An integrated strategy and risk management approach for public universities in South Africa

Thesis (PhD)--Stellenbosch University, 2017.ENGLISH SUMMARY : All organisations must face the uncertainty of both internal and external future factors. These uncertain future challenges are dealt with by formulating and applying a sound business strategy towards realising set objectives, and managing risks. Risk management provides insight into risks and opportunities that need to be managed in support of reaching set objectives. The multi-national Committee of Sponsoring Organisations of the Treadway Commission stipulated that risk management must be applied in strategy. The South African King III Code on Corporate Governance also recommended risk management to be applied as part of the strategy process. This dissertation focused on risk management as a complementary managerial function, contributing to the quality of strategy formulation. Risk management highlights the risks and opportunities that should be considered during strategy formulation. A review of relevant literature lead to the conclusion that risk management process embedded strategy formulation processes are uncommon and sparsely discussed when approached from a strategy formulation point of view. In response, a risk management embedded strategy formulation process was derived from literature. A comprehensive summary was derived of key role-players responsible for different elements of risk management within an organisation. The literature study also proposed and illustrated the inclusion of risk appetite setting into risk management processes and thus into the proposed risk-embedded strategy formulation process. Risk management as well as strategy formulation frameworks were derived and presented. The proposed embedded process was tested for acceptability through a questionnaire presented to two independent samples of managerial respondents. The first population was South African universities. The second population was organisations from sectors known for being leaders in the field of risk management. This presented the opportunity for intergroup comparisons between university and non-university respondents. Responses from these two groups were presented by means of descriptive statistics, indicating strong support for the underlying principles of the proposed process. Hypothesis about differences between the two groups were set and formally tested, leading to the conclusion that the two groups shared opinions about the value of the underlying principles of risk embedded strategizing, thus both demonstrating support for the proposed process. However, the data indicated that the application of risk embedded strategizing differed significantly between university and non-university respondents, leading to the conclusion that in terms of the practical application of risk embedded strategies, universities lagged behind non-university best practices. This study thus reviewed literature, developed and proposed a generic risk management embedded strategy formulation process, utilised a questionnaire to test acceptability of the principles underlying the proposed process, applied statistical methods to compare responses between university respondents and non-university respondents, and found that universities in South Africa lag behind the selected organisations in practice and should thus benefit from applying the risk management process embedded strategy formulation process as proposed.AFRIKAANSE OPSOMMING : Geen opsomming beskikbaar