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8/8/2019 Week3 Readings 1 and 2
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STRATEGIC DISSONANCE
by Robert A. Bugelman and Andrew S. Grove
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DISSONANCE
Inconsistency between the beliefs one holds or
between one's actions and one's beliefs
Lack of agreement, consistency, or harmony; conflict
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QUESTION:QUESTION:
How can top management inHow can top management inextremely dynamic environmentsextremely dynamic environmentsdecide on the right strategic intent?decide on the right strategic intent?
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KEY CONCEPTS
Strategic Dissonance
Strategic Inflection Point
Strategic Recognition Conceptual Framework
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STRATEGIC DISSONANCE
Alignment between firms strategic intent and
strategic action.- key premise
Strategic actions will begin to lead or lag strategic
intent cause of strategic dissonance.
Differences or conflict between
competence and the basis of competition
Strategy and action
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Conflict is strategic when it signals future
industry or corporate transformation
Key to moving the company out of strategic
dissonance is top managements capacity to
use the conflicting information generated by it
to create new strategic intent
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STRATEGIC INFLECTION POINT
Giving way of one type of industry dynamics toanother; the change of one winning strategy intoanother; the replacement of an existing technological
regime by a new one.
Creates a valley of death
The way out of the valley of death is a new strategicintent that takes advantage of the new industry
conditions--problem is, how do you know what thatis?? How do you know if its an SIP?
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STRATEGIC RECOGNITION
Top managements major tool for dealing with
strategic dissonance and an SIP
Picks out the elements that can form the basis for
new, viable strategic goals
Enabled by the ability of internal selection
environment
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CONCEPTUAL FRAMEWORK
Describes the evolving linkages between companys
core competencies and the basis of competition in
the industry and its official corporate strategy and
strategic action
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FRAMEWORK
Basis of competitive
advantage in the industry
nternal selection
environment
istinctive competence
of the firm
fficial
corporate
strategy
trategic
action
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SOURCES OF STRATEGIC DISSONANCE
Divergence of the basis of competition and
distinctive competence
Divergence between stated strategy and strategic
action
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INTERNAL SELECTION ENVIRONMENT
If the company faces SIP, the internal selectionenvironment would be more important for survival thanits stated strategy.
Regulates the allocation of the companys scarceresources to strategic action while the official strategy is
in flux
Cash, competencies, capabilities and sr. managementattention
The continues success provides time cushion for bringingcorporate strategy back in line with strategic actionand keeping company alive during SIP
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MANAGING STRATEGIC DISSONANCE
Taking advantage of strategic dissonance and
surviving an SIP depend on the internal selection
environment and top management behaviors
Internal selection environment must reflect external
reality
Top management must allow dispute to occur
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NEW STRATEGIC INTENT
Formulate based on strategic recognition
Develop a mental image of what the industry will
look like based on information generated by strategic
dissonance
Changing with the environment and the organization
(led by reality)
Requires reinventing or rediscovering the companys
identity
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STRATEGIC INTENT
TO STRATEGIC ACTION
Reassigning resources to pursue new strategic intent
Corporate strategy is realized by performing the series
of strategic action and not via strategic planning.
Middle managers insights
Too little logical debate--vision is not clearly developed and
march is not clear
Too much debate paralyzes the company and delays
strategic action
Role of sr. management:
Pull strategic action and strategy in line.
Encourage debate, bring it to conclusion
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CULTURE IS THE KEY
Dominant top-down force lock steps towardsstrategic intent
Dominant bottom-up force company will drift
aimlessly Strong both bottom-up and top-down forces
Two attributes:
1) Tolerates-even encourages-debate
2) Capable of making-and accepting-clear decisions;with entire organization capable of supporting thedecision
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Conclusion
Conceptual framework examines link between:
Companies' distinctive competencies and basis of
competition
Strategy and action
Divergence is the natural outcome of internal and
external dynamic forces
Strategic dissonance creates opportunity for thetop management to learn about changing reality of
the competitive world
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Thank you