Description
This abstract tell the historical development of the strategic management concept author(s) jeffrey bracker.
The Historical Development of the Strategic Management Concept
Author(s): Jeffrey Bracker
Source: The Academy of Management Review, Vol. 5, No. 2 (Apr., 1980), pp. 219-224
Published by: Academy of Management
Stable URL: http://www.jstor.org/stable/257431 .
Accessed: 16/09/2011 23:38
Your use of the JSTOR archive indicates your acceptance of the Terms & Conditions of Use, available at .
http://www.jstor.org/page/info/about/policies/terms.jsp
JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build upon a wide range of
content in a trusted digital archive. We use information technology and tools to increase productivity and facilitate new forms
of scholarship. For more information about JSTOR, please contact [email protected].
Academy of Management is collaborating with JSTOR to digitize, preserve and extend access to The Academy
of Management Review.
http://www.jstor.org
Academy
of
Management Review 1980, Vol. 5, No. 2, 219-224
T h e Historical
Development
of th e
Strategic Management Concept
JEFFREY BRACKER
Georgia
State
University
In th is
article,
I examine h ow th e
concept
of
strategy
h as evolved into th e
field of
strategic management.
A definition of
strategic management
is
developed
from commonalities of
past
definitions and a selected overview
of
approach es
to
operationalizing strategic management
is
presented.
Since its first mention in th e Old
T estament, th e
concept
of
strategy
h as been
largely
a semantic
issue. Numerous auth ors h ave focused th eir atten-
tion on th e
concept
of
strategy
but h ave failed to
compreh ensively investigate
its h istorical evolution.
T h is
omission,
in favor of an
exclusively
contem-
poraneous approach ,
h as led to confusion
among
professionals
and students alike.
My objective
in
th is
paper
is to
develop
a definition of
strategic
management
from commonalities of
past
defini-
tions,
and to
provide
a useful
departure point
for th e
classroom
study
of
strategic management.
T h e
underlying principles
of
strategy
were dis-
cussed
by Homer, Euripides,
and
many
oth er
early
writers. Our word
strategy
comes from th e Greek
strategos,
"a
general,"
wh ich in turn comes from
roots
meaning "army"
and "lead." T h e Greek verb
stratego
means to
"plan
th e destruction of one's
enemies
th rough
effective use of resources." T h e
concept
of
strategy
in a
military
or
political
context
h as remained
prominent th rough out h istory,
and
h as been discussed
by
such
major
writers as
Sh akespeare, Montesquieu, Kant, Mill, Hegel,
Clausewitz, Liddell
Hart,
and
T olstoy.
T h e
strategic
concepts developed by
th ese writers h ave been
used
by
numerous militarists and
political th eorists,
such as
Mach iavelli, Napoleon, Bismarck, Yama-
moto, and Hitler.
One of th e first known
applications
of
strategy
to
business occurred wh en Socrates consoled Nich o-
mach ides,
a Greek militarist wh o lost an election to
th e
position
of
general
to
Antisth enes,
a Greek
businessman. Socrates
compared
th e duties of a
? 1980
by
th e
Academyof Management 0363-7425
general
and a businessman and sh owed Nich o-
mach ides th at in eith er case one
plans
th e use of
one's resources to meet
objectives.
T h is
viewpoint
was
lost,
for all
practical purposes,
with th e fall of
th e Greek
city-states
and was not to rise
again
until
after th e Industrial Revolution.
T h e need for a
concept
of
strategy
related to
business became
greater
after World War
II,
as
business moved from a
relatively
stable environ-
ment into a more
rapidly ch anging
and
competitive
environment. Ansoff h as attributed th is
ch ange
in
environment to two
significant
factors:
(1)
th e
marked acceleration in th e rate of
ch ange
with in
firms,
and
(2)
th e accelerated
application
of science
and
tech nology
to th e
process
of
management
[1969, p. 7].
T h e accelerated rate of
ch ange put
a
premium
on th e
ability
to
anticipate ch ange,
to take
advantage
of new
opportunities,
and to take
timely
action in
avoiding
th reats to th e firm. New tech nol-
ogies spurred
interest in and
acceptance
of
analytic
and
explicit approach es
to decision
making
th at
increased
management's ability
to deal with th e
increasingly
uncertain future.
T h e first modern writers to relate th e
concept
of
strategy
to business were Von Neumann and
Morgenstern [1947],
with th eir
th eory
of
games.
Numerous oth er auth ors h ave
developed concepts
of business
strategy
in th e
past
30
years.
A com-
parison
of th ese modern auth ors'
concepts
h as
been
presented by
Hofer and Sch endel
[1978].
T h ey
found th at
among
th e
auth ors,
th ere was
major disagreement
in th ree
primary
areas:
(1)
th e
breadth of th e
concept
of business
strategy, (2)
th e
219
T able 1
A
Ch ronology
of Recent Definitions of
Strategy
1947 Von Neumann &
Morgenstern, T h eory
of
Games and Economic Beh avior
[pp. 79-84]
1954 Drucker, T h e Practice of
Management [p. 17]
1962
Ch andler, Strategy
and Structure:
Ch apters
in
th e
History
of American Industrial
Enterprise
[p. 13]
1965 Ansoff, Corporate Strategy:
An
Analytic Ap-
proach
to Growth and
Expansion [pp.
118-121]
1968 Cannon, Business
Strategy
and
Policy [p. 9]
1969
Learned, Ch ristenson, Andrews, & Guth , Busi-
ness
Policy:
T ext and Cases
[p. 15]
1971 Newman &
Logan, Strategy, Policy,
and
Central
Management [p. 70]
1972 Sch endel &
Hatten, Business
policy
or strat-
egic management, Academy
of
Management
Proceedings [p. 4]
1973
Uyterh oeven, Ackerman, &
Rosenblum, Strat-
egy
and
Organization:
T ext and cases in
General
Management [pp. 9-10]
1974
Ackoff, Redesigning
th e Future
[p. 29]
1975 Paine &
Naumes, Strategy
and
Policy
Forma-
tion: An
Integrative Approach [p. 7]
1975
McCarth y, Minich iello,
&
Curran, Business
Policy
and
Strategy: Concepts
and
Readings
[p. 19]
1976
Glueck, Business
Policy: Strategy
Formation
and
Management Action, 2nd ed.
[p. 3]
1977
McNich ols, Policy Making
and Executive
Action, 5th ed.
[p. 9]
Strategy
is a series of actions
by
a firm th at are decided on
according
to th e
particular
situation.
Strategy
is
analyzing
th e
present
situation and
ch anging
it if
necessary. Incorporated
in th is is
finding
out wh at one's
resources are or wh at
th ey
sh ould be.
Strategy
is th e determinator of th e basic
long-term goals
of
an
enterprise,
and th e
adoption
of courses of action and th e
allocation of resources
necessary
for
carrying
out th ese
goals.
Strategy
is a rule for
making
decisions determined
by
product/market scope, growth vector, competitive
advan-
tage,
and
synergy.
Strategies
are th e directional action decisions wh ich are
required competitively
to ach ieve th e
company's purpose.
Strategy
is th e
pattern
of
objectives, purposes,
or
goals
and
major policies
and
plans
for
ach ieving
th ese
goals,
stated in
such
away
as to define wh at business th e
company
is in or is
to be in and th e kind of
company
it is or is to be.
Strategies
are
forward-looking plans
th at
anticipate ch ange
and initiate action to take
advantage
of
opportunities
th at are
integrated
into th e
concepts
or mission of th e
company.
Strategy
is defined as th e basic
goals
and
objectives
of th e
organization,
th e
major programs
of action ch osen to reach
th ese
goals
and
objectives,
and th e
major pattern
of
resource allocation used to relate th e
organization
to its
environment.
Strategy provides
both direction and coh esion to th e enter-
prise
and is
composed
of several
steps: strategic profile,
strategic forecast, resource
audit, strategic
alternatives ex-
plored,
tests for
consistency and, finally, strategic
ch oice.
Strategy
is concerned with
long-range objectives
and
ways
of
pursuing
th em th at affect th e
system
as a wh ole.
Strategies
are
specific major
actions or
patterns
of actions
for th e attainment of th e firm's
objectives.
Strategy
is an
analysis
of th e environment and selection of
economic alternatives th at will match th e
corporate
resources and
objectives
at a risk commensurate with th e
profit
and
viability
wh ich th e alternatives offer.
Strategy
is a
unified, compreh ensive,
and
integrated plan
designed
to assure th at th e basic
objectives
of th e
enterprise
are ach ieved.
Strategy
is embedded in
policy
formulation: it
comprises
a
series of decisions
reflecting
th e determination of basic
business
objectives
and th e utilization of skills and
resources to attain th ese
goals.
220
Date Contributor and Source Definition
T able 1
(Continued)
1977 Steiner &
Miner, Management Policy
and
Strategy: T ext, Readings,
and Cases
[p. 19]
1979
Mintzberg,
T h e
Structuring
of
Organizations
[p. 25]
1979 Sch endel & Hofer, Strategic Management:
A New View of Business
Policy
and
Planning
[p. 516]
components,
if
any,
of
strategy,
and
(3)
th e inclu-
siveness of th e
strategy-formulation process.
Hofer
and Sch endel's
comparison
failed to discuss th e
commonalities in th e
concept
of business
strategy,
h owever. I h ave th erefore
presented
a
summary
of
modern
major
writers' definitions of business strat-
egy
in T able
1, indicating
in italics
key
terms th at
identify
common th reads in th ese definitions.
T able 1 sh ows th at business
strategy
h as th e
following
ch aracteristics: an environmental orsitua-
tional
analysis
is used to determine a firm's
posture
in its
field,
and th en th e firm's resources are utilized
in an
appropriate
manner to attain its
major goals.
Strategic management
is th e direct
organization-
al
application
of th e
concepts
of business
strategy
th at h ave been
developed
in th e academic realm.
T h at
is, strategic management
entails th e
analysis
of internal and external environments of a firrrm to
maximize th e utilization of resources in relation to
objectives.
T h is statement can be considered as a
macro definition of th e
concept
of business strat-
egy,
or
strategic management
Strategy
is th e
forging
of
company missions, setting objec-
tives for th e
organization
in
ligh t
of external and internal
forces, formulating specific policies
and
strategies
to ach ieve
objectives,
and
ensuring
th eir
proper implementation
so th at
th e
basicpurposes
and
objectives
of th e
organization
will be
ach ieved.
Strategy
is a
mediating
force between th e
organization
and
its environment: consistent
patterns
in streams of
organizational
decisions to deal with th e environment.
Strategy provides
directional cues to th e
organization
th at
permit
it to ach ieve its
objectives,
wh ile
responding
to th e
opportunities
and th reats in its environment.
T h e
major importance
of
strategic management
is th at it
gives organizations
a framework for devel-
oping
abilities for
anticipating
and
coping
with
ch ange.
It also
h elps
to
develop
th e
ability
to deal
with uncertain futures
by defining
a
procedure
for
accomplish ing goals.
Only recently
h as th e literature addressed th e
operationalization
of
strategic management.
T able
2
provides
a brief overview of
approach es
to
opera-
tionalizing strategic management;
a more exten-
sive overview of th e literature can be found in Hofer
[1976]
and Sch endel and Hofer
[1979].
Since th e time of th e
early Greeks,
th e
concept
of
business
strategy
h as
ch anged
from a macro to a
micro and back to a macro
viewpoint (see
T able
3).
Now business research ers and
practitioners
need
to move from a concern with definitions of th e con-
cept
to a consolidation of
terminology.
Such a
consolidation would facilitate th e
empirical testing
of
h ypoth eses
as
part
of an
attempt
to validate or
reject
traditional constructs and to
develop
useful
applications
to
organizational
environments.
221
T able 2
Approach es
to
Operationalizing Strategic Management
Explanation
of Work
A 2SLS
regression
model of
strategic
resource allocation to
investigate
th e
funds-allocation
process
in a number of firms.
1968
1972
Boston
Consulting Group
Elliott
1973
Macintosh , T surumi,
and T surumi
1974
Sch oeffler, Buzzell, and
Heany
1975
Buzzell, Gale,
and Sultan
1975 Kirch h off
1976
Sch endel, Patton, and
Riggs
1976 Sch endel and Patton
1978 Bass
1978
Hatten, Sch endel, and
Cooper
A
process
model
dealing
with cost/volume
relationsh ips
of a
variety
of
products.
A number of
strategic
conclusions
regarding cost, volume, market
sh are,
and
profitability
are
developed.
A
strategic analysis using
a simultaneous
equation
model of th e
major
elements of
corporate performance.
A 2SLS
regression
model
linking
th e
largest
Canadian meat
packer
to a
model of th e Canadian
economy
for th e
purpose
of environmental
perception, analysis,
and
determining optimal strategic
action.
A
study
of th e
strategic relationsh ip
between market sh are and oth er factors
and
profitability (PIMS).
A
study
of th e
strategic relationsh ip
between market sh are and oth er factors
and
profitability (PIMS).
An
analysis
of internal factors
contributing
to return on
investment;
uses an SPSS
stepwise regression
model.
A
strategic
OLS
regression
model of
corporate
turnaround
strategies.
A 3SLS
regression
model of
corporate strategy
to overcome th e
multiple-
goal problem
and to
capture complex patterns
of th e
strategic, operating,
and environmental variables th at influence
goal
attainment.
A
strategic
model formulated for consumer durables
specifying
th e
price
level for each
period
of a
product's
life th at will maximize th e firm's
discounted cash flow.
Merges
an earlier Bass demand model with th e
Boston
Consulting Group's experience
curve.
An OLS
regression
model of th e U.S.
brewing industry relating strategic
(controllable)
and environmental
(noncontrollable)
variables to a firm's
return on
equity.
222
Date
1967
Auth or
Mueller
T able 3
History
of th e
Scope
of
Strategic Management
Micro
Industrial Post World
Revolution War II
Rationale
Strategy
Definition
Major
Contributors
Application
of
Strategy
National markets
Large, complex
interrelated
organizations
Effective use of resources to
meet
objectives
Early
Greek writers such as
Homer, Euripides,
and
Socrates
Business, Military,
and
Government
Oligopolistic
environment
Unlimited resource
availability
Lack of national markets
Lack of
ability
to
anticipate
ch ange
Stable environment
Effective use of resources to
meet
objectives
Sh akespeare, Montesquieu,
Kant, Mill, Hegel, Clausewitz,
T olstoy
Military
and Government
Dynamic
environment
New
tech nology
Ability
to
anticipate ch ange
National markets
Ability
to deal with uncertain
future
Analysis
of internal and exter-
nal environments of th e firm in
order to maximize utilization of
resources in relation to
objec-
tives
Von Neumann &
Morgenstern,
Drucker, Ch andler, Ansoff,
Glueck, McNich ols, Steiner,
Miner, Mintzberg, Hofer,
Sch endel
Business, Military,
and
Government
223
T ime
Macro
3000 B.C. Fall of Greek
City-
States
Roman
Empire
Macro
Future
REFERENCES
Ackoff,
R.
Redesigning
th e future. New York:
Wiley,
1974.
Ansoff,
H. I.
Corporate strategy:
An
analytic approach
to busi-
ness
policy
for
growth
and
expansion.
New York: McGraw-
Hill, 1965.
Ansoff, H. I.
(Ed.).
Business
strategy:
Selected
readings.
Baltimore, Md.:
Penguin Books, 1969.
Bass,
F. M. T h e
relationsh ip
between diffusion rater, experi-
ence curves, and demand elasticities for consumer durable
tech nological
innovations.
Paper
No. 660, Institute for Re-
search in th e Beh avioral, Economic, and
Management
Sci-
ences, Krannert Graduate Sch ool of
Management,
March 1978.
Boston
Consulting Group. Perspectives
on
experience.
Boston: Boston
Consulting Group,
1968.
Buzzell,
R.
D.; Gale,
B.
T .; &
Sultan,
R. G. M. Market sh are: A
key
to
profitability.
Harvard Business Review, 1975,
53(1),
97-106.
Cannon, J. T . Business
strategy
and
policy.
New York:
Harcourt, Brace &
World, 1968.
Ch andler,
A.
Strategy
and structure:
Ch apters
in th e
h istory
of
American industrial
enterprise. Cambridge,
Mass.: MIT
Press,
1962.
Drucker,
P. T h e
practice
of
management.
New York:
Harper
&
Broth ers, 1954.
Elliott, J. W.
Forecasting
and
analysis
of
corporate
financial
performance
with an econometric model of th e firm. Journal of
Financial and Quantitative
Analysis, 1972, 7(2),
1499-1526.
Glueck, W. Business
policy, strategy formation, and
manage-
ment action
(2nd ed.).
New York:
McGraw-Hill, 1976.
Hatten, K.
J.; Sch endel,
D. E.; &
Cooper,
A. C. A
strategic
model of th e U.S.
brewing industry:
1952-1971.
Academy
of
Management Journal, 1978,21(4),
597-610.
Hofer, C. W. Research on
strategic planning:
A
survey
of
past
studies and
suggestions
for future efforts. Journal of Econom-
ics and
Business, 1976, 28(3),
261-286.
Hofer, C.
W.; &
Sch endel, D.
Strategy
formulation:
Analytical
concepts.
St. Paul, Minn.: West
Publish ing,
1978.
Kirch h off,
B. A.
Empirical analysis
of th e
strategic
factors con-
tributing
to return on investment.
Unpublish ed paper,
Univer-
sity
of Nebraska at
Omah a, 1975.
Learned,
E.
P.; Ch ristensen, R.
C.; Andrews,
K.
R.; &
Guth , W. D.
Business
policy:
T ext and cases.
Homewood, III.: Irwin, 1969.
Jeffrey
Bracker is an
Georgia
State Universil
Macintosh , N. R.; T surumi, H.; & T surumi, Y. Economics for
strategic planning.
Journal of Business
Policy, 1973, 3(3), 49-
60.
McCarth y,
D. J.; Minich iello, R. J.; & Curran, J. R. Business
policy
and
strategy: Concepts
and
readings. Homewood, III.:
Irwin, 1975.
McNich ols, T . J.
Policy making
and executive action
(5th
edi-
tion).
New York: McGraw-Hill, 1977.
Mintzberg,
H. T h e
structuring
of
organizations. Englewood
Cliffs, N.J.: Prentice-Hall, 1979.
Mueller, D. C. T h e firm decision
process:
An economic investi-
gation. Quarterly
Journal of Economics, 1967, 81(1), 58-81.
Newman, W. H.; &
Logan,
J. P.
Strategy, policy,
and central
management.
Cincinnati: South -Western
Publish ing,
1971.
Paine, F.; & Naumes, W.
Strategy
and
policy
formation: An
integrative approach . Ph iladelph ia: Saunders, 1974.
Sch endel, D. E.; & Hatten, K. J. Business
policy
or
strategic
management:
A view for an
emerging discipline.
In V. F.
Mitch ell, R. T . Barth , & F. H. Mitch ell
(Eds.), Academy
of Man-
agement Proceedings,
1972.
Sch endel, D. E.; & Hofer, C.
Strategic management.
Boston:
Little, Brown, 1979.
Sch endel, D.; & Patton, G. R. A simultaneous
equation
model
of
corporate strategy. Paper
No. 582, Institute for Research in
th e
Beh avioral, Economic, and
Management Sciences, Krannert
Graduate Sch ool of
Management,
December 1976.
Sch endel, D.; Patton, G. R.; &
Riggs,
J.
Corporate
turnaround
strategies:
A
study
of
profit
decline and
recovery.
Journal of
General
Management, 1976,3(3),
3-11.
Sch oeffler, S.; Buzzell, R. D.; &
Heany,
D. F.
Impact
of strat-
egic planning
on
profit performance. Harvard Business Re-
view, 1974, 52(2),
137-145.
Steiner, G. A.; & Miner, J. B.
Managementpolicy
and
strategy:
T ext, readings,
and cases. New York: Macmillan, 1977.
Uyterh oeven, H.; Ackerman, R.; & Rosenblum, J. W.
Strategy
and
organization:
T ext and cases in
general management.
Homewood, III.: Irwin, 1973.
Von Neumann, J.; &
Morgenstern, O. T h eory
of
games
and
economic beh avior
(2nd ed.).
Princeton: Princeton
University
Press, 1947.
Instructor of
Management
at
ty,
Atlanta.
Received 3/30/79
224
doc_770747317.pdf
This abstract tell the historical development of the strategic management concept author(s) jeffrey bracker.
The Historical Development of the Strategic Management Concept
Author(s): Jeffrey Bracker
Source: The Academy of Management Review, Vol. 5, No. 2 (Apr., 1980), pp. 219-224
Published by: Academy of Management
Stable URL: http://www.jstor.org/stable/257431 .
Accessed: 16/09/2011 23:38
Your use of the JSTOR archive indicates your acceptance of the Terms & Conditions of Use, available at .
http://www.jstor.org/page/info/about/policies/terms.jsp
JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build upon a wide range of
content in a trusted digital archive. We use information technology and tools to increase productivity and facilitate new forms
of scholarship. For more information about JSTOR, please contact [email protected].
Academy of Management is collaborating with JSTOR to digitize, preserve and extend access to The Academy
of Management Review.
http://www.jstor.org
Academy
of
Management Review 1980, Vol. 5, No. 2, 219-224
T h e Historical
Development
of th e
Strategic Management Concept
JEFFREY BRACKER
Georgia
State
University
In th is
article,
I examine h ow th e
concept
of
strategy
h as evolved into th e
field of
strategic management.
A definition of
strategic management
is
developed
from commonalities of
past
definitions and a selected overview
of
approach es
to
operationalizing strategic management
is
presented.
Since its first mention in th e Old
T estament, th e
concept
of
strategy
h as been
largely
a semantic
issue. Numerous auth ors h ave focused th eir atten-
tion on th e
concept
of
strategy
but h ave failed to
compreh ensively investigate
its h istorical evolution.
T h is
omission,
in favor of an
exclusively
contem-
poraneous approach ,
h as led to confusion
among
professionals
and students alike.
My objective
in
th is
paper
is to
develop
a definition of
strategic
management
from commonalities of
past
defini-
tions,
and to
provide
a useful
departure point
for th e
classroom
study
of
strategic management.
T h e
underlying principles
of
strategy
were dis-
cussed
by Homer, Euripides,
and
many
oth er
early
writers. Our word
strategy
comes from th e Greek
strategos,
"a
general,"
wh ich in turn comes from
roots
meaning "army"
and "lead." T h e Greek verb
stratego
means to
"plan
th e destruction of one's
enemies
th rough
effective use of resources." T h e
concept
of
strategy
in a
military
or
political
context
h as remained
prominent th rough out h istory,
and
h as been discussed
by
such
major
writers as
Sh akespeare, Montesquieu, Kant, Mill, Hegel,
Clausewitz, Liddell
Hart,
and
T olstoy.
T h e
strategic
concepts developed by
th ese writers h ave been
used
by
numerous militarists and
political th eorists,
such as
Mach iavelli, Napoleon, Bismarck, Yama-
moto, and Hitler.
One of th e first known
applications
of
strategy
to
business occurred wh en Socrates consoled Nich o-
mach ides,
a Greek militarist wh o lost an election to
th e
position
of
general
to
Antisth enes,
a Greek
businessman. Socrates
compared
th e duties of a
? 1980
by
th e
Academyof Management 0363-7425
general
and a businessman and sh owed Nich o-
mach ides th at in eith er case one
plans
th e use of
one's resources to meet
objectives.
T h is
viewpoint
was
lost,
for all
practical purposes,
with th e fall of
th e Greek
city-states
and was not to rise
again
until
after th e Industrial Revolution.
T h e need for a
concept
of
strategy
related to
business became
greater
after World War
II,
as
business moved from a
relatively
stable environ-
ment into a more
rapidly ch anging
and
competitive
environment. Ansoff h as attributed th is
ch ange
in
environment to two
significant
factors:
(1)
th e
marked acceleration in th e rate of
ch ange
with in
firms,
and
(2)
th e accelerated
application
of science
and
tech nology
to th e
process
of
management
[1969, p. 7].
T h e accelerated rate of
ch ange put
a
premium
on th e
ability
to
anticipate ch ange,
to take
advantage
of new
opportunities,
and to take
timely
action in
avoiding
th reats to th e firm. New tech nol-
ogies spurred
interest in and
acceptance
of
analytic
and
explicit approach es
to decision
making
th at
increased
management's ability
to deal with th e
increasingly
uncertain future.
T h e first modern writers to relate th e
concept
of
strategy
to business were Von Neumann and
Morgenstern [1947],
with th eir
th eory
of
games.
Numerous oth er auth ors h ave
developed concepts
of business
strategy
in th e
past
30
years.
A com-
parison
of th ese modern auth ors'
concepts
h as
been
presented by
Hofer and Sch endel
[1978].
T h ey
found th at
among
th e
auth ors,
th ere was
major disagreement
in th ree
primary
areas:
(1)
th e
breadth of th e
concept
of business
strategy, (2)
th e
219
T able 1
A
Ch ronology
of Recent Definitions of
Strategy
1947 Von Neumann &
Morgenstern, T h eory
of
Games and Economic Beh avior
[pp. 79-84]
1954 Drucker, T h e Practice of
Management [p. 17]
1962
Ch andler, Strategy
and Structure:
Ch apters
in
th e
History
of American Industrial
Enterprise
[p. 13]
1965 Ansoff, Corporate Strategy:
An
Analytic Ap-
proach
to Growth and
Expansion [pp.
118-121]
1968 Cannon, Business
Strategy
and
Policy [p. 9]
1969
Learned, Ch ristenson, Andrews, & Guth , Busi-
ness
Policy:
T ext and Cases
[p. 15]
1971 Newman &
Logan, Strategy, Policy,
and
Central
Management [p. 70]
1972 Sch endel &
Hatten, Business
policy
or strat-
egic management, Academy
of
Management
Proceedings [p. 4]
1973
Uyterh oeven, Ackerman, &
Rosenblum, Strat-
egy
and
Organization:
T ext and cases in
General
Management [pp. 9-10]
1974
Ackoff, Redesigning
th e Future
[p. 29]
1975 Paine &
Naumes, Strategy
and
Policy
Forma-
tion: An
Integrative Approach [p. 7]
1975
McCarth y, Minich iello,
&
Curran, Business
Policy
and
Strategy: Concepts
and
Readings
[p. 19]
1976
Glueck, Business
Policy: Strategy
Formation
and
Management Action, 2nd ed.
[p. 3]
1977
McNich ols, Policy Making
and Executive
Action, 5th ed.
[p. 9]
Strategy
is a series of actions
by
a firm th at are decided on
according
to th e
particular
situation.
Strategy
is
analyzing
th e
present
situation and
ch anging
it if
necessary. Incorporated
in th is is
finding
out wh at one's
resources are or wh at
th ey
sh ould be.
Strategy
is th e determinator of th e basic
long-term goals
of
an
enterprise,
and th e
adoption
of courses of action and th e
allocation of resources
necessary
for
carrying
out th ese
goals.
Strategy
is a rule for
making
decisions determined
by
product/market scope, growth vector, competitive
advan-
tage,
and
synergy.
Strategies
are th e directional action decisions wh ich are
required competitively
to ach ieve th e
company's purpose.
Strategy
is th e
pattern
of
objectives, purposes,
or
goals
and
major policies
and
plans
for
ach ieving
th ese
goals,
stated in
such
away
as to define wh at business th e
company
is in or is
to be in and th e kind of
company
it is or is to be.
Strategies
are
forward-looking plans
th at
anticipate ch ange
and initiate action to take
advantage
of
opportunities
th at are
integrated
into th e
concepts
or mission of th e
company.
Strategy
is defined as th e basic
goals
and
objectives
of th e
organization,
th e
major programs
of action ch osen to reach
th ese
goals
and
objectives,
and th e
major pattern
of
resource allocation used to relate th e
organization
to its
environment.
Strategy provides
both direction and coh esion to th e enter-
prise
and is
composed
of several
steps: strategic profile,
strategic forecast, resource
audit, strategic
alternatives ex-
plored,
tests for
consistency and, finally, strategic
ch oice.
Strategy
is concerned with
long-range objectives
and
ways
of
pursuing
th em th at affect th e
system
as a wh ole.
Strategies
are
specific major
actions or
patterns
of actions
for th e attainment of th e firm's
objectives.
Strategy
is an
analysis
of th e environment and selection of
economic alternatives th at will match th e
corporate
resources and
objectives
at a risk commensurate with th e
profit
and
viability
wh ich th e alternatives offer.
Strategy
is a
unified, compreh ensive,
and
integrated plan
designed
to assure th at th e basic
objectives
of th e
enterprise
are ach ieved.
Strategy
is embedded in
policy
formulation: it
comprises
a
series of decisions
reflecting
th e determination of basic
business
objectives
and th e utilization of skills and
resources to attain th ese
goals.
220
Date Contributor and Source Definition
T able 1
(Continued)
1977 Steiner &
Miner, Management Policy
and
Strategy: T ext, Readings,
and Cases
[p. 19]
1979
Mintzberg,
T h e
Structuring
of
Organizations
[p. 25]
1979 Sch endel & Hofer, Strategic Management:
A New View of Business
Policy
and
Planning
[p. 516]
components,
if
any,
of
strategy,
and
(3)
th e inclu-
siveness of th e
strategy-formulation process.
Hofer
and Sch endel's
comparison
failed to discuss th e
commonalities in th e
concept
of business
strategy,
h owever. I h ave th erefore
presented
a
summary
of
modern
major
writers' definitions of business strat-
egy
in T able
1, indicating
in italics
key
terms th at
identify
common th reads in th ese definitions.
T able 1 sh ows th at business
strategy
h as th e
following
ch aracteristics: an environmental orsitua-
tional
analysis
is used to determine a firm's
posture
in its
field,
and th en th e firm's resources are utilized
in an
appropriate
manner to attain its
major goals.
Strategic management
is th e direct
organization-
al
application
of th e
concepts
of business
strategy
th at h ave been
developed
in th e academic realm.
T h at
is, strategic management
entails th e
analysis
of internal and external environments of a firrrm to
maximize th e utilization of resources in relation to
objectives.
T h is statement can be considered as a
macro definition of th e
concept
of business strat-
egy,
or
strategic management
Strategy
is th e
forging
of
company missions, setting objec-
tives for th e
organization
in
ligh t
of external and internal
forces, formulating specific policies
and
strategies
to ach ieve
objectives,
and
ensuring
th eir
proper implementation
so th at
th e
basicpurposes
and
objectives
of th e
organization
will be
ach ieved.
Strategy
is a
mediating
force between th e
organization
and
its environment: consistent
patterns
in streams of
organizational
decisions to deal with th e environment.
Strategy provides
directional cues to th e
organization
th at
permit
it to ach ieve its
objectives,
wh ile
responding
to th e
opportunities
and th reats in its environment.
T h e
major importance
of
strategic management
is th at it
gives organizations
a framework for devel-
oping
abilities for
anticipating
and
coping
with
ch ange.
It also
h elps
to
develop
th e
ability
to deal
with uncertain futures
by defining
a
procedure
for
accomplish ing goals.
Only recently
h as th e literature addressed th e
operationalization
of
strategic management.
T able
2
provides
a brief overview of
approach es
to
opera-
tionalizing strategic management;
a more exten-
sive overview of th e literature can be found in Hofer
[1976]
and Sch endel and Hofer
[1979].
Since th e time of th e
early Greeks,
th e
concept
of
business
strategy
h as
ch anged
from a macro to a
micro and back to a macro
viewpoint (see
T able
3).
Now business research ers and
practitioners
need
to move from a concern with definitions of th e con-
cept
to a consolidation of
terminology.
Such a
consolidation would facilitate th e
empirical testing
of
h ypoth eses
as
part
of an
attempt
to validate or
reject
traditional constructs and to
develop
useful
applications
to
organizational
environments.
221
T able 2
Approach es
to
Operationalizing Strategic Management
Explanation
of Work
A 2SLS
regression
model of
strategic
resource allocation to
investigate
th e
funds-allocation
process
in a number of firms.
1968
1972
Boston
Consulting Group
Elliott
1973
Macintosh , T surumi,
and T surumi
1974
Sch oeffler, Buzzell, and
Heany
1975
Buzzell, Gale,
and Sultan
1975 Kirch h off
1976
Sch endel, Patton, and
Riggs
1976 Sch endel and Patton
1978 Bass
1978
Hatten, Sch endel, and
Cooper
A
process
model
dealing
with cost/volume
relationsh ips
of a
variety
of
products.
A number of
strategic
conclusions
regarding cost, volume, market
sh are,
and
profitability
are
developed.
A
strategic analysis using
a simultaneous
equation
model of th e
major
elements of
corporate performance.
A 2SLS
regression
model
linking
th e
largest
Canadian meat
packer
to a
model of th e Canadian
economy
for th e
purpose
of environmental
perception, analysis,
and
determining optimal strategic
action.
A
study
of th e
strategic relationsh ip
between market sh are and oth er factors
and
profitability (PIMS).
A
study
of th e
strategic relationsh ip
between market sh are and oth er factors
and
profitability (PIMS).
An
analysis
of internal factors
contributing
to return on
investment;
uses an SPSS
stepwise regression
model.
A
strategic
OLS
regression
model of
corporate
turnaround
strategies.
A 3SLS
regression
model of
corporate strategy
to overcome th e
multiple-
goal problem
and to
capture complex patterns
of th e
strategic, operating,
and environmental variables th at influence
goal
attainment.
A
strategic
model formulated for consumer durables
specifying
th e
price
level for each
period
of a
product's
life th at will maximize th e firm's
discounted cash flow.
Merges
an earlier Bass demand model with th e
Boston
Consulting Group's experience
curve.
An OLS
regression
model of th e U.S.
brewing industry relating strategic
(controllable)
and environmental
(noncontrollable)
variables to a firm's
return on
equity.
222
Date
1967
Auth or
Mueller
T able 3
History
of th e
Scope
of
Strategic Management
Micro
Industrial Post World
Revolution War II
Rationale
Strategy
Definition
Major
Contributors
Application
of
Strategy
National markets
Large, complex
interrelated
organizations
Effective use of resources to
meet
objectives
Early
Greek writers such as
Homer, Euripides,
and
Socrates
Business, Military,
and
Government
Oligopolistic
environment
Unlimited resource
availability
Lack of national markets
Lack of
ability
to
anticipate
ch ange
Stable environment
Effective use of resources to
meet
objectives
Sh akespeare, Montesquieu,
Kant, Mill, Hegel, Clausewitz,
T olstoy
Military
and Government
Dynamic
environment
New
tech nology
Ability
to
anticipate ch ange
National markets
Ability
to deal with uncertain
future
Analysis
of internal and exter-
nal environments of th e firm in
order to maximize utilization of
resources in relation to
objec-
tives
Von Neumann &
Morgenstern,
Drucker, Ch andler, Ansoff,
Glueck, McNich ols, Steiner,
Miner, Mintzberg, Hofer,
Sch endel
Business, Military,
and
Government
223
T ime
Macro
3000 B.C. Fall of Greek
City-
States
Roman
Empire
Macro
Future
REFERENCES
Ackoff,
R.
Redesigning
th e future. New York:
Wiley,
1974.
Ansoff,
H. I.
Corporate strategy:
An
analytic approach
to busi-
ness
policy
for
growth
and
expansion.
New York: McGraw-
Hill, 1965.
Ansoff, H. I.
(Ed.).
Business
strategy:
Selected
readings.
Baltimore, Md.:
Penguin Books, 1969.
Bass,
F. M. T h e
relationsh ip
between diffusion rater, experi-
ence curves, and demand elasticities for consumer durable
tech nological
innovations.
Paper
No. 660, Institute for Re-
search in th e Beh avioral, Economic, and
Management
Sci-
ences, Krannert Graduate Sch ool of
Management,
March 1978.
Boston
Consulting Group. Perspectives
on
experience.
Boston: Boston
Consulting Group,
1968.
Buzzell,
R.
D.; Gale,
B.
T .; &
Sultan,
R. G. M. Market sh are: A
key
to
profitability.
Harvard Business Review, 1975,
53(1),
97-106.
Cannon, J. T . Business
strategy
and
policy.
New York:
Harcourt, Brace &
World, 1968.
Ch andler,
A.
Strategy
and structure:
Ch apters
in th e
h istory
of
American industrial
enterprise. Cambridge,
Mass.: MIT
Press,
1962.
Drucker,
P. T h e
practice
of
management.
New York:
Harper
&
Broth ers, 1954.
Elliott, J. W.
Forecasting
and
analysis
of
corporate
financial
performance
with an econometric model of th e firm. Journal of
Financial and Quantitative
Analysis, 1972, 7(2),
1499-1526.
Glueck, W. Business
policy, strategy formation, and
manage-
ment action
(2nd ed.).
New York:
McGraw-Hill, 1976.
Hatten, K.
J.; Sch endel,
D. E.; &
Cooper,
A. C. A
strategic
model of th e U.S.
brewing industry:
1952-1971.
Academy
of
Management Journal, 1978,21(4),
597-610.
Hofer, C. W. Research on
strategic planning:
A
survey
of
past
studies and
suggestions
for future efforts. Journal of Econom-
ics and
Business, 1976, 28(3),
261-286.
Hofer, C.
W.; &
Sch endel, D.
Strategy
formulation:
Analytical
concepts.
St. Paul, Minn.: West
Publish ing,
1978.
Kirch h off,
B. A.
Empirical analysis
of th e
strategic
factors con-
tributing
to return on investment.
Unpublish ed paper,
Univer-
sity
of Nebraska at
Omah a, 1975.
Learned,
E.
P.; Ch ristensen, R.
C.; Andrews,
K.
R.; &
Guth , W. D.
Business
policy:
T ext and cases.
Homewood, III.: Irwin, 1969.
Jeffrey
Bracker is an
Georgia
State Universil
Macintosh , N. R.; T surumi, H.; & T surumi, Y. Economics for
strategic planning.
Journal of Business
Policy, 1973, 3(3), 49-
60.
McCarth y,
D. J.; Minich iello, R. J.; & Curran, J. R. Business
policy
and
strategy: Concepts
and
readings. Homewood, III.:
Irwin, 1975.
McNich ols, T . J.
Policy making
and executive action
(5th
edi-
tion).
New York: McGraw-Hill, 1977.
Mintzberg,
H. T h e
structuring
of
organizations. Englewood
Cliffs, N.J.: Prentice-Hall, 1979.
Mueller, D. C. T h e firm decision
process:
An economic investi-
gation. Quarterly
Journal of Economics, 1967, 81(1), 58-81.
Newman, W. H.; &
Logan,
J. P.
Strategy, policy,
and central
management.
Cincinnati: South -Western
Publish ing,
1971.
Paine, F.; & Naumes, W.
Strategy
and
policy
formation: An
integrative approach . Ph iladelph ia: Saunders, 1974.
Sch endel, D. E.; & Hatten, K. J. Business
policy
or
strategic
management:
A view for an
emerging discipline.
In V. F.
Mitch ell, R. T . Barth , & F. H. Mitch ell
(Eds.), Academy
of Man-
agement Proceedings,
1972.
Sch endel, D. E.; & Hofer, C.
Strategic management.
Boston:
Little, Brown, 1979.
Sch endel, D.; & Patton, G. R. A simultaneous
equation
model
of
corporate strategy. Paper
No. 582, Institute for Research in
th e
Beh avioral, Economic, and
Management Sciences, Krannert
Graduate Sch ool of
Management,
December 1976.
Sch endel, D.; Patton, G. R.; &
Riggs,
J.
Corporate
turnaround
strategies:
A
study
of
profit
decline and
recovery.
Journal of
General
Management, 1976,3(3),
3-11.
Sch oeffler, S.; Buzzell, R. D.; &
Heany,
D. F.
Impact
of strat-
egic planning
on
profit performance. Harvard Business Re-
view, 1974, 52(2),
137-145.
Steiner, G. A.; & Miner, J. B.
Managementpolicy
and
strategy:
T ext, readings,
and cases. New York: Macmillan, 1977.
Uyterh oeven, H.; Ackerman, R.; & Rosenblum, J. W.
Strategy
and
organization:
T ext and cases in
general management.
Homewood, III.: Irwin, 1973.
Von Neumann, J.; &
Morgenstern, O. T h eory
of
games
and
economic beh avior
(2nd ed.).
Princeton: Princeton
University
Press, 1947.
Instructor of
Management
at
ty,
Atlanta.
Received 3/30/79
224
doc_770747317.pdf