Can management strategy minimize the impact of red tape on organizational performance?

Abstract

This study investigates the effects of red tape and strategy on organizational performance. Data come from 135 English local government authorities. Data are collected on several dimensions of red tape, three types of strategy (prospecting, defending, and reacting), and internal and external perceptual measures of organizational performance. The findings show that red tape lowers performance. The harmful effects of red tape are, however, mitigated by a strategic stance of prospecting. Defending has no effect on the impact of red tape on organizational performance, whereas reacting tends to amplify the harmful effects—thus worsening organizational performance. The primary implication of these findings is that public organizations should move toward more proactive strategies.