Miles and Snow’s Organizational

Strategies
To succeed in any competition requires a strategy. It doesn’t particularly matter
where you are competing, or what you are competing in, you are going to need a
strategy if you are to come out on top.

That concept is true in sports, and it is certainly true in business. Even companies
with the best products in the world need a sound strategy in order to make sure
those products wind up in the hands of as many consumers as possible. An
organization without a clearly defined strategy is destined to fail.

In order to match up your organizational goals with the strategies that you use on an
ongoing basis, it may be helpful to consult with Miles and Snow’s Organizational
Strategies tool.

The ideas presented in this tool can be greatly helpful when trying to ensure that all
actions taken within an organization are working toward the same desired result. If a
company’s strategy does not make sense of the goals that it has in place, it will be
difficult to reach a satisfactory conclusion.

Miles and Snow identify four unique strategies that are used by organizations. Below
we will quickly look at each of these four, and what they say about the underlying
business.

Prospector
When an organization falls into the category of Prospector, they are expected to
consistently be on the forefront of innovation and development. Rather than sitting
still with products that have been previously developed and taken to market,
prospecting organizations are always seeking to create the ‘next big thing’.

By definition, this type of organization is going to have some huge successes, and
they are also likely to have some big misses as well. The goal, of course, is to have
the hits outweigh the misses, so that the company can continue to afford to innovate
well into the future.

Technology companies often fall into the category of Prospector, but not always.
Some tech companies continue to push the envelope, trying to lead the way in new
product development – which can force the competition to constantly play catch up.
However, other tech companies will simply rest on what they have done and ride it
out for maximum profits until the market moves on to something else.

Defender
As the name would indicate, this is an organization that is satisfied with their current
place in the market – and they are going to work hard to defend it as the years go by.
Instead of investing time and money into trying to develop new products to take to
the market, this kind of an organization is going to sit back and reap the rewards of
what they have already created.
Of course, no one can stay in business by sitting still, so it will be necessary to make
at least modest improvements along the way to remain relevant and competitive.
Often, these developments come ‘behind the scenes’ in the form of manufacturing
improvements, cost savings, etc.

It should be noted that a firm does not have to remain in just one of these strategy
categories for its entire existence. It is quite common for firms to shift from one to the
other as markets develop. Commonly, companies that were once considered
innovative in their space will slide gradually into defender territory as less and less
innovation is possible in their given market. Understanding when and how to shift
from one strategy to another is crucial if profits and market share are to be
maintained.

Analyzer
In many ways, organizations that land in the analyzer category are a blend of the first
two options on the list. These tend to be some of the biggest companies around, as
they have the capacity to both develop new technologies and products as well as
defend the market for those they have already created.

When you think of the biggest brand names in the world, many of them are going to
fit nicely under the analyzer definition.

Usually, the companies that are true analyzers will not actually be the first to create
something, but they may instead improve upon the creation of another firm.
Therefore, they are innovators to a degree, but not in the truest sense of the word.
This type of firm will generally sit back, observe the market and its demands, and
then seek to fill those demands as successfully as possible. Thanks to their typically
large size, this type of company can be late to the market with a specific product and
still be successful in the end.

Reactor
The final category on the list, those firms that land in the reactor category really have
no one specific approach to their business. It should go without saying that
organizations generally do not want to fall into the reactor class, as this means that
they are simply trying to catch up with the market as things change over time.

Taking a reactive approach to business is how many large companies wind up losing
market share over time. Even businesses with great ideas, products, and employees
can wind up lagging behind if their management team takes a reactive approach to
their decision making. It is nearly inevitable that companies who react to the market
are going to be passed up by the organizations who innovate, defend, or analyze
successfully.

It is important to know where your organization fits within this framework. Once you
have a clear picture of which of these four ways you are going to use to compete in
the market, you can then structure the design of your operations in a way that will
suit the strategy you have taken. For instance, as company that wants to innovate is
going to need plenty of creative thinkers within the organization in order to actually
lead the way in terms of new creations. Without the right people, or the proper
infrastructure, it is hard to successfully execute your intended strategy over the years
to come.
 Key Points
 lMiles and Snow suggest that business level strategies generally fall into one
of four categories: prospector, defender, analyzer, and reactor.
 A Prospector is innovative and growth oriented, searches for new markets
and new growth opportunities, and encourages risk taking.
 A Defender protects their current markets, maintains stable growth, and
serves current customers.
 An Analyzer maintains current markets and current customer satisfaction with
moderate emphasis on innovation.
 A Reactor has no clear strategy but reacts to changes in the environment and
drifts with events.
 The ideas presented in this tool can be greatly helpful when trying to ensure
that all actions taken within an organization are working toward the same
desired result.
 is innovative and growth oriented, searches for new markets and new growth
opportunities, and encourages risk taking.
 A Defender protects their current markets, maintains stable growth, and serves
current customers.
 An Analyzer maintains current markets and current customer satisfaction with
moderate emphasis on innovation.
 A Reactor has no clear strategy but reacts to changes in the environment and drifts
with events.
 The ideas presented in this tool can be greatly helpful when trying to ensure that all
actions taken within an organization are working toward the same desired result.
ORGANIZATIONAL CULTURE DEFINITION AND CHARACTERISTICS

Organizational culture includes an organization’s expectations, experiences, philosophy, as well as

the values that guide member behavior, and is expressed in member self-image, inner workings,
interactions with the outside world, and future expectations. Culture is based on shared attitudes,
beliefs, customs, and written and unwritten rules that have been developed over time and are
considered valid (The Business Dictionary).

Culture also includes the organization’s vision, values, norms, systems, symbols, language,
assumptions, beliefs, and habits (Needle, 2004).

Simply stated, organizational culture is “the way things are done around here” (Deal & Kennedy,
2000).

While the above definitions of culture express how the construct plays out in the workplace, other
definitions stress employee behavioral components, and how organizational culture directly
influences the behaviors of employees within an organization.

Under this set of definitions, organizational culture is a set of shared assumptions that guide what
happens in organizations by defining appropriate behavior for various situations (Ravasi & Schultz,
2006). Organizational culture affects the way people and groups interact with each other, with
clients, and with stakeholders. Also, organizational culture may influence how much employees
identify with their organization (Schrodt, 2002).

In business terms, other phrases are often used interchangeably, including “corporate culture,”
“workplace culture,” and “business culture.”

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HOW IS ORGANIZATIONAL CULTURE CREATED AND COMMUNICATED?

Business leaders are vital to the creation and communication of their workplace culture. However,
the relationship between leadership and culture is not one-sided. While leaders are the principal
architects of culture, an established culture influences what kind of leadership is possible (Schein,
2010).

Leaders must appreciate their role in maintaining or evolving an organization’s culture. A deeply
embedded and established culture illustrates how people should behave, which can help employees
achieve their goals. This behavioral framework, in turn, ensures higher job satisfaction when an
employee feels a leader is helping him or her complete a goal (Tsai, 2011). From this perspective,
organizational culture, leadership, and job satisfaction are all inextricably linked.

Leaders can create, and also be created or influenced by, many different workplace cultures. These
differences can manifest themselves is a variety of ways including, but not limited to:

WORKPLACE CULTURE DIFFERENCES

Person Culture and Market Culture

How members of an organization conduct business, treat employees, customers, and the wider
community are strong aspects of person culture and market culture. Person culture is a culture in
which horizontal structures are most applicable. Each individual is seen as more valuable than the
organization itself. This can be difficult to sustain, as the organization may suffer due to competing
people and priorities (Boundless, 2015). Market cultures are results-oriented, with a focus on
competition, achievement, and “getting the job done” (ArtsFWD, 2013).

Adaptive Culture and Adhocracy Culture

The extent to which freedom is allowed in decision making, developing new ideas and personal
expression are vital parts of adaptive cultures and adhocracy cultures. Adaptive cultures value
change and are action-oriented, increasing the likelihood of survival through time (Costanza et al.,
2015). Adhocracy cultures are dynamic and entrepreneurial, with a focus on risk-taking, innovation,
and doing things first (ArtsFWD, 2013).

Power Culture, Role Culture, and Hierarchy Culture

How power and information flow through the organizational hierarchy and system are aspects of
power cultures, role cultures, and hierarchy cultures. Power cultures have one leader who makes
rapid decisions and controls the strategy. This type of culture requires a strong deference to the
leader in charge (Boundless, 2015). Role cultures are where functional structures are created, where
individuals know their jobs, report to their superiors, and value efficiency and accuracy above all else
(Boundless, 2015). Hierarchy cultures are similar to role cultures, in that they are highly structured.
They focus on efficiency, stability, and doing things right (ArtsFWD, 2013).
Determining Forces of Organizational
Change
Organization as a system, depend on many interdependent factors which influence it’s day to day
functioning, strategic decisions and future action plans for facing the competitive challenges
successfully. These factors can be both internal and external in nature and determine an organization’s
readiness for change as well as it’s preparedness.

External Forces of Organizational Change

The external forces of change stem up from the external environment. These forces have been
described below:

Political Forces: With the rapidly changing global political scenario and the upheavals in the global
politics, the worldwide economy is equally undergoing a quick change and presenting several
challenges before the organization in the form of changes in regulations, policies and also the
economic framework in the form of globalization and liberalization.

Economic Forces: The economic forces influence organization’s change management strategy by
either presenting opportunities or challenges in the form of economic uncertainties or growing
competitive pressures.

Various factors such as changes in the business cycle, prevalent inflation or deflation rate in the
economy, fluctuation in the interest rates, economic recession, changes in the economic policies or tax
structures, import/export duties, fluctuation in the oil prices globally, financial stability of the country
and also loss/increase in the consumer confidence towards the economic conditions of the country
are some of the crucial factors. For example change in the global market, economies create a ripple
like effect and affect the Indian markets too in terms of fluctuations in the capital markets,
employment opportunities and rise or fall in the consumer demand.

Technological Forces: Technological advancements and innovations in communication and computer

technology, have revolutionized the organizational functioning by facilitating newer ways of working
and added in newer range of products/services thus creating a need for developing a framework for
managing change effectively and proactively responding to the challenges as a result of these
changes due to the technological forces.

Advancements in the technological field greatly contribute to the overall economic development in
the country and also the organization’s success or failure in the competitive environment. One of the
glowing examples is Singapore, which has emerged as one of the powerful economies within recent
times in spite of no natural resource availability. With the usage of Information Technology in the
strategic decision making and overall planning, today Singapore holds the status of being the world’s
first completely networked economy in which all homes, administrative offices,
schools/colleges/professional institutions, businesses and government branches are connected
electronically.

Task Culture and Clan Culture

How committed employees are towards collective objectives are parts of task cultures and clan
cultures. In a task culture, teams are formed with expert members to solve particular problems. A
matrix structure is common in this type of culture, due to task importance and the number of small
teams in play (Boundless, 2015). Clan cultures are family-like, with a focus on mentoring, nurturing,
and doing things together (ArtsFWD, 2013).

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HOW AND WHY DOES ORGANIZATIONAL CULTURE CHANGE?

Organizational culture is not stagnant. Members of an organization develop a shared belief around
“what right looks like” as they interact over time and learn what yields success and what doesn’t.
When those beliefs and assumptions lead to less than successful results, the culture must evolve for
the organization to stay relevant in a changing environment.

Changing organizational culture is not an easy undertaking. Employees often resist change and can
rally against a new culture. Thus, it is the duty of leaders to convince their employees of the benefits
of change and show through collective experience with new behaviors that the new culture is the
best way to operate to yield success.

Cummings & Worley (2004) proposed six guidelines for culture change

Schein’s Levels in an Organization

Culture

Artifacts
These mark the surface of the culture in every organization. The visible part of
the culture can be noticed by a visitor or an ‘outsider’ in the form of the
following aspects:

 Physical Artifacts can be found through the architecture and interior

arrangements, physical space and its allocation and office design,
 decoration, manner of dressing and even mementos and trophies
awarded on chosen occasions.

 Language gives away culture through modes of speaking, levels and

types of sound, slogans and special expressions.

 Stories and myths circulating among the staff indicate what type of
persons or acts are considered heroic, how certain types of situations
should be handled, what should not be done, what happens in this
organization if one acts in a particular way and so on. Especially
interesting are the stories that narrate what happens in ‘our’
organization if a high status person breeches a rule, what happens if
the organization has to chose between profits and people, what
happens if you make a mistake around here/there. These stories can
be about another-day-at-work-here, or about key events as well as
about the past glory of the organization.

 Technology is also a part of the culture, since it reflects and shapes

the values and assumptions through operations, materials and
knowledge.

 Visible traditions displayed at ceremonies and rituals, social practices,

leadership practices and work traditions that show ‘our way of doing
things’.

Artifacts are visible, but that does not mean that they can be understood easily
and by everyone alike. In fact, artifacts can be confusing for an observer who is
tempted to use readily available labels and stereotypes upon noticing them.
Thus, the shapers of culture as well as student should avoid going too much
into detail of an artifact, as well as overgeneralizing and labeling.

Values
When compared to basic assumptions, values are at higher levels of
consciousness and they reflect the members shared opinion on ‘how things
should be’. When we say ‘opinion’, it means that when it comes to acting,
these members may or may not act as per their values. The values help the
organizational members classify situations and actions as either undesirable or
desirable.

The values seldom lead directly to basic assumptions even after the values
have been articulated, listed and arranged according to their priority. The
observer may only find that the values do not form a pattern, or that they are
contradictory, or incongruent with observed behavior.

Basic Assumptions
An assumption is a kind of belief that is taken for granted as a fact and so it is
never challenged. A pattern of basic assumptions evolve among the members
of a social group and makes the core of the culture in any organization. When
the basic assumptions are understood, the apparently isolated and confusing
artifacts and values become coherent.

Meaning of Organisational Change:

Organisational change refers to any alteration that occurs in total
work environment. Organisational change is an important
characteristic of most organisations. An organisation must develop
adaptability to change otherwise it will either be left behind or be
swept away by the forces of change. Organisational change is
inevitable in a progressive culture. Modern organizations are highly
dynamic, versatile and adaptive to the multiplicity of changes.

Organisational change refers to the alteration of structural

relationships and roles of people in the organization. It is largely
structural in nature. An enterprise can be changed in several ways.
Its technology can be changed, its structure, its people and other
elements can be changed. Organisational change calls for a change
in the individual behaviour of the employees.
Organizations survive, grow or decay depending upon the changing
behaviour of the employees. Most changes disturb the equilibrium
of situation and environment in which the individuals or groups
exist. If a change is detrimental to the interests of individuals or
groups, they will resist the change.

What is the Greiner Growth Model?

Organizations are always under way and according to the American organizational
expert Larry Greiner, comparisons can be made with living organisms that go
through several growth phases. In 1972 he described an organizational growth
model for enterprises, in which he initially proposed five stages. The growth towards
a next stage is accompanied by resistance, which is also referred to as growing
pains. Greiners Model of Growth, Greiner’s model of organizational growth or
the Greiner Business Growth Model is a popular strategic management tool
which is very often used in today’s modern businesses to make the right strategic
decisions.

Time factor
The only variable in the Greiner Growth Model is the time factor. The Greiner growth
model is a descriptive framework in which the age of the organization is marked out
against the size of an organization. Larry Greiner assumes that an organization
grows and expands throughout the years. The Greiner Growth Model makes it easier
to understand why management styles, organizational structures, coordination
mechanisms work and why they do not work at certain phases in the development
phase of an organization. Every phase requires different competences of the
entrepreneur, as a result of which the Greiner Growth Model orients towards
strategic policy.

Phases of the Greiner Growth Model

Larry Greiner originally described five phases of growth in his Greiner Growth Model
to which he later added a sixth phase. Each phase ends with a short crisis/ growing
pains after which the next phase begins.
1. Growth through creativity
In this pioneering phase of the Greiner Growth Model, the company is young and
relatively small. The organization is informal and the employees are very loyal. There
is a flat organizational structure and the entrepreneur is externally oriented; he
invests in new clients.

Growing pains
Because the organization is growing (too fast) and is becoming more complex, the
entrepreneur is no longer able to take stock of the situation and a leadership crisis
arises. Coordination and internal control can no longer be carried out by one person.
There is a need for an improved structure.

2. Growth through direction

In this management phase of the Greiner Growth Model, functional managers are
appointed as a result of which a middle management is created that controls the
primary processes. Rules, procedures and business are formalized and
standardized. The central coordination remains in the hands of the entrepreneur.

Growing pains
Because of further growth, the coordination problems may become too big for the
entrepreneur. In addition, middle managers need more autonomy. The autonomy
crisis is born.

3. Growth through delegation

In this phase of decentralization, the entrepreneur delegates important tasks to his
middle management. Results are aimed for and the middle managers are
responsible for achieving tactical and operational objectives. Management moves at
a strategic level and rarely intervenes. A division structure is created with separate
product groups and individual managers.

Growing pains
The more divisional managers, the more difficult it will become for the management
board to coordinate all the divisions that operate independently. There is a risk of a
management crisis. There is a good chance that the divisional managers plot their
own course too much as a consequence of which the company could break up.

4. Growth through coordination and control

In the standardization phase of the Greiner Growth Model, more emphasis is put on
the coordination between the various units. In large diversified organizations the
various staff departments take up a strong position from the headquarters from
which the divisional managers are managed.

Growing pains
When the staff departments have too much power and when there is too little scope
for the divisional managers, a red tape crisis arises. The rules have made the
company too inflexible and rigid.

5. Growth through cooperation

In the cooperation phase of the Greiner Growth Model, cooperation between line and
staff departments is aimed at and this creates a break-up of the hierarchical
coordination forms such as a matrix structure or a project organization. This phase is
characterized by much mutual contact between employees via all kinds of
consultation groups. There is little formalization and standardization.

Growing pains
The frequent consultations constitute a pitfall, as a result of which a consultation
crisis may arise. There is every chance that supervision and control decline sharply.
This could mean the end for organizations, unless they develop through external
alliances.
6. Growth through alliances
In this ‘growth through undertaking phase’ the organization only requires good
external contacts and alliances. These can be found in mergers, alliances and
extensive networks.

Growing pains
Because an organization is more focused on alliances than its own core-business,
there is a good chance that an identity crisis will present itself. The organization is
taken over completely by other businesses and the ‘old’ situation will disappear
completely.

Using the Greiner Growth model

By providing an insight into the growth phases, the Greiner Growth Model can be a
tool for organizations to tackle the subsequent growing pains. Organizations will be
prepared for any possible growing pains, so they can anticipate them. However, they
cannot determine the exact moment growing pains present themselves as it is not
possible to determine the duration of a growth phase in advance.

Growing pains can also have a positive effect on a company. These growing pains
are experienced as something negative by the parties involved, but essentially they
are an excellent means to shake up the organization and make everyone aware that
it is necessary for them to embark on a new course.