Intended Strategy Development
Intended Strategy Development
Intended Strategy Development
Strategy leadership as design. It could be that the strategic leader has thought
through the strategy analytically. This might be by using the sort of techniques
associated with strategic analysis and evaluation, or it might simply be that the
individual has consciously, systematically and on the basis of his or her own logic
worked through issues the organisation faces and come to his or her own
conclusions.
Strategy leadership as vision. It could be that a strategic leader determines or
is associated with an overall vision, mission or strategic intent (see section 4.5.2)
that motivates others, helps create the shared beliefs within which people can
work together effectively and shapes more detailed strategy developed by others
in an organisation. Some writers see this as the role of the strategic leader.2
Strategy leadership as command. The strategy of an organisation might also
be dictated by an individual. This is, perhaps, most evident in owner-managed
small firms, where that individual is in direct control of all aspects of the
business. Danny Miller and Isabel Le-Breton suggest there are advantages and
disadvantages here. On the plus side it can mean speed of strategy adaptation
and sharp, innovative, unorthodox strategies that are difficult for other
companies to imitate. The downside can, however, be hubris, excessive risk
taking, and quirky, irrelevant strategies.
department that, in effect, has a coordination role. The corporate board then has
to approve the corporate plan.
Financial and strategic targets are then likely to be extracted to provide a
basis for performance monitoring of businesses and key strategic priorities on
the basis of the plan.
None the less a strategic planning system may have many uses. First, it may
indeed play a role in how the future organisational strategy is determined. For
example, it might:
Help structure analysis and thinking about complex strategic problems.
Encourage questioning and challenge of received wisdom taken for granted in
an organisation.
Encourage a longer-term view of strategy than might otherwise occur. Planning
horizons vary, of course. In a fast-moving consumer goods company, 35-year
plans may be appropriate. In companies which have to take very long-term views
on capital investment, such as those in the oil industry, planning horizons can be
as long as 15 years (in Exxon) or 20 years (in Shell).6
Enhance coordination of business-level strategies within an overall corporate
strategy.
Henry Mintzberg has, however, challenged the extent to which planning provides
such benefits.7 Arguably there are four main dangers in the way in which formal
systems of strategic planning have been employed:
Confusing strategy with the plan. Managers may see themselves as managing
strategy when what they are doing is going through the processes of planning.
Strategy is, of course, not the same as the plan: strategy is the long-term
direction that the organisation is following, not just a written document linked to
this may be a confusion between budgetary processes and strategic planning
processes; the two may come to be seen as the same. The result is that planning
gets reduced to the production of financial forecasts rather than the thinking
through of the sort of issues discussed in this book. Of course it may be
important to build the output of strategic planning into the budgetary process,
but they are not the same.
Detachment from reality. The managers responsible for the implementation of
strategies, usually line managers, may be so busy with the day-to-day operations
of the business that they cede responsibility for strategic issues to specialists or
consultants. However, these rarely have power in the organisation to make
things happen. The result can be that strategic planning becomes an intellectual
exercise removed from the reality of operation. Strategic planning can also
become over-detailed in its approach, concentrating on extensive analysis that,
whilst technically sound in itself, misses the major strategic issues facing the
organisation. For example, it is not unusual to find companies with huge amounts
of information on their markets, but with little clarity about the strategic
importance of that information. The result can be information overload with no
clear outcome. At the extreme, strategic planners may come to believe that
centrally planned strategy determines what goes on in an organisation. In fact it
is what people do and the experience they draw on to do it that are likely to play
a much more significant role (see section 11.5.1 and Chapter 15). If formal
planning systems are to be useful, those responsible for them need to draw on
such experience and involve people throughout the organisation if planning is to
avoid being removed from organisational reality.
Lack of ownership. The strategy resulting from deliberations of a corporate
planning department, or a senior management team, may not be owned more
widely in the organisation. In one extreme instance, a colleague discussing a
companys strategy with its planning director was told that a strategic plan
existed, but found it was locked in the drawer of the executives desk. Only the
planner and a few senior executives were permitted to see it! There is also a
danger that the process of strategic planning may be so cumbersome that
individuals or groups might contribute to only part of it and not understand the
whole. The result can be that the business-level strategy does not correspond to
the intended corporate strategy. This is particularly problematic in very large
firms.
Dampening of innovation. Highly formalised and rigid systems of planning,
especially if linked to very tight and detailed mechanisms of control, can result in
Logical incrementalism
Logical incrementalism is the deliberate development of strategy by
experimentation and learning from partial commitments.
Logical incrementalism is the development of strategy by experimentation and
learning from partial commitments rather than through global formulations of
total strategies.15 There are a number of reasons this is likely to be so:
Environmental uncertainty.
Generalized view of strategy
Experimentation
Coordinating emergent strategies.
Quinn argues that, despite its emergent nature, logical incrementalism can be a
conscious, purposeful, proactive, executive practice to improve information
available for decisions and build peoples psychological identification with the
development of strategy. In a sense, then, logical incrementalism encapsulates
processes that bridge intention and emergence, in that they are deliberate and
intended but rely on social processes within the organisation to sense the
environment and experiments in subsystems to try out ideas.
Since change will be gradual, the possibility of creating and developing a
commitment to change throughout the organisation is increased. Because the
different parts, or subsystems, of the organisation are in a continual state of
interplay, the managers of each can learn from each other about the feasibility of
a course of action.
Organisational politics
Cultural processes
So a cultural explanation of strategy development is that it occurs as the
outcome of the taken-for-granted assumptions and behaviours in organisations.
The important thing to stress here is that this taken-for-grantedness works to
Advocates of the learning organisation31 point out that the collective knowledge
of all the individuals in an organisation usually exceeds what the organisation
itself knows and is capable of doing; the formal structures of organisations
typically stifle organisational knowledge and creativity.
encourage processes that unlock the knowledge of individuals, and encourage
the sharing of information and knowledge, so that every individual becomes
sensitive to changes occurring around them and