Effects of Aligning Parenting Strategies and Knowledge Management Strategies on Execution Quotient (XQ) in the Parent Companies

Execution Quotient (XQ) is a measurement tool for your organization’s health. The implementation of organizational strategies and the achievement of organizational goals are a function of XQ. Without XQ, one cannot expect acceptable performance. Alignment consisting of coordination, fitness and coherence between different levels of strategies, is one of the key factors for successful implementation of organizational level strategies. Nowadays, holding companies formulate appropriate parenting strategies to manage their affiliated firms, but in order to implement these strategies at organizational level, they need to choose and implement business and functional level strategies in light of parenting strategies alignment. This
research intends to discover the degrees of alignment between parenting strategy and knowledge management (KM) strategy in the Iranian holding companies and to reach a model for its effects on XQ. In this descriptive and applied study, an appropriate model was developed based on the literature review. To measure XQ and alignment between parenting and knowledge management strategies, a sample of 30 parent state companies were selected to complete the questionnaires. The findings illustrate that XQ is influenced by strategic alignment and this effect follows an S-shaped curve.
Therefore, it is necessary to develop appropriate mechanisms to enhance XQ through aligning strategies at different levels in the holding companies.