Explaining the different approaches to local government strategy development process across two provinces in Indonesia: a cultural crossvergence approach
Creators: name: Pangaribuan, Windawaty Saurmauli
Publisher: name: RMIT University
Year: 2024
Subjects: classificationCode: 350714
subject: Public sector organisation and management
classificationCode: 350799
subject: Strategy, management and organisational behaviour not elsewhere classified

description: This research was motivated by unexplained differences in strategic performance outcomes between regional governments within Indonesia, where standardised strategy development processes adopted by local governments (LGs) were seeking predictable performance improvements nation-wide. The central government externally imposed the system and guidelines onto local authorities rather than the LGs developing them internally. The driving motivation behind this study was to explore whether the strategy development process itself was the reason for the low performance results of certain LGs, or whether poor results might be the due the interaction between local culture and the adopted Western private management practice - or another reason entirely.

To understand how the strategic planning process works in the public sector, there is a need to understand the people involved in the process. Members of a society bring a collection of cultural values into expression in their employee attitudes and actions, thereby influencing organisational behaviour and how an organisation works. This means that it may not be enough to allow everyone to participate without considering the socio-cultural influences on the people who enact the process. A review of cross-cultural studies suggests that culture plays a vital role in an organisation. However, research on cross-cultural interactions in the workplace does not address issues of diverse subcultures or local cultures that exist within the same national context where various subcultures exist among regions. 

The main objective of this research is to use a cultural crossvergence lens to explore how regional variations in local culture, religiosity and political history influence the adoption of centralised strategic processes in Indonesian LGs. The exploration of people involved in the centralised strategy development processes is essentially an investigation of a crossvergent situation that Indonesian LGs encounter when enacting the changes brought by the adoption of centralised strategic management practices. Therefore, this research draws on the crossvergence theory of cultural value evolution, in conjunction with data findings, to explain what happens at the intersection of local culture and business ideology in public management practices, and why people involved in local management accept or reject strategy development processes.

The application of qualitative methodology enabled the researcher to explore the crossvergent situation experienced by people involved in the strategy development process in the provinces of Aceh and Yogyakarta Special Region. An inductive qualitative approach provided an empirically informed and contextualised examination of the interaction between local culture and the behaviour of people involved in the strategic process. Seventy face-to-face, semi-structured interviews with key participants in Aceh and Yogyakarta Special Region were conducted using an interview protocol. Further interviews were conducted with five CG representatives who responsible for disseminating the strategy and performance processes. A thematic approach informed an iterative, recursive, reflective and hermeneutical method that led to the research findings.

The interview data revealed the significant role religiosity and political history variables play as socio-cultural influences in the two Indonesian provinces of Aceh and Yogyakarta. The unique ways that the two variables emerged in the data from the two provinces drew attention to how regional or sub-cultural identity explains the (initially) surprisingly different approaches to the centralised SDP between the two regions. These findings underline that religiosity/religious identity and political history within a single nation are important socio-cultural influences that inform different regional identities. These different regional identities then inform regional-specific responses to centralised business approaches. Consequently, when implementing centralised approaches, the regional context should be catered to in addition to the national context with the appropriate regional-specific communication and framing techniques.

Important contributions to theory and practice emerged from this study. One is the development of a framework that identifies the underlying concepts of socio-cultural differences among provinces and explains how these contribute to previously unexplained variations in outcomes when adopting standardised strategic development processes from the central government. The framework also contributes to strategic public management by identifying critical variables that may impact the adoption of management practices from different cultures. Specifically, it strengthens the theory of making strategic planning adoption more effective in local governments in non-Western countries. By bringing together cultural crossvergence theory and public strategy management studies, the framework provides a more holistic and integrated way to explain differences in strategic performance outcomes between regional governments within Indonesia, where local governments adopt standardised strategic planning processes. 

Secondly, by studying people’s experience of a centralised strategy development process in a country with high cultural and religious diversity, the framework responds to Ralston’s (2008) call to explore culturally crossvergent situation within developing nations with heterogonous regional cultures. The surfacing of the importance of these socio-cultural influences, in turn, illuminates how sub-cultural identity can give way to variations in attitudes and behaviours toward crossvergent situations within a single nation. Finally, the study indicated that communication must be informed by a sensitivity to differences in sub-cultural and religious identities. The cultural differences within regions or between regions may inform regional identity and potentially reveal the nature of communication, which is referred to as intercultural communication. This study can now contribute practically not only to the public sector environment but also to the international business environment by highlighting the need for intercultural communication competence in local governments, central government officials, and organisations operating in Aceh, Yogyakarta and Indonesia’s 35 other provinces. 

Finally, the framework is a learning model. The religiosity and political history impacting sub-cultural identity will evolve overtime. Therefore, the central government will need to revisit its understanding of the state of religiosity and political history impacting regional identity.

The researcher recognises some limitations of this study, including limited samples of only two regions in Indonesia, and discussing only some elements that affect strategy performance outcomes. Even though only two LGs and selected details were investigated, the present study has provided additional explanations for various strategy performance outcomes of LGs in Indonesia. By uncovering the role of religiosity and political history as socio-cultural influences, this study has revealed the importance of cultural identity in the ways sub cultural and religious identities affect performance in public sector organisations. It is suggested that actors who come from outside of specific regions and involve and manage the processes need to understand the different underlying identities that influence how people accept, comply with and commit to the CG processes. This study will enable CG to optimise the adoption of SP, ensuring regional performance. Finally, the study findings may contribute to future research by highlighting the importance of investigating the role of regional and religious identities when examining the link between sub-cultural values and people’s behaviour, specifically government officials, in collaborative work and when engaging in intercultural communication in culturally crossvergent situations.