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Classical approach to strategy (Science (Academics & practitioners…
Classical approach to strategy
Science
Academics & practitioners from 50's
Building knowledge, testing evidence, rational arguments
300 years of progress
Solving all sorts problems, social & management ones
Critical thinking = questioning theories, weighing up evidence
Part of ourselves we studying
Cause & effect in social situations
Adopting approaches & observer
Time & place, responding to interest, circumstances & concerns which is a influence
Socially & historically situated
Behaviour of people working it's hard finding one size fits all (Taylor & Henri Fayol 1841-1925)
Perspectives
Whittington, 2001 our own private assumptions how things work, how things get done
Four categ reading 2
Classical
Planning to achieve profitability
Rational analysis, measures & methods, returns on investments, top-down
Long-term goals & objectives, course of action, allocation of resources
Military practice & academic economics
Formulation & implementation
Maximize economic advantage
Explicit & conscious formulation & flowcharts
Evoluttionary
Management ability to plan & act rationally
Best performers that survive
Economic competition & law of market (self-interest)
Competitive processes to survive & flourish
Selecting markets such as labour, capital & control.
Strategies differentiation
Right place at the right time
Perfect fit against the current environment (ST)
Flexibility, innovation, diversification (LT)
M. Porter's competitive advantages = efficiency
Economic health & dynamism
Processual
Strategy-making = confusion & small steps
Work within the world as it is
Rational action & micro politics
Realistic theory of human behaviour
In human nature will flawed & incomplete
Environment scanning, data analyses & calculated comparisons
Personal objectives & cognitive biases to each person
Bargaining processes + political bargaining & bounded rationality
Routines, standard operation, adaptive rationality
Earn profits without max effort
Organisation slack & satisfice
Flexibility, confidence & sense of purpose to act on
Distinction between policy creation & policy execution
Logical incrementalism = process of experimentation & learning
Knowledge + experience & events, competences
Decision-making actually coping, plans & reassurance
More than markets it policies performance's
Recognizing & accommodating real-world imperfections
Systemic
Retain faith, plan forward & act effectively
Historically & culturally
Decision-makers, economic transactions
People's purchase behaviours & cultures
Appropriate & reasonable behaviour
Cultural rules & local society
Class, nations or gender
Differences in countries cultures
Freewill & self-control
Preserve the status quo
Theories of actions
Classical pioneers
Alfred Chandler (1918 - 2007)
Strategic thinker
Formulates theory to findings
Comparisons
Adapted, response, fit & develop
Externally & internally environmental changes
Positive & defensive strategies
Diversification & vertical = growth
H. Igor Ansoff (1918 - 2002)
How & what
Rational & analytical to defined objectives'
competencies & capabilities
Best use of resources (fit)
Proactive, aggressive or defensive
Strategic decision
Policy decisions
Programme decision
Standard operating procedures
Uncertainty
monitor performances & feedback
Kenneth Andrews (1916 - 2005)
Planning should be linear, rational, analytic
Personal values, aspirations, acknowledging
Environmental conditions & trends
Opportunities & risks
Good at doing
Corporate resources
Impact of economics
Structure, conduct & performance
Diversifying new markets (divisionalisation)
Industrial organisation Economics
Structure-conduct-performance
Cause & effect relationships
Positioning approach: Porter
Position = environment
Theory of action, adapt, choice & pursuit
Frameworks & models
Reading 3 Five forces
Substitutes
Threat of entry
Rivalry
Bargaining power of buyers
Bargaining power of suppliers
Figure 3.3 very important