the management of quality. Complexity is inherent in the management of relational services in intensely competitive changing environments. We therefore suggest that a multi- paradigm approach would be especially useful in dealing with the management of quality in these circumstances. If a manager has to address a multitude of problems changing from one single strategy paradigm to another single paradigm is not an effective solution. Addressing complexity requires a complex solution: that of a multi- paradigm approach.

An integrative multi-paradigm approach to strategy for the management of quality raises several implications for research. Firstly, we highlight the implications for strategy practice by reference to a case study involved in service within the highly competitive technology arena. The case was chosen to highlight the issues of managing quality in increasing unpredictability environments. Consequently less emphasis is placed in this case study on managing quality in very complex relational service settings.

The case also raises implications for research methodology to investigate multiple paradigms in a practical setting. Therefore next we briefly suggest some research methods that may be appropriate for investigating different strategy paradigms within organizations.

Readers have to bear in mind the limitation: that the methodology used in the case reflects a bias to the aim of the original research study from which this case study was taken. The original study, undertaken by one of the authors of this article, focused on strategic marketing within the rational planning paradigm.

The case highlights the integrated nature of strategy problems and strategic decisions with special reference to the management of quality issues. Attempting to investigate and explain these issues from only one paradigm would have resulted in a limited understanding of the complexity present. The case also highlighted the problems associated with the assumption that quality can be managed from one perspective. ITF Ltd. attempted to manage their quality solely from a rational perspective. However, they found that this approach was not particularly effective even within a stable, largely predictable external environment. These conditions are supposed to be ideal for this rational approach to be most effective.

An in-depth understanding incorporating other perspectives has indicated that the company also managed their quality using other strategy paradigms, although the company itself may have been unaware of doing so. These strategy paradigms have additional advantages such as flexibility and co-ordination of effort that may help companies to effectively manage their quality within different trading environments.

If, as the above case study demonstrates, multiple paradigms of strategy already exist in management practice, a reductionist study working within a single paradigm will not illuminate what is happening in practice. Multiple research methods would be required.

To uncover the strategy paradigms currently used by managers a cognitive perspective using experimental methods may be useful. These methods are necessitated to uncover the manager’s ‘theories in use’ (Argyris and SchÖn; 1974; Prahalad and Bettis, 1986) to uncover the strategy paradigms that actually govern behaviour, because these theories cannot be obtained simply by asking for them. Significant interaction between interviewer and respondent is usually required to investigate complex cognitive phenomena, resulting in possible biased responses.

Walsh (1988) has attempted to overcome some of the problems by using a sorting method, used in psychological research (Rosenberg, 1982), that requires managers to sort a large number (50) of items contained on cards into piles of factors and to rank-order them in terms of importance in making decisions. This method has advantages particularly important to research, because it allows respondents to categorize a set of stimuli independently of the interviewer’s own category system (Walsh, 1988), and is less time consuming than some other methods such as repertory grid technique (Daniels, de Chernatony and Johnson, 1995). However, experimental methods have their own set of problems, therefore these methods could be used in conjunction with other methods directly investigating managers strategies and the contexts in which they operate.

Investigating strategy paradigms within the schools of thought suggest further problems for researchers. For example, developmental strategies represent unique research problems because competitively superior resources and the capabilities to deploy them are difficult for managers to identify. Developmental phenomena also have a long term focus necessitating longitudinal research methods.

Probabilistic strategies have been successfully investigated by these means (e.g. Mintzberg & Waters, 1982), and the practical difficulties of this type of study are well understood. Due to the time consuming nature of these studies this approach is less common than cross-sectional studies.

Stacey (1995) reviews the research methods most applicable to investigating complexity and also suggests that cross-sectional studies will not capture phenomena important in non-linear systems. To uncover phenomena important in a Postmodern paradigm interpretive methods such semiotics are used (e.g. Combe & Crowther, 1999) and these represent other difficulties for researchers. It is impossible to go into the detailed problems for researchers within this article. The multifaceted nature of these problems suggest that a multi-disciplinary research team may be required to investigate multiple paradigms of strategy in-depth.

It has been suggested in this article that strategy theories should not be applied uncritically to the management of quality. An integrative multi-paradigm approach to the management of quality has been outlined to help overcome the limitations of polar ideological stances. The various theoretical strategy paradigms employed to manage quality were discussed and the advantages and limitations of these paradigms for managing quality were highlighted. It was suggested that due to the limitations inherent in strategy paradigms and in order to provide comprehensive strategies for quality, to help deal with complexity, integration of multiple theoretical strategy paradigms is required in practice. This is even further necessitated when complexity increases such as in the management of relational services in intensely competitive changing environments. In these circumstances the limitations of an ideological stance to any single strategy paradigm for the management of quality are more pronounced.

Strategies to Dealing with Complexity

Rational planning (Ansoff, 1965)

Functionalism / control (Shostack, 1987)

The learning organization (Senge, 1990)

Process emergent strategy (Stacey, 1995)

Partial solutions?

Managers should integrate the advantages of various strategy paradigms dependent on context

The service company case highlighted the need to integrate various configurations of strategy paradigms to benefit from their various advantages and to successfully manage quality. The nature of these configurations to provide the 'best' configuration of strategy paradigms for the management of quality within an organization depends on contextual issues faced by managers as shown in the ITL Ltd. Case.

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