Strategic management and the philosophy of science: the case for a constructivist methodology

In this paper, we suggest that constructivism has the potential to inform research in strategic management. The realist paradigm currently dominates strategy research, and constructivism, a well‐established tradition in the philosophy of science, is often ignored. However, a study of strategy literature and research reveals that it is drawn upon more frequently than is explicitly acknowledged. Constructivism occupies a methodological space characterized by ontological realism and epistemological relativism. Ontological realism is an important cornerstone of a field as applied as strategy, while epistemological relativism helps us explore the constructed nature of the field, where the researcher is an active participant rather than a reactor or information processor. In this paper, we demonstrate the precedents and possibilities for constructivist research in strategic management. We examine some of the existent constructivist works in the strategy literature, and point to specific techniques, including historical analysis, to demonstrate how this perspective may advance the boundaries of strategy research. Copyright © 2000 John Wiley & Sons, Ltd.     

Using strategic ambiguity as management practice in academic R&D: an ethnographic study of MIT SENSEable City Lab

This article explores the role of strategic ambiguity as a management practice, as used in SENSEable City Lab – a R&D-oriented lab located at the Massachusetts Institute of Technology in Cambridge, MA. Although literature has already explored strategic ambiguity in various organizational settings, studies focusing on how academic institutions use strategic ambiguity in the context of R&D are quite sparse. The article aims at filling this gap by reporting on a study conducted by the author across 2011 and 2014 in a R&D-oriented academic lab and reflecting on the potential of strategic ambiguity as an effective dialogic strategy to appreciate differences among internal organization members and with external partners. The article also examines some shortcomings of strategic ambiguity, such as the level of anxiety reported by some members of the lab.     

Communication and attention dynamics: An attention‐based view of strategic change

Research Summary : The attention‐based view (ABV) has highlighted the role of organizational attention in strategic decision making and adaptation. The tendency to view communication channels as “pipes and prisms” for information processing has, however, limited its ability to address strategic change. We propose a broader role for communication as a process by which actors can attend to and engage with organizational and environmental issues and initiatives and argue that such a view can significantly advance understanding of strategic change. On this basis, we offer suggestions for future research on communication practices, vocabularies, rhetorical tactics, and talk and text in shaping organizational attention in strategic change. We also maintain that this enhanced view of the ABV can help advance research on dynamic capabilities, strategy processes, strategy‐as‐practice, and behavioral strategy. Managerial Summary : To further enhance our capabilities to manage strategic change and renewal processes in organizations, we need a better understanding of how to manage organizational attention. In this article, we highlight the importance of understanding the role of communication and discuss the use of different communication practices, vocabularies, rhetorical tactics, and talk and text as possible levers that can be used to dynamically shape organizational attention. We call for further research to advance the understanding of how these levers can be used to influence the ways in which different sets of strategic issues, initiatives, and action alternatives are handled. We believe that such an enhanced view of organizational attention can enable the development of new, improved strategy practices to manage strategic change and renewal processes.     

From autonomous strategic behavior to emergent strategy

This study develops a model of emergent strategy formation at a large telecommunications firm. It integrates prominent traditions in strategy process research—strategy as patterned action, as iterated resource allocation and as practice—to show how emergent strategy originates as a project through autonomous strategic behavior, then subsequently becomes realized as a consequence of mobilizing wider support to provide impetus, manipulating strategic context to legitimate the project by constructing it as consonant with the prevailing concept of strategy, and altering structural context to embed it within organizational units, routines, and objectives. The study theorizes the role of “practices of strategy articulation” in emergent strategy formation, and explains why some autonomous strategic behavior becomes “ephemeral” and disappears rather than enduring to become emergent strategy. Copyright © 2013 John Wiley & Sons, Ltd.     

Performance feedback and middle managers’ divergent strategic behavior: The roles of social comparisons and organizational identification

Research Summary: What drives middle managers to search for new strategic initiatives and champion them to top management? This behavior—labeled divergent strategic behavior—spawns emergent strategies and thereby provides one of the essential ingredients of strategic renewal. We conceptualize divergent strategic behavior as a response to performance feedback. Data from 123 senior middle managers overseeing 21 multi‐country organizations (MCOs) of a Fortune 500 firm point to social performance comparisons rather than historical comparisons in driving divergent strategic behavior. Moreover, managers’ organizational identification affects whether they attend to organizational‐ or individual‐level feedback. These results contribute to research on performance aspirations and strategy process by providing a multilevel, multidimensional framework of performance aspirations in middle management driven strategic renewal. Managerial Summary: Middle managers are essential actors in strategic renewal. Their unique positions offer insights into operations alongside knowledge of strategy. In contrast to typical assessments of managerial performance with reference to a prior year, this research shows that performance comparisons relative to peers and other organizational units better motivate managers’ divergent strategic behavior. Our results also show that managers who identify with the firm are more attentive to organizational rather than individual performance discrepancies. Thus, our study unveils an important approach for organizations aiming to spark strategic renewal.     

How advanced is the strategy paradigm? The role of particularism and universalism in shaping research outcomes

As the field of strategy reaches its 25th anniversary, we examine how far the field has progressed during that time. Both management and strategy research have been characterized as being in an early stage of development. We draw on Kuhn's ( 1996 ) paradigm development model, which posits a connection between a field's stage of maturity and research processes and outcomes, to assess the maturity of the strategy field. We conduct two studies. The first is a cross‐discipline comparison of productivity norms for university faculty. The second study examines longitudinal research outcomes for a sample of 945 strategy faculty. Our results indicate that strategy has the attributes of both an early stage and mature field: while overall research norms are low relative to other fields, they are driven far more by merit‐based than non‐merit factors. Copyright © 2005 John Wiley & Sons, Ltd.     

Managing the search for new product concepts: a strategic approach

Abstract
The authors point out that there is little in the academic literature about the way ideas for new products emerge and how the emergence is managed. They have identified the main top management problem as the strategic one of achieving the right balance between resources put into new product search and those put into current business operations. To obtain more information on good and bad practice in this area they have investigated how a specially selected sample of small to medium-sized Canadian technological companies actually carry out new product search.
The research method was to ascertain how far corporate goals, organization structures and corporate values affected the effectiveness of new product search. Unstructured interviews were conducted with senior staff in the companies, during which information was sought about company goals, innovation strategy, internal relationships and how these impinged on the genesis of 35 projects.
The authors found an important corporate goal spurring innovation was growth (or survival), to be achieved by using new products to dominate their markets. R&D was oriented to achieving a technical edge, though not necessarily a radical breakthrough in market driven ways. Few had effective formal strategic plans for new product search. On the whole, top managements emphasized the importance of individual initiative and commitment to get results and the necessity of open communication throughout the organization.
Overall, this research reveals once more that any organization that wishes to pursue a strategy of product innovation has to build a climate which explicitly favours that strategy. Corporate strategy, itself, has a major influence on that climate. New product search requires resources and a place in the strategic plan but the extent to which it can be formalized is limited. It must be possible for new ideas, wherever generated, to emerge and gather momentum informally.     

Innovations and the role of complementarities in a strategic theory of the firm

In the resource‐based view of strategy and in evolutionary economics, complementary assets play a crucial role in explaining sustainable competitive advantages and innovations. Despite the apparent importance of complementary assets for the understanding of corporate strategy, their creation and the associated managerial problems have been much less discussed. We believe this to be a major weakness in the strategic theory of the firm. Interestingly, problems of coordination and cooperation are center stage in the contract‐based theories of the firm, and we try to integrate some of their insights into a resource‐based perspective. Specifically, we show how complementary assets raise the need for strategic direction by a firm's top management. Moreover, complementary assets magnify internal incentive problems, and their management has an impact on the innovativeness of a firm. Lastly, complementary assets play a crucial role in the internal appropriation of innovative rents. We demonstrate the fruitfulness of our integrated framework by relating some of our findings to the literature on corporate strategy, industry evolution, and organizational structures. Copyright © 2007 John Wiley & Sons, Ltd.     

Environment–strategy co‐evolution and co‐alignment: a staged model of Chinese SOEs under transition

Economic reform in China has attracted growing attention from around the world owing to its significance for theory and practice. What has been largely missing in the literature is the temporal dimension, i.e., the changes over time in key variables such as organizational environment, firm strategic adaptations, and the performance implications. In this study, we investigate environment and strategic adaptations 12 years after Tan and Litschert examined these issues in 1990. Following a staged model, the study found that (1) organizational environment and firm strategic adaptations have co‐evolved over time, (2) a new configuration has emerged and is related to improved performance, and (3) such a relationship is moderated by the stage during transition in which firms were founded. Specifically, firms founded since 1990 are more proactive and innovative than firms that had existed in the previous stage. Copyright © 2004 John Wiley & Sons, Ltd.     

SBU strategy and performance: The moderating effects of the corporate-SBU relationship

This study suggests that the link between an SBU strategy and performance is moderated by the SBU's relationship with corporate management. Information processing arguments suggest that this relationship, typically characterized by general measures of centralization, has been inappropriately conceptualized in prior research. An alternative view, one that considers which decisions and activities should be controlled by the individual SBU, is proposed and tested. The results of a study of 496 SBUs indicate that SBU performance is enhanced when: (1) SBUs with an external strategic orientation control environmental monitoring activities and strategic decision analysis, and (2) SBUs with an intraorganizational orientation control those activities relating to operations. Weaker SBU performance is associated with SBU control over those functions and activities not central to the SBU's business strategy. Therefore, it is suggested that the corporate-SBU relationship can either facilitate or inhibit the implementation of the SBU's intended strategy.     

Citation footprints on the sands of time: An analysis of idea migrations in strategic management

We elucidate the intellectual progression of the strategic management field by examining knowledge flows to and from the Strategic Management Journal (SMJ) during the period 1980–2009. We provide a detailed mapping of the evolution of the intellectual structure of the field and identify its input‐output dependency relationships with other fields. Analysis of citation data using three analytic techniques: log‐multiplicative model, pathfinder analysis, and entropy analysis allow us to discern strategic management's influence on and engagement with other disciplines. The results show that, within the intellectual universe of strategic management, SMJ has played a central role, both as a source and storer of knowledge. We notice that, over time, there has been a decline in practitioner orientation, greater communication with finance and sociology, and increasing linkages with international business and entrepreneurship. Copyright © 2015 John Wiley & Sons, Ltd.     

Strategy dynamics: Agency,path dependency,and self‐organized emergence

Analysis of a 42‐year strategic journey at a large multinational firm exposes the dynamics behind its strategic evolution. Grounded on a complexity science paradigm, this article challenges our understanding of the role of agency in strategic timing while adding conceptual and methodological innovations. Based on micro and macro approaches, qualitative interpretations, and econometric studies, the results tend to show that while agency partly produces strategy dynamics and timing of actions, strategic evolution (when not random) is largely emergent and driven by its past. These findings move the understanding of strategic evolution and timing away from a strategic choice perspective and toward a complex combination of agency, causal determinism, and self‐organization. Copyright © 2015 John Wiley & Sons, Ltd.     

Strategic concepts as micro‐level tools in strategic sensemaking

Research Summary: The purpose of this article is to illuminate the role of concepts in strategic sensemaking. Based on a longitudinal real‐time study of a city organization, we demonstrate how the concept of “self‐responsibility” played a crucial role in strategic sensemaking. We develop a theoretical model that elucidates how strategic concepts are used in meaning‐making, and how such concepts may be mobilized for the legitimation of strategic change. Our main contribution is to offer strategic concepts as a missing micro‐level component of the language‐based view of strategic processes and practices. By so doing, our analysis also adds to studies on strategic ambiguity and advances research on vocabularies. Managerial Summary: Our analysis helps to understand the role of strategic concepts, that is, specific words or phrases with established and at least partly shared meanings, in an organization's strategy process. We show how adopting the concept “self‐responsibility” helped managers in a city organization to make sense of environmental challenges and to promote change. Our analysis highlights how such concepts involve ambiguity that can help managers to establish common ground, but can also hinder implementation of specific decisions and actions if it grows over time. We suggest that under environmental changes, development of new strategic concepts may be crucial in helping managers to collectively deal with environmental changes and to articulate a new strategic direction for the organization.     

The moderating influence of strategic orientation on the strategy formation capability–performance relationship

An effective strategy formation capability is a complex organizational resource—a dynamic capability that should lead to superior performance. Strategy scholars have examined the strategy formation capability from many perspectives. However, no study has examined a comprehensive model of strategy formation in the context of the firm's strategic orientation. We develop and examine such a model. The results show that strategic orientation moderates the relationship between different elements of the strategy formation capability and performance. Copyright © 2006 John Wiley & Sons, Ltd.     

The continuing validity of the strategy‐structure nexus: new findings, 1993–2003

This study analyzes whether a diversification strategy facilitates subsequent divisionalization (and hence that ‘structure follows strategy’), and/or whether the multidivisional structure leads to a diversification strategy (and hence that ‘strategy follows structure’). In theoretical terms, this study is original in that it institutes a debate between the Chandler thesis and other perspectives that challenge the generalizability of the strategy‐structure nexus. Interestingly, this new study with contemporaneous data for the period 1993–2003 sheds light on this contested issue and postulates that despite the criticism of Chandler's contribution, it still works. Our results show that strategic diversification affects structural divisionalization, and in turn, structural divisionalization affects strategic diversification. Copyright © 2009 John Wiley & Sons, Ltd.     

Strategies for managing a portfolio of alliances

Interorganizational relationships are recognized as an increasingly important source of competitive advantage. Hence, goal‐oriented management of the alliance portfolio—all the alliances of the focal firm—plays a decisive role in company performance. Consequently, the configuration and development of the alliance portfolio become important strategic issues. In light of that, this article develops theoretical propositions that seek to clarify what determines the configuration and evolution of an alliance portfolio, and then presents the results of a longitudinal study to illustrate the developed theoretical framework. Building on contingency theory and a coevolutionary framework, we were able to identify three distinctive types of portfolio strategies at business level and to illustrate how they interact with the development of the business strategy and the business environment. Encompassing all this, the study illustrates and explains developmental paths and patterns in the evolution of an alliance portfolio. The developmental course typically evolves from adapting to shaping and to exploiting (stabilizing), according to the state of strategic uncertainty and the firm's resource endowment. A sudden increase in exogenous strategic uncertainty, however, can lead to a strategic shift back to an exploration or hybrid strategy. Copyright © 2007 John Wiley & Sons, Ltd.     

CEO compensation: A resource advantage and stakeholder‐bargaining perspective

This paper studies how CEO pay and its composition is shaped by strategic factors related to the firm's capacity to generate rents and value, the uncertainty of its resource advantage, and the competitive interaction between firm stakeholders and top management. This is done using an analytical framework in which the CEO and other firm stakeholders interact over the firm's resource surplus as utility‐maximizing claimants based on their relative bargaining power while providing shareholders their market‐based required return. Results from the model yield a number of cogent strategic insights and predictions on the causal interplay between CEO pay, firm growth and risk characteristics, stakeholder management, corporate strategy (e.g., offshoring production), and behavioral biases such as CEO optimism and overconfidence. Copyright © 2012 John Wiley & Sons, Ltd.