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Samenvatting papers ~ Strategic Decision MakingHoorcollege 1.
Calori, R. Johnson, G. & Sarnin, P. (1994).
Systems theory; the number of elements in the system and the number of links between elements ,
representing the variety of the system. The complexity of diversified firms is resolved by means of
organizational structures, and by adequate administrative mechanisms.
Organizational structure van attenuate the intensity of strategic variety that corporate level
management must deal with, but it cannot substitute for the need to handle strategic variety at the
corporate level.
Decision makers construct simplified mental models when dealing with complex problems. They may
be subject to selective perception since they are unable to evaluate comprehensively all variables
relevant to a decision. The duality raises the issue of the adequate level of cognitive simplicity vs.
complexity in a given situation, and the question of the development of individual’s cognitive
structures. The complexity of an individual conceptual system is determined by two interdependent
aspects;
- The number of parts or dimensions of the system
- The nature and extent of rules for integrating these parts
The ability to perceive several dimensions in a stimulus array is referred to as differentiation or
comprehensiveness and the development of connections among the differentiated characteristics is
referred to as integration or connectedness.
People with a higher level of cognitive complexity tend to have a higher tolerance for ambiguity,
assume leadership roles are more capable of taking the perspective of others, and of resolving
conflicts cooperatively.
Both environmental circumstances and individual characteristics shape managers’ cognitive maps.
The CEO’s understanding of his/her business environment can be analysed in two ways;
1. Assumptions about environmental structure
2. Origins / processes of environmental change
Figurative structures; mental representations of a structure ( in terms of actors in the system and
links between actors).
Operative structures; mental representations of the transformation process of a structure ( in terms
of forces and relationships between forces).
Cognitive mapping has been used for instance to uncover competitive positioning as perceived by
managers. Two aspects of cognitive mapping; 1. The content of the map in the sense of the meaning
it embodies & 2. The configuration of the map, for instance in terms of cognitive complexity.
Kathleen M. Eisenhardt ~ Strategy as strategic decision making.
The ability to make fast, widely supported, and high-quality strategic decisions on a frequent basis is
the cornerstone of effectively strategy.
Effective decision makers create strategy by;
- Building collective intuition, which enhances the ability of a top management team to see
threats and opportunities sooner and more accurately
- Stimulating quick conflict, to improve the quality of strategic thinking without sacrificing
significant time
- Maintaining a disciplined pace that drives the decision process to a timely conclusion
- Defusing political behaviour, that creates unproductive conflict and wastes time
The most powerful way to accelerate conflict is by creating multiple alternatives.
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