Measuring and modelling changes in strategy: Theoretical foundations and empirical directions

Abstract

Confronted by increasingly turbulent and complex environments, general managers have become more interested in understanding the conditions and forces that enable or disable successful changes in organizational strategies. Yet, largely because of their tendency to use f u z z y definitions and inadequate methodologies, empirical studies of changes in strategy have not provided practitioners with a set of well-tested theories. To provide a basis for circumscribing, evaluating, and directing future research, this paper begins by developing a framework f o r assessing and modelling changes in strategy. After discussing the forces that influence their occurrence and performance ouicomes, the paper reviews a representative sample of empirical studies in terms of two major questions: (1) how are changes in strategy conceptualized and modelled? and (2) what methods cif observation and analysis are employed? This review concludes with a report of importartt patterns and concerns followed by suggestions f o r future research.

Cognitive change, strategic action, and organizational renewal

“…Many theories of strategic change suggest that changes in action do not occur until some level of stress or pressure to change exceeds the level of inertia or pressure for maintaining the status. quo (Ginsberg, 1988). Similar pressures may be required to move managers through the learning process.…”

Environmental context, managerial cognition, and strategic action: an integrated view

“…We use speed of strategic response as a strategic action outcome because its implications for firm survival and success make it an outcome of interest for strategy scholars. The strategy literature has consistently prescribed the importance of aligning firm strategies with opportunities and threats in the environment (Andrews, 1987;Ginsberg, 1988;Miles and Snow, 1972;Mintzberg, 1972;Porter, 1985;Quinn, 1980;Hofer and Schendel, 1978). Further, research has demonstrated that firms that initiate timely strategic responses to changes in the environment outperform those that delay in their response (Cotrell and Nault, 2004;Haveman, 1992;Nerkar and Roberts, 2004;Smith and Grimm, 1987;Baum and Wally, 2003).…”

Financial Resources and Product Market Development: Strategic Choice and Institutional Processes During China's Transition

“…Strategic choice approaches, such as resource dependence theory, emphasize factors internal to the firm. Penrose (1959), Nelson and Winter (1982), Barney (1986Barney ( , 1991, and a host of others (Barnett, 1993;Dutton and Duncan, 1987;Ginsberg, 1988;Tichy, 1983) argue that internal firm traits determine the nature and timing of innovation. Managerial knowledge, organizational expertise and related capabilities, and a preference for autonomy from outside organizations shape firm decisions.…”

“…Managerial knowledge, organizational expertise and related capabilities, and a preference for autonomy from outside organizations shape firm decisions. From this perspective, firms' unique knowledge and capabilities allow managers to undertake new activities that, under the right set of internal and external conditions, may improve performance and long-term competitive position (Ginsberg, 1988). Innovation occurs when the firm has the necessary internal resources and capabilities to change, and the change appears to be in its interest, given available information (Kelly and Amburgey, 1991).…”