The fact that strategic decisions have an essential impact on growth, as well as on profitability, illustrates that organisations should become familiarised with the different approaches on how to come to a strategic decision.
Researchers discuss whether strategic planning tools should be used and which risk they bear and debate about the degree of formalization. Should decisions rely more on facts or more on human intuition and what benefits are involved? While there are several discussable approaches, it is widely agreed that strategic decisions influence the long-term performance of the company, by focusing on the future of the business as a whole, rather than on specific business units.
A glance at the practice shows that companies use several different approaches to come to strategic decisions. Performance indicators prove that some organisations established a very successful way of decision making, while other companies are struggling to find a way to make strategic decisions which fit the business model and the industry they are acting in.
This essay illustrates which approach is effective in making strategic decisions in today's world, with the emphasis to create an entrepreneurial environment. To analyse different approaches, this essay first reviews the literature in order to provide an overview of the theory about strategic development processes, continuing with benefits and dilemmas of deliberate and emergent strategies, illustrating that the incremental approach possesses balanced features. Finally, the essay discusses practical approaches of how to make effective strategic decisions in a high-velocity environment.
Table of Contents
- Introduction
- Literature review
- Decision making in a high-velocity environment
- Contrasting deliberate and emergent strategy in high-velocity environments
Objectives and Key Themes
This essay critically reviews literature on strategy development processes and examines the most useful approach for strategic decision-making in high-velocity environments. It aims to analyze different approaches, highlighting the benefits and challenges of deliberate and emergent strategies, ultimately advocating for an incremental approach as a balanced solution. The essay emphasizes the creation of an entrepreneurial environment within organizations.
- Strategic decision-making processes in organizations
- Deliberate versus emergent strategies
- The role of flexibility and adaptability in high-velocity environments
- Creating an entrepreneurial environment for strategic innovation
- Effective strategic decision-making tools and methodologies in volatile markets
Chapter Summaries
Introduction: This introductory section establishes the critical importance of strategic decisions for organizational growth and profitability, emphasizing the far-reaching consequences of both successful and unsuccessful decision-making. It highlights the ongoing debate surrounding the use of strategic planning tools and the balance between factual analysis and intuitive decision-making. The introduction sets the stage for a critical review of various approaches to strategic decision-making, focusing on their effectiveness in today's dynamic business environment and the necessity of fostering entrepreneurial environments.
Literature review: This chapter explores the two dominant perspectives on strategic decision-making: the traditional, deliberate approach emphasizing long-term planning and analysis, and the emergent approach prioritizing adaptability and responsiveness to short-term market changes. The chapter critiques the limitations of purely deliberate strategies, citing their inflexibility and potential for "paralysis by analysis," while also acknowledging the risks associated with overly reactive, purely emergent strategies. The discussion highlights the need for a balanced approach that incorporates both elements, combining rational analysis with flexible responsiveness. It discusses the views of several theorists like Mintzberg, Ansoff, and others, showcasing the evolution of thought in strategic management.
Decision making in a high-velocity environment: This section examines how the increasing volatility of the global economy, driven by factors like globalization, technological advancements, and market deregulation, has impacted strategic decision-making. It explores the shift towards shorter planning horizons and increased competition, discussing theories and models designed to manage strategic decision-making in highly volatile environments. The chapter emphasizes the need for organizations to cultivate innovative, entrepreneurial cultures characterized by less bureaucracy, flatter hierarchies, and a focus on continuous environmental scanning and adaptation. It explores the intersection of external market pressures and internal organizational culture.
Keywords
Strategic decision-making, high-velocity environments, deliberate strategy, emergent strategy, incremental approach, entrepreneurial environment, organizational culture, market volatility, strategic planning, competitive advantage.
Frequently Asked Questions: A Comprehensive Language Preview
What is the overall topic of this language preview?
This preview summarizes a document focusing on strategic decision-making processes, particularly within high-velocity environments. It explores the contrasting approaches of deliberate and emergent strategies, ultimately advocating for a balanced, incremental approach that fosters an entrepreneurial organizational culture.
What are the key themes explored in the document?
The key themes include strategic decision-making processes in organizations, the comparison and contrast of deliberate versus emergent strategies, the crucial role of flexibility and adaptability in dynamic markets, the cultivation of entrepreneurial environments for innovation, and the application of effective decision-making tools in volatile markets.
What is the purpose of the literature review section?
The literature review section examines the traditional deliberate approach to strategic decision-making (emphasizing long-term planning) and the emergent approach (prioritizing adaptability). It critiques the limitations of each extreme and argues for a balanced approach that combines both rational analysis and flexible responsiveness, referencing relevant theorists like Mintzberg and Ansoff.
How does the document address decision-making in high-velocity environments?
The document analyzes how factors such as globalization, technological advancements, and market deregulation impact strategic decision-making in high-velocity environments. It stresses the need for shorter planning horizons, increased competition management, and the development of innovative, entrepreneurial organizational cultures with less bureaucracy and a focus on continuous adaptation.
What is the suggested approach to strategic decision-making?
The document advocates for an incremental approach, which combines elements of both deliberate and emergent strategies. This balanced approach aims to maintain a degree of planning and foresight while remaining adaptable and responsive to the rapidly changing dynamics of high-velocity environments.
What is the significance of creating an entrepreneurial environment within organizations?
The document highlights the importance of fostering an entrepreneurial environment within organizations to enhance innovation and adaptability. This includes reducing bureaucracy, flattening hierarchies, and promoting a culture of continuous environmental scanning and responsiveness.
What are the main keywords associated with this document?
Key terms include strategic decision-making, high-velocity environments, deliberate strategy, emergent strategy, incremental approach, entrepreneurial environment, organizational culture, market volatility, strategic planning, and competitive advantage.
What topics are covered in the Table of Contents?
The Table of Contents includes an Introduction, Literature Review, a section on Decision Making in High-Velocity Environments, and a section Contrasting Deliberate and Emergent Strategy in High-Velocity Environments.
What is the overall conclusion or recommendation of the document (as inferred from the preview)?
The document likely concludes that a balanced, incremental approach to strategic decision-making, coupled with the cultivation of an entrepreneurial organizational culture, is the most effective strategy for navigating the complexities of high-velocity environments.
- Citation du texte
- Anonym (Auteur), 2015, Strategy Development Processes and Useful Approaches in High-Velocity Environments, Munich, GRIN Verlag, https://www.grin.com/document/364467
