1.2 Strategy-Making Processes: The Search for Action
The field of strategic management is often divided into different schools of thought. The planning and emergent schools are two fundamental schools that have shaped, and still influence, many debates in academia and practice. Based on the work of Chandler (1962), the planning (or rational) school considers strategy as the outcome of the sequential activities of strategic analysis, development, and implementation. The emergent school, on the other hand, led by Henry Mintzberg, considers strategy as not simply a plan but also a pattern that emerges over time based on experimentation and discussion (Mintzberg, 1973, 1978, 1987; Mintzberg and Waters, 1985). Mintzberg notes that āorganizations develop plans for the future and they also evolve patterns out of their pastā (1994: 24). Accordingly, strategy is perceived as more than just an intended outcome based on a top-down procedure and as a more complex, emergent, bottom-up process developed throughout the organization with the participation of multiple organizational members. Based on the foundations of these two schools, a number of frameworks have been developed concerned with the strategy-making processes that firms follow. Combining the learning around strategy-making processes, Hart (1992) developed an integrative framework consisting of five models (see Table 1.1). The main advantage of this model is that it integrates many of the insights from pre-existing strategy models by contrasting the roles of different management actors. In that way, strategy making is viewed as an organization-wide phenomenon.
Alongside Hart, the BowerāBurgelman (BB) process model of strategy making (Burgelman, 1983, 2002) has been a milestone in strategy process research. Bower (1970) developed a resource allocation process (RAP) model which was later modified and extended by Burgelman in the early 1980s using rich empirical insights. The result was the BB process model (Bower and Doz, 1979; Burgelman, 1983). The foundation of this process model was an evolutionary framework of the strategy-making process in established firms (see Figure 1.1). Burgelmanās primary goal was to show the interactions between strategic behavior, corporate context, and the concept of corporate strategy. According to this model the strategy-making process is determined through strategic behavior that either is induced by top management or develops autonomously:
Autonomous strategic behavior introduces new categories for the definition of product or market opportunities. It develops from the bottom up within a company and covers project-championing efforts to mobilize corporate resources. Induced behavior on the other hand represents the guiding character of strategy. āThe induced process concerns initiatives that are within the scope of the organizationās current strategy and build on existing organizational learningā (Burgelman, 1991: 241).
Structural context determination means the top-down introduction of formal organizational structures (information, evaluation, reward systems, etc.) to shape the selection of strategic investments. Strategic context determination covers political activities of middle management that aim at combining autonomous strategic behavior on the product-market level with the current corporate strategy.
What is interesting about Burgelmanās approach is that this autonomous process is perceived as an integral part of the strategy-making process:
strategy makingā¦involves keeping both processes (induced-autonomous) in play simultaneously at all times, even though one process or the other may be more prominent at different times in a companyās evolutionā¦ A company rationally tolerates autonomous strategic initiatives because such initiatives explore and potentially extend the boundaries of the companyās competencies and opportunities. (Burgelman, 2002: 14ā15)
A deeper appreciation of the behavioral aspects shaping the strategy-making process comes from studies of managerial decision making. Miller and Friesen (1978) identified 11 strategy-making process dimensions including, for example, adaptiveness, analysis, expertise, integration, innovation, and risk taking. In his study, Fredrickson (1986) proposed dimensions such as proactivene...
