Re-Viewing Strategy Processes,Ron Bradfield Graduate School of Business University of Strathclyde,Schools of thought in Strategy,Outcomes,Pluralistic,Profit-maximizing,Deliberate,Emergent,Processes,CLASSICAL,EVOLUTIONARY,SYSTEMIC,PROCESSUAL,Ansoff Chandler Sloan Drucker Porter,Henderson Aldrich Hannan & Freeman Williamson,Cyert & Marsh Simon Mintzberg Pettigrew,Morgan Granovetter Whitley Pascale Shrivastava,The Three Strategy Lenses,As design - logical, analytical and planned As experience - adaptation, cultural and political As ideas - emergent from diversity and variety,The strategy lenses are different ways of viewing strategy development:-,Assumptions of the Design Lens,Thinking precedes action Strategy making is deliberate Strategy is logical and clear Top managers are strategic decision makers and directors of strategy Organisations are mechanistic and hierarchical,The Design Lens Highlights:,The potential benefits of systematic thinking to handle complexity and uncertainty The need for planning and control The benefits of analytic tools and techniques,But:,Failure to achieve ownership of plans Detail rather than vision Informed overload Strategy as the plan Planning as ritual,Assumptions of the Experience Lens,Individual and collective experience is central Therefore culture and history strongly influences strategic thinking and choices Bargaining and negotiation determine strategic direction Strategies are likely to develop incrementally,Experience is Both,An advantage Problematic,The Experience Lens Highlights:,The importance of collective experience The links between taken for granted assumptions and ways of doing things The use of analytic/planning techniques to post rationalize and justify The risk of strategic drift,But how do we account for:,Penicillin? Mobile Phones? The Walkman? Post Its? Microwave Ovens?,Paradigm (or Recipe), the beliefs and assumptions held in common and taken for granted in an organisation ,If Unsatisfactory,(After J-C Spender),Stories,Symbols,Rituals & Routines,Paradigm,Power Structures,Control System,Organisational Structures,The Cultural Web of an Organisation,The Ideas Lens,. builds on complexity and evolutionary theories,The Ideas Lens,Ideas are generated through variety: Naturally: Environmental Change and unpredictability Diversity of experience Informal links/”weak ties” Intuition Imperfect copying,The Ideas Lens,Ideas are generated through variety: Deliberately: Experiments “Low cost probes” Moving people around Recruiting “outsiders” Incentives Reduction of boundaries Adaptive tension / edge of chaos “Simple rules”,Simple Rules,Source: Eisenhart and Sull,Selection of Ideas Through:,Market forces Project evaluation and budgeting processes Organisational culture Institutional legitimacy Attractiveness to people,Retention of Ideas Through:,Sufficient support from - champions - communities of interest Routinization Diffusion and acceptance across an industry,Management Implications,Managers cannot know or plan the future Managers need to be aware of, sensitive to and responsive to the wider environment Managers need to find ways of encouraging variety and diversity This will not be achieved by tight strategic control Formal plans and systems are de-emphasized Managers can create context And establish simple rules to create adaptive tension,Implications:,No one “right” approach Managers need to operate with all 3 lenses Requires “reflective” managers,The dangers are: Unitary perspectives on managing A lack of realism about the role and limitations of top management,Forms of Strategy,Intended Strategy,Unrealised Strategy,Deliberate Strategy,Emergent Strategy,Realised Strategy,Mintzberg,Shareholder Value,Corporations are instruments whose purpose it is to create economic value on behalf of those who invest risk taking capital in the enterprise. This clear purpose should drive companies regardless of whether they are privately or publicly held and therefore business strategies should be judged by the economic value they create for the shareholders. PWC,Economic Value Added,Defined as “ a performance measurement of economic return which takes account of profitability, the total cost of capital and the amount of assets under a managers control” Calculated as economic earnings less charge for weighted average cost (WACC) of capital employed. Therefore it measures managers in much the same way as investment fund managers are measured and aligns management performance goals with the expectations of shareholders and their opportunity cost of capital.,The Search for Uniqueness,Kanban Quality Circles CORE TQM JIT ZBB ABC MBO BPR SVA EVA VBM CRM SRM 6 Sigma Strategic Relationship Marketing E-everything Outsourcing and Offshoring Balanced Scorecard ?,“ the possibility that the only truly sustainable