The document discusses different perspectives on strategy. It summarizes that from an evolutionary perspective, strategy emerges through natural selection rather than rational planning. Managers can only ensure they fit current environmental demands rather than plan for long-term survival. The market, not managers, makes the important choices about which strategies and firms survive. Successful strategies only emerge through a process of selection, not intentional design.
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The document discusses different perspectives on strategy. It summarizes that from an evolutionary perspective, strategy emerges through natural selection rather than rational planning. Managers can only ensure they fit current environmental demands rather than plan for long-term survival. The market, not managers, makes the important choices about which strategies and firms survive. Successful strategies only emerge through a process of selection, not intentional design.
The document discusses different perspectives on strategy. It summarizes that from an evolutionary perspective, strategy emerges through natural selection rather than rational planning. Managers can only ensure they fit current environmental demands rather than plan for long-term survival. The market, not managers, makes the important choices about which strategies and firms survive. Successful strategies only emerge through a process of selection, not intentional design.
Copyright:
Attribution Non-Commercial (BY-NC)
Available Formats
Download as DOCX, PDF, TXT or read online from Scribd
The document discusses different perspectives on strategy. It summarizes that from an evolutionary perspective, strategy emerges through natural selection rather than rational planning. Managers can only ensure they fit current environmental demands rather than plan for long-term survival. The market, not managers, makes the important choices about which strategies and firms survive. Successful strategies only emerge through a process of selection, not intentional design.
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Evolutionists such as Hannan and Freeman (1988) or Oliver Williamson (1991) answer that strategy
in the Classical sense of rational future-oriented planning is often irrelevant. The environment is typically too implacable, too unpredictable to anticipate effectively. Here the Evolutionists offer individual strategists a cruel paradox. The dynamic, hostile and competitive nature of markets means not only that long-term survival cannot be planned for; it also ensures that only those firms that somehow do hit upon profit-maximizing strategies will survive. Businesses are like species of biological evolution: competitive processes ruthlessly select out the fittest for survival; the others are powerless to change themselves quickly enough to ward off extinction. From the Evolutionary perspective, then, it is the market, not managers, which makes the important choices. Successful strategies only emerge as the process of natural selection delivers its judgement. All managers can do is ensure that they fit as efficiently as possible to the environmental demands of the day.
HANNAN M. T. and J. Freeman (1977) The Population Ecology of Organizations. American Journal of Sociology, pp.82:929-964.
Strategy is the competitive moves and business approaches for growing the business, creating a market position, attracting and satisfying customers, competing successfully, conducting operation, and achieving target objectives.
When creating strategy, you can utilize a number of different actions:
Gain sales and market share via lower prices, more performance and features, better quality, or appealing design
Diversify into new businesses
Strengthen competitive capabilities and shore-up competitive weaknesses Define how key organizational activities are to be handles by management Pursue new market opportunities and defend against threats Create strategic alliances and collaborative partnerships Establish a Merger or Acquisition with your rival Enter new product markets Respond to changing market conditions and external circumstances
The strategy should be aimed at creating a product or service that is distinctive from what the competitors are offering or at developing competitive capabilities that they can not quite match. A powerful strategy can make you distinctive which will tilt the playing field in their favor by creating a sustainable competitive advantage. Reference Source: Doreen Mcgunagle (2008) Crafting Strategy For a Competitive Advantage, assessed March 16, 2011 http://ezinearticles.com/?Crafting-Strategy-For-a-Competitive-Advantage&id=1221128
Developing a vision and a mission
The aim of a MISSION STATEMENT is to specify the purpose of the organization, the philosophy and values that guide it, and the scope of the business. The Mission is the Top management's view of what the organization seeks to do and become over the long term.
A MISSION STATEMENT must be:
- Short, clear, understandable
- Goal-oriented, provides direction and focus - Defines firm's domains of operation and criteria for success - Inspiring and motivational, gives employees a sense of belonging - Reflects the company's strategy
Example : Microsoft Corporation
"A computer on every desk and in every home"
References:
Jay. B. Barney Wesley. (1997) Gaining and Soustaining Competitive Advantage, Addison-Wesley, UK.
Robert M. Grant (1998) Contemporary Strategic Analysis, 3th edition, Blackwell, UK
A firm achieves a competitive advantage in a given market whenever it outperforms its competitors. A competitive advantage may result from a lower cost of production, from the ability to provide a group of customers with higher perceived benefits, or from combination of both. One important stream, often referred to as the “resourced-based” view of strategy, emphasizes the firm-specific resources as the fundamental determinants of competitive advantage and performance. It was define firm resources as all assets, capabilities, competencies, information knowledge and reputations that are owned or controlled by the firm and that enable the firm to conceive of and implement strategies that improve its efficiency and effectiveness.
The resource-base view maintains that firms may be heterogeneous with respect to the budle of resources they control. Furthermore, since some of these resources, such as a firm’s reputation or other information-based resources, cannot be traded in factor markets and are difficult to accumulate and imitate, resource heterogeneity may persist over time. This perspective offers important insights about which resources lie at the heart of the firm’s competitive position, and therefore are worth protecting and developing the major mechanisms that drive the accumulation and limitation of resources.
Reference:
A Pettigrew, H Thomas and R Whittington. (2002) Handbook of Strategy & Management, Sage Publications Inc, London.
