Strategic Management of Organizations 2021/2022
Lecturers: Dr. Yiannis Kyratsis en Dr. Maike Tietschert
Knowledge clips week 1
Strategy and Strategic Management
Origins of contemporary business strategy, many terms we associate today with ‘strategy’
(e.g., objectives, mission, strengths, weaknesses) were developed by the military. Starting at
the time of the ancient Greek.
Development of strategic management
Long-range planning
Strategic planning
Strategic management
The main principle, or discipline, that inspired a lot of writings and insights in early strategic
management came from the field of economics, especially the industrial economics. The
focus was on profit maximization, making rational decisions and competitive rivalry.
Alfred Chandler, considered one of the founding fathers of strategic management,
he wrote a groundbreaking book “strategy and structure” (1969)
He stated that companies need to look into the future, that is important for their
survival and success
It showed that a long-term coordinated strategy was necessary in order to give an
organization order, direction and focus
What is strategy? Alfred Chandler: “The determination of the long-run goals and objectives of
an enterprise and the adoption of courses of action and the allocation of resources necessary
for carrying out these goals”.
Peter Drucker: “A firm’s theory about how to gain competitive advantages”. Michael
Porter: “Competitive strategy is about being different, it means deliberately choosing a
different set of activities to deliver a unique mix of value”. Henry Mintzberg: “A pattern in a
stream of decisions”.
All different types of definitions of what strategy is from different scholars
Strategy is the direction and scope of an organization over the long term which achieves
advantage for the organization through its configuration of recourses and capabilities within
a changing environment to meet the needs of markets and to fulfil stakeholder expectations.
The ten schools of strategy (Mintzberg)
1. Design: a process of conception A DESIGN
2. Planning: a formal process A PLAN 1, how it should be
done
3. Positioning: an analytical process A POSITION
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, 4. Entrepreneurial: a visionary process A VISION
5. Cognitive: a judgmental process A PERCEPTION
6. Learning: a emergent process A PATTERN 2, how it’s actually
done
7. Power/political: a process of negotiation AN AGENDA
8. Cultural: a collective A BELIEF
9. Environmental: a reactive process A RESPONSE
10. Configuration: a process of transformation A STAGE
Strategy as a plan, it’s conscious and purposeful. It is made in advance of action, calculated
towards achieving objectives and it specifies future choices. The strategy is intended, it was
looking forward.
Strategy as a pattern, focusses on the consistency in behavior over time, whether it is
intended or not. They look at wat is really realized. It is without preconception and it is driven
by actions, not design. We look back, not ahead.
Strategy as a position, we look outside into the marketplace to find a fitting strategy. A
match between organization and context, a unique place in the environment, a niche, intention
is to beat the competition or avoid direct competition.
Strategy as a perspective, focusses more on what happens inside the heads of the
decisionmakers, the philosophy. A collective concept, a world view, intensely shared, the
character of an organization.
Strategies deliberate and emergent
Intended strategy: conscious and purposeful, calculated and intended
Deliberate strategy: arises from intended strategy, the ability of action intentionally,
thinking before acting
Emergent strategy: not intended, emerges out of the blue because it is necessary,
ability of thinking and acting at the same time and letting strategy emerge
Realized strategy: a combination of intended and emergent strategies
Deliberate strategizing advantages: without plans organizations would be adrift, plans enable
early commitment, plans have the benefit of coordinating strategic initiatives to a cohesive
pattern, plans facilitate optimal resource allocation and plans are a mean for programming
activities in advance.
Direction, commitment, coordination, optimization and programming
Emergent strategizing advantages: organizations must keep an open mind to spot unseen
opportunities, keeping options open and not committing to early, give it a try, different people
have different ideas, understanding political and cultural dynamics.
Opportunism, flexibility, learning, entrepreneurship and support
Benefits of strategic management:
Ties the organization together with a common sense of purpose and shared values
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, Provides the organization with a clear self-concept, specific goals and guidance
Helps managers understand the present, think about the future and recognize the
signals that suggest change
Requires managers to communicate both vertically and horizontally
Encourages innovation and change within the organization to meet the needs of
different kinds of dynamic situations, improves overall coordination withing the
organization
Knowledge clips week 1
Dimensions of Strategy & Strategizing
Four dimensions of strategy:
1. Strategy context, conditions surrounding strategy activities: where?
2. Organizational purpose, impetus for strategy activities (input): why?
3. Strategy process, flow of strategy activities (throughput): how, by who?
4. Strategy content, result of strategy activities (output): what?
The limits of strategy: complexity, wicked problems. Strong connections link each problem
to other problems. Wicked problems have numerous elements with relationships among them,
they exist in a dynamic environment and can be seen in different ways. Trade-off between
good and bad, social, organizational and political constraints
Interconnectedness, complicatedness, uncertainty, ambiguity, conflict and social
constraints
The limits of strategy: contradictions. Strategies must respond to different demands from
actors with different and potential contradictory interests. There is a big need for distributive
results and balanced trade-offs.
The limits of strategy: surprises. Global financial crisis, a major example of strategy gone
wrong. Did strategy predict it, no. Did strategy contribute to producing it, yes. Where did
these strategies come from?
Business elites and top management teams trained in the most elite business
schools
Capturing serendipity rather than letting it pass unnoticed, essential to emergent
strategy, the ‘discovery’ of post-it notes are examples
Serendipity, luck and chance are excluded from rational planning views of strategy
How do strategist deal with strategic problems and tension? Tension as a puzzle as only one
optimal solution point. Tension as a dilemma has two ‘either-or’ solution points. Tension as a
trade-off has one optimal solution line and tension as a paradox has multiple innovative
reconciliations (best of both worlds).
Elements of a strategic reasoning process
Identifying, recognizing, sense-making: what is a problem?
Diagnosing, analyzing, reflecting: what is the nature of the problem?
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