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Emotional Self-Awareness and Strategic Decision Making in Private School Enterprises in Nairobi County, Kenya

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Abstract

Strategic decision making as a key ingredient of a firm's strategy shapes the expected attainment of organization goals. Firm managers as strategic decision makers are thus required to possess strategic thinking skills and competency so as to articulate a firm's vision. While many researches on strategic decision making have focused on many antecedents of decision making, there is miniature empirical evidence on emotional self-awareness facet of emotional intelligence as a key predictor of a firm manager's strategic thinking. The study was grounded on affective events theory and decision theories. The study employed explanatory research design and targeted a population of 168 private high schools from which a sample size of 151 respondents (mainly school managers) was drawn. Stratified sampling technique was used to select school directors/ principals then simple random sampling was used to select respondents that participated in the study. Data was analyzed using Pearson product moment correlation and hierarchical multiple regression methods. Descriptive analysis was used to summarize data into meaningful forms. Factor analysis was done to ensure content, construct and discriminant validity. Multiple regression results summarily indicated that emotional self-awareness significantly influenced strategic decision making (β=.368; p=0.000 at P<.001), In conclusion, emotional self-awareness of a manager plays a prediction role in strategic decision making. Further, this study provides an empirical basis for the need to develop emotional intelligence of firm managers as strategic thinkers of a firm.
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SCIENTIFIC RESEARCH GATE
International
Journal of
Economic
Papers
International Journal of Economic Papers 2017; 2 (1): 1-6
http://scigatejournals.com/publications/index.php/ijeconomic
Page | 1
Emotional Self-Awareness and Strategic Decision Making in
Private School Enterprises in Nairobi County, Kenya
Osieko.O.M1
*
, Maru L.1, Bonuke R.1
1. School of Business and Economics, Moi University. Kenya.
Abstract
Strategic decision making as a key ingredient of a firm’s strategy shapes the expected attainment of organization goals. Firm
managers as strategic decision makers are thus required to possess strategic thinking skills and competency so as to articulate a
firm’s vision. While many researches on strategic decision making have focused on many antecedents of decision making, there is
miniature empirical evidence on emotional self-awareness facet of emotional intelligence as a key predictor of a firm manager’s
strategic thinking. The study was grounded on affective events theory and decision theories. The study employed explanatory
research design and targeted a population of 168 private high schools from which a sample size of 151 respondents (mainly school
managers) was drawn. Stratified sampling technique was used to select school directors/ principals then simple random sampling
was used to select respondents that participated in the study. Data was analyzed using Pearson product moment correlation and
hierarchical multiple regression methods. Descriptive analysis was used to summarize data into meaningful forms. Factor analysis
was done to ensure content, construct and discriminant validity. Multiple regression results summarily indicated that emotional
self-awareness significantly influenced strategic decision making (β=.368; p=0.000 at P<.001), In conclusion, emotional self-
awareness of a manager plays a prediction role in strategic decision making. Further, this study provides an empirical basis for the
need to develop emotional intelligence of firm managers as strategic thinkers of a firm.
Key words: Emotions, Emotional Intelligence, Self-Awareness, Strategic Decision Making
Citation to This Article: Osieko OM, Maru L, Bonuke R. Emotional Self-Awareness and Strategic Decision Making in Private
School Enterprises in Nairobi County, Kenya. International Journal of Economic Papers, Jan 2017; 2 (1): 1-6.
1. Introduction
Strategic decision-making emerged as one of the most active areas of strategic management research and greatly
benefited from such research traditions as behavioral decision theory and transaction cost economics[21].However,
since it gained its own momentum as evidenced in substantial body of literature, it is still widely recognized that our
knowledge of strategic decision-making processes is limited and is mostly based on normative or descriptive studies
and on assumptions most of which remain untested[24].
Based on the ontology of Strategic Decision Making, Strategic decisions are non-routine and involve both the art of
leadership and the science of management. Routine decisions of how to efficiently manage resources according to
established procedures and clearly understood objectives is the technical work of management [24]. Routine decisions
are normally the purview of supervisors and middle-level managers that have the requisite authority and responsibility
to take action.
However, non-routine decisions require what Harvard Professor Ron Heifetz refers to as “adaptive work” where senior
leadership must consider the broader implications of the situation, take an active role in defining the problem,
creatively explore potential long term solutions, and apply judgments as to what should be done [14].
* Corresponding author: Osieko.O.M
E-mail address: osiekomatti@gmail.com
Osieko.O.M. et al. International Journal of Economic Papers 2017; 2 (1): 16
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Given that strategic decision making has been conceptualized as a preserve of large corporations, [16] gave three
reasons to justify the natural orientation of strategic decision making in small firms. First, small firms adopt a niche
strategy that focuses on specialized markets where large corporation normally ignores. Second, given their (small
firms) limited resources, they normally concentrate on a small product range where strong competitive advantages
and specific problem-solving competencies build up, for example, with regard to qualitative market leadership.
Finally, the high decision flexibility and direct customer contacts means that research and development findings easily
convert into marketable innovations. However, over-dependency on a few products remains risky and cannot
compensate. In summary, after a meta-analysis of literature review, they concluded that decision-makers of small
firms also apply strategic decision, although in many cases rather intuitively and/or informally.
In regard to scholarly researches on strategic decision making in firms, many studies have concentrated on antecedents
of decision making like diversity and group processes [8], strategic decision making processes [21]; [1] with little
regard to the influence of firm managers’ emotions on strategic decision making [15]. The study of emotions in
organizations therefore saw a fresh resurgence [5]. Although this resurgence was partly the result of recent intense
interest in emotions in general in the field of psychology, it was also partly because of knowledge that emotions
experienced at work influence work attitudes, loyalty, organizational commitment, job satisfaction, and decision
making among others [3]. The negative emotions that firm managers feel for instance distrust, anger, stress, have
direct effects on their decision making skills which could have a long term effect on organizational and employee
productivity [6].
Further, the effects of leaders’ or firm managers’ emotions in the leadership process have not been extensively
examined until very recently [7]. A lack of research in this area was surprising considering that emotions have been
shown to influence quality of decision-making, creativity, memory, and inductive as well as deductive reasoning. One
of the key theories of emotions in organizations is the Affective Events theory [25] which holds that environmental
exigencies generate ‘emotional events’ that cause emotional reactions in organizational members which, in turn,
determine members’ attitudes and behaviors. That is organizational events trigger affective responses in organizational
members, with consequences for workplace attitudes, cognition, and behavior. [4] Further developed the theory by
expounding on the role of affect in strategic management which is characterized by complexity, uncertainty and
ambiguity [4].
Moreover [4] posited that intra-organizational and extra-organizational environments generate ‘affective events’,
which result in emotional responses on the behalf of the organizational actors in this instance, the top management
team responsible for strategic decision-making. Intra-organizational affective events include stress-related workplace
events, the physical setting, work-group characteristics, and leader-member exchanges ultimately all derived from
the goals set in place by top management strategic decisions. Extra-organizational affective events include (1)
organizational change events; (2) economic, legal, and political events; and (3) inter-organizational negotiations. The
emotions that are invoked are the negative emotions of anger, emotional outbursts, absenteeism, shocks, turnovers,
disgust, and fear/anxiety, and the positive emotions of joy and happiness.
Further, [11], contested that the study of emotions in firm managers was rather general thus came up with emotional
intelligence a key predictor of a firm manager’s strategic decision making. To qualify this assertion, [20], [2] and [22]
found a significant influence of emotional intelligence on strategic decision making. Emotional self-awareness is
defined by [10] as a person’s accurate self-assessment, self-control However, there is miniature empirical evidence on
influence of distinctive dimensions of emotional intelligence (self-awareness, self-regulation, motivation, empathy
and social skills) on strategic decision making thus the need of this study that researched on influence emotional self-
awareness on strategic decision making in private school enterprises in Nairobi County, Kenya.
2. Methods
The study was carried out in Nairobi County, Kenya between the months of August to November 2015. Nairobi
County was chosen because it has well established and mushrooming private schools which mostly operate as profit-
making entities, hence are involved in strategic decision making to help them gain a competitive advantage over their
contenders in private school enterprises located within the county and the satellite towns of the county. According to
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Nairobi county statistics office, Nairobi county is one of Kenya’s 47 counties and hosts Kenya’s political, commercial
and industrial capital. This study adopted positivism (quantitative) paradigm since structured questionnaires were used
to collect primary data from respondents. The research further adopted explanatory design which is suitable for doing
cause-effect relationships, which are conducted in order to explain any behavior or reactions of people to a given
phenomenon in the society [19].
The study targeted 168 private high schools comprising; school Managers-Directors/Principals in nine sub-counties
of Nairobi County, Kenya from where a sample size of 151 respondents was drawn and simple random sampling was
used to select respondents that participated in the study. Measurements that were used in this study are all proven
measures. The Independent variable- Emotional self-awareness was measured using [26] questionnaire which assessed
a school manager/director’s level of emotional self-awareness. There were nine questions itemized on a 5-point Likert
response scale, ranging from; 1 (“Strongly Disagree”) to 5 (“Strongly Agree). The outcome variable (strategic decision
making) was measured using [8] measurement scale which assessed a school manager/director’s level of involvement
in strategic decision making. There were nine questions itemized on a 5-point Likert response scale, ranging from; 1
(“No extent”) to 5 (“Large extent”). Further, the following controls (age, gender, education level, designation) were
taken into consideration to minimize their effects on strategic decision making (criterion variable). They were
measured using a questionnaire on demographic data.
Several studies on firm competitive strategies and strategic decision making have used age, gender, education level,
student population and nature of school ownership to predict firm competitive strategies and strategic decision making
[22].
In reference to testing of validity and reliability of instruments, a pre-test of the questionnaires was done to ensure the
items in the questionnaire are clearly stated and have adequate content to ensure content validity while reliability was
tested using Cronbach’s alpha reliability coefficient. Further there was factor analysis as a variable reduction technique
and commonly used tool for constructing a measurement index [9] was used to extract factors according to their Eigen
values on emotional self-awareness and strategic decision making. The hypothetical prediction of emotional self-
awareness on strategic decision making was tested using researcher’s conceptual model formulae shown below;
y = β0+ β1CD+ β2CLS + β3SA+ε; where;
y = Strategic Decision Making
CD = Control variable (designation), CLS=Control variable (Length of service)
SA= Self-Awareness
ε = error term
3. Results
A total of 150 questionnaires out of 151questionnaires were filled representing a response rate of 99% which was used
for data analysis. Reliability test for the two variables that is self-awareness and strategic decision making were
computed and all showed a Cronbach alpha above 0.6 confirming the reliability of the research instruments used in
the study (Cronbach alpha for self-awareness and strategic decision making were 0.773 and 0.821 respectively). Using
Kaiser-Meyer-Olkin (KMO) Measure of Sampling Adequacy, sampling adequacy of 0.767 and 0.842 respectively for
self-awareness and strategic decision making) was found confirming suitability of factor analysis as KMO was above
0.5 and Bartlett's Test of Sphericity was significant at p<0.05. Kaiser-Meyer-Olkin (KMO) as a measure of sampling
adequacy is used to measure to compare the magnitudes of the observed correlation coefficients in relation to the
magnitudes of the partial correlation coefficients. Large KMOs are good because correlation between pairs of
variables, that is, potential factors can be explained by the other variables. Summarily, KMO value of 0.9-1 is
marvelous, 0.80-0.89 is meritorious, 0.70 to 0.79 is middling, 0.60 to 0.69 is mediocre, 0.50 to 0.59 is miserable while
when below 0.5 do not do factor analysis. A KMO value of 0.5-0.79 implies that if a factor analysis is conducted, the
factors extracted will account for fair amount of variance but not a substantial amount like 0.8-1[17].
Osieko.O.M. et al. International Journal of Economic Papers 2017; 2 (1): 16
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Orthogonal rotation of variable set was then done in order to reduce variable set. Orthogonal rotation preserves the
independence of the factors, thus, geometrically they remain 90° apart. Multi-dimensional scale set was used to
measure a particular construct- the dimensions were assumed to be well defined and validated so that the error was
not a problem. Construct validity, discriminant and content validity was measured using factor analysis.
Therefore, components extracted from factor analysis were used to construct the indices that had several indicators
measuring a single construct.
To investigate how well Emotional Self-Awareness, predict Strategic Decision Making, after controlling for
respondent’s designation, age, education level, gender and length of service, a hierarchical linear regression was
computed.
When respondent’s designation, age, education level, gender and length of service were entered alone, they predicted
strategic decision making; F=7.248, p<.001, adjusted R2=0.172, implying that only 17.2% of the variance in strategic
decision making could be predicted by the control variables (designation, age, education level, gender and length of
service).
The regression results further showed that only two control variables (designation and length of service) had a
significant influence on strategic decision making confirming the upper echelons theory that employees in the top
management team are the ones involved in strategic decision making while length of service implies a firm manager’s
experience in strategic decision making. Length of service is also supported by [12] who posit that scripts (responses)
really influence decision making. That is scripts thought of as preprogrammed responses that are based on previous
experiences or information. This implies that a manager’s work experience enables him/her build some mental images
that assists him/her go through a process of screening incoming information when engaging in the strategic decision
making process. Age, education level and gender were not statistically significant hence dropped from subsequent
analysis.
When Emotional Self-Awareness was subsequently added in the analysis, it significantly predicted strategic decision
making confirming the fitness of the multiple regression model;
y = β0+ β1CD+ β2CLS + β3SA
As can be ascertained in the results, the beta coefficient for Self-Awareness was β=.368; p=0.000 at P<.001 showing
that Self-Awareness is positively related to strategic decision making and a unit increase in emotional self-awareness,
strategic decision making will significantly increase by 0.368 units with a standard error, 0.073. This implies that a
manager who is aware of his/her emotions will positively influence strategic decision making in the firm.
4. Discussion
The central focus of this research was to test the effect of emotional self-awareness on strategic decision making in
private school enterprises in Nairobi County, Kenya. The study results revealed a beta coefficient for self-awareness
as β=.368; p=0.000atP<.001 implying that self-awareness is positively and significantly related to strategic decision
making and a unit increase in emotional self-awareness, strategic decision making will significantly increase by 0.368
units with a standard error 0. 073.This implies that a manager who is aware of his/her emotions will positively
influence strategic decision making in the firm. The results are consistent with [22] who confirmed the emotional
intelligence with self-awareness among its key dimension influences transactional and transformational leader’s
decision making for both short term and long term goals.
The study findings are also consistent with [23], [18] and [13] who did research in education sector and found
significant relationship between school manager’s emotional intelligence and their leadership styles hence influencing
their decision making for both short term and long term organization goals.
The results also support [11] statement that self-awareness is a key dimension of emotional intelligence. That “Self-
Awareness as knowing one’s emotions, recognizing a feeling as it happens-is the keystone of emotional intelligence.”
If someone knows their internal states of emotion, it allows self-control and leads empathy in others. Therefore,
Osieko.O.M. et al. International Journal of Economic Papers 2017; 2 (1): 16
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developing managers’ emotional intelligence, especially on self-awareness, through training and education is critical
and necessary for organizations that aspire to engage in strategic decision making.
The study results therefore provide comprehensive backing for the effects of emotional self-awareness on strategic
decision making by providing empirical evidence on the significant influence of emotional intelligence dimensions
(self-awareness) on strategic decision making, thus supporting existing emotional intelligence theories and researches.
For instance, [10] emotional intelligence model asserts that a person’s emotional self-awareness really influences
his/her behavior and decision making skills.
5. Conclusion
The research revealed that emotional self-awareness as a dimension of a firm manager’s emotional intelligence is a
significant predictor of strategic decision making. This suggest that in turbulent situations managers with high
emotional self-awareness can weather the storm by focusing on strategic solutions to emerging and turbulent issues in
a firm with a positive attitude rather than panicking, freaking and censuring employees or even planning exit from
organization for fear of recurring failure. Moreover, emotional self-awareness prediction of strategic decision making
indicate that strategic decision making in organizations is not always a controlled, deliberate, purely cognitive process,
as it is often assumed but rather, the emotions that managers experience in response to positive and negative workplace
happenings have a significant effect on strategic decision making processes and eventually, organizational-level
outcomes.
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