Strategic Thinking - Processual Process

Transcription

1 Author: Acumen Insights Version: 0.1 Date Published: 20-Mar This document and the contents are the sole property of Acumen Insights Ltd. Any referenced material is the property of the original author/publisher of that material and is used as reference material within this document. By downloading a copy of this document you agree to be bound by the terms and conditions stipulated by Acumen Insights Ltd. Acumen Insights Ltd Copyright 2009

2 Introduction The aim of this paper is to provide an overview of the various aspects concerned with strategic process. Before discussing some of the key aspects of the process dimension, it is worth highlighting briefly some of the key points required to conceptualise this area of concern: Discussion The strategy process resides in an organisational environment that is affected and affects the ongoing flux of events and ideas in the organization Given the uniqueness of organisations and their needs, strategies can form as well as be formulated (Mintzberg, 1987) The realised strategy may not be the one intended at the beginning of the reorientation Information Systems Technology (IST) presents unique challenges to strategists and the process of development and implementation is complex and ever challenging Implementation of the strategy is just as crucial as the development of it The contexts and the content of the strategy constantly influence the unfolding processes. When considering the strategy process dimension, we are trying to capture the dynamics of strategic change, the long-term pattern of events by that strategies are implemented, the leaders, decision arenas, the models that govern and capture conception and implementation; and the continuous iterative process of development and implementation (Whipp et al, 1988). At its core the strategy process involves decisions and actions that are crucial in understanding how strategic change unfolds. At its core the strategy process involves decisions and actions that are crucial in understanding how strategic change unfolds (Chakravarthy and White, 2002). Chakravarthy and White argue that there are in fact four dominant perspectives that can be used to reflect the decisions and actions unfolding through the strategy processes, covering: a rational decision-making perspective, the political perspective, the evolutionary perspective and the integrated perspective. The rational decision-making perspective involves the rationale application of knowledge to a situation, covering: what are the alternatives, the consequences, the desirability and the criteria for choice. As Chakravarthy and White (2002) argue, no one individual can identify all possible alternatives and in fact, no one individual can know everything about a given situation (Lewis, 1991). For these reasons a boundedlyrational individual does not engage in a comprehensive search but only a local search, not focused on optimisation but more on satisficing (Simon, 1945 cited in Chakravarthy and White, 2002). When considering power and politics (the political perspective) one must remember that these aspects are not necessarily a negative aspect of organisational change but can be vital during the strategy process in that power can be used to influence people and their actions. More importantly, power and political manoeuvring may not just be concerned with individuals but also broader interests across the organisation. Additionally, these broader interests can be composed of: a constantly shifting set of actions, each seeking to have their interests defined as part of the organisation s purpose. Chakravarthy and White (2002: 190) 1 acumeninsights

3 This makes the understanding and analysis of political manoeuvring extremely difficult to undertake. Although complex, the political perspective does overcome the more restrictive rational perspectives: our research allows us to question one of the restrictive orthodoxies in the strategy literature, that strategies are first formulated and then implemented through rational linear processes. Whipp et al (1988: 80) However, the evolutionary perspective moves beyond the rational and political perspective and argues for the acknowledgement that: organisational actions are not the result of decisions per se, but rather caused by a random intermingling of problems, people, issues, decisions, opportunities, ideas and solutions. Chakravarthy and White (2002: 191) For Weick (1979) the evolutionary model is essential for understanding how individuals and groups make sense of their world and how they organise processes. Here, sensemaking is the main mechanism for individuals to understand the environment that surrounds them (Weick, 1995). Although three distinct perspectives of the strategy process have been presented, it is feasible to assume that in fact, the strategy process is comprised of all three perspectives. In this sense a more integrated perspective is required: These and other studies have confirmed the need to complement the rational perspective on strategy processes with the social/political and evolutionary perspectives. Decisions and actions need not follow an orderly precedence. What may appear to be a decision made by top management may not have its origins in a process that was in part intuitive, social and political. Chakravarthy and White (2002: 193) The management of strategic change is a complex process, incorporating technology, organisational and human issues. The management of strategic change is a complex process, incorporating technology, organisational and human issues. Prior to strategic reorientation occurring, organisations will be in what Doz and Prahalad (1988) called the incubation stage. This is where the current strategy has become stable and is an intellectual construct (their frame of thought) it is the explicit model of what to do, how to mobilize the organisation and commit resources. As discussed earlier, this frame of thought must be changed to ensure strategic reorientation can start. In order to change the existing frame of thought, it must be challenged by new visions and ideas. In fact, political behaviour is a key aspect of achieving this as the actors involved attempt to gain support for their ideas and influence others. Doz and Prahalad (1988) also argued that during strategic development not necessarily strategy implementation those managers will continually seek legitimisation for their new ideas and visions. Again, to achieve this, pressure has to be generated and support sought for the idea/vision. Ultimately, this will lead to reallocating power through complex social processes that may be unfolding during strategy development. Instead of adopting formal recognised procedures and structures, actors could in fact use social and political manoeuvring to achieve their goals. For this reason people, their relationships and roles affect the strategy process. More importantly, each persons background, leadership style, views of IST, significance of IST and congruence of views will impact on the strategy process (Feeny et al, 1992). As the strategy process unfolds, change may not necessarily be incremental and there will be periods of stability (at various levels), which can occur prior to any action being taken (Doz and Prahalad, 1988). In fact: 2 acumeninsights

4 A critical proposition within our research is that the formulation and implementation of strategy is a continuous and iterative process. Whipp et al (1998: 20) Strategic implementation is not however solely concerned with the delivery of the actual systems and projects but must be accompanied with power reallocation, policies and procedures needed to successfully implement the desired strategic intent. Research conducted by Chakravarthy and White (2002) focuses on three key dynamics that unfold throughout the strategy process summarised in Table 1. Aspect Decision-Making Power and Politics Action Taking Characteristics This aspect has been acknowledged for many years as being crucial to understanding organisational change and has been dominated by the rationalist orthodox school, which focuses on the established logic that guides the generation of ideas. However, as illustrated in the previous discussions - about the work of Vickers - organisational processes are not always as deterministic and rational as we are led to believe. This view (adopting a more political perspective of organisations) acknowledges that decisions may not in fact be the result of organisational logic but maybe driven by power and politics within the organisation. In some cases, power and political manoeuvring maybe the only way of achieving change. Adopting a more emergent perspective, this view highlights that any decisions and actions are influenced by the organisational context. In fact, actions can be the result of random intermingling of people, problems and ideas. In this view, the actors continually sense/appreciate the information and actions throughout the organisation. Table 1: Key Aspects of the Strategy Process (Adapted from Chakravarthy and White, 2002) Although there is a tendency in the strategy knowledge on these aspects individually, there should be no one dominant view but in fact a more integrated view that is based on a number of key ideas. Although there is a tendency in the strategy knowledge on these aspects individually, there should be no one dominant view but in fact a more integrated view that is based on a number of key ideas, including the acknowledgment that individual manager s actions can precede formal decisions; individual actions can be solution driven whilst decisions and actions may not follow an orderly process. Additionally, rational analysis maybe done retrospectively; and actions can come from anywhere in the organisation and drive the process (Chakravarthy and White, 2002). Importantly, sense-making and how individuals appreciate the situation and their interactions with others in delivering the strategic intent is crucial to understand the unfolding processes. Moreover, the interactions and actions at one level will affect other levels, which are constantly affected by and affecting the strategic context/content that surround and influence the unfolding processes. Change is therefore embedded at various levels: it is temporal (as it is affected by the past), it is affected by and affects the present and the future and finally the causation of change is neither singular nor linear (Pettigrew et al, 1992). 3 acumeninsights

5 References Chakravarthy, B. and White, R., 2002, Strategy Process: Forming, Implementing and Changing Strategies in Pettigrew, A., Thomas, H. and Whittington, R., 2002, Handbook of Strategy and Management, Sage, UK Doz, Y. and Prahalad, C., 1988, A Process Model of Strategic Redirection in large complex firms: The case of multi-national corporation in Pettigrew, A, 1988, The Management of Strategic Change, Basil Blackwell, Oxford.Feeny et al, 1992 Mintzberg, H., 1987, Crafting Strategy, in De Wit, B. and Meyer, R., 1994, Strategy Process, Content, Context. An International Perspective, West Publishing, USA. Pettigrew, A., Ferlie, E. and Mckee, L., 1992, Shaping Strategic Change, Sage, London Weick, K., 1979, The Social Psychology of Organising, Addison Wesley, Reading. Weick, K., 1995, Sense-making in Organisations, Sage, CA.) Whipp, R., Rosenfield, R. and Pettigrew, A., 1988, Understanding strategic change: some preliminary British findings in Pettigrew, A., 1988, The Management of Strategic Change, Basil Blackwell, UK.. 4 acumeninsights