Planned Strategy?

Set of related decisions made by top

management about:
Who Customers Perimeter
What Customer need, products Value
How - how differentiated from competitors and
what is this based on? Imitation

Fit between elements of strategy is key:

consistent with each other dont cancel each other
reinforce each other synergy

Basic Strategic Management Process

Mission

Major
Goals

Planned
Strategy

Implementation

Unrealized
Strategy
- Change of plans by top mgt
- Lack of agreement, motives,
incentives, ability, etc., by lower
levels to implement the plan

Functional
Level Goals
- Tactical
- Operational

Emergent
Strategy
Autonomous action by
lower level employees,
often adopted later as
official strategy

Example of Emergent Strategy

Andy Grove, CEO of Intel, 1993
We came to realize that the formulation and articulation of
strategy is the job of top management. Back then (1985) we had the
very ridiculous system, common in American business at that time of
delegating strategic planning to strategic planners. The strategies
these middle managers prepared had no bearing on anything we
actually did. While they were writing reports and making
presentations, our production planners were already doing what the
business required: shifting our capacity from the DRAM business that
the Japanese were taking away from us to this new business of
microprocessors, 286s at that time.
But until top management recognized that change and articulated
it as a strategy, Intel suffered from what I call strategic dissonance.
While we were shifting capacity to microprocessors, we still had our
best development people working on memory [chip] projects. That
made no sense. So a major change in strategy can only happen when
management reconciles action and speech.

In what situations (e.g., types of industries, firms, etc.), would

the emergent strategy phenomena be more likely to occur or
perhaps should be allowed (by top management) to occur?

Planned
Strategy

Implementation

Unrealized
Strategy

Emergent
Strategy

Planned Strategy
Stable Industry
Low Cost Structure needed
Small Company

Realized
Strategy

Emergent Strategy
vs.
vs.
vs.

Dynamic Industry
High Creativity / Product Development
Large Organization

Basic Strategic Management Process

- Serendipity
- Unplanned shift by top management

Feedback/Adjustment

Mission

Major
Goals

Planned
Strategy

Situation Analysis

Implementation

Unrealized
Strategy

Functional
Level Goals
- Tactical
- Operational

Emergent
Strategy
Autonomous action by
lower level employees

Levels of Strategic Management

Figure 1.3

Strategy
Formulation

Implementation,
From a strategy
perspective

Strategic
Management
process as
reflected in
the textbook
chapters