Assisgment Perceived Quality of the Organizations Employees
The third objective of this study is to describe Louisiana small business
owners’/managers’ perceived obstacles to strategic planning. As a component of The Perceived
Obstacles to Strategic Planning Inventory, the researcher designed the Perceived Quality of the
Organization’s Employees Scale. This approach relied on input from a panel of academic experts,
whose area of expertise included research and theory, and industry experts, whose area of
expertise included strategic planning consulting. The items developed were as follows: 1) Our
employees show up on time, 2) Our employees are rarely absent from work, 3) Our employees
are willing to learn, 4) Our employees are willing to learn from errors, 5) Our employees are
skilled in their craft, 6) Our employees possess knowledge of the industry, 7) Our employees
work well in teams, 8) Our employees follow instructions, 9) Our employees contribute
solutions, 10) Our employees achieve maximum productivity with minimum wasted effort or
expense, 11) Our employees are focused on customer service, and 12) Our employees are
focused on customer solutions. Each item was measured using a 6-point Likert-type response
scale. The response options were strongly disagree, disagree, slightly disagree, slightly agree,
agree, and strongly agree. The higher the point value, the higher the perceived quality of the
organization’s employees.
When analyzing the means, and standard deviation for each item of the Perceived Quality
of the Organization’s Employees Scale, the researcher found that “Our employees are skilled in
their craft” had the highest overall level of agreement, with a mean of 5.24 (SD=.65). The item
with the lowest level of agreement, “Our employees achieve maximum productivity with
minimum wasted effort or expense,” had a mean of 4.20 (SD=1.03). The reliability of the 12item
scale as measured by the use of Cronbach’s Alpha was a=.90. To aid in the interpretation of the
data, the researcher developed an interpretive scale for the responses to the 12 items. The
interpretive scale had the following categories: 5.5-6.0 = strongly agree, 4.5-5.49 = agree,
3.54.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.5 = disagree, and 1-1.5 = strongly
disagree. When the mean item responses were classified into two categories, 11 of the items were
in the “agree” category, with the remaining item in the “slightly agree” category. The means and
standard deviations for the items are reported in Table 11.
To further analyze the Perceived Quality of the Organization’s Employees Scale, the
researcher conducted a factor analysis to determine if underlying constructs existed in the scale.
Using the Shapiro-Wilks Test, the researcher first examined items for normality. Additionally, the
measure of sampling adequacy (MSA) was examined for both individual items and the overall
scale. The Kaiser-Meyer-Olkin Measure of Sampling Adequacy was .87. The lowest individual
item MSA was .80, which was higher than the minimum acceptable level of .50 (Hair et al.,
2006). All data met the assumptions for the use of factor analysis. Principal components analysis
with varimax rotation was used in conducting the factor analysis.
To determine the number of factors to be extracted, the researcher used both the Latent
Root criterion and the scree plot technique. The factor analysis was first computed without
restrictions on the number of factors extracted. The default minimum value of one was used on
the latent root measure. The scree plot was examined in order to identify the optimum number of
factors for extraction. The researcher identified the most pronounced bend in the scree plot curve.
From this examination, the optimum number of factors was determined to be two, plus or minus
one. Each of these three analyses was then examined for three criteria. First, each of the analyses
was examined to determine whether the items in each of the extracted factors met the minimum
acceptable loading criteria as identified by Hair et al. (2006). Hair et al. (2006) suggested that .30
would meet the criterion for exploratory research. Secondly, the analysis was examined for
inefficient factors or factors containing only one or two items. Constructs with only one item are
of little use to the researcher, as the purpose of the analysis is to identity underlying constructs in
the data. Lastly, the researcher examined each analysis for the presence of significant cross-
loadings. If an item loads significantly on multiple factors, it is possible that the respondents
perceived the item differently. Due to the factor loadings, the number of inefficient factors and
the number of substantial cross-loadings, the optimum number of factors was determined to be
one. The Eigenvalue for the factor was 5.94 and the factor explained 49.51% of the variance (see
Table 12).
Table 12 Factor Loadings of Items in the Perceived Quality of the Organization’s Employees
Scale
Component
Our employees contribute solutions. .837
Our employees are focused on customer solutions. .816
Our employees achieve maximum productivity with
minimum wasted effort or expense.
.795
Our employees are willing to learn from errors. .778
Our employees are focused on customer service. .716
Our employees follow instructions. .703
Our employees are skilled in their craft. .691
Our employees are willing to learn. .673
Our employees are rarely absent from work. .634
Our employees work well in teams. .618
Our employees show up on time .587
Our employees possess knowledge of the industry. .523
Note. Eigenvalue = 5.94, Percent of variance explained = 49.51%
The researcher computed an overall score for the perceived quality of the organization’s
employees based on the results of the factor analysis. This score was computed as the mean of
the 12 items in the scale. The mean Perceived Quality of the Organization’s Employees Score
was 4.95 (SD=.62), with values ranging from 3.00 to 6.00. The overall mean was in the
interpretive category of “agree.” When the Perceived Quality of the Organization’s Employees
Score was examined by response category, the category with the largest number of scores was
4.50-5.49 (n=37, 52.90%) (see Table 13).
Table 13 Perceived Quality of the Organization’s Employees Score
Score Frequency Percent
1.00-1.49 0 0.00
1.50-2.49 0 0.00
2.50-3.49 1 1.40
3.50-4.49 14 20.00
(Table 13 continued)
Score Frequency Percent
4.50-5.49 37 52.90
5.50-6.00 18 25.7
Total 70 100.10
Note. Mean = 4.95, Standard Deviation = .62
Note. The response scale used was 6 = strongly agree, 5 = agree, 4 = slightly agree, 3 = slightly
disagree, 2 = disagree, 1 = strongly agree. The interpretive scale used was 5.5-6.0 = strongly
agree, 4.5-5.49 = agree, 3.5-4.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.49 =
disagree, and 1.00-1.49 = strongly disagree. a SA = strongly agree, A = Agree, AS = slightly
agree, DS = slightly disagree, D = disagree, SD = strongly disagree
Perceived Degree to Which the Organization’s Leadership has Knowledge of the Planning
Process
As a component of the Perceived Obstacles to Strategic Planning Inventory, the
researcher designed the Perceived Degree to Which the Organization’s Leadership Has
Knowledge of the Planning Process scale. This approach relied on input from a panel of
academic experts, whose area of expertise included research and theory, and industry experts,
whose area of expertise included strategic planning consulting. The items developed were as
follows: 1) I know what a GAP analysis is, 2) I know what a Needs Analysis is, 3) I know what a
SWOT Analysis is, 4) I know what a vision and mission statement is, 5) I know how to write a
strategic plan, 6) I know what a succession plan is, and 7) I know how to measure performance.
Each item was measured using a 6-point Likert-type response scale. The response options were
strongly disagree, disagree, slightly disagree, slightly agree, agree, and strongly agree. A higher
rating indicated a higher level of agreement. A lower rating indicated a stronger level of
disagreement.
When analyzing the mean and standard deviation for each item of the Perceived Degree
to Which the Organization’s Leadership has Knowledge of the Planning Process Scale, the
researcher found that “I know what a vision and mission statement is” had the highest overall
level of agreement, with a mean of 5.34 (SD=.68). The item with the lowest level of agreement,
“I know what a SWOT Analysis is,” had a mean of 3.69 (SD=1.91). The reliability of the 7-item
scale as measured by the use of Cronbach’s Alpha was a=.83. To aid in the interpretation of the
data, the researcher developed an interpretive scale for the responses to the 7 items. The
interpretive scale had the following categories: 5.5-6.0 = strongly agree, 4.5-5.49 = agree,
3.54.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.5 = disagree, and 1-1.5 = strongly
disagree. When the mean item responses were classified into categories, four of the items were in
the “agree” category, and the other three were in the “slightly agree” category. The means and
standard deviation for each item are reported in Table 14.
Table 14 The Organization’s Leadership has Knowledge of the Planning Process among Small
Business / Managers in Louisiana
Mean Standard
Deviation
Interpretive
Scale Category
I know what a vision and mission statement is. 5.34 .68 A
I know how to measure performance. 4.71 .94 A
I know what a succession plan is. 4.67 1.29 A
I know how to write a strategic plan. 4.49 1.34 A
I know what a Needs Analysis is. 4.03 1.55 AS
I know what a GAP analysis is. 3.70 1.61 AS
I know what a SWOT Analysis is 3.69 1.91 AS
Note. The response scale used was 6 = strongly agree, 5 = agree, 4 = slightly agree, 3 = slightly
disagree, 2 = disagree, 1 = strongly agree. The interpretive scale used was 5.5-6.0 = strongly
agree, 4.5-5.49 = agree, 3.5-4.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.49 =
disagree, and 1.00-1.49 = strongly disagree. a SA = strongly agree, A = Agree, AS = slightly
agree, DS = slightly disagree, D = disagree, SD = strongly disagree
To further analyze the Perceived Degree to Which the Organization’s Leadership has
Knowledge of the Planning Process Scale, the researcher conducted a factor analysis to
determine if underlying constructs existed. Using the Shapiro-Wilks Test, the researcher first
examined items for normality. Additionally, the measure of sampling adequacy (MSA) was
examined for both individual items and the overall scale. The Kaiser-Meyer-Olkin Measure of
Sampling Adequacy was .78. The lowest individual item MSA was .69, which was higher than
the minimum acceptable level. All data met the assumptions for the use of a factor analysis.
Principal components analysis with varimax rotation was used in conducting the factor analysis.
To determine the number of factors to be extracted, the researcher used both the Latent
Root criterion and the scree plot technique. The factor analysis was first computed without
restrictions on the number of factors extracted. The default minimum value of one was used on
the latent root measure. The scree plot was examined in order to identify the optimum number of
factors for extraction. The researcher identified the most pronounced bend in the scree plot curve.
From this examination, the optimum number of factors was determined to be two, plus or minus
one. Each factor was then examined for three criteria. First, each extracted factor was examined
to determine whether it met the minimum acceptable loading criteria as identified by Hair et al.
(2006). Hair et al. (2006) suggested that .30 would meet the criterion for exploratory research.
Secondly, the analysis was examined for inefficient factors or factors containing only one or two
items. Constructs with only one item are of little use to the researcher, as the purpose of the
analysis is to identity underlying constructs in the data. Lastly, the researcher examined each
analysis for the presence of significant cross-loadings. If an item loads significantly on multiple
factors, it is possible that the respondents perceived the item differently. Due to the factor
loadings, the number of inefficient factors and the number of substantial cross-loadings, the
optimum number of factors was determined to be one. The Eigenvalue for the factor was 3.58
and the factor explained 51.12% of the variance (see Table 15).
The researcher computed the overall score for the perceived degree to which the
organization’s leadership has knowledge of the planning process based on the results of a factor
analysis. This score was computed as the mean of the 7 items in the scale.
Table 15 Factor Loadings of Items in the Perceived Degree To which the Organization’s
Leadership has Knowledge of the Planning Process Scale
Component
I know what a GAP analysis is. .853
I know what a Needs Analysis is. .819
I know what a SWOT Analysis is. .786
I know what a vision and mission statement is. .724
I know how to write a strategic plan. .636
I know what a succession plan is. .603
I know how to measure performance. .520
Note. Eigenvalue = 3.58, Percent of variance explained = 51.12%
The mean Perceived Degree to Which the Organization’s Leadership has Knowledge of
the Planning Process Score was 4.38 (SD=.97) with values ranging from 2.29 to 6.00. When the
Perceived Degree to Which the Organization’s Leadership has Knowledge of the Planning
Process Score was examined by response category, the category with the largest number of
scores was 4.50-5.49 (n=27, 38.60%) (see Table 16).
Table 16 Perceived Degree to which the Organization’s Leadership has Knowledge of the
Planning Process Scale
Score Frequency Percent
1.00-1.49 0 0.00
1.50-2.49 2 2.90
2.50-3.49 13 18.60
3.50-4.49 20 28.60
4.50-5.49 27 38.60
5.50-6.00 8 11.40
70 100.00
Note. Mean = 4.38, Standard Deviation = .97
Note. The response scale used was 6 = strongly agree, 5 = agree, 4 = slightly agree, 3 = slightly
disagree, 2 = disagree, 1 = strongly agree. The interpretive scale used was 5.5-6.0 = strongly
agree, 4.5-5.49 = agree, 3.5-4.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.49 =
disagree, and 1.00-1.49 = strongly disagree.
a SA = strongly agree, A = Agree, AS = slightly agree, DS = slightly disagree, D = disagree, SD =
strongly disagree
Perceived Available Time the Organization has to Strategically Plan
As a component of the Perceived Obstacles to Strategic Planning Inventory, the
researcher designed the Perceived Available Time the Organization has to Strategically Plan
scale. This approach relied on input from a panel of academic experts, whose area of expertise
included research and theory, and industry experts, whose area of expertise included strategic
planning consulting. The items developed were as follows: 1) Our organization’s leadership
allocates time every month for long-term planning, 2) Our organization has time to allocate for
long-term planning, 3) Our organization utilizes time set aside to plan long-term, 4) Our
organization is focused on day-to-day operations more than on long-term planning, 5) Our
organization is focused on customer needs more than on long-term planning, 6) Our organization
is focused on revenues more than on long-term planning, 7) Our organization is focused on
regulatory concerns more than on long-term planning, and 8) Our organization is focused on
logistical concerns more than on long-term planning. Each item was measured using a 6-point
Likert-type response scale. The response options were strongly disagree, disagree, slightly
disagree, slightly agree, agree, and strongly agree. The higher the point value, the higher the
perceived available time the organization has to strategically plan
When analyzing the mean and standard deviation for each item of the Perceived
Available Time the Organization Has to Strategically Plan Scale, the researcher found that “Our
organization is focused on customer needs more than on long-term planning” had the highest
overall level of agreement, with a mean of 4.79 (SD=.87). The item with the lowest level of
agreement, “Our organization’s leadership allocates time every month for long-term planning,”
had a mean of 3.36 (SD=1.63). The reliability of the 8-item scale as measured using the
Cronbach’s Alpha was a=.84. To aid in the interpretation of the data, the researcher developed an
interpretive scale for the responses to the eight items. The interpretive scale had the following
categories: 5.5-6.0 = strongly agree, 4.5-5.49 = agree, 3.5-4.49 = slightly agree, 2.50-3.49 =
slightly disagree, 1.50-2.5 = disagree, and 1-1.5 = strongly disagree. When the mean item
responses were classified into categories, two of the items were in the “agree” category, three
were in the “slightly agree” category, and the remaining three were located in the “slightly
disagree” category. The means and standard deviations for the items are reported in Table 17.
Table 17 The Perceived Available Time the Organization has to Strategically Plan among Small
Businesses Owners / Managers in Louisiana
Mean Standard
Deviation
Interpretive
Scale
Category
Our organization is focused on customer needs more
than on long-term planning. 4.79 .87 A
Our organization is focused on day-to-day operations
more than on long-term planning. 4.69 1.00 A
Our organization is focused on revenues more than on
long-term planning. 4.33 1.09 AS
Our organization has time to allocate for long-term
planning. 3.80 1.42 AS
Our organization is focused on logistical concerns
more than on long-term planning. 3.57 1.22 AS
Our organization is focused on regulatory concerns
more than on long-term planning. 3.47 1.40 DS
Our organization utilizes time set aside to plan long-term. 3.43 1.49 DS
Our organization’s leadership allocates time every month for
long-term planning. 3.36 1.63 DS
Note. The response scale used was 6 = strongly agree, 5 = agree, 4 = slightly agree, 3 = slightly
disagree, 2 = disagree, 1 = strongly agree. The interpretive scale used was 5.5-6.0 = strongly
agree, 4.5-5.49 = agree, 3.5-4.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.49 =
disagree, and 1.00-1.49 = strongly disagree.
a SA = strongly agree, A = Agree, AS = slightly agree, DS = slightly disagree, D = disagree, SD =
strongly disagree
To further analyze the Perceived Available Time the Organization Has to Strategically
Plan Scale, the researcher conducted a factor analysis to determine if underlying constructs
existed. Using the Shapiro-Wilks Test, the researcher first examined items for normality.
Additionally, the measure of sampling adequacy (MSA) was examined for both individual items
and the overall scale. The Kaiser-Meyer-Olkin MSA was .73. The lowest individual item MSA
was .67, which was higher than the minimum acceptable level of .50 as suggested by Hair et al.
(2006). All data met the assumptions for the use of factor analysis. Principal components analysis
with varimax rotation was used in conducting the factor analysis.
To determine the number of factors to be extracted, the researcher used both the Latent
Root criterion and the scree plot technique. The factor analysis was first computed without
restrictions on the number of factors extracted. The default minimum value of one was used on
the latent root measure. The scree plot was examined in order to identify the optimum number of
factors for extraction. The researcher identified the most pronounced bend in the scree plot curve.
From this examination, the optimum number of factors was determined to be two, plus or minus
one. Each factor was then examined for three criteria. First, each of analyses was examined to
determine whether the items in each of the extracted factors met the minimum acceptable loading
criteria as identified by Hair et al. (2006). Hair et al. (2006) suggested that .30 would meet the
criterion for exploratory research. Secondly, the analysis was examined for inefficient factors or
factors containing only one or two items. Constructs with only one item are of little use to the
researcher, as the purpose of the analysis is to identity underlying constructs in the data. Lastly,
the researcher examined each of the analyses for the presence of significant cross-loadings. If an
item loads significantly on multiple factors, it is possible that the respondents perceived the item
differently. Due to the factor loadings, the number of inefficient factors and the number of
substantial cross-loadings, the optimum number of factors was determined to be one. The
Eigenvalue for the factor was 3.80 and the factor explained 47.52% of the variance (see Table
18).
The researcher’s next step was to compute an overall Perceived Available Time the
Organization Has to Strategically Plan score. However, for items 1) Our organization’s
leadership allocates time every month for long-term planning, 2) Our organization has time to
Table 18 Factor Loadings of Items in the Perceived Available Time the Organization has to
Strategically Plan Scale
Component
Our organization utilizes time set aside to plan long-term. -.83
Our organization’s leadership allocates time every month for long-term
planning. -.80
Our organization has time to allocate for long-term planning. -.71
Our organization is focused on logistical concerns more than on long-term
planning. .70
Our organization is focused on customer needs more than on long-term
planning. .67
Our organization is focused on regulatory concerns more than on long-term
planning. .62
Our organization is focused on revenues more than on long-term planning. .61
Our organization is focused on day-to-day operations more than on long-term
planning. .54
Note. Eigenvalue = 3.80, Percent of variance explained = 47.52%
allocate for long-term planning, and 3) Our organization utilizes time set aside to plan
long-term, a high level of agreement indicated a positive perception of available time to
strategically plan. For the remaining items, 4) Our organization is focused on day-to-day
operations more than on long-term planning, 5) Our organization is focused on customer needs
more than on long-term planning, 6) Our organization is focused on revenues more than on
longterm planning, 7) Our organization is focused on regulatory concerns more than on long-
term planning, and 8) Our organization is focused on logistical concerns more than on long-term
planning, a low level of agreement, or disagreement, indicated a positive perception of available
time to strategically plan. Due to the reverse wording of a portion of the items, computing a
factor score would have been ineffective. Therefore, the items were recoded to reflect a higher
value, consistent with other items that indicated a positive response to planning. Specifically, the
reverse worded items were coded so that Strongly Disagree = 6, Disagree = 5, Slightly Disagree
= 4, Slightly Agree = 3, Agree = 2, and Strongly Agree = 1. The value for each item was coded so
that the higher value indicated the more positive response. The item with the most positive
response was Our organization has time to allocate for long-term planning (Mean=3.80,
SD=1.42). The item with the lowest mean response (most negative) was Our organization is
focused on customer needs more than on long-term planning (Mean=2.21, SD=.87). Recorded
mean item response scores are presented in Table 19.
Table 19 Means and Standard Deviations for Reverse Coded Items in Perceived Available Time
the Organization has to Strategically Plan Scale
Mean Standard
Deviation
Interpretive
Scorea
Our organization has time to allocate for long-term
planning.b 3.80 1.42 PS
Our organization is focused on regulatory concerns
more than on long-term planning.b 3.53 1.40 PS
Our organization is focused on logistical concerns 3.43 1.22 NS
more than on long-term planning. b
Our organization utilizes time set aside to plan
longterm. b 3.43 1.49 NS
Our organization’s leadership allocates time every
month for long-term planning. b 3.36 1.63 NS
Our organization is focused on revenues more than
on long-term planning. b 2.67 1.09 NS
Our organization is focused on day-to-day
operations more than on long-term planning. b 2.31 1.00 N
Our organization is focused on customer needs more
than on long-term planning. b 2.21 .87 N
Note. The original response scale used was 6 = Strongly Disagree, 5 = Disagree, 4 = Slightly
Disagree, 3 = Slightly Agree, 2 = Agree, 1 = Strongly Agree. The interpretive scale used was 5.5-
6.0 = strongly positive, 4.5-5.49 = positive, 3.5-4.49 = slightly positive, 2.50-3.49 = negative,
1.50-2.49 = slightly negative, and 1.00-1.49 = strongly negative.
aSP = strongly positive, P = positive, SP = slightly positive, N = negative, NS = slightly
negative, SN = strongly negative
bReverse coded item scale recoded as follows: 1= SA, 2 = A, 3 = AS, 4 = SD, 5 = D, 6 =
DS Using the consistently coded items in the single factor identified in the factor analysis,
the researcher computed the perceived available time the organization has to strategically plan
score, which was the mean of the eight items in the factor. The mean score was 3.09 (SD=0.88),
with values ranging from 1.25 to 5.13. These scores were grouped into response categories, as
shown in Table 22. When the Perceived Available Time the Organization Has to Strategically
Plan Scale was examined by response category, the category with the largest number of scores
was 2.50-3.49 (n=26, 41.40%) (see Table 20).
Table 20 Perceived Available Time the Organization has to Strategically Plan Scale
Score Frequency Percent
1.00-1.49 3 4.29
1.50-2.49 16 22.90
2.50-3.49 26 37.14
3.50-4.49 21 30.00
4.50-5.49 4 5.70
5.50-6.00 0 0.00
Total 70 100.00
Note. Mean = 3.09 Standard Deviation = .88
Note. The response scale used was 6 = Strongly Disagree, 5 = Disagree, 4 = Slightly Disagree, 3
= Slightly Agree, 2 = Agree, 1 = Strongly Agree. The interpretive scale used was 5.5-6.0 =
strongly disagree, 4.5-5.49 = disagree, 3.5-4.49 = slightly disagree, 2.50-3.49 = slightly agree,
1.50-2.49 = agree, and 1.0-1.49 = strongly agree. a SA = strongly agree, A = Agree, AS = slightly
agree, DS = slightly disagree, D = disagree, SD = strongly disagree
Objective Four
The fourth objective of this study is to determine if a relationship exists between
Louisiana small business owners' perceived obstacles to strategic planning and each of the
demographic and perceived obstacles to planning measures included in the study. The first of
these demographic measures was the industry in which the organization is positioned. This
measure included the 24 categories of industries identified by the Louisiana Small Business
Association. However, with only 70 respondents in the study and 24 possible responses, the
number of responses in most of the categories were too small to enable a comparison on the
strategic planning score variable. Only one category, Professional Services, had a sufficient
number of responses to allow the examination of the proposed relationship. In addition, since this
variable was nominal in nature, a comparative analysis was judged to be preferable to the use of
correlational statistics. Therefore, since only one category had sufficient numbers for analysis, a
t-test was used to compare those respondents that reported Professional Services with other
respondents. The comparative statistic was chosen over a correlation coefficient for the ease of
interpretation of the findings. The mean strategic planning score for all respondents other than
Professional Services was 4.74 (SD=.71). The mean strategic planning score for Professional
Services industries was 4.52 (SD=.65). Levene’s Test for equality of variances was not
significant (F=.15, p=.71), indicating that the assumption of equal variances was met. Therefore,
the pooled variance estimate was used in computing the t-test. Based on this test, no significant
difference was found in mean strategic planning score between the two groups (t68=1.22, p=.23).
The second variable examined for a relationship with the strategic planning score was
“legal structure of the business.” The Louisiana Small Business Association identifies five
categories of legal business structure represented in the state of Louisiana. Of these five
categories, only two had sufficient respondents to enable the examination of their relationship
with the “perceived degree to which the organization conducts strategic planning.” Of the 70
respondents, 38 self-identified as a Limited Liability Corporation. A t-test was conducted to
examine whether or not differences existed in mean strategic planning score between
respondents identifying as a Limited Liability Corporation and all other types of legal structure.
The mean strategic planning score for Limited Liability Corporations was 4.58 (SD=.75). The
mean strategic planning score for non-Limited Liability Corporations was 4.77 (SD=.61).
Levene’s Test for equality of variances was not significant (F=.18, p=.67), indicating that the
assumption of equal variances was met. Therefore, the pooled variance estimate was used in
computing the t-test. Based on this test, no significant difference was found in mean strategic
planning score between the two groups (t68=1.17, p=.25).
A second t-test was conducted to examine whether or not differences existed in mean
strategic planning score between respondents identifying as a Subchapter S Corporation (S-Corp)
and all other types of legal structure. The mean strategic planning score for Subchapter S
Corporations was 4.80 (SD=.62). The mean strategic planning score for non-Subchapter S
Corporations was 4.62 (SD=.72). Levene’s Test for equality of variances was not significant
(F=.18, p=.67), indicating that the assumption of equal variances was met. Therefore, the pooled
variance estimate was used in computing the t-test. Based on this test, no significant difference
was found in mean strategic planning score between the two groups (t68=-.93, p=.36). No other
statistical tests were conducted on small business legal structure because the sample size for each
of the remaining categories was too small to conduct an analysis.
A third t-test was conducted to examine whether or not differences existed in mean
strategic planning score between respondents who identified as having or not having a written
long-term plan. The mean strategic planning score for respondents who had a written long-term
plan was 4.98 (SD=.62). The mean strategic planning score for respondents who did not have a
written long-term plan was 4.51 (SD=.68). Levene’s Test for equality of variances was not
significant (F=.07, p=.80), indicating that the assumption of equal variances was met. Therefore,
the pooled variance estimate was used in computing the t-test. Based on this test, a significant
difference was found in mean strategic planning score between the two groups (t68 = 2.773, p
= .007). Therefore, those respondents who said they had a written long-term plan had higher
strategic planning scores then those who did not.
Pearson Product Moment Correlation Coefficients (PPMr) were calculated between
strategic planning score and the demographic variables measured on a continuous scale of
measurement. These included years the organization has been in business and number of
employees on the payroll, as well as variables that measured perceived obstacles to strategic
planning. No significant relationship existed between years in business and strategic planning
score (r = -.109, p = .37). Additionally, no significant relationship existed between number of
employees and strategic planning score (r = -.066, p = .59). There was, however, a significant
positive relationship between the perceived degree to which the organization conducts strategic
planning and the perceived quality of the organization’s employees (r = .367, p < .002), the
perceived degree to which the organization’s leadership has knowledge of the planning process
(r = .330, p = .005), and the perceived available time the organization has to strategically plan (r
= .322, p = .004). Therefore, for all three relationships, a higher score was associated with a
higher strategic planning score (see Table 21).
Table 21 Relationships with the Perceived Degree to which the Organization Conducts Strategic
Planning
aPPMr p value bDescriptor
Perceived quality of the organization’s employees .367 .002 MA
Perceived degree to which the organization’s leadership has
knowledge of the planning process .330 .005 MA
Perceived available time the organization has to strategically
plan .322 .007 MA
Years the organization been in business -.109 .369 LA
Number of employees currently on the organization’s
payroll -.066 .588 NA
aPearson Product Moment Correlation Coefficients bDavis’ Descriptors (1971): .00 to .09 =
Negligible Association, .10 to .29 = Low Association, .30 to .49 = Moderate Association, .50
to .69 = Substantial Association, and .70 or higher = Very Strong Association
NA = Negligible Association, LA = Low Association, MA = Moderate Association, SA =
Substantial Association, VS = Very Strong Association
Objective Five
In order to determine if a model exists explaining a significant portion of the variance in
Louisiana small business owners' perceived degree to which the organization conducts strategic
planning, a stepwise regression analysis was conducted. To ensure that there were no excessive
levels of collinearity among the variables in this study. the variance inflation factors (VIF) were
examined. According to Hair et al. (2006), “A common cutoff threshold is a tolerance value
of .10 which corresponds to a VIF value of 10” (p. 230). The VIF values in this analysis ranged
from 1.028 to 1.404, indicating no excessive multicollinearity between factors. Bivariate
correlations were examined between all factors used as independent variables and “the perceived
degree to which the organization conducts strategic planning.” Of the nine factors, the three
perceptual factors had the highest correlations, ranging from .322 to .367. The remaining six
factors had lower correlations, with the exception of written plan, which had a correlation
of .319. These correlations are presented in Table 22.
Table 22 Correlations between the Perceived Degree to which the Organization Conducts
Strategic Planning and Selected Demographic and Perceptual Factors
N ar p value bDescriptor
Perceived quality of the organization’s employees 70 .367 .001 MA
Perceived degree to which the organization’s leadership
has knowledge of the planning process 70 .330 .003 MA
Perceived available time the organization has to
strategically plan 70 .322 .003 MA
Written long-term plan 70 .319 .004 MA
Positioned in the professional services industry 70 -.146 .114 LA
Legal structure of the business as Limited Liability
Corporation 70 -.140 .123 LA
Legal structure of the business as Subchapter S
Corporation 70 .112 .179 LA
Years the organization been in business 70 -.109 .184 LA
Number of employees currently on the organization’s
payroll. 70 -.066 .294 NA
aPearson Product Moment Correlation Coefficients
bDavis’ Descriptors (1971): .00 to .09 = Negligible Association, .10 to .29 = Low Association, .30
to .49 = Moderate Association, .50 to .69 = Substantial Association, and .70 or higher = Very
Strong Association
NA = Negligible Association, LA = Low Association, MA = Moderate Association, SA =
Substantial Association, VS = Very Strong Association
The first variable to enter the regression model was “the perceived quality of the
organization’s employees,” with an R square of .134, F(1,68) = 10.56, p = .002, explaining
13.4% of the variance in “the perceived degree to which the organization conducts strategic
planning.” The second variable entered was whether or not the organization had a “written
longterm plan,” which had an R square change of .073, F(1,67) = 6.17, p = .015, explaining an
additional 7.3% of the variance in “the perceived degree to which the organization conducts
strategic planning.” These two variables combined explained 20.7% of the variance in “the
perceived degree to which the organization conducts strategic planning.”
Two additional variables added one percent or more to the explained variance. However,
these two variables were individually non-significant. The first of the two non-significant
variables that entered the model was “the perceived degree to which the organization’s leadership
has knowledge of the planning process,” with an R square change of .026, F(1,66) = 2.28, p
= .136. This 2.6% increase in explained variance was individually not significant; however, it
was included in the model because it added one percent or more of explained variance while the
overall model remained significant. Similarly, whether or not the small business was positioned
in “professional services,” industry an R square change of .010, F(1,65) = .359, was added to the
model with a 1% increase in explained variance. This 1% increase in explained variance was
individually not significant; however, it also was included in the model because it added one
percent or more of explained variance while the overall model remained significant. These two
variables combined, though not individually significant, explained 3.6% of the variance in “the
perceived degree to which the organization conducts strategic planning.”
The total R square for this model was .244 and the four variables, in combination,
explained 24.4% of the variance in “the perceived degree to which the organization conducts
strategic planning.” The results of the regression indicate subjects with higher scores on “the
perceived quality of the organization’s employees” and “the perceived degree to which the
organization’s leadership has knowledge of the planning process” tended to have higher scores
on “the perceived degree to which the organization conducts strategic planning.” Furthermore,
those respondents who answered “yes” to whether or not they had a “written long-term plan”
tended to have a higher “perceived degree to which the organization conducts strategic planning”
score. Similarly, those respondents who indicated that their organizations were positioned in the
“professional services” industry tended to have lower “perceived degree to which the
organization conducts strategic planning” scores. The results of the regression analysis are
presented in Table 23.
Table 23 Multiple Regression Analysis of “The Perceived Degree to Which the Organization
Conducts Strategic Planning” on Selected Perceptual and Demographic Measures among
Louisiana Small Businesses
ANOVA
Sources of Variation df MS F P
Regression 4 2.010 5.238 .001
Residual 65 .384
Total 69
Model Summary
Model R Square R Square
Change
F Change Sig. F
Change
Standardized
Coefficients
Beta
Perceived quality of the
organization’s employees .134 .134 10.557 .002 .278
Written long-term plan .207 .073 6.171 .015 .216
Perceived degree to which
the organization’s
leadership has knowledge
of the planning process
.234 .026 2.278 .136 .177
Professional services .244 .010 .852 .359 -.101
Variables not in the Equation
Variables t P
The Perceived Available Time the
Organization Has to Strategically Plan .993 .325
Number of employees are currently on
the organization’s payroll -.892 .376
Legal structure of the business as
Subchapter S Corporation .519 .605
Years the organization been in business -.255 .800
Legal structure of the business as
Limited Liability Corporation -.172 .864
When analyzing the means, and standard deviation for each item of the Perceived Quality
of the Organization’s Employees Scale, the researcher found that “Our employees are skilled in
their craft” had the highest overall level of agreement, with a mean of 5.24 (SD=.65). The item
with the lowest level of agreement, “Our employees achieve maximum productivity with
minimum wasted effort or expense,” had a mean of 4.20 (SD=1.03). The reliability of the 12item
scale as measured by the use of Cronbach’s Alpha was a=.90. To aid in the interpretation of the
data, the researcher developed an interpretive scale for the responses to the 12 items. The
interpretive scale had the following categories: 5.5-6.0 = strongly agree, 4.5-5.49 = agree,
3.54.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.5 = disagree, and 1-1.5 = strongly
disagree. When the mean item responses were classified into two categories, 11 of the items were
in the “agree” category, with the remaining item in the “slightly agree” category. The means and
standard deviations for the items are reported in Table 11.
To further analyze the Perceived Quality of the Organization’s Employees Scale, the
researcher conducted a factor analysis to determine if underlying constructs existed in the scale.
Using the Shapiro-Wilks Test, the researcher first examined items for normality. Additionally, the
measure of sampling adequacy (MSA) was examined for both individual items and the overall
scale. The Kaiser-Meyer-Olkin Measure of Sampling Adequacy was .87. The lowest individual
item MSA was .80, which was higher than the minimum acceptable level of .50 (Hair et al.,
2006). All data met the assumptions for the use of factor analysis. Principal components analysis
with varimax rotation was used in conducting the factor analysis.
To determine the number of factors to be extracted, the researcher used both the Latent
Root criterion and the scree plot technique. The factor analysis was first computed without
restrictions on the number of factors extracted. The default minimum value of one was used on
the latent root measure. The scree plot was examined in order to identify the optimum number of
factors for extraction. The researcher identified the most pronounced bend in the scree plot curve.
From this examination, the optimum number of factors was determined to be two, plus or minus
one. Each of these three analyses was then examined for three criteria. First, each of the analyses
was examined to determine whether the items in each of the extracted factors met the minimum
acceptable loading criteria as identified by Hair et al. (2006). Hair et al. (2006) suggested that .30
would meet the criterion for exploratory research. Secondly, the analysis was examined for
inefficient factors or factors containing only one or two items. Constructs with only one item are
of little use to the researcher, as the purpose of the analysis is to identity underlying constructs in
the data. Lastly, the researcher examined each analysis for the presence of significant cross-
loadings. If an item loads significantly on multiple factors, it is possible that the respondents
perceived the item differently. Due to the factor loadings, the number of inefficient factors and
the number of substantial cross-loadings, the optimum number of factors was determined to be
one. The Eigenvalue for the factor was 5.94 and the factor explained 49.51% of the variance (see
Table 12).
Table 12 Factor Loadings of Items in the Perceived Quality of the Organization’s Employees
Scale
Component
Our employees contribute solutions. .837
Our employees are focused on customer solutions. .816
Our employees achieve maximum productivity with
minimum wasted effort or expense.
.795
Our employees are willing to learn from errors. .778
Our employees are focused on customer service. .716
Our employees follow instructions. .703
Our employees are skilled in their craft. .691
Our employees are willing to learn. .673
Our employees are rarely absent from work. .634
Our employees work well in teams. .618
Our employees show up on time .587
Our employees possess knowledge of the industry. .523
Note. Eigenvalue = 5.94, Percent of variance explained = 49.51%
The researcher computed an overall score for the perceived quality of the organization’s
employees based on the results of the factor analysis. This score was computed as the mean of
the 12 items in the scale. The mean Perceived Quality of the Organization’s Employees Score
was 4.95 (SD=.62), with values ranging from 3.00 to 6.00. The overall mean was in the
interpretive category of “agree.” When the Perceived Quality of the Organization’s Employees
Score was examined by response category, the category with the largest number of scores was
4.50-5.49 (n=37, 52.90%) (see Table 13).
Table 13 Perceived Quality of the Organization’s Employees Score
Score Frequency Percent
1.00-1.49 0 0.00
1.50-2.49 0 0.00
2.50-3.49 1 1.40
3.50-4.49 14 20.00
(Table 13 continued)
Score Frequency Percent
4.50-5.49 37 52.90
5.50-6.00 18 25.7
Total 70 100.10
Note. Mean = 4.95, Standard Deviation = .62
Note. The response scale used was 6 = strongly agree, 5 = agree, 4 = slightly agree, 3 = slightly
disagree, 2 = disagree, 1 = strongly agree. The interpretive scale used was 5.5-6.0 = strongly
agree, 4.5-5.49 = agree, 3.5-4.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.49 =
disagree, and 1.00-1.49 = strongly disagree. a SA = strongly agree, A = Agree, AS = slightly
agree, DS = slightly disagree, D = disagree, SD = strongly disagree
Perceived Degree to Which the Organization’s Leadership has Knowledge of the Planning
Process
As a component of the Perceived Obstacles to Strategic Planning Inventory, the
researcher designed the Perceived Degree to Which the Organization’s Leadership Has
Knowledge of the Planning Process scale. This approach relied on input from a panel of
academic experts, whose area of expertise included research and theory, and industry experts,
whose area of expertise included strategic planning consulting. The items developed were as
follows: 1) I know what a GAP analysis is, 2) I know what a Needs Analysis is, 3) I know what a
SWOT Analysis is, 4) I know what a vision and mission statement is, 5) I know how to write a
strategic plan, 6) I know what a succession plan is, and 7) I know how to measure performance.
Each item was measured using a 6-point Likert-type response scale. The response options were
strongly disagree, disagree, slightly disagree, slightly agree, agree, and strongly agree. A higher
rating indicated a higher level of agreement. A lower rating indicated a stronger level of
disagreement.
When analyzing the mean and standard deviation for each item of the Perceived Degree
to Which the Organization’s Leadership has Knowledge of the Planning Process Scale, the
researcher found that “I know what a vision and mission statement is” had the highest overall
level of agreement, with a mean of 5.34 (SD=.68). The item with the lowest level of agreement,
“I know what a SWOT Analysis is,” had a mean of 3.69 (SD=1.91). The reliability of the 7-item
scale as measured by the use of Cronbach’s Alpha was a=.83. To aid in the interpretation of the
data, the researcher developed an interpretive scale for the responses to the 7 items. The
interpretive scale had the following categories: 5.5-6.0 = strongly agree, 4.5-5.49 = agree,
3.54.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.5 = disagree, and 1-1.5 = strongly
disagree. When the mean item responses were classified into categories, four of the items were in
the “agree” category, and the other three were in the “slightly agree” category. The means and
standard deviation for each item are reported in Table 14.
Table 14 The Organization’s Leadership has Knowledge of the Planning Process among Small
Business / Managers in Louisiana
Mean Standard
Deviation
Interpretive
Scale Category
I know what a vision and mission statement is. 5.34 .68 A
I know how to measure performance. 4.71 .94 A
I know what a succession plan is. 4.67 1.29 A
I know how to write a strategic plan. 4.49 1.34 A
I know what a Needs Analysis is. 4.03 1.55 AS
I know what a GAP analysis is. 3.70 1.61 AS
I know what a SWOT Analysis is 3.69 1.91 AS
Note. The response scale used was 6 = strongly agree, 5 = agree, 4 = slightly agree, 3 = slightly
disagree, 2 = disagree, 1 = strongly agree. The interpretive scale used was 5.5-6.0 = strongly
agree, 4.5-5.49 = agree, 3.5-4.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.49 =
disagree, and 1.00-1.49 = strongly disagree. a SA = strongly agree, A = Agree, AS = slightly
agree, DS = slightly disagree, D = disagree, SD = strongly disagree
To further analyze the Perceived Degree to Which the Organization’s Leadership has
Knowledge of the Planning Process Scale, the researcher conducted a factor analysis to
determine if underlying constructs existed. Using the Shapiro-Wilks Test, the researcher first
examined items for normality. Additionally, the measure of sampling adequacy (MSA) was
examined for both individual items and the overall scale. The Kaiser-Meyer-Olkin Measure of
Sampling Adequacy was .78. The lowest individual item MSA was .69, which was higher than
the minimum acceptable level. All data met the assumptions for the use of a factor analysis.
Principal components analysis with varimax rotation was used in conducting the factor analysis.
To determine the number of factors to be extracted, the researcher used both the Latent
Root criterion and the scree plot technique. The factor analysis was first computed without
restrictions on the number of factors extracted. The default minimum value of one was used on
the latent root measure. The scree plot was examined in order to identify the optimum number of
factors for extraction. The researcher identified the most pronounced bend in the scree plot curve.
From this examination, the optimum number of factors was determined to be two, plus or minus
one. Each factor was then examined for three criteria. First, each extracted factor was examined
to determine whether it met the minimum acceptable loading criteria as identified by Hair et al.
(2006). Hair et al. (2006) suggested that .30 would meet the criterion for exploratory research.
Secondly, the analysis was examined for inefficient factors or factors containing only one or two
items. Constructs with only one item are of little use to the researcher, as the purpose of the
analysis is to identity underlying constructs in the data. Lastly, the researcher examined each
analysis for the presence of significant cross-loadings. If an item loads significantly on multiple
factors, it is possible that the respondents perceived the item differently. Due to the factor
loadings, the number of inefficient factors and the number of substantial cross-loadings, the
optimum number of factors was determined to be one. The Eigenvalue for the factor was 3.58
and the factor explained 51.12% of the variance (see Table 15).
The researcher computed the overall score for the perceived degree to which the
organization’s leadership has knowledge of the planning process based on the results of a factor
analysis. This score was computed as the mean of the 7 items in the scale.
Table 15 Factor Loadings of Items in the Perceived Degree To which the Organization’s
Leadership has Knowledge of the Planning Process Scale
Component
I know what a GAP analysis is. .853
I know what a Needs Analysis is. .819
I know what a SWOT Analysis is. .786
I know what a vision and mission statement is. .724
I know how to write a strategic plan. .636
I know what a succession plan is. .603
I know how to measure performance. .520
Note. Eigenvalue = 3.58, Percent of variance explained = 51.12%
The mean Perceived Degree to Which the Organization’s Leadership has Knowledge of
the Planning Process Score was 4.38 (SD=.97) with values ranging from 2.29 to 6.00. When the
Perceived Degree to Which the Organization’s Leadership has Knowledge of the Planning
Process Score was examined by response category, the category with the largest number of
scores was 4.50-5.49 (n=27, 38.60%) (see Table 16).
Table 16 Perceived Degree to which the Organization’s Leadership has Knowledge of the
Planning Process Scale
Score Frequency Percent
1.00-1.49 0 0.00
1.50-2.49 2 2.90
2.50-3.49 13 18.60
3.50-4.49 20 28.60
4.50-5.49 27 38.60
5.50-6.00 8 11.40
70 100.00
Note. Mean = 4.38, Standard Deviation = .97
Note. The response scale used was 6 = strongly agree, 5 = agree, 4 = slightly agree, 3 = slightly
disagree, 2 = disagree, 1 = strongly agree. The interpretive scale used was 5.5-6.0 = strongly
agree, 4.5-5.49 = agree, 3.5-4.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.49 =
disagree, and 1.00-1.49 = strongly disagree.
a SA = strongly agree, A = Agree, AS = slightly agree, DS = slightly disagree, D = disagree, SD =
strongly disagree
Perceived Available Time the Organization has to Strategically Plan
As a component of the Perceived Obstacles to Strategic Planning Inventory, the
researcher designed the Perceived Available Time the Organization has to Strategically Plan
scale. This approach relied on input from a panel of academic experts, whose area of expertise
included research and theory, and industry experts, whose area of expertise included strategic
planning consulting. The items developed were as follows: 1) Our organization’s leadership
allocates time every month for long-term planning, 2) Our organization has time to allocate for
long-term planning, 3) Our organization utilizes time set aside to plan long-term, 4) Our
organization is focused on day-to-day operations more than on long-term planning, 5) Our
organization is focused on customer needs more than on long-term planning, 6) Our organization
is focused on revenues more than on long-term planning, 7) Our organization is focused on
regulatory concerns more than on long-term planning, and 8) Our organization is focused on
logistical concerns more than on long-term planning. Each item was measured using a 6-point
Likert-type response scale. The response options were strongly disagree, disagree, slightly
disagree, slightly agree, agree, and strongly agree. The higher the point value, the higher the
perceived available time the organization has to strategically plan
When analyzing the mean and standard deviation for each item of the Perceived
Available Time the Organization Has to Strategically Plan Scale, the researcher found that “Our
organization is focused on customer needs more than on long-term planning” had the highest
overall level of agreement, with a mean of 4.79 (SD=.87). The item with the lowest level of
agreement, “Our organization’s leadership allocates time every month for long-term planning,”
had a mean of 3.36 (SD=1.63). The reliability of the 8-item scale as measured using the
Cronbach’s Alpha was a=.84. To aid in the interpretation of the data, the researcher developed an
interpretive scale for the responses to the eight items. The interpretive scale had the following
categories: 5.5-6.0 = strongly agree, 4.5-5.49 = agree, 3.5-4.49 = slightly agree, 2.50-3.49 =
slightly disagree, 1.50-2.5 = disagree, and 1-1.5 = strongly disagree. When the mean item
responses were classified into categories, two of the items were in the “agree” category, three
were in the “slightly agree” category, and the remaining three were located in the “slightly
disagree” category. The means and standard deviations for the items are reported in Table 17.
Table 17 The Perceived Available Time the Organization has to Strategically Plan among Small
Businesses Owners / Managers in Louisiana
Mean Standard
Deviation
Interpretive
Scale
Category
Our organization is focused on customer needs more
than on long-term planning. 4.79 .87 A
Our organization is focused on day-to-day operations
more than on long-term planning. 4.69 1.00 A
Our organization is focused on revenues more than on
long-term planning. 4.33 1.09 AS
Our organization has time to allocate for long-term
planning. 3.80 1.42 AS
Our organization is focused on logistical concerns
more than on long-term planning. 3.57 1.22 AS
Our organization is focused on regulatory concerns
more than on long-term planning. 3.47 1.40 DS
Our organization utilizes time set aside to plan long-term. 3.43 1.49 DS
Our organization’s leadership allocates time every month for
long-term planning. 3.36 1.63 DS
Note. The response scale used was 6 = strongly agree, 5 = agree, 4 = slightly agree, 3 = slightly
disagree, 2 = disagree, 1 = strongly agree. The interpretive scale used was 5.5-6.0 = strongly
agree, 4.5-5.49 = agree, 3.5-4.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.49 =
disagree, and 1.00-1.49 = strongly disagree.
a SA = strongly agree, A = Agree, AS = slightly agree, DS = slightly disagree, D = disagree, SD =
strongly disagree
To further analyze the Perceived Available Time the Organization Has to Strategically
Plan Scale, the researcher conducted a factor analysis to determine if underlying constructs
existed. Using the Shapiro-Wilks Test, the researcher first examined items for normality.
Additionally, the measure of sampling adequacy (MSA) was examined for both individual items
and the overall scale. The Kaiser-Meyer-Olkin MSA was .73. The lowest individual item MSA
was .67, which was higher than the minimum acceptable level of .50 as suggested by Hair et al.
(2006). All data met the assumptions for the use of factor analysis. Principal components analysis
with varimax rotation was used in conducting the factor analysis.
To determine the number of factors to be extracted, the researcher used both the Latent
Root criterion and the scree plot technique. The factor analysis was first computed without
restrictions on the number of factors extracted. The default minimum value of one was used on
the latent root measure. The scree plot was examined in order to identify the optimum number of
factors for extraction. The researcher identified the most pronounced bend in the scree plot curve.
From this examination, the optimum number of factors was determined to be two, plus or minus
one. Each factor was then examined for three criteria. First, each of analyses was examined to
determine whether the items in each of the extracted factors met the minimum acceptable loading
criteria as identified by Hair et al. (2006). Hair et al. (2006) suggested that .30 would meet the
criterion for exploratory research. Secondly, the analysis was examined for inefficient factors or
factors containing only one or two items. Constructs with only one item are of little use to the
researcher, as the purpose of the analysis is to identity underlying constructs in the data. Lastly,
the researcher examined each of the analyses for the presence of significant cross-loadings. If an
item loads significantly on multiple factors, it is possible that the respondents perceived the item
differently. Due to the factor loadings, the number of inefficient factors and the number of
substantial cross-loadings, the optimum number of factors was determined to be one. The
Eigenvalue for the factor was 3.80 and the factor explained 47.52% of the variance (see Table
18).
The researcher’s next step was to compute an overall Perceived Available Time the
Organization Has to Strategically Plan score. However, for items 1) Our organization’s
leadership allocates time every month for long-term planning, 2) Our organization has time to
Table 18 Factor Loadings of Items in the Perceived Available Time the Organization has to
Strategically Plan Scale
Component
Our organization utilizes time set aside to plan long-term. -.83
Our organization’s leadership allocates time every month for long-term
planning. -.80
Our organization has time to allocate for long-term planning. -.71
Our organization is focused on logistical concerns more than on long-term
planning. .70
Our organization is focused on customer needs more than on long-term
planning. .67
Our organization is focused on regulatory concerns more than on long-term
planning. .62
Our organization is focused on revenues more than on long-term planning. .61
Our organization is focused on day-to-day operations more than on long-term
planning. .54
Note. Eigenvalue = 3.80, Percent of variance explained = 47.52%
allocate for long-term planning, and 3) Our organization utilizes time set aside to plan
long-term, a high level of agreement indicated a positive perception of available time to
strategically plan. For the remaining items, 4) Our organization is focused on day-to-day
operations more than on long-term planning, 5) Our organization is focused on customer needs
more than on long-term planning, 6) Our organization is focused on revenues more than on
longterm planning, 7) Our organization is focused on regulatory concerns more than on long-
term planning, and 8) Our organization is focused on logistical concerns more than on long-term
planning, a low level of agreement, or disagreement, indicated a positive perception of available
time to strategically plan. Due to the reverse wording of a portion of the items, computing a
factor score would have been ineffective. Therefore, the items were recoded to reflect a higher
value, consistent with other items that indicated a positive response to planning. Specifically, the
reverse worded items were coded so that Strongly Disagree = 6, Disagree = 5, Slightly Disagree
= 4, Slightly Agree = 3, Agree = 2, and Strongly Agree = 1. The value for each item was coded so
that the higher value indicated the more positive response. The item with the most positive
response was Our organization has time to allocate for long-term planning (Mean=3.80,
SD=1.42). The item with the lowest mean response (most negative) was Our organization is
focused on customer needs more than on long-term planning (Mean=2.21, SD=.87). Recorded
mean item response scores are presented in Table 19.
Table 19 Means and Standard Deviations for Reverse Coded Items in Perceived Available Time
the Organization has to Strategically Plan Scale
Mean Standard
Deviation
Interpretive
Scorea
Our organization has time to allocate for long-term 3.80 1.42 PS
planning.b
Our organization is focused on regulatory concerns
more than on long-term planning.b 3.53 1.40 PS
Our organization is focused on logistical concerns
more than on long-term planning. b 3.43 1.22 NS
Our organization utilizes time set aside to plan
longterm. b 3.43 1.49 NS
Our organization’s leadership allocates time every
month for long-term planning. b 3.36 1.63 NS
Our organization is focused on revenues more than
on long-term planning. b 2.67 1.09 NS
Our organization is focused on day-to-day
operations more than on long-term planning. b 2.31 1.00 N
Our organization is focused on customer needs more
than on long-term planning. b 2.21 .87 N
Note. The original response scale used was 6 = Strongly Disagree, 5 = Disagree, 4 = Slightly
Disagree, 3 = Slightly Agree, 2 = Agree, 1 = Strongly Agree. The interpretive scale used was 5.5-
6.0 = strongly positive, 4.5-5.49 = positive, 3.5-4.49 = slightly positive, 2.50-3.49 = negative,
1.50-2.49 = slightly negative, and 1.00-1.49 = strongly negative.
aSP = strongly positive, P = positive, SP = slightly positive, N = negative, NS = slightly
negative, SN = strongly negative
bReverse coded item scale recoded as follows: 1= SA, 2 = A, 3 = AS, 4 = SD, 5 = D, 6 =
DS Using the consistently coded items in the single factor identified in the factor analysis,
the researcher computed the perceived available time the organization has to strategically plan
score, which was the mean of the eight items in the factor. The mean score was 3.09 (SD=0.88),
with values ranging from 1.25 to 5.13. These scores were grouped into response categories, as
shown in Table 22. When the Perceived Available Time the Organization Has to Strategically
Plan Scale was examined by response category, the category with the largest number of scores
was 2.50-3.49 (n=26, 41.40%) (see Table 20).
Table 20 Perceived Available Time the Organization has to Strategically Plan Scale
Score Frequency Percent
1.00-1.49 3 4.29
1.50-2.49 16 22.90
2.50-3.49 26 37.14
3.50-4.49 21 30.00
4.50-5.49 4 5.70
5.50-6.00 0 0.00
Total 70 100.00
Note. Mean = 3.09 Standard Deviation = .88
Note. The response scale used was 6 = Strongly Disagree, 5 = Disagree, 4 = Slightly Disagree, 3
= Slightly Agree, 2 = Agree, 1 = Strongly Agree. The interpretive scale used was 5.5-6.0 =
strongly disagree, 4.5-5.49 = disagree, 3.5-4.49 = slightly disagree, 2.50-3.49 = slightly agree,
1.50-2.49 = agree, and 1.0-1.49 = strongly agree. a SA = strongly agree, A = Agree, AS = slightly
agree, DS = slightly disagree, D = disagree, SD = strongly disagree
Objective Four
The fourth objective of this study is to determine if a relationship exists between
Louisiana small business owners' perceived obstacles to strategic planning and each of the
demographic and perceived obstacles to planning measures included in the study. The first of
these demographic measures was the industry in which the organization is positioned. This
measure included the 24 categories of industries identified by the Louisiana Small Business
Association. However, with only 70 respondents in the study and 24 possible responses, the
number of responses in most of the categories were too small to enable a comparison on the
strategic planning score variable. Only one category, Professional Services, had a sufficient
number of responses to allow the examination of the proposed relationship. In addition, since this
variable was nominal in nature, a comparative analysis was judged to be preferable to the use of
correlational statistics. Therefore, since only one category had sufficient numbers for analysis, a
t-test was used to compare those respondents that reported Professional Services with other
respondents. The comparative statistic was chosen over a correlation coefficient for the ease of
interpretation of the findings. The mean strategic planning score for all respondents other than
Professional Services was 4.74 (SD=.71). The mean strategic planning score for Professional
Services industries was 4.52 (SD=.65). Levene’s Test for equality of variances was not
significant (F=.15, p=.71), indicating that the assumption of equal variances was met. Therefore,
the pooled variance estimate was used in computing the t-test. Based on this test, no significant
difference was found in mean strategic planning score between the two groups (t68=1.22, p=.23).
The second variable examined for a relationship with the strategic planning score was
“legal structure of the business.” The Louisiana Small Business Association identifies five
categories of legal business structure represented in the state of Louisiana. Of these five
categories, only two had sufficient respondents to enable the examination of their relationship
with the “perceived degree to which the organization conducts strategic planning.” Of the 70
respondents, 38 self-identified as a Limited Liability Corporation. A t-test was conducted to
examine whether or not differences existed in mean strategic planning score between
respondents identifying as a Limited Liability Corporation and all other types of legal structure.
The mean strategic planning score for Limited Liability Corporations was 4.58 (SD=.75). The
mean strategic planning score for non-Limited Liability Corporations was 4.77 (SD=.61).
Levene’s Test for equality of variances was not significant (F=.18, p=.67), indicating that the
assumption of equal variances was met. Therefore, the pooled variance estimate was used in
computing the t-test. Based on this test, no significant difference was found in mean strategic
planning score between the two groups (t68=1.17, p=.25).
A second t-test was conducted to examine whether or not differences existed in mean
strategic planning score between respondents identifying as a Subchapter S Corporation (S-Corp)
and all other types of legal structure. The mean strategic planning score for Subchapter S
Corporations was 4.80 (SD=.62). The mean strategic planning score for non-Subchapter S
Corporations was 4.62 (SD=.72). Levene’s Test for equality of variances was not significant
(F=.18, p=.67), indicating that the assumption of equal variances was met. Therefore, the pooled
variance estimate was used in computing the t-test. Based on this test, no significant difference
was found in mean strategic planning score between the two groups (t68=-.93, p=.36). No other
statistical tests were conducted on small business legal structure because the sample size for each
of the remaining categories was too small to conduct an analysis.
A third t-test was conducted to examine whether or not differences existed in mean
strategic planning score between respondents who identified as having or not having a written
long-term plan. The mean strategic planning score for respondents who had a written long-term
plan was 4.98 (SD=.62). The mean strategic planning score for respondents who did not have a
written long-term plan was 4.51 (SD=.68). Levene’s Test for equality of variances was not
significant (F=.07, p=.80), indicating that the assumption of equal variances was met. Therefore,
the pooled variance estimate was used in computing the t-test. Based on this test, a significant
difference was found in mean strategic planning score between the two groups (t68 = 2.773, p
= .007). Therefore, those respondents who said they had a written long-term plan had higher
strategic planning scores then those who did not.
Pearson Product Moment Correlation Coefficients (PPMr) were calculated between
strategic planning score and the demographic variables measured on a continuous scale of
measurement. These included years the organization has been in business and number of
employees on the payroll, as well as variables that measured perceived obstacles to strategic
planning. No significant relationship existed between years in business and strategic planning
score (r = -.109, p = .37). Additionally, no significant relationship existed between number of
employees and strategic planning score (r = -.066, p = .59). There was, however, a significant
positive relationship between the perceived degree to which the organization conducts strategic
planning and the perceived quality of the organization’s employees (r = .367, p < .002), the
perceived degree to which the organization’s leadership has knowledge of the planning process
(r = .330, p = .005), and the perceived available time the organization has to strategically plan (r
= .322, p = .004). Therefore, for all three relationships, a higher score was associated with a
higher strategic planning score (see Table 21).
Table 21 Relationships with the Perceived Degree to which the Organization Conducts Strategic
Planning
aPPMr p value bDescriptor
Perceived quality of the organization’s employees .367 .002 MA
Perceived degree to which the organization’s leadership has
knowledge of the planning process .330 .005 MA
Perceived available time the organization has to strategically
plan .322 .007 MA
Years the organization been in business -.109 .369 LA
Number of employees currently on the organization’s
payroll -.066 .588 NA
aPearson Product Moment Correlation Coefficients bDavis’ Descriptors (1971): .00 to .09 =
Negligible Association, .10 to .29 = Low Association, .30 to .49 = Moderate Association, .50
to .69 = Substantial Association, and .70 or higher = Very Strong Association
NA = Negligible Association, LA = Low Association, MA = Moderate Association, SA =
Substantial Association, VS = Very Strong Association
Objective Five
In order to determine if a model exists explaining a significant portion of the variance in
Louisiana small business owners' perceived degree to which the organization conducts strategic
planning, a stepwise regression analysis was conducted. To ensure that there were no excessive
levels of collinearity among the variables in this study. the variance inflation factors (VIF) were
examined. According to Hair et al. (2006), “A common cutoff threshold is a tolerance value
of .10 which corresponds to a VIF value of 10” (p. 230). The VIF values in this analysis ranged
from 1.028 to 1.404, indicating no excessive multicollinearity between factors. Bivariate
correlations were examined between all factors used as independent variables and “the perceived
degree to which the organization conducts strategic planning.” Of the nine factors, the three
perceptual factors had the highest correlations, ranging from .322 to .367. The remaining six
factors had lower correlations, with the exception of written plan, which had a correlation
of .319. These correlations are presented in Table 22.
Table 22 Correlations between the Perceived Degree to which the Organization Conducts
Strategic Planning and Selected Demographic and Perceptual Factors
N ar p value bDescriptor
Perceived quality of the organization’s employees 70 .367 .001 MA
Perceived degree to which the organization’s leadership
has knowledge of the planning process 70 .330 .003 MA
Perceived available time the organization has to
strategically plan 70 .322 .003 MA
Written long-term plan 70 .319 .004 MA
Positioned in the professional services industry 70 -.146 .114 LA
Legal structure of the business as Limited Liability
Corporation 70 -.140 .123 LA
Legal structure of the business as Subchapter S
Corporation 70 .112 .179 LA
Years the organization been in business 70 -.109 .184 LA
Number of employees currently on the organization’s
payroll. 70 -.066 .294 NA
aPearson Product Moment Correlation Coefficients
bDavis’ Descriptors (1971): .00 to .09 = Negligible Association, .10 to .29 = Low Association, .30
to .49 = Moderate Association, .50 to .69 = Substantial Association, and .70 or higher = Very
Strong Association
NA = Negligible Association, LA = Low Association, MA = Moderate Association, SA =
Substantial Association, VS = Very Strong Association
The first variable to enter the regression model was “the perceived quality of the
organization’s employees,” with an R square of .134, F(1,68) = 10.56, p = .002, explaining
13.4% of the variance in “the perceived degree to which the organization conducts strategic
planning.” The second variable entered was whether or not the organization had a “written
longterm plan,” which had an R square change of .073, F(1,67) = 6.17, p = .015, explaining an
additional 7.3% of the variance in “the perceived degree to which the organization conducts
strategic planning.” These two variables combined explained 20.7% of the variance in “the
perceived degree to which the organization conducts strategic planning.”
Two additional variables added one percent or more to the explained variance. However,
these two variables were individually non-significant. The first of the two non-significant
variables that entered the model was “the perceived degree to which the organization’s leadership
has knowledge of the planning process,” with an R square change of .026, F(1,66) = 2.28, p
= .136. This 2.6% increase in explained variance was individually not significant; however, it
was included in the model because it added one percent or more of explained variance while the
overall model remained significant. Similarly, whether or not the small business was positioned
in “professional services,” industry an R square change of .010, F(1,65) = .359, was added to the
model with a 1% increase in explained variance. This 1% increase in explained variance was
individually not significant; however, it also was included in the model because it added one
percent or more of explained variance while the overall model remained significant. These two
variables combined, though not individually significant, explained 3.6% of the variance in “the
perceived degree to which the organization conducts strategic planning.”
The total R square for this model was .244 and the four variables, in combination,
explained 24.4% of the variance in “the perceived degree to which the organization conducts
strategic planning.” The results of the regression indicate subjects with higher scores on “the
perceived quality of the organization’s employees” and “the perceived degree to which the
organization’s leadership has knowledge of the planning process” tended to have higher scores
on “the perceived degree to which the organization conducts strategic planning.” Furthermore,
those respondents who answered “yes” to whether or not they had a “written long-term plan”
tended to have a higher “perceived degree to which the organization conducts strategic planning”
score. Similarly, those respondents who indicated that their organizations were positioned in the
“professional services” industry tended to have lower “perceived degree to which the
organization conducts strategic planning” scores. The results of the regression analysis are
presented in Table 23.
Table 23 Multiple Regression Analysis of “The Perceived Degree to Which the Organization
Conducts Strategic Planning” on Selected Perceptual and Demographic Measures among
Louisiana Small Businesses
ANOVA
Sources of Variation df MS F P
Regression 4 2.010 5.238 .001
Residual 65 .384
Total 69
Model Summary
Model R Square R Square
Change
F Change Sig. F
Change
Standardized
Coefficients
Beta
Perceived quality of the
organization’s employees .134 .134 10.557 .002 .278
Written long-term plan .207 .073 6.171 .015 .216
Perceived degree to which
the organization’s
leadership has knowledge
of the planning process
.234 .026 2.278 .136 .177
Professional services .244 .010 .852 .359 -.101
Variables not in the Equation
Variables t P
The Perceived Available Time the
Organization Has to Strategically Plan .993 .325
Number of employees are currently on
the organization’s payroll -.892 .376
Legal structure of the business as
Subchapter S Corporation .519 .605
Years the organization been in business -.255 .800
Legal structure of the business as
Limited Liability Corporation -.172 .864
When analyzing the means, and standard deviation for each item of the Perceived Quality
of the Organization’s Employees Scale, the researcher found that “Our employees are skilled in
their craft” had the highest overall level of agreement, with a mean of 5.24 (SD=.65). The item
with the lowest level of agreement, “Our employees achieve maximum productivity with
minimum wasted effort or expense,” had a mean of 4.20 (SD=1.03). The reliability of the 12item
scale as measured by the use of Cronbach’s Alpha was a=.90. To aid in the interpretation of the
data, the researcher developed an interpretive scale for the responses to the 12 items. The
interpretive scale had the following categories: 5.5-6.0 = strongly agree, 4.5-5.49 = agree,
3.54.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.5 = disagree, and 1-1.5 = strongly
disagree. When the mean item responses were classified into two categories, 11 of the items were
in the “agree” category, with the remaining item in the “slightly agree” category. The means and
standard deviations for the items are reported in Table 11.
To further analyze the Perceived Quality of the Organization’s Employees Scale, the
researcher conducted a factor analysis to determine if underlying constructs existed in the scale.
Using the Shapiro-Wilks Test, the researcher first examined items for normality. Additionally, the
measure of sampling adequacy (MSA) was examined for both individual items and the overall
scale. The Kaiser-Meyer-Olkin Measure of Sampling Adequacy was .87. The lowest individual
item MSA was .80, which was higher than the minimum acceptable level of .50 (Hair et al.,
2006). All data met the assumptions for the use of factor analysis. Principal components analysis
with varimax rotation was used in conducting the factor analysis.
To determine the number of factors to be extracted, the researcher used both the Latent
Root criterion and the scree plot technique. The factor analysis was first computed without
restrictions on the number of factors extracted. The default minimum value of one was used on
the latent root measure. The scree plot was examined in order to identify the optimum number of
factors for extraction. The researcher identified the most pronounced bend in the scree plot curve.
From this examination, the optimum number of factors was determined to be two, plus or minus
one. Each of these three analyses was then examined for three criteria. First, each of the analyses
was examined to determine whether the items in each of the extracted factors met the minimum
acceptable loading criteria as identified by Hair et al. (2006). Hair et al. (2006) suggested that .30
would meet the criterion for exploratory research. Secondly, the analysis was examined for
inefficient factors or factors containing only one or two items. Constructs with only one item are
of little use to the researcher, as the purpose of the analysis is to identity underlying constructs in
the data. Lastly, the researcher examined each analysis for the presence of significant cross-
loadings. If an item loads significantly on multiple factors, it is possible that the respondents
perceived the item differently. Due to the factor loadings, the number of inefficient factors and
the number of substantial cross-loadings, the optimum number of factors was determined to be
one. The Eigenvalue for the factor was 5.94 and the factor explained 49.51% of the variance (see
Table 12).
Table 12 Factor Loadings of Items in the Perceived Quality of the Organization’s Employees
Scale
Component
Our employees contribute solutions. .837
Our employees are focused on customer solutions. .816
Our employees achieve maximum productivity with
minimum wasted effort or expense.
.795
Our employees are willing to learn from errors. .778
Our employees are focused on customer service. .716
Our employees follow instructions. .703
Our employees are skilled in their craft. .691
Our employees are willing to learn. .673
Our employees are rarely absent from work. .634
Our employees work well in teams. .618
Our employees show up on time .587
Our employees possess knowledge of the industry. .523
Note. Eigenvalue = 5.94, Percent of variance explained = 49.51%
The researcher computed an overall score for the perceived quality of the organization’s
employees based on the results of the factor analysis. This score was computed as the mean of
the 12 items in the scale. The mean Perceived Quality of the Organization’s Employees Score
was 4.95 (SD=.62), with values ranging from 3.00 to 6.00. The overall mean was in the
interpretive category of “agree.” When the Perceived Quality of the Organization’s Employees
Score was examined by response category, the category with the largest number of scores was
4.50-5.49 (n=37, 52.90%) (see Table 13).
Table 13 Perceived Quality of the Organization’s Employees Score
Score Frequency Percent
1.00-1.49 0 0.00
1.50-2.49 0 0.00
2.50-3.49 1 1.40
3.50-4.49 14 20.00
(Table 13 continued)
Score Frequency Percent
4.50-5.49 37 52.90
5.50-6.00 18 25.7
Total 70 100.10
Note. Mean = 4.95, Standard Deviation = .62
Note. The response scale used was 6 = strongly agree, 5 = agree, 4 = slightly agree, 3 = slightly
disagree, 2 = disagree, 1 = strongly agree. The interpretive scale used was 5.5-6.0 = strongly
agree, 4.5-5.49 = agree, 3.5-4.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.49 =
disagree, and 1.00-1.49 = strongly disagree. a SA = strongly agree, A = Agree, AS = slightly
agree, DS = slightly disagree, D = disagree, SD = strongly disagree
Perceived Degree to Which the Organization’s Leadership has Knowledge of the Planning
Process
As a component of the Perceived Obstacles to Strategic Planning Inventory, the
researcher designed the Perceived Degree to Which the Organization’s Leadership Has
Knowledge of the Planning Process scale. This approach relied on input from a panel of
academic experts, whose area of expertise included research and theory, and industry experts,
whose area of expertise included strategic planning consulting. The items developed were as
follows: 1) I know what a GAP analysis is, 2) I know what a Needs Analysis is, 3) I know what a
SWOT Analysis is, 4) I know what a vision and mission statement is, 5) I know how to write a
strategic plan, 6) I know what a succession plan is, and 7) I know how to measure performance.
Each item was measured using a 6-point Likert-type response scale. The response options were
strongly disagree, disagree, slightly disagree, slightly agree, agree, and strongly agree. A higher
rating indicated a higher level of agreement. A lower rating indicated a stronger level of
disagreement.
When analyzing the mean and standard deviation for each item of the Perceived Degree
to Which the Organization’s Leadership has Knowledge of the Planning Process Scale, the
researcher found that “I know what a vision and mission statement is” had the highest overall
level of agreement, with a mean of 5.34 (SD=.68). The item with the lowest level of agreement,
“I know what a SWOT Analysis is,” had a mean of 3.69 (SD=1.91). The reliability of the 7-item
scale as measured by the use of Cronbach’s Alpha was a=.83. To aid in the interpretation of the
data, the researcher developed an interpretive scale for the responses to the 7 items. The
interpretive scale had the following categories: 5.5-6.0 = strongly agree, 4.5-5.49 = agree,
3.54.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.5 = disagree, and 1-1.5 = strongly
disagree. When the mean item responses were classified into categories, four of the items were in
the “agree” category, and the other three were in the “slightly agree” category. The means and
standard deviation for each item are reported in Table 14.
Table 14 The Organization’s Leadership has Knowledge of the Planning Process among Small
Business / Managers in Louisiana
Mean Standard Interpretive
Deviation Scale Category
I know what a vision and mission statement is. 5.34 .68 A
I know how to measure performance. 4.71 .94 A
I know what a succession plan is. 4.67 1.29 A
I know how to write a strategic plan. 4.49 1.34 A
I know what a Needs Analysis is. 4.03 1.55 AS
I know what a GAP analysis is. 3.70 1.61 AS
I know what a SWOT Analysis is 3.69 1.91 AS
Note. The response scale used was 6 = strongly agree, 5 = agree, 4 = slightly agree, 3 = slightly
disagree, 2 = disagree, 1 = strongly agree. The interpretive scale used was 5.5-6.0 = strongly
agree, 4.5-5.49 = agree, 3.5-4.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.49 =
disagree, and 1.00-1.49 = strongly disagree. a SA = strongly agree, A = Agree, AS = slightly
agree, DS = slightly disagree, D = disagree, SD = strongly disagree
To further analyze the Perceived Degree to Which the Organization’s Leadership has
Knowledge of the Planning Process Scale, the researcher conducted a factor analysis to
determine if underlying constructs existed. Using the Shapiro-Wilks Test, the researcher first
examined items for normality. Additionally, the measure of sampling adequacy (MSA) was
examined for both individual items and the overall scale. The Kaiser-Meyer-Olkin Measure of
Sampling Adequacy was .78. The lowest individual item MSA was .69, which was higher than
the minimum acceptable level. All data met the assumptions for the use of a factor analysis.
Principal components analysis with varimax rotation was used in conducting the factor analysis.
To determine the number of factors to be extracted, the researcher used both the Latent
Root criterion and the scree plot technique. The factor analysis was first computed without
restrictions on the number of factors extracted. The default minimum value of one was used on
the latent root measure. The scree plot was examined in order to identify the optimum number of
factors for extraction. The researcher identified the most pronounced bend in the scree plot curve.
From this examination, the optimum number of factors was determined to be two, plus or minus
one. Each factor was then examined for three criteria. First, each extracted factor was examined
to determine whether it met the minimum acceptable loading criteria as identified by Hair et al.
(2006). Hair et al. (2006) suggested that .30 would meet the criterion for exploratory research.
Secondly, the analysis was examined for inefficient factors or factors containing only one or two
items. Constructs with only one item are of little use to the researcher, as the purpose of the
analysis is to identity underlying constructs in the data. Lastly, the researcher examined each
analysis for the presence of significant cross-loadings. If an item loads significantly on multiple
factors, it is possible that the respondents perceived the item differently. Due to the factor
loadings, the number of inefficient factors and the number of substantial cross-loadings, the
optimum number of factors was determined to be one. The Eigenvalue for the factor was 3.58
and the factor explained 51.12% of the variance (see Table 15).
The researcher computed the overall score for the perceived degree to which the
organization’s leadership has knowledge of the planning process based on the results of a factor
analysis. This score was computed as the mean of the 7 items in the scale.
Table 15 Factor Loadings of Items in the Perceived Degree To which the Organization’s
Leadership has Knowledge of the Planning Process Scale
Component
I know what a GAP analysis is. .853
I know what a Needs Analysis is. .819
I know what a SWOT Analysis is. .786
I know what a vision and mission statement is. .724
I know how to write a strategic plan. .636
I know what a succession plan is. .603
I know how to measure performance. .520
Note. Eigenvalue = 3.58, Percent of variance explained = 51.12%
The mean Perceived Degree to Which the Organization’s Leadership has Knowledge of
the Planning Process Score was 4.38 (SD=.97) with values ranging from 2.29 to 6.00. When the
Perceived Degree to Which the Organization’s Leadership has Knowledge of the Planning
Process Score was examined by response category, the category with the largest number of
scores was 4.50-5.49 (n=27, 38.60%) (see Table 16).
Table 16 Perceived Degree to which the Organization’s Leadership has Knowledge of the
Planning Process Scale
Score Frequency Percent
1.00-1.49 0 0.00
1.50-2.49 2 2.90
2.50-3.49 13 18.60
3.50-4.49 20 28.60
4.50-5.49 27 38.60
5.50-6.00 8 11.40
70 100.00
Note. Mean = 4.38, Standard Deviation = .97
Note. The response scale used was 6 = strongly agree, 5 = agree, 4 = slightly agree, 3 = slightly
disagree, 2 = disagree, 1 = strongly agree. The interpretive scale used was 5.5-6.0 = strongly
agree, 4.5-5.49 = agree, 3.5-4.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.49 =
disagree, and 1.00-1.49 = strongly disagree.
a SA = strongly agree, A = Agree, AS = slightly agree, DS = slightly disagree, D = disagree, SD =
strongly disagree
Perceived Available Time the Organization has to Strategically Plan
As a component of the Perceived Obstacles to Strategic Planning Inventory, the
researcher designed the Perceived Available Time the Organization has to Strategically Plan
scale. This approach relied on input from a panel of academic experts, whose area of expertise
included research and theory, and industry experts, whose area of expertise included strategic
planning consulting. The items developed were as follows: 1) Our organization’s leadership
allocates time every month for long-term planning, 2) Our organization has time to allocate for
long-term planning, 3) Our organization utilizes time set aside to plan long-term, 4) Our
organization is focused on day-to-day operations more than on long-term planning, 5) Our
organization is focused on customer needs more than on long-term planning, 6) Our organization
is focused on revenues more than on long-term planning, 7) Our organization is focused on
regulatory concerns more than on long-term planning, and 8) Our organization is focused on
logistical concerns more than on long-term planning. Each item was measured using a 6-point
Likert-type response scale. The response options were strongly disagree, disagree, slightly
disagree, slightly agree, agree, and strongly agree. The higher the point value, the higher the
perceived available time the organization has to strategically plan
When analyzing the mean and standard deviation for each item of the Perceived
Available Time the Organization Has to Strategically Plan Scale, the researcher found that “Our
organization is focused on customer needs more than on long-term planning” had the highest
overall level of agreement, with a mean of 4.79 (SD=.87). The item with the lowest level of
agreement, “Our organization’s leadership allocates time every month for long-term planning,”
had a mean of 3.36 (SD=1.63). The reliability of the 8-item scale as measured using the
Cronbach’s Alpha was a=.84. To aid in the interpretation of the data, the researcher developed an
interpretive scale for the responses to the eight items. The interpretive scale had the following
categories: 5.5-6.0 = strongly agree, 4.5-5.49 = agree, 3.5-4.49 = slightly agree, 2.50-3.49 =
slightly disagree, 1.50-2.5 = disagree, and 1-1.5 = strongly disagree. When the mean item
responses were classified into categories, two of the items were in the “agree” category, three
were in the “slightly agree” category, and the remaining three were located in the “slightly
disagree” category. The means and standard deviations for the items are reported in Table 17.
Table 17 The Perceived Available Time the Organization has to Strategically Plan among Small
Businesses Owners / Managers in Louisiana
Mean Standard
Deviation
Interpretive
Scale
Category
Our organization is focused on customer needs more
than on long-term planning. 4.79 .87 A
Our organization is focused on day-to-day operations
more than on long-term planning. 4.69 1.00 A
Our organization is focused on revenues more than on
long-term planning. 4.33 1.09 AS
Our organization has time to allocate for long-term
planning. 3.80 1.42 AS
Our organization is focused on logistical concerns
more than on long-term planning. 3.57 1.22 AS
Our organization is focused on regulatory concerns
more than on long-term planning. 3.47 1.40 DS
Our organization utilizes time set aside to plan long-term. 3.43 1.49 DS
Our organization’s leadership allocates time every month for
long-term planning. 3.36 1.63 DS
Note. The response scale used was 6 = strongly agree, 5 = agree, 4 = slightly agree, 3 = slightly
disagree, 2 = disagree, 1 = strongly agree. The interpretive scale used was 5.5-6.0 = strongly
agree, 4.5-5.49 = agree, 3.5-4.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.49 =
disagree, and 1.00-1.49 = strongly disagree.
a SA = strongly agree, A = Agree, AS = slightly agree, DS = slightly disagree, D = disagree, SD =
strongly disagree
To further analyze the Perceived Available Time the Organization Has to Strategically
Plan Scale, the researcher conducted a factor analysis to determine if underlying constructs
existed. Using the Shapiro-Wilks Test, the researcher first examined items for normality.
Additionally, the measure of sampling adequacy (MSA) was examined for both individual items
and the overall scale. The Kaiser-Meyer-Olkin MSA was .73. The lowest individual item MSA
was .67, which was higher than the minimum acceptable level of .50 as suggested by Hair et al.
(2006). All data met the assumptions for the use of factor analysis. Principal components analysis
with varimax rotation was used in conducting the factor analysis.
To determine the number of factors to be extracted, the researcher used both the Latent
Root criterion and the scree plot technique. The factor analysis was first computed without
restrictions on the number of factors extracted. The default minimum value of one was used on
the latent root measure. The scree plot was examined in order to identify the optimum number of
factors for extraction. The researcher identified the most pronounced bend in the scree plot curve.
From this examination, the optimum number of factors was determined to be two, plus or minus
one. Each factor was then examined for three criteria. First, each of analyses was examined to
determine whether the items in each of the extracted factors met the minimum acceptable loading
criteria as identified by Hair et al. (2006). Hair et al. (2006) suggested that .30 would meet the
criterion for exploratory research. Secondly, the analysis was examined for inefficient factors or
factors containing only one or two items. Constructs with only one item are of little use to the
researcher, as the purpose of the analysis is to identity underlying constructs in the data. Lastly,
the researcher examined each of the analyses for the presence of significant cross-loadings. If an
item loads significantly on multiple factors, it is possible that the respondents perceived the item
differently. Due to the factor loadings, the number of inefficient factors and the number of
substantial cross-loadings, the optimum number of factors was determined to be one. The
Eigenvalue for the factor was 3.80 and the factor explained 47.52% of the variance (see Table
18).
The researcher’s next step was to compute an overall Perceived Available Time the
Organization Has to Strategically Plan score. However, for items 1) Our organization’s
leadership allocates time every month for long-term planning, 2) Our organization has time to
Table 18 Factor Loadings of Items in the Perceived Available Time the Organization has to
Strategically Plan Scale
Component
Our organization utilizes time set aside to plan long-term. -.83
Our organization’s leadership allocates time every month for long-term
planning. -.80
Our organization has time to allocate for long-term planning. -.71
Our organization is focused on logistical concerns more than on long-term
planning. .70
Our organization is focused on customer needs more than on long-term
planning. .67
Our organization is focused on regulatory concerns more than on long-term
planning. .62
Our organization is focused on revenues more than on long-term planning. .61
Our organization is focused on day-to-day operations more than on long-term
planning. .54
Note. Eigenvalue = 3.80, Percent of variance explained = 47.52%
allocate for long-term planning, and 3) Our organization utilizes time set aside to plan
long-term, a high level of agreement indicated a positive perception of available time to
strategically plan. For the remaining items, 4) Our organization is focused on day-to-day
operations more than on long-term planning, 5) Our organization is focused on customer needs
more than on long-term planning, 6) Our organization is focused on revenues more than on
longterm planning, 7) Our organization is focused on regulatory concerns more than on long-
term planning, and 8) Our organization is focused on logistical concerns more than on long-term
planning, a low level of agreement, or disagreement, indicated a positive perception of available
time to strategically plan. Due to the reverse wording of a portion of the items, computing a
factor score would have been ineffective. Therefore, the items were recoded to reflect a higher
value, consistent with other items that indicated a positive response to planning. Specifically, the
reverse worded items were coded so that Strongly Disagree = 6, Disagree = 5, Slightly Disagree
= 4, Slightly Agree = 3, Agree = 2, and Strongly Agree = 1. The value for each item was coded so
that the higher value indicated the more positive response. The item with the most positive
response was Our organization has time to allocate for long-term planning (Mean=3.80,
SD=1.42). The item with the lowest mean response (most negative) was Our organization is
focused on customer needs more than on long-term planning (Mean=2.21, SD=.87). Recorded
mean item response scores are presented in Table 19.
Table 19 Means and Standard Deviations for Reverse Coded Items in Perceived Available Time
the Organization has to Strategically Plan Scale
Mean Standard
Deviation
Interpretive
Scorea
Our organization has time to allocate for long-term 3.80 1.42 PS
planning.b
Our organization is focused on regulatory concerns
more than on long-term planning.b 3.53 1.40 PS
Our organization is focused on logistical concerns
more than on long-term planning. b 3.43 1.22 NS
Our organization utilizes time set aside to plan
longterm. b 3.43 1.49 NS
Our organization’s leadership allocates time every
month for long-term planning. b 3.36 1.63 NS
Our organization is focused on revenues more than
on long-term planning. b 2.67 1.09 NS
Our organization is focused on day-to-day
operations more than on long-term planning. b 2.31 1.00 N
Our organization is focused on customer needs more
than on long-term planning. b 2.21 .87 N
Note. The original response scale used was 6 = Strongly Disagree, 5 = Disagree, 4 = Slightly
Disagree, 3 = Slightly Agree, 2 = Agree, 1 = Strongly Agree. The interpretive scale used was 5.5-
6.0 = strongly positive, 4.5-5.49 = positive, 3.5-4.49 = slightly positive, 2.50-3.49 = negative,
1.50-2.49 = slightly negative, and 1.00-1.49 = strongly negative.
aSP = strongly positive, P = positive, SP = slightly positive, N = negative, NS = slightly
negative, SN = strongly negative
bReverse coded item scale recoded as follows: 1= SA, 2 = A, 3 = AS, 4 = SD, 5 = D, 6 =
DS Using the consistently coded items in the single factor identified in the factor analysis,
the researcher computed the perceived available time the organization has to strategically plan
score, which was the mean of the eight items in the factor. The mean score was 3.09 (SD=0.88),
with values ranging from 1.25 to 5.13. These scores were grouped into response categories, as
shown in Table 22. When the Perceived Available Time the Organization Has to Strategically
Plan Scale was examined by response category, the category with the largest number of scores
was 2.50-3.49 (n=26, 41.40%) (see Table 20).
Table 20 Perceived Available Time the Organization has to Strategically Plan Scale
Score Frequency Percent
1.00-1.49 3 4.29
1.50-2.49 16 22.90
2.50-3.49 26 37.14
3.50-4.49 21 30.00
4.50-5.49 4 5.70
5.50-6.00 0 0.00
Total 70 100.00
Note. Mean = 3.09 Standard Deviation = .88
Note. The response scale used was 6 = Strongly Disagree, 5 = Disagree, 4 = Slightly Disagree, 3
= Slightly Agree, 2 = Agree, 1 = Strongly Agree. The interpretive scale used was 5.5-6.0 =
strongly disagree, 4.5-5.49 = disagree, 3.5-4.49 = slightly disagree, 2.50-3.49 = slightly agree,
1.50-2.49 = agree, and 1.0-1.49 = strongly agree. a SA = strongly agree, A = Agree, AS = slightly
agree, DS = slightly disagree, D = disagree, SD = strongly disagree
Objective Four
The fourth objective of this study is to determine if a relationship exists between
Louisiana small business owners' perceived obstacles to strategic planning and each of the
demographic and perceived obstacles to planning measures included in the study. The first of
these demographic measures was the industry in which the organization is positioned. This
measure included the 24 categories of industries identified by the Louisiana Small Business
Association. However, with only 70 respondents in the study and 24 possible responses, the
number of responses in most of the categories were too small to enable a comparison on the
strategic planning score variable. Only one category, Professional Services, had a sufficient
number of responses to allow the examination of the proposed relationship. In addition, since this
variable was nominal in nature, a comparative analysis was judged to be preferable to the use of
correlational statistics. Therefore, since only one category had sufficient numbers for analysis, a
t-test was used to compare those respondents that reported Professional Services with other
respondents. The comparative statistic was chosen over a correlation coefficient for the ease of
interpretation of the findings. The mean strategic planning score for all respondents other than
Professional Services was 4.74 (SD=.71). The mean strategic planning score for Professional
Services industries was 4.52 (SD=.65). Levene’s Test for equality of variances was not
significant (F=.15, p=.71), indicating that the assumption of equal variances was met. Therefore,
the pooled variance estimate was used in computing the t-test. Based on this test, no significant
difference was found in mean strategic planning score between the two groups (t68=1.22, p=.23).
The second variable examined for a relationship with the strategic planning score was
“legal structure of the business.” The Louisiana Small Business Association identifies five
categories of legal business structure represented in the state of Louisiana. Of these five
categories, only two had sufficient respondents to enable the examination of their relationship
with the “perceived degree to which the organization conducts strategic planning.” Of the 70
respondents, 38 self-identified as a Limited Liability Corporation. A t-test was conducted to
examine whether or not differences existed in mean strategic planning score between
respondents identifying as a Limited Liability Corporation and all other types of legal structure.
The mean strategic planning score for Limited Liability Corporations was 4.58 (SD=.75). The
mean strategic planning score for non-Limited Liability Corporations was 4.77 (SD=.61).
Levene’s Test for equality of variances was not significant (F=.18, p=.67), indicating that the
assumption of equal variances was met. Therefore, the pooled variance estimate was used in
computing the t-test. Based on this test, no significant difference was found in mean strategic
planning score between the two groups (t68=1.17, p=.25).
A second t-test was conducted to examine whether or not differences existed in mean
strategic planning score between respondents identifying as a Subchapter S Corporation (S-Corp)
and all other types of legal structure. The mean strategic planning score for Subchapter S
Corporations was 4.80 (SD=.62). The mean strategic planning score for non-Subchapter S
Corporations was 4.62 (SD=.72). Levene’s Test for equality of variances was not significant
(F=.18, p=.67), indicating that the assumption of equal variances was met. Therefore, the pooled
variance estimate was used in computing the t-test. Based on this test, no significant difference
was found in mean strategic planning score between the two groups (t68=-.93, p=.36). No other
statistical tests were conducted on small business legal structure because the sample size for each
of the remaining categories was too small to conduct an analysis.
A third t-test was conducted to examine whether or not differences existed in mean
strategic planning score between respondents who identified as having or not having a written
long-term plan. The mean strategic planning score for respondents who had a written long-term
plan was 4.98 (SD=.62). The mean strategic planning score for respondents who did not have a
written long-term plan was 4.51 (SD=.68). Levene’s Test for equality of variances was not
significant (F=.07, p=.80), indicating that the assumption of equal variances was met. Therefore,
the pooled variance estimate was used in computing the t-test. Based on this test, a significant
difference was found in mean strategic planning score between the two groups (t68 = 2.773, p
= .007). Therefore, those respondents who said they had a written long-term plan had higher
strategic planning scores then those who did not.
Pearson Product Moment Correlation Coefficients (PPMr) were calculated between
strategic planning score and the demographic variables measured on a continuous scale of
measurement. These included years the organization has been in business and number of
employees on the payroll, as well as variables that measured perceived obstacles to strategic
planning. No significant relationship existed between years in business and strategic planning
score (r = -.109, p = .37). Additionally, no significant relationship existed between number of
employees and strategic planning score (r = -.066, p = .59). There was, however, a significant
positive relationship between the perceived degree to which the organization conducts strategic
planning and the perceived quality of the organization’s employees (r = .367, p < .002), the
perceived degree to which the organization’s leadership has knowledge of the planning process
(r = .330, p = .005), and the perceived available time the organization has to strategically plan (r
= .322, p = .004). Therefore, for all three relationships, a higher score was associated with a
higher strategic planning score (see Table 21).
Table 21 Relationships with the Perceived Degree to which the Organization Conducts Strategic
Planning
aPPMr p value bDescriptor
Perceived quality of the organization’s employees .367 .002 MA
Perceived degree to which the organization’s leadership has
knowledge of the planning process .330 .005 MA
Perceived available time the organization has to strategically
plan .322 .007 MA
Years the organization been in business -.109 .369 LA
Number of employees currently on the organization’s
payroll -.066 .588 NA
aPearson Product Moment Correlation Coefficients bDavis’ Descriptors (1971): .00 to .09 =
Negligible Association, .10 to .29 = Low Association, .30 to .49 = Moderate Association, .50
to .69 = Substantial Association, and .70 or higher = Very Strong Association
NA = Negligible Association, LA = Low Association, MA = Moderate Association, SA =
Substantial Association, VS = Very Strong Association
Objective Five
In order to determine if a model exists explaining a significant portion of the variance in
Louisiana small business owners' perceived degree to which the organization conducts strategic
planning, a stepwise regression analysis was conducted. To ensure that there were no excessive
levels of collinearity among the variables in this study. the variance inflation factors (VIF) were
examined. According to Hair et al. (2006), “A common cutoff threshold is a tolerance value
of .10 which corresponds to a VIF value of 10” (p. 230). The VIF values in this analysis ranged
from 1.028 to 1.404, indicating no excessive multicollinearity between factors. Bivariate
correlations were examined between all factors used as independent variables and “the perceived
degree to which the organization conducts strategic planning.” Of the nine factors, the three
perceptual factors had the highest correlations, ranging from .322 to .367. The remaining six
factors had lower correlations, with the exception of written plan, which had a correlation
of .319. These correlations are presented in Table 22.
Table 22 Correlations between the Perceived Degree to which the Organization Conducts
Strategic Planning and Selected Demographic and Perceptual Factors
N ar p value bDescriptor
Perceived quality of the organization’s employees 70 .367 .001 MA
Perceived degree to which the organization’s leadership
has knowledge of the planning process 70 .330 .003 MA
Perceived available time the organization has to
strategically plan 70 .322 .003 MA
Written long-term plan 70 .319 .004 MA
Positioned in the professional services industry 70 -.146 .114 LA
Legal structure of the business as Limited Liability
Corporation 70 -.140 .123 LA
Legal structure of the business as Subchapter S
Corporation 70 .112 .179 LA
Years the organization been in business 70 -.109 .184 LA
Number of employees currently on the organization’s
payroll. 70 -.066 .294 NA
aPearson Product Moment Correlation Coefficients
bDavis’ Descriptors (1971): .00 to .09 = Negligible Association, .10 to .29 = Low Association, .30
to .49 = Moderate Association, .50 to .69 = Substantial Association, and .70 or higher = Very
Strong Association
NA = Negligible Association, LA = Low Association, MA = Moderate Association, SA =
Substantial Association, VS = Very Strong Association
The first variable to enter the regression model was “the perceived quality of the
organization’s employees,” with an R square of .134, F(1,68) = 10.56, p = .002, explaining
13.4% of the variance in “the perceived degree to which the organization conducts strategic
planning.” The second variable entered was whether or not the organization had a “written
longterm plan,” which had an R square change of .073, F(1,67) = 6.17, p = .015, explaining an
additional 7.3% of the variance in “the perceived degree to which the organization conducts
strategic planning.” These two variables combined explained 20.7% of the variance in “the
perceived degree to which the organization conducts strategic planning.”
Two additional variables added one percent or more to the explained variance. However,
these two variables were individually non-significant. The first of the two non-significant
variables that entered the model was “the perceived degree to which the organization’s leadership
has knowledge of the planning process,” with an R square change of .026, F(1,66) = 2.28, p
= .136. This 2.6% increase in explained variance was individually not significant; however, it
was included in the model because it added one percent or more of explained variance while the
overall model remained significant. Similarly, whether or not the small business was positioned
in “professional services,” industry an R square change of .010, F(1,65) = .359, was added to the
model with a 1% increase in explained variance. This 1% increase in explained variance was
individually not significant; however, it also was included in the model because it added one
percent or more of explained variance while the overall model remained significant. These two
variables combined, though not individually significant, explained 3.6% of the variance in “the
perceived degree to which the organization conducts strategic planning.”
The total R square for this model was .244 and the four variables, in combination,
explained 24.4% of the variance in “the perceived degree to which the organization conducts
strategic planning.” The results of the regression indicate subjects with higher scores on “the
perceived quality of the organization’s employees” and “the perceived degree to which the
organization’s leadership has knowledge of the planning process” tended to have higher scores
on “the perceived degree to which the organization conducts strategic planning.” Furthermore,
those respondents who answered “yes” to whether or not they had a “written long-term plan”
tended to have a higher “perceived degree to which the organization conducts strategic planning”
score. Similarly, those respondents who indicated that their organizations were positioned in the
“professional services” industry tended to have lower “perceived degree to which the
organization conducts strategic planning” scores. The results of the regression analysis are
presented in Table 23.
Table 23 Multiple Regression Analysis of “The Perceived Degree to Which the Organization
Conducts Strategic Planning” on Selected Perceptual and Demographic Measures among
Louisiana Small Businesses
ANOVA
Sources of Variation df MS F P
Regression 4 2.010 5.238 .001
Residual 65 .384
Total 69
Model Summary
Model R Square R Square
Change
F Change Sig. F
Change
Standardized
Coefficients
Beta
Perceived quality of the
organization’s employees .134 .134 10.557 .002 .278
Written long-term plan .207 .073 6.171 .015 .216
Perceived degree to which
the organization’s
leadership has knowledge
of the planning process
.234 .026 2.278 .136 .177
Professional services .244 .010 .852 .359 -.101
Variables not in the Equation
Variables t P
The Perceived Available Time the
Organization Has to Strategically Plan .993 .325
Number of employees are currently on
the organization’s payroll -.892 .376
Legal structure of the business as
Subchapter S Corporation .519 .605
Years the organization been in business -.255 .800
Legal structure of the business as
Limited Liability Corporation -.172 .864
When analyzing the means, and standard deviation for each item of the Perceived Quality
of the Organization’s Employees Scale, the researcher found that “Our employees are skilled in
their craft” had the highest overall level of agreement, with a mean of 5.24 (SD=.65). The item
with the lowest level of agreement, “Our employees achieve maximum productivity with
minimum wasted effort or expense,” had a mean of 4.20 (SD=1.03). The reliability of the 12item
scale as measured by the use of Cronbach’s Alpha was a=.90. To aid in the interpretation of the
data, the researcher developed an interpretive scale for the responses to the 12 items. The
interpretive scale had the following categories: 5.5-6.0 = strongly agree, 4.5-5.49 = agree,
3.54.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.5 = disagree, and 1-1.5 = strongly
disagree. When the mean item responses were classified into two categories, 11 of the items were
in the “agree” category, with the remaining item in the “slightly agree” category. The means and
standard deviations for the items are reported in Table 11.
To further analyze the Perceived Quality of the Organization’s Employees Scale, the
researcher conducted a factor analysis to determine if underlying constructs existed in the scale.
Using the Shapiro-Wilks Test, the researcher first examined items for normality. Additionally, the
measure of sampling adequacy (MSA) was examined for both individual items and the overall
scale. The Kaiser-Meyer-Olkin Measure of Sampling Adequacy was .87. The lowest individual
item MSA was .80, which was higher than the minimum acceptable level of .50 (Hair et al.,
2006). All data met the assumptions for the use of factor analysis. Principal components analysis
with varimax rotation was used in conducting the factor analysis.
To determine the number of factors to be extracted, the researcher used both the Latent
Root criterion and the scree plot technique. The factor analysis was first computed without
restrictions on the number of factors extracted. The default minimum value of one was used on
the latent root measure. The scree plot was examined in order to identify the optimum number of
factors for extraction. The researcher identified the most pronounced bend in the scree plot curve.
From this examination, the optimum number of factors was determined to be two, plus or minus
one. Each of these three analyses was then examined for three criteria. First, each of the analyses
was examined to determine whether the items in each of the extracted factors met the minimum
acceptable loading criteria as identified by Hair et al. (2006). Hair et al. (2006) suggested that .30
would meet the criterion for exploratory research. Secondly, the analysis was examined for
inefficient factors or factors containing only one or two items. Constructs with only one item are
of little use to the researcher, as the purpose of the analysis is to identity underlying constructs in
the data. Lastly, the researcher examined each analysis for the presence of significant cross-
loadings. If an item loads significantly on multiple factors, it is possible that the respondents
perceived the item differently. Due to the factor loadings, the number of inefficient factors and
the number of substantial cross-loadings, the optimum number of factors was determined to be
one. The Eigenvalue for the factor was 5.94 and the factor explained 49.51% of the variance (see
Table 12).
Table 12 Factor Loadings of Items in the Perceived Quality of the Organization’s Employees
Scale
Component
Our employees contribute solutions. .837
Our employees are focused on customer solutions. .816
Our employees achieve maximum productivity with
minimum wasted effort or expense.
.795
Our employees are willing to learn from errors. .778
Our employees are focused on customer service. .716
Our employees follow instructions. .703
Our employees are skilled in their craft. .691
Our employees are willing to learn. .673
Our employees are rarely absent from work. .634
Our employees work well in teams. .618
Our employees show up on time .587
Our employees possess knowledge of the industry. .523
Note. Eigenvalue = 5.94, Percent of variance explained = 49.51%
The researcher computed an overall score for the perceived quality of the organization’s
employees based on the results of the factor analysis. This score was computed as the mean of
the 12 items in the scale. The mean Perceived Quality of the Organization’s Employees Score
was 4.95 (SD=.62), with values ranging from 3.00 to 6.00. The overall mean was in the
interpretive category of “agree.” When the Perceived Quality of the Organization’s Employees
Score was examined by response category, the category with the largest number of scores was
4.50-5.49 (n=37, 52.90%) (see Table 13).
Table 13 Perceived Quality of the Organization’s Employees Score
Score Frequency Percent
1.00-1.49 0 0.00
1.50-2.49 0 0.00
2.50-3.49 1 1.40
3.50-4.49 14 20.00
(Table 13 continued)
Score Frequency Percent
4.50-5.49 37 52.90
5.50-6.00 18 25.7
Total 70 100.10
Note. Mean = 4.95, Standard Deviation = .62
Note. The response scale used was 6 = strongly agree, 5 = agree, 4 = slightly agree, 3 = slightly
disagree, 2 = disagree, 1 = strongly agree. The interpretive scale used was 5.5-6.0 = strongly
agree, 4.5-5.49 = agree, 3.5-4.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.49 =
disagree, and 1.00-1.49 = strongly disagree. a SA = strongly agree, A = Agree, AS = slightly
agree, DS = slightly disagree, D = disagree, SD = strongly disagree
Perceived Degree to Which the Organization’s Leadership has Knowledge of the Planning
Process
As a component of the Perceived Obstacles to Strategic Planning Inventory, the
researcher designed the Perceived Degree to Which the Organization’s Leadership Has
Knowledge of the Planning Process scale. This approach relied on input from a panel of
academic experts, whose area of expertise included research and theory, and industry experts,
whose area of expertise included strategic planning consulting. The items developed were as
follows: 1) I know what a GAP analysis is, 2) I know what a Needs Analysis is, 3) I know what a
SWOT Analysis is, 4) I know what a vision and mission statement is, 5) I know how to write a
strategic plan, 6) I know what a succession plan is, and 7) I know how to measure performance.
Each item was measured using a 6-point Likert-type response scale. The response options were
strongly disagree, disagree, slightly disagree, slightly agree, agree, and strongly agree. A higher
rating indicated a higher level of agreement. A lower rating indicated a stronger level of
disagreement.
When analyzing the mean and standard deviation for each item of the Perceived Degree
to Which the Organization’s Leadership has Knowledge of the Planning Process Scale, the
researcher found that “I know what a vision and mission statement is” had the highest overall
level of agreement, with a mean of 5.34 (SD=.68). The item with the lowest level of agreement,
“I know what a SWOT Analysis is,” had a mean of 3.69 (SD=1.91). The reliability of the 7-item
scale as measured by the use of Cronbach’s Alpha was a=.83. To aid in the interpretation of the
data, the researcher developed an interpretive scale for the responses to the 7 items. The
interpretive scale had the following categories: 5.5-6.0 = strongly agree, 4.5-5.49 = agree,
3.54.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.5 = disagree, and 1-1.5 = strongly
disagree. When the mean item responses were classified into categories, four of the items were in
the “agree” category, and the other three were in the “slightly agree” category. The means and
standard deviation for each item are reported in Table 14.
Table 14 The Organization’s Leadership has Knowledge of the Planning Process among Small
Business / Managers in Louisiana
Mean Standard Interpretive
Deviation Scale Category
I know what a vision and mission statement is. 5.34 .68 A
I know how to measure performance. 4.71 .94 A
I know what a succession plan is. 4.67 1.29 A
I know how to write a strategic plan. 4.49 1.34 A
I know what a Needs Analysis is. 4.03 1.55 AS
I know what a GAP analysis is. 3.70 1.61 AS
I know what a SWOT Analysis is 3.69 1.91 AS
Note. The response scale used was 6 = strongly agree, 5 = agree, 4 = slightly agree, 3 = slightly
disagree, 2 = disagree, 1 = strongly agree. The interpretive scale used was 5.5-6.0 = strongly
agree, 4.5-5.49 = agree, 3.5-4.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.49 =
disagree, and 1.00-1.49 = strongly disagree. a SA = strongly agree, A = Agree, AS = slightly
agree, DS = slightly disagree, D = disagree, SD = strongly disagree
To further analyze the Perceived Degree to Which the Organization’s Leadership has
Knowledge of the Planning Process Scale, the researcher conducted a factor analysis to
determine if underlying constructs existed. Using the Shapiro-Wilks Test, the researcher first
examined items for normality. Additionally, the measure of sampling adequacy (MSA) was
examined for both individual items and the overall scale. The Kaiser-Meyer-Olkin Measure of
Sampling Adequacy was .78. The lowest individual item MSA was .69, which was higher than
the minimum acceptable level. All data met the assumptions for the use of a factor analysis.
Principal components analysis with varimax rotation was used in conducting the factor analysis.
To determine the number of factors to be extracted, the researcher used both the Latent
Root criterion and the scree plot technique. The factor analysis was first computed without
restrictions on the number of factors extracted. The default minimum value of one was used on
the latent root measure. The scree plot was examined in order to identify the optimum number of
factors for extraction. The researcher identified the most pronounced bend in the scree plot curve.
From this examination, the optimum number of factors was determined to be two, plus or minus
one. Each factor was then examined for three criteria. First, each extracted factor was examined
to determine whether it met the minimum acceptable loading criteria as identified by Hair et al.
(2006). Hair et al. (2006) suggested that .30 would meet the criterion for exploratory research.
Secondly, the analysis was examined for inefficient factors or factors containing only one or two
items. Constructs with only one item are of little use to the researcher, as the purpose of the
analysis is to identity underlying constructs in the data. Lastly, the researcher examined each
analysis for the presence of significant cross-loadings. If an item loads significantly on multiple
factors, it is possible that the respondents perceived the item differently. Due to the factor
loadings, the number of inefficient factors and the number of substantial cross-loadings, the
optimum number of factors was determined to be one. The Eigenvalue for the factor was 3.58
and the factor explained 51.12% of the variance (see Table 15).
The researcher computed the overall score for the perceived degree to which the
organization’s leadership has knowledge of the planning process based on the results of a factor
analysis. This score was computed as the mean of the 7 items in the scale.
Table 15 Factor Loadings of Items in the Perceived Degree To which the Organization’s
Leadership has Knowledge of the Planning Process Scale
Component
I know what a GAP analysis is. .853
I know what a Needs Analysis is. .819
I know what a SWOT Analysis is. .786
I know what a vision and mission statement is. .724
I know how to write a strategic plan. .636
I know what a succession plan is. .603
I know how to measure performance. .520
Note. Eigenvalue = 3.58, Percent of variance explained = 51.12%
The mean Perceived Degree to Which the Organization’s Leadership has Knowledge of
the Planning Process Score was 4.38 (SD=.97) with values ranging from 2.29 to 6.00. When the
Perceived Degree to Which the Organization’s Leadership has Knowledge of the Planning
Process Score was examined by response category, the category with the largest number of
scores was 4.50-5.49 (n=27, 38.60%) (see Table 16).
Table 16 Perceived Degree to which the Organization’s Leadership has Knowledge of the
Planning Process Scale
Score Frequency Percent
1.00-1.49 0 0.00
1.50-2.49 2 2.90
2.50-3.49 13 18.60
3.50-4.49 20 28.60
4.50-5.49 27 38.60
5.50-6.00 8 11.40
70 100.00
Note. Mean = 4.38, Standard Deviation = .97
Note. The response scale used was 6 = strongly agree, 5 = agree, 4 = slightly agree, 3 = slightly
disagree, 2 = disagree, 1 = strongly agree. The interpretive scale used was 5.5-6.0 = strongly
agree, 4.5-5.49 = agree, 3.5-4.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.49 =
disagree, and 1.00-1.49 = strongly disagree.
a SA = strongly agree, A = Agree, AS = slightly agree, DS = slightly disagree, D = disagree, SD =
strongly disagree
Perceived Available Time the Organization has to Strategically Plan
As a component of the Perceived Obstacles to Strategic Planning Inventory, the
researcher designed the Perceived Available Time the Organization has to Strategically Plan
scale. This approach relied on input from a panel of academic experts, whose area of expertise
included research and theory, and industry experts, whose area of expertise included strategic
planning consulting. The items developed were as follows: 1) Our organization’s leadership
allocates time every month for long-term planning, 2) Our organization has time to allocate for
long-term planning, 3) Our organization utilizes time set aside to plan long-term, 4) Our
organization is focused on day-to-day operations more than on long-term planning, 5) Our
organization is focused on customer needs more than on long-term planning, 6) Our organization
is focused on revenues more than on long-term planning, 7) Our organization is focused on
regulatory concerns more than on long-term planning, and 8) Our organization is focused on
logistical concerns more than on long-term planning. Each item was measured using a 6-point
Likert-type response scale. The response options were strongly disagree, disagree, slightly
disagree, slightly agree, agree, and strongly agree. The higher the point value, the higher the
perceived available time the organization has to strategically plan
When analyzing the mean and standard deviation for each item of the Perceived
Available Time the Organization Has to Strategically Plan Scale, the researcher found that “Our
organization is focused on customer needs more than on long-term planning” had the highest
overall level of agreement, with a mean of 4.79 (SD=.87). The item with the lowest level of
agreement, “Our organization’s leadership allocates time every month for long-term planning,”
had a mean of 3.36 (SD=1.63). The reliability of the 8-item scale as measured using the
Cronbach’s Alpha was a=.84. To aid in the interpretation of the data, the researcher developed an
interpretive scale for the responses to the eight items. The interpretive scale had the following
categories: 5.5-6.0 = strongly agree, 4.5-5.49 = agree, 3.5-4.49 = slightly agree, 2.50-3.49 =
slightly disagree, 1.50-2.5 = disagree, and 1-1.5 = strongly disagree. When the mean item
responses were classified into categories, two of the items were in the “agree” category, three
were in the “slightly agree” category, and the remaining three were located in the “slightly
disagree” category. The means and standard deviations for the items are reported in Table 17.
Table 17 The Perceived Available Time the Organization has to Strategically Plan among Small
Businesses Owners / Managers in Louisiana
Mean Standard
Deviation
Interpretive
Scale
Category
Our organization is focused on customer needs more
than on long-term planning. 4.79 .87 A
Our organization is focused on day-to-day operations
more than on long-term planning. 4.69 1.00 A
Our organization is focused on revenues more than on
long-term planning. 4.33 1.09 AS
Our organization has time to allocate for long-term
planning. 3.80 1.42 AS
Our organization is focused on logistical concerns
more than on long-term planning. 3.57 1.22 AS
Our organization is focused on regulatory concerns
more than on long-term planning. 3.47 1.40 DS
Our organization utilizes time set aside to plan long-term. 3.43 1.49 DS
Our organization’s leadership allocates time every month for
long-term planning. 3.36 1.63 DS
Note. The response scale used was 6 = strongly agree, 5 = agree, 4 = slightly agree, 3 = slightly
disagree, 2 = disagree, 1 = strongly agree. The interpretive scale used was 5.5-6.0 = strongly
agree, 4.5-5.49 = agree, 3.5-4.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.49 =
disagree, and 1.00-1.49 = strongly disagree.
a SA = strongly agree, A = Agree, AS = slightly agree, DS = slightly disagree, D = disagree, SD =
strongly disagree
To further analyze the Perceived Available Time the Organization Has to Strategically
Plan Scale, the researcher conducted a factor analysis to determine if underlying constructs
existed. Using the Shapiro-Wilks Test, the researcher first examined items for normality.
Additionally, the measure of sampling adequacy (MSA) was examined for both individual items
and the overall scale. The Kaiser-Meyer-Olkin MSA was .73. The lowest individual item MSA
was .67, which was higher than the minimum acceptable level of .50 as suggested by Hair et al.
(2006). All data met the assumptions for the use of factor analysis. Principal components analysis
with varimax rotation was used in conducting the factor analysis.
To determine the number of factors to be extracted, the researcher used both the Latent
Root criterion and the scree plot technique. The factor analysis was first computed without
restrictions on the number of factors extracted. The default minimum value of one was used on
the latent root measure. The scree plot was examined in order to identify the optimum number of
factors for extraction. The researcher identified the most pronounced bend in the scree plot curve.
From this examination, the optimum number of factors was determined to be two, plus or minus
one. Each factor was then examined for three criteria. First, each of analyses was examined to
determine whether the items in each of the extracted factors met the minimum acceptable loading
criteria as identified by Hair et al. (2006). Hair et al. (2006) suggested that .30 would meet the
criterion for exploratory research. Secondly, the analysis was examined for inefficient factors or
factors containing only one or two items. Constructs with only one item are of little use to the
researcher, as the purpose of the analysis is to identity underlying constructs in the data. Lastly,
the researcher examined each of the analyses for the presence of significant cross-loadings. If an
item loads significantly on multiple factors, it is possible that the respondents perceived the item
differently. Due to the factor loadings, the number of inefficient factors and the number of
substantial cross-loadings, the optimum number of factors was determined to be one. The
Eigenvalue for the factor was 3.80 and the factor explained 47.52% of the variance (see Table
18).
The researcher’s next step was to compute an overall Perceived Available Time the
Organization Has to Strategically Plan score. However, for items 1) Our organization’s
leadership allocates time every month for long-term planning, 2) Our organization has time to
Table 18 Factor Loadings of Items in the Perceived Available Time the Organization has to
Strategically Plan Scale
Component
Our organization utilizes time set aside to plan long-term. -.83
Our organization’s leadership allocates time every month for long-term
planning. -.80
Our organization has time to allocate for long-term planning. -.71
Our organization is focused on logistical concerns more than on long-term
planning. .70
Our organization is focused on customer needs more than on long-term
planning. .67
Our organization is focused on regulatory concerns more than on long-term
planning. .62
Our organization is focused on revenues more than on long-term planning. .61
Our organization is focused on day-to-day operations more than on long-term
planning. .54
Note. Eigenvalue = 3.80, Percent of variance explained = 47.52%
allocate for long-term planning, and 3) Our organization utilizes time set aside to plan
long-term, a high level of agreement indicated a positive perception of available time to
strategically plan. For the remaining items, 4) Our organization is focused on day-to-day
operations more than on long-term planning, 5) Our organization is focused on customer needs
more than on long-term planning, 6) Our organization is focused on revenues more than on
longterm planning, 7) Our organization is focused on regulatory concerns more than on long-
term planning, and 8) Our organization is focused on logistical concerns more than on long-term
planning, a low level of agreement, or disagreement, indicated a positive perception of available
time to strategically plan. Due to the reverse wording of a portion of the items, computing a
factor score would have been ineffective. Therefore, the items were recoded to reflect a higher
value, consistent with other items that indicated a positive response to planning. Specifically, the
reverse worded items were coded so that Strongly Disagree = 6, Disagree = 5, Slightly Disagree
= 4, Slightly Agree = 3, Agree = 2, and Strongly Agree = 1. The value for each item was coded so
that the higher value indicated the more positive response. The item with the most positive
response was Our organization has time to allocate for long-term planning (Mean=3.80,
SD=1.42). The item with the lowest mean response (most negative) was Our organization is
focused on customer needs more than on long-term planning (Mean=2.21, SD=.87). Recorded
mean item response scores are presented in Table 19.
Table 19 Means and Standard Deviations for Reverse Coded Items in Perceived Available Time
the Organization has to Strategically Plan Scale
Mean Standard
Deviation
Interpretive
Scorea
Our organization has time to allocate for long-term 3.80 1.42 PS
planning.b
Our organization is focused on regulatory concerns
more than on long-term planning.b 3.53 1.40 PS
Our organization is focused on logistical concerns
more than on long-term planning. b 3.43 1.22 NS
Our organization utilizes time set aside to plan
longterm. b 3.43 1.49 NS
Our organization’s leadership allocates time every
month for long-term planning. b 3.36 1.63 NS
Our organization is focused on revenues more than
on long-term planning. b 2.67 1.09 NS
Our organization is focused on day-to-day
operations more than on long-term planning. b 2.31 1.00 N
Our organization is focused on customer needs more
than on long-term planning. b 2.21 .87 N
Note. The original response scale used was 6 = Strongly Disagree, 5 = Disagree, 4 = Slightly
Disagree, 3 = Slightly Agree, 2 = Agree, 1 = Strongly Agree. The interpretive scale used was 5.5-
6.0 = strongly positive, 4.5-5.49 = positive, 3.5-4.49 = slightly positive, 2.50-3.49 = negative,
1.50-2.49 = slightly negative, and 1.00-1.49 = strongly negative.
aSP = strongly positive, P = positive, SP = slightly positive, N = negative, NS = slightly
negative, SN = strongly negative
bReverse coded item scale recoded as follows: 1= SA, 2 = A, 3 = AS, 4 = SD, 5 = D, 6 =
DS Using the consistently coded items in the single factor identified in the factor analysis,
the researcher computed the perceived available time the organization has to strategically plan
score, which was the mean of the eight items in the factor. The mean score was 3.09 (SD=0.88),
with values ranging from 1.25 to 5.13. These scores were grouped into response categories, as
shown in Table 22. When the Perceived Available Time the Organization Has to Strategically
Plan Scale was examined by response category, the category with the largest number of scores
was 2.50-3.49 (n=26, 41.40%) (see Table 20).
Table 20 Perceived Available Time the Organization has to Strategically Plan Scale
Score Frequency Percent
1.00-1.49 3 4.29
1.50-2.49 16 22.90
2.50-3.49 26 37.14
3.50-4.49 21 30.00
4.50-5.49 4 5.70
5.50-6.00 0 0.00
Total 70 100.00
Note. Mean = 3.09 Standard Deviation = .88
Note. The response scale used was 6 = Strongly Disagree, 5 = Disagree, 4 = Slightly Disagree, 3
= Slightly Agree, 2 = Agree, 1 = Strongly Agree. The interpretive scale used was 5.5-6.0 =
strongly disagree, 4.5-5.49 = disagree, 3.5-4.49 = slightly disagree, 2.50-3.49 = slightly agree,
1.50-2.49 = agree, and 1.0-1.49 = strongly agree. a SA = strongly agree, A = Agree, AS = slightly
agree, DS = slightly disagree, D = disagree, SD = strongly disagree
Objective Four
The fourth objective of this study is to determine if a relationship exists between
Louisiana small business owners' perceived obstacles to strategic planning and each of the
demographic and perceived obstacles to planning measures included in the study. The first of
these demographic measures was the industry in which the organization is positioned. This
measure included the 24 categories of industries identified by the Louisiana Small Business
Association. However, with only 70 respondents in the study and 24 possible responses, the
number of responses in most of the categories were too small to enable a comparison on the
strategic planning score variable. Only one category, Professional Services, had a sufficient
number of responses to allow the examination of the proposed relationship. In addition, since this
variable was nominal in nature, a comparative analysis was judged to be preferable to the use of
correlational statistics. Therefore, since only one category had sufficient numbers for analysis, a
t-test was used to compare those respondents that reported Professional Services with other
respondents. The comparative statistic was chosen over a correlation coefficient for the ease of
interpretation of the findings. The mean strategic planning score for all respondents other than
Professional Services was 4.74 (SD=.71). The mean strategic planning score for Professional
Services industries was 4.52 (SD=.65). Levene’s Test for equality of variances was not
significant (F=.15, p=.71), indicating that the assumption of equal variances was met. Therefore,
the pooled variance estimate was used in computing the t-test. Based on this test, no significant
difference was found in mean strategic planning score between the two groups (t68=1.22, p=.23).
The second variable examined for a relationship with the strategic planning score was
“legal structure of the business.” The Louisiana Small Business Association identifies five
categories of legal business structure represented in the state of Louisiana. Of these five
categories, only two had sufficient respondents to enable the examination of their relationship
with the “perceived degree to which the organization conducts strategic planning.” Of the 70
respondents, 38 self-identified as a Limited Liability Corporation. A t-test was conducted to
examine whether or not differences existed in mean strategic planning score between
respondents identifying as a Limited Liability Corporation and all other types of legal structure.
The mean strategic planning score for Limited Liability Corporations was 4.58 (SD=.75). The
mean strategic planning score for non-Limited Liability Corporations was 4.77 (SD=.61).
Levene’s Test for equality of variances was not significant (F=.18, p=.67), indicating that the
assumption of equal variances was met. Therefore, the pooled variance estimate was used in
computing the t-test. Based on this test, no significant difference was found in mean strategic
planning score between the two groups (t68=1.17, p=.25).
A second t-test was conducted to examine whether or not differences existed in mean
strategic planning score between respondents identifying as a Subchapter S Corporation (S-Corp)
and all other types of legal structure. The mean strategic planning score for Subchapter S
Corporations was 4.80 (SD=.62). The mean strategic planning score for non-Subchapter S
Corporations was 4.62 (SD=.72). Levene’s Test for equality of variances was not significant
(F=.18, p=.67), indicating that the assumption of equal variances was met. Therefore, the pooled
variance estimate was used in computing the t-test. Based on this test, no significant difference
was found in mean strategic planning score between the two groups (t68=-.93, p=.36). No other
statistical tests were conducted on small business legal structure because the sample size for each
of the remaining categories was too small to conduct an analysis.
A third t-test was conducted to examine whether or not differences existed in mean
strategic planning score between respondents who identified as having or not having a written
long-term plan. The mean strategic planning score for respondents who had a written long-term
plan was 4.98 (SD=.62). The mean strategic planning score for respondents who did not have a
written long-term plan was 4.51 (SD=.68). Levene’s Test for equality of variances was not
significant (F=.07, p=.80), indicating that the assumption of equal variances was met. Therefore,
the pooled variance estimate was used in computing the t-test. Based on this test, a significant
difference was found in mean strategic planning score between the two groups (t68 = 2.773, p
= .007). Therefore, those respondents who said they had a written long-term plan had higher
strategic planning scores then those who did not.
Pearson Product Moment Correlation Coefficients (PPMr) were calculated between
strategic planning score and the demographic variables measured on a continuous scale of
measurement. These included years the organization has been in business and number of
employees on the payroll, as well as variables that measured perceived obstacles to strategic
planning. No significant relationship existed between years in business and strategic planning
score (r = -.109, p = .37). Additionally, no significant relationship existed between number of
employees and strategic planning score (r = -.066, p = .59). There was, however, a significant
positive relationship between the perceived degree to which the organization conducts strategic
planning and the perceived quality of the organization’s employees (r = .367, p < .002), the
perceived degree to which the organization’s leadership has knowledge of the planning process
(r = .330, p = .005), and the perceived available time the organization has to strategically plan (r
= .322, p = .004). Therefore, for all three relationships, a higher score was associated with a
higher strategic planning score (see Table 21).
Table 21 Relationships with the Perceived Degree to which the Organization Conducts Strategic
Planning
aPPMr p value bDescriptor
Perceived quality of the organization’s employees .367 .002 MA
Perceived degree to which the organization’s leadership has
knowledge of the planning process .330 .005 MA
Perceived available time the organization has to strategically
plan .322 .007 MA
Years the organization been in business -.109 .369 LA
Number of employees currently on the organization’s
payroll -.066 .588 NA
aPearson Product Moment Correlation Coefficients bDavis’ Descriptors (1971): .00 to .09 =
Negligible Association, .10 to .29 = Low Association, .30 to .49 = Moderate Association, .50
to .69 = Substantial Association, and .70 or higher = Very Strong Association
NA = Negligible Association, LA = Low Association, MA = Moderate Association, SA =
Substantial Association, VS = Very Strong Association
Objective Five
In order to determine if a model exists explaining a significant portion of the variance in
Louisiana small business owners' perceived degree to which the organization conducts strategic
planning, a stepwise regression analysis was conducted. To ensure that there were no excessive
levels of collinearity among the variables in this study. the variance inflation factors (VIF) were
examined. According to Hair et al. (2006), “A common cutoff threshold is a tolerance value
of .10 which corresponds to a VIF value of 10” (p. 230). The VIF values in this analysis ranged
from 1.028 to 1.404, indicating no excessive multicollinearity between factors. Bivariate
correlations were examined between all factors used as independent variables and “the perceived
degree to which the organization conducts strategic planning.” Of the nine factors, the three
perceptual factors had the highest correlations, ranging from .322 to .367. The remaining six
factors had lower correlations, with the exception of written plan, which had a correlation
of .319. These correlations are presented in Table 22.
Table 22 Correlations between the Perceived Degree to which the Organization Conducts
Strategic Planning and Selected Demographic and Perceptual Factors
N ar p value bDescriptor
Perceived quality of the organization’s employees 70 .367 .001 MA
Perceived degree to which the organization’s leadership
has knowledge of the planning process 70 .330 .003 MA
Perceived available time the organization has to
strategically plan 70 .322 .003 MA
Written long-term plan 70 .319 .004 MA
Positioned in the professional services industry 70 -.146 .114 LA
Legal structure of the business as Limited Liability
Corporation 70 -.140 .123 LA
Legal structure of the business as Subchapter S
Corporation 70 .112 .179 LA
Years the organization been in business 70 -.109 .184 LA
Number of employees currently on the organization’s
payroll. 70 -.066 .294 NA
aPearson Product Moment Correlation Coefficients
bDavis’ Descriptors (1971): .00 to .09 = Negligible Association, .10 to .29 = Low Association, .30
to .49 = Moderate Association, .50 to .69 = Substantial Association, and .70 or higher = Very
Strong Association
NA = Negligible Association, LA = Low Association, MA = Moderate Association, SA =
Substantial Association, VS = Very Strong Association
The first variable to enter the regression model was “the perceived quality of the
organization’s employees,” with an R square of .134, F(1,68) = 10.56, p = .002, explaining
13.4% of the variance in “the perceived degree to which the organization conducts strategic
planning.” The second variable entered was whether or not the organization had a “written
longterm plan,” which had an R square change of .073, F(1,67) = 6.17, p = .015, explaining an
additional 7.3% of the variance in “the perceived degree to which the organization conducts
strategic planning.” These two variables combined explained 20.7% of the variance in “the
perceived degree to which the organization conducts strategic planning.”
Two additional variables added one percent or more to the explained variance. However,
these two variables were individually non-significant. The first of the two non-significant
variables that entered the model was “the perceived degree to which the organization’s leadership
has knowledge of the planning process,” with an R square change of .026, F(1,66) = 2.28, p
= .136. This 2.6% increase in explained variance was individually not significant; however, it
was included in the model because it added one percent or more of explained variance while the
overall model remained significant. Similarly, whether or not the small business was positioned
in “professional services,” industry an R square change of .010, F(1,65) = .359, was added to the
model with a 1% increase in explained variance. This 1% increase in explained variance was
individually not significant; however, it also was included in the model because it added one
percent or more of explained variance while the overall model remained significant. These two
variables combined, though not individually significant, explained 3.6% of the variance in “the
perceived degree to which the organization conducts strategic planning.”
The total R square for this model was .244 and the four variables, in combination,
explained 24.4% of the variance in “the perceived degree to which the organization conducts
strategic planning.” The results of the regression indicate subjects with higher scores on “the
perceived quality of the organization’s employees” and “the perceived degree to which the
organization’s leadership has knowledge of the planning process” tended to have higher scores
on “the perceived degree to which the organization conducts strategic planning.” Furthermore,
those respondents who answered “yes” to whether or not they had a “written long-term plan”
tended to have a higher “perceived degree to which the organization conducts strategic planning”
score. Similarly, those respondents who indicated that their organizations were positioned in the
“professional services” industry tended to have lower “perceived degree to which the
organization conducts strategic planning” scores. The results of the regression analysis are
presented in Table 23.
Table 23 Multiple Regression Analysis of “The Perceived Degree to Which the Organization
Conducts Strategic Planning” on Selected Perceptual and Demographic Measures among
Louisiana Small Businesses
ANOVA
Sources of Variation df MS F P
Regression 4 2.010 5.238 .001
Residual 65 .384
Total 69
Model Summary
Model R Square R Square
Change
F Change Sig. F
Change
Standardized
Coefficients
Beta
Perceived quality of the
organization’s employees .134 .134 10.557 .002 .278
Written long-term plan .207 .073 6.171 .015 .216
Perceived degree to which
the organization’s
leadership has knowledge
of the planning process
.234 .026 2.278 .136 .177
Professional services .244 .010 .852 .359 -.101
Variables not in the Equation
Variables t P
The Perceived Available Time the
Organization Has to Strategically Plan .993 .325
Number of employees are currently on
the organization’s payroll -.892 .376
Legal structure of the business as
Subchapter S Corporation .519 .605
Years the organization been in business -.255 .800
Legal structure of the business as
Limited Liability Corporation -.172 .864
When analyzing the means, and standard deviation for each item of the Perceived Quality
of the Organization’s Employees Scale, the researcher found that “Our employees are skilled in
their craft” had the highest overall level of agreement, with a mean of 5.24 (SD=.65). The item
with the lowest level of agreement, “Our employees achieve maximum productivity with
minimum wasted effort or expense,” had a mean of 4.20 (SD=1.03). The reliability of the 12item
scale as measured by the use of Cronbach’s Alpha was a=.90. To aid in the interpretation of the
data, the researcher developed an interpretive scale for the responses to the 12 items. The
interpretive scale had the following categories: 5.5-6.0 = strongly agree, 4.5-5.49 = agree,
3.54.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.5 = disagree, and 1-1.5 = strongly
disagree. When the mean item responses were classified into two categories, 11 of the items were
in the “agree” category, with the remaining item in the “slightly agree” category. The means and
standard deviations for the items are reported in Table 11.
To further analyze the Perceived Quality of the Organization’s Employees Scale, the
researcher conducted a factor analysis to determine if underlying constructs existed in the scale.
Using the Shapiro-Wilks Test, the researcher first examined items for normality. Additionally, the
measure of sampling adequacy (MSA) was examined for both individual items and the overall
scale. The Kaiser-Meyer-Olkin Measure of Sampling Adequacy was .87. The lowest individual
item MSA was .80, which was higher than the minimum acceptable level of .50 (Hair et al.,
2006). All data met the assumptions for the use of factor analysis. Principal components analysis
with varimax rotation was used in conducting the factor analysis.
To determine the number of factors to be extracted, the researcher used both the Latent
Root criterion and the scree plot technique. The factor analysis was first computed without
restrictions on the number of factors extracted. The default minimum value of one was used on
the latent root measure. The scree plot was examined in order to identify the optimum number of
factors for extraction. The researcher identified the most pronounced bend in the scree plot curve.
From this examination, the optimum number of factors was determined to be two, plus or minus
one. Each of these three analyses was then examined for three criteria. First, each of the analyses
was examined to determine whether the items in each of the extracted factors met the minimum
acceptable loading criteria as identified by Hair et al. (2006). Hair et al. (2006) suggested that .30
would meet the criterion for exploratory research. Secondly, the analysis was examined for
inefficient factors or factors containing only one or two items. Constructs with only one item are
of little use to the researcher, as the purpose of the analysis is to identity underlying constructs in
the data. Lastly, the researcher examined each analysis for the presence of significant cross-
loadings. If an item loads significantly on multiple factors, it is possible that the respondents
perceived the item differently. Due to the factor loadings, the number of inefficient factors and
the number of substantial cross-loadings, the optimum number of factors was determined to be
one. The Eigenvalue for the factor was 5.94 and the factor explained 49.51% of the variance (see
Table 12).
Table 12 Factor Loadings of Items in the Perceived Quality of the Organization’s Employees
Scale
Component
Our employees contribute solutions. .837
Our employees are focused on customer solutions. .816
Our employees achieve maximum productivity with
minimum wasted effort or expense.
.795
Our employees are willing to learn from errors. .778
Our employees are focused on customer service. .716
Our employees follow instructions. .703
Our employees are skilled in their craft. .691
Our employees are willing to learn. .673
Our employees are rarely absent from work. .634
Our employees work well in teams. .618
Our employees show up on time .587
Our employees possess knowledge of the industry. .523
Note. Eigenvalue = 5.94, Percent of variance explained = 49.51%
The researcher computed an overall score for the perceived quality of the organization’s
employees based on the results of the factor analysis. This score was computed as the mean of
the 12 items in the scale. The mean Perceived Quality of the Organization’s Employees Score
was 4.95 (SD=.62), with values ranging from 3.00 to 6.00. The overall mean was in the
interpretive category of “agree.” When the Perceived Quality of the Organization’s Employees
Score was examined by response category, the category with the largest number of scores was
4.50-5.49 (n=37, 52.90%) (see Table 13).
Table 13 Perceived Quality of the Organization’s Employees Score
Score Frequency Percent
1.00-1.49 0 0.00
1.50-2.49 0 0.00
2.50-3.49 1 1.40
3.50-4.49 14 20.00
(Table 13 continued)
Score Frequency Percent
4.50-5.49 37 52.90
5.50-6.00 18 25.7
Total 70 100.10
Note. Mean = 4.95, Standard Deviation = .62
Note. The response scale used was 6 = strongly agree, 5 = agree, 4 = slightly agree, 3 = slightly
disagree, 2 = disagree, 1 = strongly agree. The interpretive scale used was 5.5-6.0 = strongly
agree, 4.5-5.49 = agree, 3.5-4.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.49 =
disagree, and 1.00-1.49 = strongly disagree. a SA = strongly agree, A = Agree, AS = slightly
agree, DS = slightly disagree, D = disagree, SD = strongly disagree
Perceived Degree to Which the Organization’s Leadership has Knowledge of the Planning
Process
As a component of the Perceived Obstacles to Strategic Planning Inventory, the
researcher designed the Perceived Degree to Which the Organization’s Leadership Has
Knowledge of the Planning Process scale. This approach relied on input from a panel of
academic experts, whose area of expertise included research and theory, and industry experts,
whose area of expertise included strategic planning consulting. The items developed were as
follows: 1) I know what a GAP analysis is, 2) I know what a Needs Analysis is, 3) I know what a
SWOT Analysis is, 4) I know what a vision and mission statement is, 5) I know how to write a
strategic plan, 6) I know what a succession plan is, and 7) I know how to measure performance.
Each item was measured using a 6-point Likert-type response scale. The response options were
strongly disagree, disagree, slightly disagree, slightly agree, agree, and strongly agree. A higher
rating indicated a higher level of agreement. A lower rating indicated a stronger level of
disagreement.
When analyzing the mean and standard deviation for each item of the Perceived Degree
to Which the Organization’s Leadership has Knowledge of the Planning Process Scale, the
researcher found that “I know what a vision and mission statement is” had the highest overall
level of agreement, with a mean of 5.34 (SD=.68). The item with the lowest level of agreement,
“I know what a SWOT Analysis is,” had a mean of 3.69 (SD=1.91). The reliability of the 7-item
scale as measured by the use of Cronbach’s Alpha was a=.83. To aid in the interpretation of the
data, the researcher developed an interpretive scale for the responses to the 7 items. The
interpretive scale had the following categories: 5.5-6.0 = strongly agree, 4.5-5.49 = agree,
3.54.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.5 = disagree, and 1-1.5 = strongly
disagree. When the mean item responses were classified into categories, four of the items were in
the “agree” category, and the other three were in the “slightly agree” category. The means and
standard deviation for each item are reported in Table 14.
Table 14 The Organization’s Leadership has Knowledge of the Planning Process among Small
Business / Managers in Louisiana
Mean Standard Interpretive
Deviation Scale Category
I know what a vision and mission statement is. 5.34 .68 A
I know how to measure performance. 4.71 .94 A
I know what a succession plan is. 4.67 1.29 A
I know how to write a strategic plan. 4.49 1.34 A
I know what a Needs Analysis is. 4.03 1.55 AS
I know what a GAP analysis is. 3.70 1.61 AS
I know what a SWOT Analysis is 3.69 1.91 AS
Note. The response scale used was 6 = strongly agree, 5 = agree, 4 = slightly agree, 3 = slightly
disagree, 2 = disagree, 1 = strongly agree. The interpretive scale used was 5.5-6.0 = strongly
agree, 4.5-5.49 = agree, 3.5-4.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.49 =
disagree, and 1.00-1.49 = strongly disagree. a SA = strongly agree, A = Agree, AS = slightly
agree, DS = slightly disagree, D = disagree, SD = strongly disagree
To further analyze the Perceived Degree to Which the Organization’s Leadership has
Knowledge of the Planning Process Scale, the researcher conducted a factor analysis to
determine if underlying constructs existed. Using the Shapiro-Wilks Test, the researcher first
examined items for normality. Additionally, the measure of sampling adequacy (MSA) was
examined for both individual items and the overall scale. The Kaiser-Meyer-Olkin Measure of
Sampling Adequacy was .78. The lowest individual item MSA was .69, which was higher than
the minimum acceptable level. All data met the assumptions for the use of a factor analysis.
Principal components analysis with varimax rotation was used in conducting the factor analysis.
To determine the number of factors to be extracted, the researcher used both the Latent
Root criterion and the scree plot technique. The factor analysis was first computed without
restrictions on the number of factors extracted. The default minimum value of one was used on
the latent root measure. The scree plot was examined in order to identify the optimum number of
factors for extraction. The researcher identified the most pronounced bend in the scree plot curve.
From this examination, the optimum number of factors was determined to be two, plus or minus
one. Each factor was then examined for three criteria. First, each extracted factor was examined
to determine whether it met the minimum acceptable loading criteria as identified by Hair et al.
(2006). Hair et al. (2006) suggested that .30 would meet the criterion for exploratory research.
Secondly, the analysis was examined for inefficient factors or factors containing only one or two
items. Constructs with only one item are of little use to the researcher, as the purpose of the
analysis is to identity underlying constructs in the data. Lastly, the researcher examined each
analysis for the presence of significant cross-loadings. If an item loads significantly on multiple
factors, it is possible that the respondents perceived the item differently. Due to the factor
loadings, the number of inefficient factors and the number of substantial cross-loadings, the
optimum number of factors was determined to be one. The Eigenvalue for the factor was 3.58
and the factor explained 51.12% of the variance (see Table 15).
The researcher computed the overall score for the perceived degree to which the
organization’s leadership has knowledge of the planning process based on the results of a factor
analysis. This score was computed as the mean of the 7 items in the scale.
Table 15 Factor Loadings of Items in the Perceived Degree To which the Organization’s
Leadership has Knowledge of the Planning Process Scale
Component
I know what a GAP analysis is. .853
I know what a Needs Analysis is. .819
I know what a SWOT Analysis is. .786
I know what a vision and mission statement is. .724
I know how to write a strategic plan. .636
I know what a succession plan is. .603
I know how to measure performance. .520
Note. Eigenvalue = 3.58, Percent of variance explained = 51.12%
The mean Perceived Degree to Which the Organization’s Leadership has Knowledge of
the Planning Process Score was 4.38 (SD=.97) with values ranging from 2.29 to 6.00. When the
Perceived Degree to Which the Organization’s Leadership has Knowledge of the Planning
Process Score was examined by response category, the category with the largest number of
scores was 4.50-5.49 (n=27, 38.60%) (see Table 16).
Table 16 Perceived Degree to which the Organization’s Leadership has Knowledge of the
Planning Process Scale
Score Frequency Percent
1.00-1.49 0 0.00
1.50-2.49 2 2.90
2.50-3.49 13 18.60
3.50-4.49 20 28.60
4.50-5.49 27 38.60
5.50-6.00 8 11.40
70 100.00
Note. Mean = 4.38, Standard Deviation = .97
Note. The response scale used was 6 = strongly agree, 5 = agree, 4 = slightly agree, 3 = slightly
disagree, 2 = disagree, 1 = strongly agree. The interpretive scale used was 5.5-6.0 = strongly
agree, 4.5-5.49 = agree, 3.5-4.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.49 =
disagree, and 1.00-1.49 = strongly disagree.
a SA = strongly agree, A = Agree, AS = slightly agree, DS = slightly disagree, D = disagree, SD =
strongly disagree
Perceived Available Time the Organization has to Strategically Plan
As a component of the Perceived Obstacles to Strategic Planning Inventory, the
researcher designed the Perceived Available Time the Organization has to Strategically Plan
scale. This approach relied on input from a panel of academic experts, whose area of expertise
included research and theory, and industry experts, whose area of expertise included strategic
planning consulting. The items developed were as follows: 1) Our organization’s leadership
allocates time every month for long-term planning, 2) Our organization has time to allocate for
long-term planning, 3) Our organization utilizes time set aside to plan long-term, 4) Our
organization is focused on day-to-day operations more than on long-term planning, 5) Our
organization is focused on customer needs more than on long-term planning, 6) Our organization
is focused on revenues more than on long-term planning, 7) Our organization is focused on
regulatory concerns more than on long-term planning, and 8) Our organization is focused on
logistical concerns more than on long-term planning. Each item was measured using a 6-point
Likert-type response scale. The response options were strongly disagree, disagree, slightly
disagree, slightly agree, agree, and strongly agree. The higher the point value, the higher the
perceived available time the organization has to strategically plan
When analyzing the mean and standard deviation for each item of the Perceived
Available Time the Organization Has to Strategically Plan Scale, the researcher found that “Our
organization is focused on customer needs more than on long-term planning” had the highest
overall level of agreement, with a mean of 4.79 (SD=.87). The item with the lowest level of
agreement, “Our organization’s leadership allocates time every month for long-term planning,”
had a mean of 3.36 (SD=1.63). The reliability of the 8-item scale as measured using the
Cronbach’s Alpha was a=.84. To aid in the interpretation of the data, the researcher developed an
interpretive scale for the responses to the eight items. The interpretive scale had the following
categories: 5.5-6.0 = strongly agree, 4.5-5.49 = agree, 3.5-4.49 = slightly agree, 2.50-3.49 =
slightly disagree, 1.50-2.5 = disagree, and 1-1.5 = strongly disagree. When the mean item
responses were classified into categories, two of the items were in the “agree” category, three
were in the “slightly agree” category, and the remaining three were located in the “slightly
disagree” category. The means and standard deviations for the items are reported in Table 17.
Table 17 The Perceived Available Time the Organization has to Strategically Plan among Small
Businesses Owners / Managers in Louisiana
Mean Standard
Deviation
Interpretive
Scale
Category
Our organization is focused on customer needs more
than on long-term planning. 4.79 .87 A
Our organization is focused on day-to-day operations
more than on long-term planning. 4.69 1.00 A
Our organization is focused on revenues more than on
long-term planning. 4.33 1.09 AS
Our organization has time to allocate for long-term
planning. 3.80 1.42 AS
Our organization is focused on logistical concerns
more than on long-term planning. 3.57 1.22 AS
Our organization is focused on regulatory concerns
more than on long-term planning. 3.47 1.40 DS
Our organization utilizes time set aside to plan long-term. 3.43 1.49 DS
Our organization’s leadership allocates time every month for
long-term planning. 3.36 1.63 DS
Note. The response scale used was 6 = strongly agree, 5 = agree, 4 = slightly agree, 3 = slightly
disagree, 2 = disagree, 1 = strongly agree. The interpretive scale used was 5.5-6.0 = strongly
agree, 4.5-5.49 = agree, 3.5-4.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.49 =
disagree, and 1.00-1.49 = strongly disagree.
a SA = strongly agree, A = Agree, AS = slightly agree, DS = slightly disagree, D = disagree, SD =
strongly disagree
To further analyze the Perceived Available Time the Organization Has to Strategically
Plan Scale, the researcher conducted a factor analysis to determine if underlying constructs
existed. Using the Shapiro-Wilks Test, the researcher first examined items for normality.
Additionally, the measure of sampling adequacy (MSA) was examined for both individual items
and the overall scale. The Kaiser-Meyer-Olkin MSA was .73. The lowest individual item MSA
was .67, which was higher than the minimum acceptable level of .50 as suggested by Hair et al.
(2006). All data met the assumptions for the use of factor analysis. Principal components analysis
with varimax rotation was used in conducting the factor analysis.
To determine the number of factors to be extracted, the researcher used both the Latent
Root criterion and the scree plot technique. The factor analysis was first computed without
restrictions on the number of factors extracted. The default minimum value of one was used on
the latent root measure. The scree plot was examined in order to identify the optimum number of
factors for extraction. The researcher identified the most pronounced bend in the scree plot curve.
From this examination, the optimum number of factors was determined to be two, plus or minus
one. Each factor was then examined for three criteria. First, each of analyses was examined to
determine whether the items in each of the extracted factors met the minimum acceptable loading
criteria as identified by Hair et al. (2006). Hair et al. (2006) suggested that .30 would meet the
criterion for exploratory research. Secondly, the analysis was examined for inefficient factors or
factors containing only one or two items. Constructs with only one item are of little use to the
researcher, as the purpose of the analysis is to identity underlying constructs in the data. Lastly,
the researcher examined each of the analyses for the presence of significant cross-loadings. If an
item loads significantly on multiple factors, it is possible that the respondents perceived the item
differently. Due to the factor loadings, the number of inefficient factors and the number of
substantial cross-loadings, the optimum number of factors was determined to be one. The
Eigenvalue for the factor was 3.80 and the factor explained 47.52% of the variance (see Table
18).
The researcher’s next step was to compute an overall Perceived Available Time the
Organization Has to Strategically Plan score. However, for items 1) Our organization’s
leadership allocates time every month for long-term planning, 2) Our organization has time to
Table 18 Factor Loadings of Items in the Perceived Available Time the Organization has to
Strategically Plan Scale
Component
Our organization utilizes time set aside to plan long-term. -.83
Our organization’s leadership allocates time every month for long-term
planning. -.80
Our organization has time to allocate for long-term planning. -.71
Our organization is focused on logistical concerns more than on long-term
planning. .70
Our organization is focused on customer needs more than on long-term
planning. .67
Our organization is focused on regulatory concerns more than on long-term
planning. .62
Our organization is focused on revenues more than on long-term planning. .61
Our organization is focused on day-to-day operations more than on long-term
planning. .54
Note. Eigenvalue = 3.80, Percent of variance explained = 47.52%
allocate for long-term planning, and 3) Our organization utilizes time set aside to plan
long-term, a high level of agreement indicated a positive perception of available time to
strategically plan. For the remaining items, 4) Our organization is focused on day-to-day
operations more than on long-term planning, 5) Our organization is focused on customer needs
more than on long-term planning, 6) Our organization is focused on revenues more than on
longterm planning, 7) Our organization is focused on regulatory concerns more than on long-
term planning, and 8) Our organization is focused on logistical concerns more than on long-term
planning, a low level of agreement, or disagreement, indicated a positive perception of available
time to strategically plan. Due to the reverse wording of a portion of the items, computing a
factor score would have been ineffective. Therefore, the items were recoded to reflect a higher
value, consistent with other items that indicated a positive response to planning. Specifically, the
reverse worded items were coded so that Strongly Disagree = 6, Disagree = 5, Slightly Disagree
= 4, Slightly Agree = 3, Agree = 2, and Strongly Agree = 1. The value for each item was coded so
that the higher value indicated the more positive response. The item with the most positive
response was Our organization has time to allocate for long-term planning (Mean=3.80,
SD=1.42). The item with the lowest mean response (most negative) was Our organization is
focused on customer needs more than on long-term planning (Mean=2.21, SD=.87). Recorded
mean item response scores are presented in Table 19.
Table 19 Means and Standard Deviations for Reverse Coded Items in Perceived Available Time
the Organization has to Strategically Plan Scale
Mean Standard
Deviation
Interpretive
Scorea
Our organization has time to allocate for long-term 3.80 1.42 PS
planning.b
Our organization is focused on regulatory concerns
more than on long-term planning.b 3.53 1.40 PS
Our organization is focused on logistical concerns
more than on long-term planning. b 3.43 1.22 NS
Our organization utilizes time set aside to plan
longterm. b 3.43 1.49 NS
Our organization’s leadership allocates time every
month for long-term planning. b 3.36 1.63 NS
Our organization is focused on revenues more than
on long-term planning. b 2.67 1.09 NS
Our organization is focused on day-to-day
operations more than on long-term planning. b 2.31 1.00 N
Our organization is focused on customer needs more
than on long-term planning. b 2.21 .87 N
Note. The original response scale used was 6 = Strongly Disagree, 5 = Disagree, 4 = Slightly
Disagree, 3 = Slightly Agree, 2 = Agree, 1 = Strongly Agree. The interpretive scale used was 5.5-
6.0 = strongly positive, 4.5-5.49 = positive, 3.5-4.49 = slightly positive, 2.50-3.49 = negative,
1.50-2.49 = slightly negative, and 1.00-1.49 = strongly negative.
aSP = strongly positive, P = positive, SP = slightly positive, N = negative, NS = slightly
negative, SN = strongly negative
bReverse coded item scale recoded as follows: 1= SA, 2 = A, 3 = AS, 4 = SD, 5 = D, 6 =
DS Using the consistently coded items in the single factor identified in the factor analysis,
the researcher computed the perceived available time the organization has to strategically plan
score, which was the mean of the eight items in the factor. The mean score was 3.09 (SD=0.88),
with values ranging from 1.25 to 5.13. These scores were grouped into response categories, as
shown in Table 22. When the Perceived Available Time the Organization Has to Strategically
Plan Scale was examined by response category, the category with the largest number of scores
was 2.50-3.49 (n=26, 41.40%) (see Table 20).
Table 20 Perceived Available Time the Organization has to Strategically Plan Scale
Score Frequency Percent
1.00-1.49 3 4.29
1.50-2.49 16 22.90
2.50-3.49 26 37.14
3.50-4.49 21 30.00
4.50-5.49 4 5.70
5.50-6.00 0 0.00
Total 70 100.00
Note. Mean = 3.09 Standard Deviation = .88
Note. The response scale used was 6 = Strongly Disagree, 5 = Disagree, 4 = Slightly Disagree, 3
= Slightly Agree, 2 = Agree, 1 = Strongly Agree. The interpretive scale used was 5.5-6.0 =
strongly disagree, 4.5-5.49 = disagree, 3.5-4.49 = slightly disagree, 2.50-3.49 = slightly agree,
1.50-2.49 = agree, and 1.0-1.49 = strongly agree. a SA = strongly agree, A = Agree, AS = slightly
agree, DS = slightly disagree, D = disagree, SD = strongly disagree
Objective Four
The fourth objective of this study is to determine if a relationship exists between
Louisiana small business owners' perceived obstacles to strategic planning and each of the
demographic and perceived obstacles to planning measures included in the study. The first of
these demographic measures was the industry in which the organization is positioned. This
measure included the 24 categories of industries identified by the Louisiana Small Business
Association. However, with only 70 respondents in the study and 24 possible responses, the
number of responses in most of the categories were too small to enable a comparison on the
strategic planning score variable. Only one category, Professional Services, had a sufficient
number of responses to allow the examination of the proposed relationship. In addition, since this
variable was nominal in nature, a comparative analysis was judged to be preferable to the use of
correlational statistics. Therefore, since only one category had sufficient numbers for analysis, a
t-test was used to compare those respondents that reported Professional Services with other
respondents. The comparative statistic was chosen over a correlation coefficient for the ease of
interpretation of the findings. The mean strategic planning score for all respondents other than
Professional Services was 4.74 (SD=.71). The mean strategic planning score for Professional
Services industries was 4.52 (SD=.65). Levene’s Test for equality of variances was not
significant (F=.15, p=.71), indicating that the assumption of equal variances was met. Therefore,
the pooled variance estimate was used in computing the t-test. Based on this test, no significant
difference was found in mean strategic planning score between the two groups (t68=1.22, p=.23).
The second variable examined for a relationship with the strategic planning score was
“legal structure of the business.” The Louisiana Small Business Association identifies five
categories of legal business structure represented in the state of Louisiana. Of these five
categories, only two had sufficient respondents to enable the examination of their relationship
with the “perceived degree to which the organization conducts strategic planning.” Of the 70
respondents, 38 self-identified as a Limited Liability Corporation. A t-test was conducted to
examine whether or not differences existed in mean strategic planning score between
respondents identifying as a Limited Liability Corporation and all other types of legal structure.
The mean strategic planning score for Limited Liability Corporations was 4.58 (SD=.75). The
mean strategic planning score for non-Limited Liability Corporations was 4.77 (SD=.61).
Levene’s Test for equality of variances was not significant (F=.18, p=.67), indicating that the
assumption of equal variances was met. Therefore, the pooled variance estimate was used in
computing the t-test. Based on this test, no significant difference was found in mean strategic
planning score between the two groups (t68=1.17, p=.25).
A second t-test was conducted to examine whether or not differences existed in mean
strategic planning score between respondents identifying as a Subchapter S Corporation (S-Corp)
and all other types of legal structure. The mean strategic planning score for Subchapter S
Corporations was 4.80 (SD=.62). The mean strategic planning score for non-Subchapter S
Corporations was 4.62 (SD=.72). Levene’s Test for equality of variances was not significant
(F=.18, p=.67), indicating that the assumption of equal variances was met. Therefore, the pooled
variance estimate was used in computing the t-test. Based on this test, no significant difference
was found in mean strategic planning score between the two groups (t68=-.93, p=.36). No other
statistical tests were conducted on small business legal structure because the sample size for each
of the remaining categories was too small to conduct an analysis.
A third t-test was conducted to examine whether or not differences existed in mean
strategic planning score between respondents who identified as having or not having a written
long-term plan. The mean strategic planning score for respondents who had a written long-term
plan was 4.98 (SD=.62). The mean strategic planning score for respondents who did not have a
written long-term plan was 4.51 (SD=.68). Levene’s Test for equality of variances was not
significant (F=.07, p=.80), indicating that the assumption of equal variances was met. Therefore,
the pooled variance estimate was used in computing the t-test. Based on this test, a significant
difference was found in mean strategic planning score between the two groups (t68 = 2.773, p
= .007). Therefore, those respondents who said they had a written long-term plan had higher
strategic planning scores then those who did not.
Pearson Product Moment Correlation Coefficients (PPMr) were calculated between
strategic planning score and the demographic variables measured on a continuous scale of
measurement. These included years the organization has been in business and number of
employees on the payroll, as well as variables that measured perceived obstacles to strategic
planning. No significant relationship existed between years in business and strategic planning
score (r = -.109, p = .37). Additionally, no significant relationship existed between number of
employees and strategic planning score (r = -.066, p = .59). There was, however, a significant
positive relationship between the perceived degree to which the organization conducts strategic
planning and the perceived quality of the organization’s employees (r = .367, p < .002), the
perceived degree to which the organization’s leadership has knowledge of the planning process
(r = .330, p = .005), and the perceived available time the organization has to strategically plan (r
= .322, p = .004). Therefore, for all three relationships, a higher score was associated with a
higher strategic planning score (see Table 21).
Table 21 Relationships with the Perceived Degree to which the Organization Conducts Strategic
Planning
aPPMr p value bDescriptor
Perceived quality of the organization’s employees .367 .002 MA
Perceived degree to which the organization’s leadership has
knowledge of the planning process .330 .005 MA
Perceived available time the organization has to strategically
plan .322 .007 MA
Years the organization been in business -.109 .369 LA
Number of employees currently on the organization’s
payroll -.066 .588 NA
aPearson Product Moment Correlation Coefficients bDavis’ Descriptors (1971): .00 to .09 =
Negligible Association, .10 to .29 = Low Association, .30 to .49 = Moderate Association, .50
to .69 = Substantial Association, and .70 or higher = Very Strong Association
NA = Negligible Association, LA = Low Association, MA = Moderate Association, SA =
Substantial Association, VS = Very Strong Association
Objective Five
In order to determine if a model exists explaining a significant portion of the variance in
Louisiana small business owners' perceived degree to which the organization conducts strategic
planning, a stepwise regression analysis was conducted. To ensure that there were no excessive
levels of collinearity among the variables in this study. the variance inflation factors (VIF) were
examined. According to Hair et al. (2006), “A common cutoff threshold is a tolerance value
of .10 which corresponds to a VIF value of 10” (p. 230). The VIF values in this analysis ranged
from 1.028 to 1.404, indicating no excessive multicollinearity between factors. Bivariate
correlations were examined between all factors used as independent variables and “the perceived
degree to which the organization conducts strategic planning.” Of the nine factors, the three
perceptual factors had the highest correlations, ranging from .322 to .367. The remaining six
factors had lower correlations, with the exception of written plan, which had a correlation
of .319. These correlations are presented in Table 22.
Table 22 Correlations between the Perceived Degree to which the Organization Conducts
Strategic Planning and Selected Demographic and Perceptual Factors
N ar p value bDescriptor
Perceived quality of the organization’s employees 70 .367 .001 MA
Perceived degree to which the organization’s leadership
has knowledge of the planning process 70 .330 .003 MA
Perceived available time the organization has to
strategically plan 70 .322 .003 MA
Written long-term plan 70 .319 .004 MA
Positioned in the professional services industry 70 -.146 .114 LA
Legal structure of the business as Limited Liability
Corporation 70 -.140 .123 LA
Legal structure of the business as Subchapter S
Corporation 70 .112 .179 LA
Years the organization been in business 70 -.109 .184 LA
Number of employees currently on the organization’s
payroll. 70 -.066 .294 NA
aPearson Product Moment Correlation Coefficients
bDavis’ Descriptors (1971): .00 to .09 = Negligible Association, .10 to .29 = Low Association, .30
to .49 = Moderate Association, .50 to .69 = Substantial Association, and .70 or higher = Very
Strong Association
NA = Negligible Association, LA = Low Association, MA = Moderate Association, SA =
Substantial Association, VS = Very Strong Association
The first variable to enter the regression model was “the perceived quality of the
organization’s employees,” with an R square of .134, F(1,68) = 10.56, p = .002, explaining
13.4% of the variance in “the perceived degree to which the organization conducts strategic
planning.” The second variable entered was whether or not the organization had a “written
longterm plan,” which had an R square change of .073, F(1,67) = 6.17, p = .015, explaining an
additional 7.3% of the variance in “the perceived degree to which the organization conducts
strategic planning.” These two variables combined explained 20.7% of the variance in “the
perceived degree to which the organization conducts strategic planning.”
Two additional variables added one percent or more to the explained variance. However,
these two variables were individually non-significant. The first of the two non-significant
variables that entered the model was “the perceived degree to which the organization’s leadership
has knowledge of the planning process,” with an R square change of .026, F(1,66) = 2.28, p
= .136. This 2.6% increase in explained variance was individually not significant; however, it
was included in the model because it added one percent or more of explained variance while the
overall model remained significant. Similarly, whether or not the small business was positioned
in “professional services,” industry an R square change of .010, F(1,65) = .359, was added to the
model with a 1% increase in explained variance. This 1% increase in explained variance was
individually not significant; however, it also was included in the model because it added one
percent or more of explained variance while the overall model remained significant. These two
variables combined, though not individually significant, explained 3.6% of the variance in “the
perceived degree to which the organization conducts strategic planning.”
The total R square for this model was .244 and the four variables, in combination,
explained 24.4% of the variance in “the perceived degree to which the organization conducts
strategic planning.” The results of the regression indicate subjects with higher scores on “the
perceived quality of the organization’s employees” and “the perceived degree to which the
organization’s leadership has knowledge of the planning process” tended to have higher scores
on “the perceived degree to which the organization conducts strategic planning.” Furthermore,
those respondents who answered “yes” to whether or not they had a “written long-term plan”
tended to have a higher “perceived degree to which the organization conducts strategic planning”
score. Similarly, those respondents who indicated that their organizations were positioned in the
“professional services” industry tended to have lower “perceived degree to which the
organization conducts strategic planning” scores. The results of the regression analysis are
presented in Table 23.
Table 23 Multiple Regression Analysis of “The Perceived Degree to Which the Organization
Conducts Strategic Planning” on Selected Perceptual and Demographic Measures among
Louisiana Small Businesses
ANOVA
Sources of Variation df MS F P
Regression 4 2.010 5.238 .001
Residual 65 .384
Total 69
Model Summary
Model R Square R Square
Change
F Change Sig. F
Change
Standardized
Coefficients
Beta
Perceived quality of the
organization’s employees .134 .134 10.557 .002 .278
Written long-term plan .207 .073 6.171 .015 .216
Perceived degree to which
the organization’s
leadership has knowledge
of the planning process
.234 .026 2.278 .136 .177
Professional services .244 .010 .852 .359 -.101
Variables not in the Equation
Variables t P
The Perceived Available Time the
Organization Has to Strategically Plan .993 .325
Number of employees are currently on
the organization’s payroll -.892 .376
Legal structure of the business as
Subchapter S Corporation .519 .605
Years the organization been in business -.255 .800
Legal structure of the business as
Limited Liability Corporation -.172 .864
When analyzing the means, and standard deviation for each item of the Perceived Quality
of the Organization’s Employees Scale, the researcher found that “Our employees are skilled in
their craft” had the highest overall level of agreement, with a mean of 5.24 (SD=.65). The item
with the lowest level of agreement, “Our employees achieve maximum productivity with
minimum wasted effort or expense,” had a mean of 4.20 (SD=1.03). The reliability of the 12item
scale as measured by the use of Cronbach’s Alpha was a=.90. To aid in the interpretation of the
data, the researcher developed an interpretive scale for the responses to the 12 items. The
interpretive scale had the following categories: 5.5-6.0 = strongly agree, 4.5-5.49 = agree,
3.54.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.5 = disagree, and 1-1.5 = strongly
disagree. When the mean item responses were classified into two categories, 11 of the items were
in the “agree” category, with the remaining item in the “slightly agree” category. The means and
standard deviations for the items are reported in Table 11.
To further analyze the Perceived Quality of the Organization’s Employees Scale, the
researcher conducted a factor analysis to determine if underlying constructs existed in the scale.
Using the Shapiro-Wilks Test, the researcher first examined items for normality. Additionally, the
measure of sampling adequacy (MSA) was examined for both individual items and the overall
scale. The Kaiser-Meyer-Olkin Measure of Sampling Adequacy was .87. The lowest individual
item MSA was .80, which was higher than the minimum acceptable level of .50 (Hair et al.,
2006). All data met the assumptions for the use of factor analysis. Principal components analysis
with varimax rotation was used in conducting the factor analysis.
To determine the number of factors to be extracted, the researcher used both the Latent
Root criterion and the scree plot technique. The factor analysis was first computed without
restrictions on the number of factors extracted. The default minimum value of one was used on
the latent root measure. The scree plot was examined in order to identify the optimum number of
factors for extraction. The researcher identified the most pronounced bend in the scree plot curve.
From this examination, the optimum number of factors was determined to be two, plus or minus
one. Each of these three analyses was then examined for three criteria. First, each of the analyses
was examined to determine whether the items in each of the extracted factors met the minimum
acceptable loading criteria as identified by Hair et al. (2006). Hair et al. (2006) suggested that .30
would meet the criterion for exploratory research. Secondly, the analysis was examined for
inefficient factors or factors containing only one or two items. Constructs with only one item are
of little use to the researcher, as the purpose of the analysis is to identity underlying constructs in
the data. Lastly, the researcher examined each analysis for the presence of significant cross-
loadings. If an item loads significantly on multiple factors, it is possible that the respondents
perceived the item differently. Due to the factor loadings, the number of inefficient factors and
the number of substantial cross-loadings, the optimum number of factors was determined to be
one. The Eigenvalue for the factor was 5.94 and the factor explained 49.51% of the variance (see
Table 12).
Table 12 Factor Loadings of Items in the Perceived Quality of the Organization’s Employees
Scale
Component
Our employees contribute solutions. .837
Our employees are focused on customer solutions. .816
Our employees achieve maximum productivity with
minimum wasted effort or expense.
.795
Our employees are willing to learn from errors. .778
Our employees are focused on customer service. .716
Our employees follow instructions. .703
Our employees are skilled in their craft. .691
Our employees are willing to learn. .673
Our employees are rarely absent from work. .634
Our employees work well in teams. .618
Our employees show up on time .587
Our employees possess knowledge of the industry. .523
Note. Eigenvalue = 5.94, Percent of variance explained = 49.51%
The researcher computed an overall score for the perceived quality of the organization’s
employees based on the results of the factor analysis. This score was computed as the mean of
the 12 items in the scale. The mean Perceived Quality of the Organization’s Employees Score
was 4.95 (SD=.62), with values ranging from 3.00 to 6.00. The overall mean was in the
interpretive category of “agree.” When the Perceived Quality of the Organization’s Employees
Score was examined by response category, the category with the largest number of scores was
4.50-5.49 (n=37, 52.90%) (see Table 13).
Table 13 Perceived Quality of the Organization’s Employees Score
Score Frequency Percent
1.00-1.49 0 0.00
1.50-2.49 0 0.00
2.50-3.49 1 1.40
3.50-4.49 14 20.00
(Table 13 continued)
Score Frequency Percent
4.50-5.49 37 52.90
5.50-6.00 18 25.7
Total 70 100.10
Note. Mean = 4.95, Standard Deviation = .62
Note. The response scale used was 6 = strongly agree, 5 = agree, 4 = slightly agree, 3 = slightly
disagree, 2 = disagree, 1 = strongly agree. The interpretive scale used was 5.5-6.0 = strongly
agree, 4.5-5.49 = agree, 3.5-4.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.49 =
disagree, and 1.00-1.49 = strongly disagree. a SA = strongly agree, A = Agree, AS = slightly
agree, DS = slightly disagree, D = disagree, SD = strongly disagree
Perceived Degree to Which the Organization’s Leadership has Knowledge of the Planning
Process
As a component of the Perceived Obstacles to Strategic Planning Inventory, the
researcher designed the Perceived Degree to Which the Organization’s Leadership Has
Knowledge of the Planning Process scale. This approach relied on input from a panel of
academic experts, whose area of expertise included research and theory, and industry experts,
whose area of expertise included strategic planning consulting. The items developed were as
follows: 1) I know what a GAP analysis is, 2) I know what a Needs Analysis is, 3) I know what a
SWOT Analysis is, 4) I know what a vision and mission statement is, 5) I know how to write a
strategic plan, 6) I know what a succession plan is, and 7) I know how to measure performance.
Each item was measured using a 6-point Likert-type response scale. The response options were
strongly disagree, disagree, slightly disagree, slightly agree, agree, and strongly agree. A higher
rating indicated a higher level of agreement. A lower rating indicated a stronger level of
disagreement.
When analyzing the mean and standard deviation for each item of the Perceived Degree
to Which the Organization’s Leadership has Knowledge of the Planning Process Scale, the
researcher found that “I know what a vision and mission statement is” had the highest overall
level of agreement, with a mean of 5.34 (SD=.68). The item with the lowest level of agreement,
“I know what a SWOT Analysis is,” had a mean of 3.69 (SD=1.91). The reliability of the 7-item
scale as measured by the use of Cronbach’s Alpha was a=.83. To aid in the interpretation of the
data, the researcher developed an interpretive scale for the responses to the 7 items. The
interpretive scale had the following categories: 5.5-6.0 = strongly agree, 4.5-5.49 = agree,
3.54.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.5 = disagree, and 1-1.5 = strongly
disagree. When the mean item responses were classified into categories, four of the items were in
the “agree” category, and the other three were in the “slightly agree” category. The means and
standard deviation for each item are reported in Table 14.
Table 14 The Organization’s Leadership has Knowledge of the Planning Process among Small
Business / Managers in Louisiana
Mean Standard Interpretive
Deviation Scale Category
I know what a vision and mission statement is. 5.34 .68 A
I know how to measure performance. 4.71 .94 A
I know what a succession plan is. 4.67 1.29 A
I know how to write a strategic plan. 4.49 1.34 A
I know what a Needs Analysis is. 4.03 1.55 AS
I know what a GAP analysis is. 3.70 1.61 AS
I know what a SWOT Analysis is 3.69 1.91 AS
Note. The response scale used was 6 = strongly agree, 5 = agree, 4 = slightly agree, 3 = slightly
disagree, 2 = disagree, 1 = strongly agree. The interpretive scale used was 5.5-6.0 = strongly
agree, 4.5-5.49 = agree, 3.5-4.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.49 =
disagree, and 1.00-1.49 = strongly disagree. a SA = strongly agree, A = Agree, AS = slightly
agree, DS = slightly disagree, D = disagree, SD = strongly disagree
To further analyze the Perceived Degree to Which the Organization’s Leadership has
Knowledge of the Planning Process Scale, the researcher conducted a factor analysis to
determine if underlying constructs existed. Using the Shapiro-Wilks Test, the researcher first
examined items for normality. Additionally, the measure of sampling adequacy (MSA) was
examined for both individual items and the overall scale. The Kaiser-Meyer-Olkin Measure of
Sampling Adequacy was .78. The lowest individual item MSA was .69, which was higher than
the minimum acceptable level. All data met the assumptions for the use of a factor analysis.
Principal components analysis with varimax rotation was used in conducting the factor analysis.
To determine the number of factors to be extracted, the researcher used both the Latent
Root criterion and the scree plot technique. The factor analysis was first computed without
restrictions on the number of factors extracted. The default minimum value of one was used on
the latent root measure. The scree plot was examined in order to identify the optimum number of
factors for extraction. The researcher identified the most pronounced bend in the scree plot curve.
From this examination, the optimum number of factors was determined to be two, plus or minus
one. Each factor was then examined for three criteria. First, each extracted factor was examined
to determine whether it met the minimum acceptable loading criteria as identified by Hair et al.
(2006). Hair et al. (2006) suggested that .30 would meet the criterion for exploratory research.
Secondly, the analysis was examined for inefficient factors or factors containing only one or two
items. Constructs with only one item are of little use to the researcher, as the purpose of the
analysis is to identity underlying constructs in the data. Lastly, the researcher examined each
analysis for the presence of significant cross-loadings. If an item loads significantly on multiple
factors, it is possible that the respondents perceived the item differently. Due to the factor
loadings, the number of inefficient factors and the number of substantial cross-loadings, the
optimum number of factors was determined to be one. The Eigenvalue for the factor was 3.58
and the factor explained 51.12% of the variance (see Table 15).
The researcher computed the overall score for the perceived degree to which the
organization’s leadership has knowledge of the planning process based on the results of a factor
analysis. This score was computed as the mean of the 7 items in the scale.
Table 15 Factor Loadings of Items in the Perceived Degree To which the Organization’s
Leadership has Knowledge of the Planning Process Scale
Component
I know what a GAP analysis is. .853
I know what a Needs Analysis is. .819
I know what a SWOT Analysis is. .786
I know what a vision and mission statement is. .724
I know how to write a strategic plan. .636
I know what a succession plan is. .603
I know how to measure performance. .520
Note. Eigenvalue = 3.58, Percent of variance explained = 51.12%
The mean Perceived Degree to Which the Organization’s Leadership has Knowledge of
the Planning Process Score was 4.38 (SD=.97) with values ranging from 2.29 to 6.00. When the
Perceived Degree to Which the Organization’s Leadership has Knowledge of the Planning
Process Score was examined by response category, the category with the largest number of
scores was 4.50-5.49 (n=27, 38.60%) (see Table 16).
Table 16 Perceived Degree to which the Organization’s Leadership has Knowledge of the
Planning Process Scale
Score Frequency Percent
1.00-1.49 0 0.00
1.50-2.49 2 2.90
2.50-3.49 13 18.60
3.50-4.49 20 28.60
4.50-5.49 27 38.60
5.50-6.00 8 11.40
70 100.00
Note. Mean = 4.38, Standard Deviation = .97
Note. The response scale used was 6 = strongly agree, 5 = agree, 4 = slightly agree, 3 = slightly
disagree, 2 = disagree, 1 = strongly agree. The interpretive scale used was 5.5-6.0 = strongly
agree, 4.5-5.49 = agree, 3.5-4.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.49 =
disagree, and 1.00-1.49 = strongly disagree.
a SA = strongly agree, A = Agree, AS = slightly agree, DS = slightly disagree, D = disagree, SD =
strongly disagree
Perceived Available Time the Organization has to Strategically Plan
As a component of the Perceived Obstacles to Strategic Planning Inventory, the
researcher designed the Perceived Available Time the Organization has to Strategically Plan
scale. This approach relied on input from a panel of academic experts, whose area of expertise
included research and theory, and industry experts, whose area of expertise included strategic
planning consulting. The items developed were as follows: 1) Our organization’s leadership
allocates time every month for long-term planning, 2) Our organization has time to allocate for
long-term planning, 3) Our organization utilizes time set aside to plan long-term, 4) Our
organization is focused on day-to-day operations more than on long-term planning, 5) Our
organization is focused on customer needs more than on long-term planning, 6) Our organization
is focused on revenues more than on long-term planning, 7) Our organization is focused on
regulatory concerns more than on long-term planning, and 8) Our organization is focused on
logistical concerns more than on long-term planning. Each item was measured using a 6-point
Likert-type response scale. The response options were strongly disagree, disagree, slightly
disagree, slightly agree, agree, and strongly agree. The higher the point value, the higher the
perceived available time the organization has to strategically plan
When analyzing the mean and standard deviation for each item of the Perceived
Available Time the Organization Has to Strategically Plan Scale, the researcher found that “Our
organization is focused on customer needs more than on long-term planning” had the highest
overall level of agreement, with a mean of 4.79 (SD=.87). The item with the lowest level of
agreement, “Our organization’s leadership allocates time every month for long-term planning,”
had a mean of 3.36 (SD=1.63). The reliability of the 8-item scale as measured using the
Cronbach’s Alpha was a=.84. To aid in the interpretation of the data, the researcher developed an
interpretive scale for the responses to the eight items. The interpretive scale had the following
categories: 5.5-6.0 = strongly agree, 4.5-5.49 = agree, 3.5-4.49 = slightly agree, 2.50-3.49 =
slightly disagree, 1.50-2.5 = disagree, and 1-1.5 = strongly disagree. When the mean item
responses were classified into categories, two of the items were in the “agree” category, three
were in the “slightly agree” category, and the remaining three were located in the “slightly
disagree” category. The means and standard deviations for the items are reported in Table 17.
Table 17 The Perceived Available Time the Organization has to Strategically Plan among Small
Businesses Owners / Managers in Louisiana
Mean Standard
Deviation
Interpretive
Scale
Category
Our organization is focused on customer needs more
than on long-term planning. 4.79 .87 A
Our organization is focused on day-to-day operations
more than on long-term planning. 4.69 1.00 A
Our organization is focused on revenues more than on
long-term planning. 4.33 1.09 AS
Our organization has time to allocate for long-term
planning. 3.80 1.42 AS
Our organization is focused on logistical concerns
more than on long-term planning. 3.57 1.22 AS
Our organization is focused on regulatory concerns
more than on long-term planning. 3.47 1.40 DS
Our organization utilizes time set aside to plan long-term. 3.43 1.49 DS
Our organization’s leadership allocates time every month for
long-term planning. 3.36 1.63 DS
Note. The response scale used was 6 = strongly agree, 5 = agree, 4 = slightly agree, 3 = slightly
disagree, 2 = disagree, 1 = strongly agree. The interpretive scale used was 5.5-6.0 = strongly
agree, 4.5-5.49 = agree, 3.5-4.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.49 =
disagree, and 1.00-1.49 = strongly disagree.
a SA = strongly agree, A = Agree, AS = slightly agree, DS = slightly disagree, D = disagree, SD =
strongly disagree
To further analyze the Perceived Available Time the Organization Has to Strategically
Plan Scale, the researcher conducted a factor analysis to determine if underlying constructs
existed. Using the Shapiro-Wilks Test, the researcher first examined items for normality.
Additionally, the measure of sampling adequacy (MSA) was examined for both individual items
and the overall scale. The Kaiser-Meyer-Olkin MSA was .73. The lowest individual item MSA
was .67, which was higher than the minimum acceptable level of .50 as suggested by Hair et al.
(2006). All data met the assumptions for the use of factor analysis. Principal components analysis
with varimax rotation was used in conducting the factor analysis.
To determine the number of factors to be extracted, the researcher used both the Latent
Root criterion and the scree plot technique. The factor analysis was first computed without
restrictions on the number of factors extracted. The default minimum value of one was used on
the latent root measure. The scree plot was examined in order to identify the optimum number of
factors for extraction. The researcher identified the most pronounced bend in the scree plot curve.
From this examination, the optimum number of factors was determined to be two, plus or minus
one. Each factor was then examined for three criteria. First, each of analyses was examined to
determine whether the items in each of the extracted factors met the minimum acceptable loading
criteria as identified by Hair et al. (2006). Hair et al. (2006) suggested that .30 would meet the
criterion for exploratory research. Secondly, the analysis was examined for inefficient factors or
factors containing only one or two items. Constructs with only one item are of little use to the
researcher, as the purpose of the analysis is to identity underlying constructs in the data. Lastly,
the researcher examined each of the analyses for the presence of significant cross-loadings. If an
item loads significantly on multiple factors, it is possible that the respondents perceived the item
differently. Due to the factor loadings, the number of inefficient factors and the number of
substantial cross-loadings, the optimum number of factors was determined to be one. The
Eigenvalue for the factor was 3.80 and the factor explained 47.52% of the variance (see Table
18).
The researcher’s next step was to compute an overall Perceived Available Time the
Organization Has to Strategically Plan score. However, for items 1) Our organization’s
leadership allocates time every month for long-term planning, 2) Our organization has time to
Table 18 Factor Loadings of Items in the Perceived Available Time the Organization has to
Strategically Plan Scale
Component
Our organization utilizes time set aside to plan long-term. -.83
Our organization’s leadership allocates time every month for long-term
planning. -.80
Our organization has time to allocate for long-term planning. -.71
Our organization is focused on logistical concerns more than on long-term
planning. .70
Our organization is focused on customer needs more than on long-term
planning. .67
Our organization is focused on regulatory concerns more than on long-term
planning. .62
Our organization is focused on revenues more than on long-term planning. .61
Our organization is focused on day-to-day operations more than on long-term
planning. .54
Note. Eigenvalue = 3.80, Percent of variance explained = 47.52%
allocate for long-term planning, and 3) Our organization utilizes time set aside to plan
long-term, a high level of agreement indicated a positive perception of available time to
strategically plan. For the remaining items, 4) Our organization is focused on day-to-day
operations more than on long-term planning, 5) Our organization is focused on customer needs
more than on long-term planning, 6) Our organization is focused on revenues more than on
longterm planning, 7) Our organization is focused on regulatory concerns more than on long-
term planning, and 8) Our organization is focused on logistical concerns more than on long-term
planning, a low level of agreement, or disagreement, indicated a positive perception of available
time to strategically plan. Due to the reverse wording of a portion of the items, computing a
factor score would have been ineffective. Therefore, the items were recoded to reflect a higher
value, consistent with other items that indicated a positive response to planning. Specifically, the
reverse worded items were coded so that Strongly Disagree = 6, Disagree = 5, Slightly Disagree
= 4, Slightly Agree = 3, Agree = 2, and Strongly Agree = 1. The value for each item was coded so
that the higher value indicated the more positive response. The item with the most positive
response was Our organization has time to allocate for long-term planning (Mean=3.80,
SD=1.42). The item with the lowest mean response (most negative) was Our organization is
focused on customer needs more than on long-term planning (Mean=2.21, SD=.87). Recorded
mean item response scores are presented in Table 19.
Table 19 Means and Standard Deviations for Reverse Coded Items in Perceived Available Time
the Organization has to Strategically Plan Scale
Mean Standard
Deviation
Interpretive
Scorea
Our organization has time to allocate for long-term 3.80 1.42 PS
planning.b
Our organization is focused on regulatory concerns
more than on long-term planning.b 3.53 1.40 PS
Our organization is focused on logistical concerns
more than on long-term planning. b 3.43 1.22 NS
Our organization utilizes time set aside to plan
longterm. b 3.43 1.49 NS
Our organization’s leadership allocates time every
month for long-term planning. b 3.36 1.63 NS
Our organization is focused on revenues more than
on long-term planning. b 2.67 1.09 NS
Our organization is focused on day-to-day
operations more than on long-term planning. b 2.31 1.00 N
Our organization is focused on customer needs more
than on long-term planning. b 2.21 .87 N
Note. The original response scale used was 6 = Strongly Disagree, 5 = Disagree, 4 = Slightly
Disagree, 3 = Slightly Agree, 2 = Agree, 1 = Strongly Agree. The interpretive scale used was 5.5-
6.0 = strongly positive, 4.5-5.49 = positive, 3.5-4.49 = slightly positive, 2.50-3.49 = negative,
1.50-2.49 = slightly negative, and 1.00-1.49 = strongly negative.
aSP = strongly positive, P = positive, SP = slightly positive, N = negative, NS = slightly
negative, SN = strongly negative
bReverse coded item scale recoded as follows: 1= SA, 2 = A, 3 = AS, 4 = SD, 5 = D, 6 =
DS Using the consistently coded items in the single factor identified in the factor analysis,
the researcher computed the perceived available time the organization has to strategically plan
score, which was the mean of the eight items in the factor. The mean score was 3.09 (SD=0.88),
with values ranging from 1.25 to 5.13. These scores were grouped into response categories, as
shown in Table 22. When the Perceived Available Time the Organization Has to Strategically
Plan Scale was examined by response category, the category with the largest number of scores
was 2.50-3.49 (n=26, 41.40%) (see Table 20).
Table 20 Perceived Available Time the Organization has to Strategically Plan Scale
Score Frequency Percent
1.00-1.49 3 4.29
1.50-2.49 16 22.90
2.50-3.49 26 37.14
3.50-4.49 21 30.00
4.50-5.49 4 5.70
5.50-6.00 0 0.00
Total 70 100.00
Note. Mean = 3.09 Standard Deviation = .88
Note. The response scale used was 6 = Strongly Disagree, 5 = Disagree, 4 = Slightly Disagree, 3
= Slightly Agree, 2 = Agree, 1 = Strongly Agree. The interpretive scale used was 5.5-6.0 =
strongly disagree, 4.5-5.49 = disagree, 3.5-4.49 = slightly disagree, 2.50-3.49 = slightly agree,
1.50-2.49 = agree, and 1.0-1.49 = strongly agree. a SA = strongly agree, A = Agree, AS = slightly
agree, DS = slightly disagree, D = disagree, SD = strongly disagree
Objective Four
The fourth objective of this study is to determine if a relationship exists between
Louisiana small business owners' perceived obstacles to strategic planning and each of the
demographic and perceived obstacles to planning measures included in the study. The first of
these demographic measures was the industry in which the organization is positioned. This
measure included the 24 categories of industries identified by the Louisiana Small Business
Association. However, with only 70 respondents in the study and 24 possible responses, the
number of responses in most of the categories were too small to enable a comparison on the
strategic planning score variable. Only one category, Professional Services, had a sufficient
number of responses to allow the examination of the proposed relationship. In addition, since this
variable was nominal in nature, a comparative analysis was judged to be preferable to the use of
correlational statistics. Therefore, since only one category had sufficient numbers for analysis, a
t-test was used to compare those respondents that reported Professional Services with other
respondents. The comparative statistic was chosen over a correlation coefficient for the ease of
interpretation of the findings. The mean strategic planning score for all respondents other than
Professional Services was 4.74 (SD=.71). The mean strategic planning score for Professional
Services industries was 4.52 (SD=.65). Levene’s Test for equality of variances was not
significant (F=.15, p=.71), indicating that the assumption of equal variances was met. Therefore,
the pooled variance estimate was used in computing the t-test. Based on this test, no significant
difference was found in mean strategic planning score between the two groups (t68=1.22, p=.23).
The second variable examined for a relationship with the strategic planning score was
“legal structure of the business.” The Louisiana Small Business Association identifies five
categories of legal business structure represented in the state of Louisiana. Of these five
categories, only two had sufficient respondents to enable the examination of their relationship
with the “perceived degree to which the organization conducts strategic planning.” Of the 70
respondents, 38 self-identified as a Limited Liability Corporation. A t-test was conducted to
examine whether or not differences existed in mean strategic planning score between
respondents identifying as a Limited Liability Corporation and all other types of legal structure.
The mean strategic planning score for Limited Liability Corporations was 4.58 (SD=.75). The
mean strategic planning score for non-Limited Liability Corporations was 4.77 (SD=.61).
Levene’s Test for equality of variances was not significant (F=.18, p=.67), indicating that the
assumption of equal variances was met. Therefore, the pooled variance estimate was used in
computing the t-test. Based on this test, no significant difference was found in mean strategic
planning score between the two groups (t68=1.17, p=.25).
A second t-test was conducted to examine whether or not differences existed in mean
strategic planning score between respondents identifying as a Subchapter S Corporation (S-Corp)
and all other types of legal structure. The mean strategic planning score for Subchapter S
Corporations was 4.80 (SD=.62). The mean strategic planning score for non-Subchapter S
Corporations was 4.62 (SD=.72). Levene’s Test for equality of variances was not significant
(F=.18, p=.67), indicating that the assumption of equal variances was met. Therefore, the pooled
variance estimate was used in computing the t-test. Based on this test, no significant difference
was found in mean strategic planning score between the two groups (t68=-.93, p=.36). No other
statistical tests were conducted on small business legal structure because the sample size for each
of the remaining categories was too small to conduct an analysis.
A third t-test was conducted to examine whether or not differences existed in mean
strategic planning score between respondents who identified as having or not having a written
long-term plan. The mean strategic planning score for respondents who had a written long-term
plan was 4.98 (SD=.62). The mean strategic planning score for respondents who did not have a
written long-term plan was 4.51 (SD=.68). Levene’s Test for equality of variances was not
significant (F=.07, p=.80), indicating that the assumption of equal variances was met. Therefore,
the pooled variance estimate was used in computing the t-test. Based on this test, a significant
difference was found in mean strategic planning score between the two groups (t68 = 2.773, p
= .007). Therefore, those respondents who said they had a written long-term plan had higher
strategic planning scores then those who did not.
Pearson Product Moment Correlation Coefficients (PPMr) were calculated between
strategic planning score and the demographic variables measured on a continuous scale of
measurement. These included years the organization has been in business and number of
employees on the payroll, as well as variables that measured perceived obstacles to strategic
planning. No significant relationship existed between years in business and strategic planning
score (r = -.109, p = .37). Additionally, no significant relationship existed between number of
employees and strategic planning score (r = -.066, p = .59). There was, however, a significant
positive relationship between the perceived degree to which the organization conducts strategic
planning and the perceived quality of the organization’s employees (r = .367, p < .002), the
perceived degree to which the organization’s leadership has knowledge of the planning process
(r = .330, p = .005), and the perceived available time the organization has to strategically plan (r
= .322, p = .004). Therefore, for all three relationships, a higher score was associated with a
higher strategic planning score (see Table 21).
Table 21 Relationships with the Perceived Degree to which the Organization Conducts Strategic
Planning
aPPMr p value bDescriptor
Perceived quality of the organization’s employees .367 .002 MA
Perceived degree to which the organization’s leadership has
knowledge of the planning process .330 .005 MA
Perceived available time the organization has to strategically
plan .322 .007 MA
Years the organization been in business -.109 .369 LA
Number of employees currently on the organization’s
payroll -.066 .588 NA
aPearson Product Moment Correlation Coefficients bDavis’ Descriptors (1971): .00 to .09 =
Negligible Association, .10 to .29 = Low Association, .30 to .49 = Moderate Association, .50
to .69 = Substantial Association, and .70 or higher = Very Strong Association
NA = Negligible Association, LA = Low Association, MA = Moderate Association, SA =
Substantial Association, VS = Very Strong Association
Objective Five
In order to determine if a model exists explaining a significant portion of the variance in
Louisiana small business owners' perceived degree to which the organization conducts strategic
planning, a stepwise regression analysis was conducted. To ensure that there were no excessive
levels of collinearity among the variables in this study. the variance inflation factors (VIF) were
examined. According to Hair et al. (2006), “A common cutoff threshold is a tolerance value
of .10 which corresponds to a VIF value of 10” (p. 230). The VIF values in this analysis ranged
from 1.028 to 1.404, indicating no excessive multicollinearity between factors. Bivariate
correlations were examined between all factors used as independent variables and “the perceived
degree to which the organization conducts strategic planning.” Of the nine factors, the three
perceptual factors had the highest correlations, ranging from .322 to .367. The remaining six
factors had lower correlations, with the exception of written plan, which had a correlation
of .319. These correlations are presented in Table 22.
Table 22 Correlations between the Perceived Degree to which the Organization Conducts
Strategic Planning and Selected Demographic and Perceptual Factors
N ar p value bDescriptor
Perceived quality of the organization’s employees 70 .367 .001 MA
Perceived degree to which the organization’s leadership
has knowledge of the planning process 70 .330 .003 MA
Perceived available time the organization has to
strategically plan 70 .322 .003 MA
Written long-term plan 70 .319 .004 MA
Positioned in the professional services industry 70 -.146 .114 LA
Legal structure of the business as Limited Liability
Corporation 70 -.140 .123 LA
Legal structure of the business as Subchapter S
Corporation 70 .112 .179 LA
Years the organization been in business 70 -.109 .184 LA
Number of employees currently on the organization’s
payroll. 70 -.066 .294 NA
aPearson Product Moment Correlation Coefficients
bDavis’ Descriptors (1971): .00 to .09 = Negligible Association, .10 to .29 = Low Association, .30
to .49 = Moderate Association, .50 to .69 = Substantial Association, and .70 or higher = Very
Strong Association
NA = Negligible Association, LA = Low Association, MA = Moderate Association, SA =
Substantial Association, VS = Very Strong Association
The first variable to enter the regression model was “the perceived quality of the
organization’s employees,” with an R square of .134, F(1,68) = 10.56, p = .002, explaining
13.4% of the variance in “the perceived degree to which the organization conducts strategic
planning.” The second variable entered was whether or not the organization had a “written
longterm plan,” which had an R square change of .073, F(1,67) = 6.17, p = .015, explaining an
additional 7.3% of the variance in “the perceived degree to which the organization conducts
strategic planning.” These two variables combined explained 20.7% of the variance in “the
perceived degree to which the organization conducts strategic planning.”
Two additional variables added one percent or more to the explained variance. However,
these two variables were individually non-significant. The first of the two non-significant
variables that entered the model was “the perceived degree to which the organization’s leadership
has knowledge of the planning process,” with an R square change of .026, F(1,66) = 2.28, p
= .136. This 2.6% increase in explained variance was individually not significant; however, it
was included in the model because it added one percent or more of explained variance while the
overall model remained significant. Similarly, whether or not the small business was positioned
in “professional services,” industry an R square change of .010, F(1,65) = .359, was added to the
model with a 1% increase in explained variance. This 1% increase in explained variance was
individually not significant; however, it also was included in the model because it added one
percent or more of explained variance while the overall model remained significant. These two
variables combined, though not individually significant, explained 3.6% of the variance in “the
perceived degree to which the organization conducts strategic planning.”
The total R square for this model was .244 and the four variables, in combination,
explained 24.4% of the variance in “the perceived degree to which the organization conducts
strategic planning.” The results of the regression indicate subjects with higher scores on “the
perceived quality of the organization’s employees” and “the perceived degree to which the
organization’s leadership has knowledge of the planning process” tended to have higher scores
on “the perceived degree to which the organization conducts strategic planning.” Furthermore,
those respondents who answered “yes” to whether or not they had a “written long-term plan”
tended to have a higher “perceived degree to which the organization conducts strategic planning”
score. Similarly, those respondents who indicated that their organizations were positioned in the
“professional services” industry tended to have lower “perceived degree to which the
organization conducts strategic planning” scores. The results of the regression analysis are
presented in Table 23.
Table 23 Multiple Regression Analysis of “The Perceived Degree to Which the Organization
Conducts Strategic Planning” on Selected Perceptual and Demographic Measures among
Louisiana Small Businesses
ANOVA
Sources of Variation df MS F P
Regression 4 2.010 5.238 .001
Residual 65 .384
Total 69
Model Summary
Model R Square R Square
Change
F Change Sig. F
Change
Standardized
Coefficients
Beta
Perceived quality of the
organization’s employees .134 .134 10.557 .002 .278
Written long-term plan .207 .073 6.171 .015 .216
Perceived degree to which
the organization’s
leadership has knowledge
of the planning process
.234 .026 2.278 .136 .177
Professional services .244 .010 .852 .359 -.101
Variables not in the Equation
Variables t P
The Perceived Available Time the
Organization Has to Strategically Plan .993 .325
Number of employees are currently on
the organization’s payroll -.892 .376
Legal structure of the business as
Subchapter S Corporation .519 .605
Years the organization been in business -.255 .800
Legal structure of the business as
Limited Liability Corporation -.172 .864
When analyzing the means, and standard deviation for each item of the Perceived Quality
of the Organization’s Employees Scale, the researcher found that “Our employees are skilled in
their craft” had the highest overall level of agreement, with a mean of 5.24 (SD=.65). The item
with the lowest level of agreement, “Our employees achieve maximum productivity with
minimum wasted effort or expense,” had a mean of 4.20 (SD=1.03). The reliability of the 12item
scale as measured by the use of Cronbach’s Alpha was a=.90. To aid in the interpretation of the
data, the researcher developed an interpretive scale for the responses to the 12 items. The
interpretive scale had the following categories: 5.5-6.0 = strongly agree, 4.5-5.49 = agree,
3.54.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.5 = disagree, and 1-1.5 = strongly
disagree. When the mean item responses were classified into two categories, 11 of the items were
in the “agree” category, with the remaining item in the “slightly agree” category. The means and
standard deviations for the items are reported in Table 11.
To further analyze the Perceived Quality of the Organization’s Employees Scale, the
researcher conducted a factor analysis to determine if underlying constructs existed in the scale.
Using the Shapiro-Wilks Test, the researcher first examined items for normality. Additionally, the
measure of sampling adequacy (MSA) was examined for both individual items and the overall
scale. The Kaiser-Meyer-Olkin Measure of Sampling Adequacy was .87. The lowest individual
item MSA was .80, which was higher than the minimum acceptable level of .50 (Hair et al.,
2006). All data met the assumptions for the use of factor analysis. Principal components analysis
with varimax rotation was used in conducting the factor analysis.
To determine the number of factors to be extracted, the researcher used both the Latent
Root criterion and the scree plot technique. The factor analysis was first computed without
restrictions on the number of factors extracted. The default minimum value of one was used on
the latent root measure. The scree plot was examined in order to identify the optimum number of
factors for extraction. The researcher identified the most pronounced bend in the scree plot curve.
From this examination, the optimum number of factors was determined to be two, plus or minus
one. Each of these three analyses was then examined for three criteria. First, each of the analyses
was examined to determine whether the items in each of the extracted factors met the minimum
acceptable loading criteria as identified by Hair et al. (2006). Hair et al. (2006) suggested that .30
would meet the criterion for exploratory research. Secondly, the analysis was examined for
inefficient factors or factors containing only one or two items. Constructs with only one item are
of little use to the researcher, as the purpose of the analysis is to identity underlying constructs in
the data. Lastly, the researcher examined each analysis for the presence of significant cross-
loadings. If an item loads significantly on multiple factors, it is possible that the respondents
perceived the item differently. Due to the factor loadings, the number of inefficient factors and
the number of substantial cross-loadings, the optimum number of factors was determined to be
one. The Eigenvalue for the factor was 5.94 and the factor explained 49.51% of the variance (see
Table 12).
Table 12 Factor Loadings of Items in the Perceived Quality of the Organization’s Employees
Scale
Component
Our employees contribute solutions. .837
Our employees are focused on customer solutions. .816
Our employees achieve maximum productivity with
minimum wasted effort or expense.
.795
Our employees are willing to learn from errors. .778
Our employees are focused on customer service. .716
Our employees follow instructions. .703
Our employees are skilled in their craft. .691
Our employees are willing to learn. .673
Our employees are rarely absent from work. .634
Our employees work well in teams. .618
Our employees show up on time .587
Our employees possess knowledge of the industry. .523
Note. Eigenvalue = 5.94, Percent of variance explained = 49.51%
The researcher computed an overall score for the perceived quality of the organization’s
employees based on the results of the factor analysis. This score was computed as the mean of
the 12 items in the scale. The mean Perceived Quality of the Organization’s Employees Score
was 4.95 (SD=.62), with values ranging from 3.00 to 6.00. The overall mean was in the
interpretive category of “agree.” When the Perceived Quality of the Organization’s Employees
Score was examined by response category, the category with the largest number of scores was
4.50-5.49 (n=37, 52.90%) (see Table 13).
Table 13 Perceived Quality of the Organization’s Employees Score
Score Frequency Percent
1.00-1.49 0 0.00
1.50-2.49 0 0.00
2.50-3.49 1 1.40
3.50-4.49 14 20.00
(Table 13 continued)
Score Frequency Percent
4.50-5.49 37 52.90
5.50-6.00 18 25.7
Total 70 100.10
Note. Mean = 4.95, Standard Deviation = .62
Note. The response scale used was 6 = strongly agree, 5 = agree, 4 = slightly agree, 3 = slightly
disagree, 2 = disagree, 1 = strongly agree. The interpretive scale used was 5.5-6.0 = strongly
agree, 4.5-5.49 = agree, 3.5-4.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.49 =
disagree, and 1.00-1.49 = strongly disagree. a SA = strongly agree, A = Agree, AS = slightly
agree, DS = slightly disagree, D = disagree, SD = strongly disagree
Perceived Degree to Which the Organization’s Leadership has Knowledge of the Planning
Process
As a component of the Perceived Obstacles to Strategic Planning Inventory, the
researcher designed the Perceived Degree to Which the Organization’s Leadership Has
Knowledge of the Planning Process scale. This approach relied on input from a panel of
academic experts, whose area of expertise included research and theory, and industry experts,
whose area of expertise included strategic planning consulting. The items developed were as
follows: 1) I know what a GAP analysis is, 2) I know what a Needs Analysis is, 3) I know what a
SWOT Analysis is, 4) I know what a vision and mission statement is, 5) I know how to write a
strategic plan, 6) I know what a succession plan is, and 7) I know how to measure performance.
Each item was measured using a 6-point Likert-type response scale. The response options were
strongly disagree, disagree, slightly disagree, slightly agree, agree, and strongly agree. A higher
rating indicated a higher level of agreement. A lower rating indicated a stronger level of
disagreement.
When analyzing the mean and standard deviation for each item of the Perceived Degree
to Which the Organization’s Leadership has Knowledge of the Planning Process Scale, the
researcher found that “I know what a vision and mission statement is” had the highest overall
level of agreement, with a mean of 5.34 (SD=.68). The item with the lowest level of agreement,
“I know what a SWOT Analysis is,” had a mean of 3.69 (SD=1.91). The reliability of the 7-item
scale as measured by the use of Cronbach’s Alpha was a=.83. To aid in the interpretation of the
data, the researcher developed an interpretive scale for the responses to the 7 items. The
interpretive scale had the following categories: 5.5-6.0 = strongly agree, 4.5-5.49 = agree,
3.54.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.5 = disagree, and 1-1.5 = strongly
disagree. When the mean item responses were classified into categories, four of the items were in
the “agree” category, and the other three were in the “slightly agree” category. The means and
standard deviation for each item are reported in Table 14.
Table 14 The Organization’s Leadership has Knowledge of the Planning Process among Small
Business / Managers in Louisiana
Mean Standard Interpretive
Deviation Scale Category
I know what a vision and mission statement is. 5.34 .68 A
I know how to measure performance. 4.71 .94 A
I know what a succession plan is. 4.67 1.29 A
I know how to write a strategic plan. 4.49 1.34 A
I know what a Needs Analysis is. 4.03 1.55 AS
I know what a GAP analysis is. 3.70 1.61 AS
I know what a SWOT Analysis is 3.69 1.91 AS
Note. The response scale used was 6 = strongly agree, 5 = agree, 4 = slightly agree, 3 = slightly
disagree, 2 = disagree, 1 = strongly agree. The interpretive scale used was 5.5-6.0 = strongly
agree, 4.5-5.49 = agree, 3.5-4.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.49 =
disagree, and 1.00-1.49 = strongly disagree. a SA = strongly agree, A = Agree, AS = slightly
agree, DS = slightly disagree, D = disagree, SD = strongly disagree
To further analyze the Perceived Degree to Which the Organization’s Leadership has
Knowledge of the Planning Process Scale, the researcher conducted a factor analysis to
determine if underlying constructs existed. Using the Shapiro-Wilks Test, the researcher first
examined items for normality. Additionally, the measure of sampling adequacy (MSA) was
examined for both individual items and the overall scale. The Kaiser-Meyer-Olkin Measure of
Sampling Adequacy was .78. The lowest individual item MSA was .69, which was higher than
the minimum acceptable level. All data met the assumptions for the use of a factor analysis.
Principal components analysis with varimax rotation was used in conducting the factor analysis.
To determine the number of factors to be extracted, the researcher used both the Latent
Root criterion and the scree plot technique. The factor analysis was first computed without
restrictions on the number of factors extracted. The default minimum value of one was used on
the latent root measure. The scree plot was examined in order to identify the optimum number of
factors for extraction. The researcher identified the most pronounced bend in the scree plot curve.
From this examination, the optimum number of factors was determined to be two, plus or minus
one. Each factor was then examined for three criteria. First, each extracted factor was examined
to determine whether it met the minimum acceptable loading criteria as identified by Hair et al.
(2006). Hair et al. (2006) suggested that .30 would meet the criterion for exploratory research.
Secondly, the analysis was examined for inefficient factors or factors containing only one or two
items. Constructs with only one item are of little use to the researcher, as the purpose of the
analysis is to identity underlying constructs in the data. Lastly, the researcher examined each
analysis for the presence of significant cross-loadings. If an item loads significantly on multiple
factors, it is possible that the respondents perceived the item differently. Due to the factor
loadings, the number of inefficient factors and the number of substantial cross-loadings, the
optimum number of factors was determined to be one. The Eigenvalue for the factor was 3.58
and the factor explained 51.12% of the variance (see Table 15).
The researcher computed the overall score for the perceived degree to which the
organization’s leadership has knowledge of the planning process based on the results of a factor
analysis. This score was computed as the mean of the 7 items in the scale.
Table 15 Factor Loadings of Items in the Perceived Degree To which the Organization’s
Leadership has Knowledge of the Planning Process Scale
Component
I know what a GAP analysis is. .853
I know what a Needs Analysis is. .819
I know what a SWOT Analysis is. .786
I know what a vision and mission statement is. .724
I know how to write a strategic plan. .636
I know what a succession plan is. .603
I know how to measure performance. .520
Note. Eigenvalue = 3.58, Percent of variance explained = 51.12%
The mean Perceived Degree to Which the Organization’s Leadership has Knowledge of
the Planning Process Score was 4.38 (SD=.97) with values ranging from 2.29 to 6.00. When the
Perceived Degree to Which the Organization’s Leadership has Knowledge of the Planning
Process Score was examined by response category, the category with the largest number of
scores was 4.50-5.49 (n=27, 38.60%) (see Table 16).
Table 16 Perceived Degree to which the Organization’s Leadership has Knowledge of the
Planning Process Scale
Score Frequency Percent
1.00-1.49 0 0.00
1.50-2.49 2 2.90
2.50-3.49 13 18.60
3.50-4.49 20 28.60
4.50-5.49 27 38.60
5.50-6.00 8 11.40
70 100.00
Note. Mean = 4.38, Standard Deviation = .97
Note. The response scale used was 6 = strongly agree, 5 = agree, 4 = slightly agree, 3 = slightly
disagree, 2 = disagree, 1 = strongly agree. The interpretive scale used was 5.5-6.0 = strongly
agree, 4.5-5.49 = agree, 3.5-4.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.49 =
disagree, and 1.00-1.49 = strongly disagree.
a SA = strongly agree, A = Agree, AS = slightly agree, DS = slightly disagree, D = disagree, SD =
strongly disagree
Perceived Available Time the Organization has to Strategically Plan
As a component of the Perceived Obstacles to Strategic Planning Inventory, the
researcher designed the Perceived Available Time the Organization has to Strategically Plan
scale. This approach relied on input from a panel of academic experts, whose area of expertise
included research and theory, and industry experts, whose area of expertise included strategic
planning consulting. The items developed were as follows: 1) Our organization’s leadership
allocates time every month for long-term planning, 2) Our organization has time to allocate for
long-term planning, 3) Our organization utilizes time set aside to plan long-term, 4) Our
organization is focused on day-to-day operations more than on long-term planning, 5) Our
organization is focused on customer needs more than on long-term planning, 6) Our organization
is focused on revenues more than on long-term planning, 7) Our organization is focused on
regulatory concerns more than on long-term planning, and 8) Our organization is focused on
logistical concerns more than on long-term planning. Each item was measured using a 6-point
Likert-type response scale. The response options were strongly disagree, disagree, slightly
disagree, slightly agree, agree, and strongly agree. The higher the point value, the higher the
perceived available time the organization has to strategically plan
When analyzing the mean and standard deviation for each item of the Perceived
Available Time the Organization Has to Strategically Plan Scale, the researcher found that “Our
organization is focused on customer needs more than on long-term planning” had the highest
overall level of agreement, with a mean of 4.79 (SD=.87). The item with the lowest level of
agreement, “Our organization’s leadership allocates time every month for long-term planning,”
had a mean of 3.36 (SD=1.63). The reliability of the 8-item scale as measured using the
Cronbach’s Alpha was a=.84. To aid in the interpretation of the data, the researcher developed an
interpretive scale for the responses to the eight items. The interpretive scale had the following
categories: 5.5-6.0 = strongly agree, 4.5-5.49 = agree, 3.5-4.49 = slightly agree, 2.50-3.49 =
slightly disagree, 1.50-2.5 = disagree, and 1-1.5 = strongly disagree. When the mean item
responses were classified into categories, two of the items were in the “agree” category, three
were in the “slightly agree” category, and the remaining three were located in the “slightly
disagree” category. The means and standard deviations for the items are reported in Table 17.
Table 17 The Perceived Available Time the Organization has to Strategically Plan among Small
Businesses Owners / Managers in Louisiana
Mean Standard
Deviation
Interpretive
Scale
Category
Our organization is focused on customer needs more
than on long-term planning. 4.79 .87 A
Our organization is focused on day-to-day operations
more than on long-term planning. 4.69 1.00 A
Our organization is focused on revenues more than on
long-term planning. 4.33 1.09 AS
Our organization has time to allocate for long-term
planning. 3.80 1.42 AS
Our organization is focused on logistical concerns
more than on long-term planning. 3.57 1.22 AS
Our organization is focused on regulatory concerns
more than on long-term planning. 3.47 1.40 DS
Our organization utilizes time set aside to plan long-term. 3.43 1.49 DS
Our organization’s leadership allocates time every month for
long-term planning. 3.36 1.63 DS
Note. The response scale used was 6 = strongly agree, 5 = agree, 4 = slightly agree, 3 = slightly
disagree, 2 = disagree, 1 = strongly agree. The interpretive scale used was 5.5-6.0 = strongly
agree, 4.5-5.49 = agree, 3.5-4.49 = slightly agree, 2.50-3.49 = slightly disagree, 1.50-2.49 =
disagree, and 1.00-1.49 = strongly disagree.
a SA = strongly agree, A = Agree, AS = slightly agree, DS = slightly disagree, D = disagree, SD =
strongly disagree
To further analyze the Perceived Available Time the Organization Has to Strategically
Plan Scale, the researcher conducted a factor analysis to determine if underlying constructs
existed. Using the Shapiro-Wilks Test, the researcher first examined items for normality.
Additionally, the measure of sampling adequacy (MSA) was examined for both individual items
and the overall scale. The Kaiser-Meyer-Olkin MSA was .73. The lowest individual item MSA
was .67, which was higher than the minimum acceptable level of .50 as suggested by Hair et al.
(2006). All data met the assumptions for the use of factor analysis. Principal components analysis
with varimax rotation was used in conducting the factor analysis.
To determine the number of factors to be extracted, the researcher used both the Latent
Root criterion and the scree plot technique. The factor analysis was first computed without
restrictions on the number of factors extracted. The default minimum value of one was used on
the latent root measure. The scree plot was examined in order to identify the optimum number of
factors for extraction. The researcher identified the most pronounced bend in the scree plot curve.
From this examination, the optimum number of factors was determined to be two, plus or minus
one. Each factor was then examined for three criteria. First, each of analyses was examined to
determine whether the items in each of the extracted factors met the minimum acceptable loading
criteria as identified by Hair et al. (2006). Hair et al. (2006) suggested that .30 would meet the
criterion for exploratory research. Secondly, the analysis was examined for inefficient factors or
factors containing only one or two items. Constructs with only one item are of little use to the
researcher, as the purpose of the analysis is to identity underlying constructs in the data. Lastly,
the researcher examined each of the analyses for the presence of significant cross-loadings. If an
item loads significantly on multiple factors, it is possible that the respondents perceived the item
differently. Due to the factor loadings, the number of inefficient factors and the number of
substantial cross-loadings, the optimum number of factors was determined to be one. The
Eigenvalue for the factor was 3.80 and the factor explained 47.52% of the variance (see Table
18).
The researcher’s next step was to compute an overall Perceived Available Time the
Organization Has to Strategically Plan score. However, for items 1) Our organization’s
leadership allocates time every month for long-term planning, 2) Our organization has time to
Table 18 Factor Loadings of Items in the Perceived Available Time the Organization has to
Strategically Plan Scale
Component
Our organization utilizes time set aside to plan long-term. -.83
Our organization’s leadership allocates time every month for long-term
planning. -.80
Our organization has time to allocate for long-term planning. -.71
Our organization is focused on logistical concerns more than on long-term
planning. .70
Our organization is focused on customer needs more than on long-term
planning. .67
Our organization is focused on regulatory concerns more than on long-term
planning. .62
Our organization is focused on revenues more than on long-term planning. .61
Our organization is focused on day-to-day operations more than on long-term
planning. .54
Note. Eigenvalue = 3.80, Percent of variance explained = 47.52%
allocate for long-term planning, and 3) Our organization utilizes time set aside to plan
long-term, a high level of agreement indicated a positive perception of available time to
strategically plan. For the remaining items, 4) Our organization is focused on day-to-day
operations more than on long-term planning, 5) Our organization is focused on customer needs
more than on long-term planning, 6) Our organization is focused on revenues more than on
longterm planning, 7) Our organization is focused on regulatory concerns more than on long-
term planning, and 8) Our organization is focused on logistical concerns more than on long-term
planning, a low level of agreement, or disagreement, indicated a positive perception of available
time to strategically plan. Due to the reverse wording of a portion of the items, computing a
factor score would have been ineffective. Therefore, the items were recoded to reflect a higher
value, consistent with other items that indicated a positive response to planning. Specifically, the
reverse worded items were coded so that Strongly Disagree = 6, Disagree = 5, Slightly Disagree
= 4, Slightly Agree = 3, Agree = 2, and Strongly Agree = 1. The value for each item was coded so
that the higher value indicated the more positive response. The item with the most positive
response was Our organization has time to allocate for long-term planning (Mean=3.80,
SD=1.42). The item with the lowest mean response (most negative) was Our organization is
focused on customer needs more than on long-term planning (Mean=2.21, SD=.87). Recorded
mean item response scores are presented in Table 19.
Table 19 Means and Standard Deviations for Reverse Coded Items in Perceived Available Time
the Organization has to Strategically Plan Scale
Mean Standard
Deviation
Interpretive
Scorea
Our organization has time to allocate for long-term 3.80 1.42 PS
planning.b
Our organization is focused on regulatory concerns
more than on long-term planning.b 3.53 1.40 PS
Our organization is focused on logistical concerns
more than on long-term planning. b 3.43 1.22 NS
Our organization utilizes time set aside to plan
longterm. b 3.43 1.49 NS
Our organization’s leadership allocates time every
month for long-term planning. b 3.36 1.63 NS
Our organization is focused on revenues more than
on long-term planning. b 2.67 1.09 NS
Our organization is focused on day-to-day
operations more than on long-term planning. b 2.31 1.00 N
Our organization is focused on customer needs more
than on long-term planning. b 2.21 .87 N
Note. The original response scale used was 6 = Strongly Disagree, 5 = Disagree, 4 = Slightly
Disagree, 3 = Slightly Agree, 2 = Agree, 1 = Strongly Agree. The interpretive scale used was 5.5-
6.0 = strongly positive, 4.5-5.49 = positive, 3.5-4.49 = slightly positive, 2.50-3.49 = negative,
1.50-2.49 = slightly negative, and 1.00-1.49 = strongly negative.
aSP = strongly positive, P = positive, SP = slightly positive, N = negative, NS = slightly
negative, SN = strongly negative
bReverse coded item scale recoded as follows: 1= SA, 2 = A, 3 = AS, 4 = SD, 5 = D, 6 =
DS Using the consistently coded items in the single factor identified in the factor analysis,
the researcher computed the perceived available time the organization has to strategically plan
score, which was the mean of the eight items in the factor. The mean score was 3.09 (SD=0.88),
with values ranging from 1.25 to 5.13. These scores were grouped into response categories, as
shown in Table 22. When the Perceived Available Time the Organization Has to Strategically
Plan Scale was examined by response category, the category with the largest number of scores
was 2.50-3.49 (n=26, 41.40%) (see Table 20).
Table 20 Perceived Available Time the Organization has to Strategically Plan Scale
Score Frequency Percent
1.00-1.49 3 4.29
1.50-2.49 16 22.90
2.50-3.49 26 37.14
3.50-4.49 21 30.00
4.50-5.49 4 5.70
5.50-6.00 0 0.00
Total 70 100.00
Note. Mean = 3.09 Standard Deviation = .88
Note. The response scale used was 6 = Strongly Disagree, 5 = Disagree, 4 = Slightly Disagree, 3
= Slightly Agree, 2 = Agree, 1 = Strongly Agree. The interpretive scale used was 5.5-6.0 =
strongly disagree, 4.5-5.49 = disagree, 3.5-4.49 = slightly disagree, 2.50-3.49 = slightly agree,
1.50-2.49 = agree, and 1.0-1.49 = strongly agree. a SA = strongly agree, A = Agree, AS = slightly
agree, DS = slightly disagree, D = disagree, SD = strongly disagree
Objective Four
The fourth objective of this study is to determine if a relationship exists between
Louisiana small business owners' perceived obstacles to strategic planning and each of the
demographic and perceived obstacles to planning measures included in the study. The first of
these demographic measures was the industry in which the organization is positioned. This
measure included the 24 categories of industries identified by the Louisiana Small Business
Association. However, with only 70 respondents in the study and 24 possible responses, the
number of responses in most of the categories were too small to enable a comparison on the
strategic planning score variable. Only one category, Professional Services, had a sufficient
number of responses to allow the examination of the proposed relationship. In addition, since this
variable was nominal in nature, a comparative analysis was judged to be preferable to the use of
correlational statistics. Therefore, since only one category had sufficient numbers for analysis, a
t-test was used to compare those respondents that reported Professional Services with other
respondents. The comparative statistic was chosen over a correlation coefficient for the ease of
interpretation of the findings. The mean strategic planning score for all respondents other than
Professional Services was 4.74 (SD=.71). The mean strategic planning score for Professional
Services industries was 4.52 (SD=.65). Levene’s Test for equality of variances was not
significant (F=.15, p=.71), indicating that the assumption of equal variances was met. Therefore,
the pooled variance estimate was used in computing the t-test. Based on this test, no significant
difference was found in mean strategic planning score between the two groups (t68=1.22, p=.23).
The second variable examined for a relationship with the strategic planning score was
“legal structure of the business.” The Louisiana Small Business Association identifies five
categories of legal business structure represented in the state of Louisiana. Of these five
categories, only two had sufficient respondents to enable the examination of their relationship
with the “perceived degree to which the organization conducts strategic planning.” Of the 70
respondents, 38 self-identified as a Limited Liability Corporation. A t-test was conducted to
examine whether or not differences existed in mean strategic planning score between
respondents identifying as a Limited Liability Corporation and all other types of legal structure.
The mean strategic planning score for Limited Liability Corporations was 4.58 (SD=.75). The
mean strategic planning score for non-Limited Liability Corporations was 4.77 (SD=.61).
Levene’s Test for equality of variances was not significant (F=.18, p=.67), indicating that the
assumption of equal variances was met. Therefore, the pooled variance estimate was used in
computing the t-test. Based on this test, no significant difference was found in mean strategic
planning score between the two groups (t68=1.17, p=.25).
A second t-test was conducted to examine whether or not differences existed in mean
strategic planning score between respondents identifying as a Subchapter S Corporation (S-Corp)
and all other types of legal structure. The mean strategic planning score for Subchapter S
Corporations was 4.80 (SD=.62). The mean strategic planning score for non-Subchapter S
Corporations was 4.62 (SD=.72). Levene’s Test for equality of variances was not significant
(F=.18, p=.67), indicating that the assumption of equal variances was met. Therefore, the pooled
variance estimate was used in computing the t-test. Based on this test, no significant difference
was found in mean strategic planning score between the two groups (t68=-.93, p=.36). No other
statistical tests were conducted on small business legal structure because the sample size for each
of the remaining categories was too small to conduct an analysis.
A third t-test was conducted to examine whether or not differences existed in mean
strategic planning score between respondents who identified as having or not having a written
long-term plan. The mean strategic planning score for respondents who had a written long-term
plan was 4.98 (SD=.62). The mean strategic planning score for respondents who did not have a
written long-term plan was 4.51 (SD=.68). Levene’s Test for equality of variances was not
significant (F=.07, p=.80), indicating that the assumption of equal variances was met. Therefore,
the pooled variance estimate was used in computing the t-test. Based on this test, a significant
difference was found in mean strategic planning score between the two groups (t68 = 2.773, p
= .007). Therefore, those respondents who said they had a written long-term plan had higher
strategic planning scores then those who did not.
Pearson Product Moment Correlation Coefficients (PPMr) were calculated between
strategic planning score and the demographic variables measured on a continuous scale of
measurement. These included years the organization has been in business and number of
employees on the payroll, as well as variables that measured perceived obstacles to strategic
planning. No significant relationship existed between years in business and strategic planning
score (r = -.109, p = .37). Additionally, no significant relationship existed between number of
employees and strategic planning score (r = -.066, p = .59). There was, however, a significant
positive relationship between the perceived degree to which the organization conducts strategic
planning and the perceived quality of the organization’s employees (r = .367, p < .002), the
perceived degree to which the organization’s leadership has knowledge of the planning process
(r = .330, p = .005), and the perceived available time the organization has to strategically plan (r
= .322, p = .004). Therefore, for all three relationships, a higher score was associated with a
higher strategic planning score (see Table 21).
Table 21 Relationships with the Perceived Degree to which the Organization Conducts Strategic
Planning
aPPMr p value bDescriptor
Perceived quality of the organization’s employees .367 .002 MA
Perceived degree to which the organization’s leadership has
knowledge of the planning process .330 .005 MA
Perceived available time the organization has to strategically
plan .322 .007 MA
Years the organization been in business -.109 .369 LA
Number of employees currently on the organization’s
payroll -.066 .588 NA
aPearson Product Moment Correlation Coefficients bDavis’ Descriptors (1971): .00 to .09 =
Negligible Association, .10 to .29 = Low Association, .30 to .49 = Moderate Association, .50
to .69 = Substantial Association, and .70 or higher = Very Strong Association
NA = Negligible Association, LA = Low Association, MA = Moderate Association, SA =
Substantial Association, VS = Very Strong Association
Objective Five
In order to determine if a model exists explaining a significant portion of the variance in
Louisiana small business owners' perceived degree to which the organization conducts strategic
planning, a stepwise regression analysis was conducted. To ensure that there were no excessive
levels of collinearity among the variables in this study. the variance inflation factors (VIF) were
examined. According to Hair et al. (2006), “A common cutoff threshold is a tolerance value
of .10 which corresponds to a VIF value of 10” (p. 230). The VIF values in this analysis ranged
from 1.028 to 1.404, indicating no excessive multicollinearity between factors. Bivariate
correlations were examined between all factors used as independent variables and “the perceived
degree to which the organization conducts strategic planning.” Of the nine factors, the three
perceptual factors had the highest correlations, ranging from .322 to .367. The remaining six
factors had lower correlations, with the exception of written plan, which had a correlation
of .319. These correlations are presented in Table 22.
Table 22 Correlations between the Perceived Degree to which the Organization Conducts
Strategic Planning and Selected Demographic and Perceptual Factors
N ar p value bDescriptor
Perceived quality of the organization’s employees 70 .367 .001 MA
Perceived degree to which the organization’s leadership
has knowledge of the planning process 70 .330 .003 MA
Perceived available time the organization has to
strategically plan 70 .322 .003 MA
Written long-term plan 70 .319 .004 MA
Positioned in the professional services industry 70 -.146 .114 LA
Legal structure of the business as Limited Liability
Corporation 70 -.140 .123 LA
Legal structure of the business as Subchapter S
Corporation 70 .112 .179 LA
Years the organization been in business 70 -.109 .184 LA
Number of employees currently on the organization’s
payroll. 70 -.066 .294 NA
aPearson Product Moment Correlation Coefficients
bDavis’ Descriptors (1971): .00 to .09 = Negligible Association, .10 to .29 = Low Association, .30
to .49 = Moderate Association, .50 to .69 = Substantial Association, and .70 or higher = Very
Strong Association
NA = Negligible Association, LA = Low Association, MA = Moderate Association, SA =
Substantial Association, VS = Very Strong Association
The first variable to enter the regression model was “the perceived quality of the
organization’s employees,” with an R square of .134, F(1,68) = 10.56, p = .002, explaining
13.4% of the variance in “the perceived degree to which the organization conducts strategic
planning.” The second variable entered was whether or not the organization had a “written
longterm plan,” which had an R square change of .073, F(1,67) = 6.17, p = .015, explaining an
additional 7.3% of the variance in “the perceived degree to which the organization conducts
strategic planning.” These two variables combined explained 20.7% of the variance in “the
perceived degree to which the organization conducts strategic planning.”
Two additional variables added one percent or more to the explained variance. However,
these two variables were individually non-significant. The first of the two non-significant
variables that entered the model was “the perceived degree to which the organization’s leadership
has knowledge of the planning process,” with an R square change of .026, F(1,66) = 2.28, p
= .136. This 2.6% increase in explained variance was individually not significant; however, it
was included in the model because it added one percent or more of explained variance while the
overall model remained significant. Similarly, whether or not the small business was positioned
in “professional services,” industry an R square change of .010, F(1,65) = .359, was added to the
model with a 1% increase in explained variance. This 1% increase in explained variance was
individually not significant; however, it also was included in the model because it added one
percent or more of explained variance while the overall model remained significant. These two
variables combined, though not individually significant, explained 3.6% of the variance in “the
perceived degree to which the organization conducts strategic planning.”
The total R square for this model was .244 and the four variables, in combination,
explained 24.4% of the variance in “the perceived degree to which the organization conducts
strategic planning.” The results of the regression indicate subjects with higher scores on “the
perceived quality of the organization’s employees” and “the perceived degree to which the
organization’s leadership has knowledge of the planning process” tended to have higher scores
on “the perceived degree to which the organization conducts strategic planning.” Furthermore,
those respondents who answered “yes” to whether or not they had a “written long-term plan”
tended to have a higher “perceived degree to which the organization conducts strategic planning”
score. Similarly, those respondents who indicated that their organizations were positioned in the
“professional services” industry tended to have lower “perceived degree to which the
organization conducts strategic planning” scores. The results of the regression analysis are
presented in Table 23.
Table 23 Multiple Regression Analysis of “The Perceived Degree to Which the Organization
Conducts Strategic Planning” on Selected Perceptual and Demographic Measures among
Louisiana Small Businesses
ANOVA
Sources of Variation df MS F P
Regression 4 2.010 5.238 .001
Residual 65 .384
Total 69
Model Summary
Model R Square R Square
Change
F Change Sig. F
Change
Standardized
Coefficients
Beta
Perceived quality of the
organization’s employees .134 .134 10.557 .002 .278
Written long-term plan .207 .073 6.171 .015 .216
Perceived degree to which
the organization’s
leadership has knowledge
of the planning process
.234 .026 2.278 .136 .177
Professional services .244 .010 .852 .359 -.101
Variables not in the Equation
Variables t P
The Perceived Available Time the
Organization Has to Strategically Plan .993 .325
Number of employees are currently on
the organization’s payroll -.892 .376
Legal structure of the business as
Subchapter S Corporation .519 .605
Years the organization been in business -.255 .800
Legal structure of the business as
Limited Liability Corporation -.172 .864
