9/25/2023 Implementing Strategies & Strategy as practices Solmaz Filiz Karabag 1 A model of the elements of strategic management Strategic capabilities The environment Expectations and Purposes Strategic Choices Organizing Corporate level strategies Business level strategies Development directions and methods Tech inno, Bus Mod inno Org In 2 Strategic Position Strategy into Action Processes and Practices Change 9/25/2023 Learning outcomes • What is meant by the strategy as practice? And overall concept • Questions that are answered by strategy as practice research • Arenas of strategy/practicing strategy 3 • Strategic management is an applied discipline, and using theories developed for stable environments and context might be irrelevant in the increasingly high-velocity business environment. Capability building Speed in resource reconfiguration Low • Knowledge intensity Capability building Earlier RB and competences Environmental Velocity High High Capability building Knowledge-based resources and competencies Jarzabkowsk, 2003 Positioning 4 9/25/2023 Strategic tools for such environment Low • Knowledge intensity Value Chain Boston Consultant Growth Matrix Experiences curve 5 Forces, PESTs etc Porter’s strategic forces 5 Strategic as practices Doing of strategy The construction of this strategic flow and activities are consequential for the firm through the actions and interaction of multiple actors and the practices that they draw upon (Jarzabkowski, 2025) 6 Environmental Velocity High Cycle time reduction Market disruption analysis Dynamic capabilities: Speed Value chain: speed of transfer Simple rules: fast decisions Fast enter & exit Simple rules: trigger systems Dynamic strategy and practices High Dynamic capabilities: Learning Value/supply chain management Knowledge management Core competencies Jarzabkowsk, 2003 9/25/2023 Strategy as practices (theoretical foundation) Strategy as practices as does not require a new theories per se, but to draw upon a range of existing theories to explore strategy problems. It tries to develop novel methods and focuses on the micro foundations of doing strategy 7 Strategy as practice (the question tries to answer) Strategy as practices as a field is characterized less by what theory is adopted than what the problem is explained. 8 What is strategy Who are strategists? What do they? Why do they? What kinds of tools and tactics do they use? How do they influence the strategies? 9/25/2023 Strategy as practice defines strategy As a socially accomplished activity constructed through the actions, interactions, and negotiations of multiple actors and the situated practices that they draw upon. 9 Strategy as practice focuses on Not all activities are strategic activities • Activities that draw on strategic practices. Important activities such as strategic planning, annual reviews, strategic workshops and analysis • Activities might be considered strategic to the extent that it is consequential for strategic outcomes, directions, survival and competitive advantages. 10 9/25/2023 Strategy as practice Who are strategists? • Wider scope of strategy actors all levels of the organization. • Traditional board room demographics (need to study the actual identities, experiences, and competencies). • Outside organization (None-executives directors, consultants, gurus, and clients) 11 Strategic as Practices Framework • Practitioners (senior managers, board members, consultants, innovators, and others ) draw on more or less institutionalized strategy. • Practices (routines, tools, or discourses at organizational and extra-organizational levels) in idiosyncratic and creative ways • Praxis or practices (specific activities such as meetings, retreats, conversations, talk, interactions and behaviors) to generate what is then conceived as a strategy 12 Strategic as Practices Framework 9/25/2023 • Whittington, 2006 13 What do strategists/practitioners do? Making phone calls and having meetings (Mintzberg, 1973 What strategists do is connected to who strategies are and the situations in which they act (Jarzabkowski, 2005). They talk, sell their ideas, use resources, display emotions and motivations, actively speed up the action, employ inaction, and engage in short and long-term tactics. 14 9/25/2023 What kinds of tools and tactics do they use? 15 Some of the arenas for SaP POWER POINT PRESENTATIONS 16 SPEECH & DISCOURSE MEMOS, MEETING NOTES AND COMPANY DOCUMENTS MEETINGS 9/25/2023 Power point presentations as a tool to control the strategic focus • Enables participants to notice specific semiotic objects that are or are not depicted as they engage in conversations • Focuses strategies on what is most relevant to top managers or clients as they engage in followup actions • High risk • Moderate risk • Low/no risk 17 Discursive practices, Bodily movements and Conception of the strategy • 18 Wenzel, M., & Koch, J. (2018). Strategy as staged performance: A critical discursive perspective on keynote speeches as a genre of strategic communication. Strategic Management Journal, 39(3), 639-663. 9/25/2023 • https://www.youtube.com/watch?v=Kh7ftCRQerA&t=1s 19 Memos, meeting notes, e-mails & company documents 20 9/25/2023 Meetings 21 Different functions of meetings described in e.g. the literature • Synchronization e.g. • Sense-making • Critical reflection • Generation and development of new ideas e.g. • Setting and advancing an agenda • Bargaining • Formation of alliances and building support Coordination Function Cognitive Function Symbolic Function Political Function Dittrich et al., 2021 22 • Pooling and distribution of information • Distribution and monitoring of tasks Social Function e.g. • Legitimation/validation of established order • Ritual • Status and status change e.g. • Establishing relationships and networks • Team building • Development of organizational identity 9/25/2023 What makes a meeting strategic Meetings that are explicitly labeled strategic Meetings that serve as sites of strategic work 23 Initiation practices: Practices of setting up meetings (Jarzabkowski & Seidl, 2008) Setting the agenda Shaping power dynamics Setting the sitting places 24 Meetings that are consequential 9/25/2023 Initiation practices: Meeting Conduct Practices I (Different combinations used in shaping strategy, Wodak et al. 2021) Bonding Encouraging Directing Re-committing Modulating/ Regulating 25 Initiation practices: Meeting Conduct Practices I: Discursive practices for developing a collective view of strategy (Kwon et al. 2014) 26 Re-defining Simplifying Equalizing Legitimating/ authorizing Reconciling / Reestablishing 9/25/2023 Conduct practices II Turn-taking practices (Jarzabkowski & Seidl, 2008) different effects on stability and chang of strategic orientations • Free discussion • Restricted discussion • Restricted free discussion 27 Termination practices Linking to other meetings • Rescheduling • Setting up working group • Voting • …. 28 9/25/2023 How strategic issues travel across meetings Path 1: Leading to positive selection Path 2: Leading to de-selection 29 Relation to pre-meeting talk Hoon (2007): Committee meetings --Informal conversations outside formal meetings create alignment around strategic issues and provide opportunities for making pre-arraignments for the formal meetings. 30 McNulty & Pettigrew (1999). Board Meeting– Pre-meeting talk enables board meetings to increase the chance of acceptance of their proposals 9/25/2023 Organizational Hierarchy (Asmuss & Oshima, 2012) & Meetings Hierarchical position shapes possibilities of contributing to developing a strategic plan. People in superior positions: New proposals and the right to make proposals tend to be accepted People in subordinate positions: Need to negotiate the right to make proposals 31 Meeting (sum up) Different combinations of meeting practices across different meetings are required for the development of new strategic ideas Combination of practices determines whether new ideas are developed to the stage of challenging existing strategic orientations or whether the status quo is preserved. 32 9/25/2023 Strategy as Cognition 33 Cognitive psychology is important to understanding strategy • The field of cognitive psychology can help to gain a deeper understanding of the process by which strategy is formed. • Strategists develop their knowledge structures/thinking processes mainly through direct experience. • Direct experience shapes what they know, which in turn shapes what they do, thereby shaping their subsequent experience. • The cognitive school of thought gives rise to two different viewpoints: • The processing/structuring of knowledge is an effort to produce an objective picture of the world. Therefore, cognition re-creates the world. • Cognition is a subjective process; strategy is an interpretation of the world. Therefore, cognition creates the world. 34 9/25/2023 Cognitive psychology is important to understanding strategy • The field of cognitive psychology can help to gain a deeper understanding of the process by which strategy is formed. • Strategists develop their knowledge structures/thinking processes mainly through direct experience. • Direct experience shapes what they know, which in turn shapes what they do, thereby shaping their subsequent experience. • The cognitive school of thought gives rise to two different viewpoints: • The processing/structuring of knowledge is an effort to produce an objective picture of the world. Therefore, cognition re-creates the world. • Cognition is a subjective process; strategy is an interpretation of the world. Therefore, cognition creates the world. 35 Cognition as information processing • An organization is a collective system for processing information. • Strategic cognition can, therefore, be seen as information processing. • Cognition can be influenced by the effects of working in an organization. • As information gets processed at various levels, it is repeatedly subject to distortion. 36 9/25/2023 Cognition as mapping • An essential prerequisite for strategic cognition is the existence of mental structures – also referred to as mental models, frames, or maps – to organize knowledge. • Mental models help strategists navigate the environment in which they operate. Their impact on behavior/organizational action can be profound. 37 Cognition as concept attainment • Strategic cognition involves not only using mental maps/models, but also creating them. • The creation of cognitive maps can, in a sense, be viewed as strategy formation. • Since strategy is a concept, strategymaking can be considered concept attainment. • Insight and intuition are key elements of the above mental processes. 38 9/25/2023 Cognition as construction • This view looks at strategy as interpretation, based on cognition as construction. • The picture of the external world that is perceived by the mind, interacts with cognition, and is then shaped and interpreted by it. In other words, the mind constructs its world. • Management insight hinges on the ability to use multiple lenses/alternate views of the world. • Such use of multiple perspectives should be balanced with focus, to aid decisiveness and effective management. 39 Strategy as Attention 40 9/25/2023 Information vs. attention • What information consumes is rather obvious: it consumes the attention of its recipients. Hence, a wealth of information creates a poverty of attention. • Herbert Simon, economist and Nobel Prize recipient • We live in an Attention Economy. One of the most acute problems today is the volume of information that needs to be dealt with and the resulting attention deficit. • Attention is a scarce resource. It has important implications for business, especially for its strategy and structure. Therefore, corporate leaders should help their organizations manage/focus attention. • Managers confront attention deficit, partly because information has become less expensive over the years. • The volume of information has also multiplied enormously and is more than can ever be fully absorbed. 41 More than information overload • Information overload and the speed and complexity of business, increase the importance of attention management. • In the attention economy, every business faces two basic problems: • How to get and hold attention (of consumers, stockholders, potential employees, etc.). • How to allocate its attention (in the face of multiple options). • An effective starting point for addressing these questions is the strategy and structure of the firm – not only because they are so important, but because they are, essentially, vehicles for focusing organizational attention. 42 9/25/2023 Attention and strategy: is there a difference? • • • • • 43 Attending to structure 44 • Organisation structure is a powerful vehicle for focusing attention on a particular aspect of the business – both internally, as well as externally. • Organisational structure sends a message that some issues are more important than others. • To focus attention on processes/activities by which work gets done, structure should be based on process management, rather than on lines of business or functional distinctions. • Structure harnesses the power of titles, performance evaluation/compensation systems, communication lines, informal social networks, etc. to channel attention towards a formally structured objective. Attention is a vital resource, and the key to developing effective strategy/structures. Making the right key decisions is fundamentally a matter of attention management. Attention is always a precursor of action: It is the bridge between awareness and action. If an issue does not receive attention, it will not be resolved. Strategy and structure are only mental constructs/tools that help to focus the attention of executives, managers, employees on particular aspects, rather than others. 9/25/2023 Pay attention. It pays • Attention is a valuable lens for viewing strategy and structure. While attention alone does not determine success or failure, it is the right place to start, and a perspective worth monitoring consistently. 45 Strategy as Objectivity 46 9/25/2023 The perils of objectivity and detachment Many management frameworks emphasise objectivity and intellectual detachment. Managerial objectivity is the power to stand outside of a situation, to map it onto a logical framework and initiate the action it suggests. However, attempts to use of such frameworks unquestioningly, or to apply them very rationally, can be counter-productive. The assumptions implicit in using these frameworks – that the cause-effect relationships described by the frameworks are context-free, and that these techniques can be used by managers in other organisations to achieve similar results, in a very rational manner – are flawed. The critical question is whether managers can/should be so very rational at all times, especially during periods of radical change. 47 When should managers be rational? • There are two reasons why the answer to the above question is negative – one intellectual, the other social. • The intellectual problem is that business realities do not exist independently of their observers. Economies/markets/organisations/strategies are constructed rather than natural objects. • Thus, objectivity is never absolute – it is always relative to some frame of reference developed from the past. • Real change means that the frames themselves have to be altered. A rigid objectivity freezes this process, preventing an examination of the more tacit assumptions underlying the framework. • The social reason is that too much objectivity leads to senior management seeing themselves as outside the change process, diagnosing the condition of those within it. • Successful change initiatives demand that everyone in the organisation is seen and felt to share a common fate. • Suggestions that the change process is entirely objective/rational introduces a distance between the managers and the managed. This creates cynicism among the workers, and increases their resistance to being changed. 48 9/25/2023 The danger of selfsealing beliefs • Management frameworks often lead managers to ignore information that is inconsistent with the basic assumptions of these frameworks. • Ignoring information that is inconsistent with the frameworks leads to ‘sealing’ the framework – managers keep using the framework even when they are failing. • To be effective, managers must treat frameworks as tools that may be useful for some purposes, but inadequate for others. • Judging whether a framework is fit for the purpose that managers have in mind is an act of judgement. It is not in the framework itself. 49 Senior management are not cooks, they are ingredients • A change effort can only be successful if people genuinely feel that the future is up to them to invent, not someone else’s plan that they are merely implementing. • To create such a sense of empowerment, senior management should behave in a way that expresses open, egalitarian values. • Change cannot be managed, it can only be led. For fundamental organisational change, senior managers have to be part of the change process. • Senior managers are powerful role models – they should lead by modelling the new behaviour that they expect from their people. 50 9/25/2023 Strategic Thinking as ‘Seeing’ 51 If strategies are visions, then ‘seeing’ plays a role in strategic thinking. But there are different kinds of ‘seeing’. Seeing ahead/seeing behind • Strategic thinking means seeing ahead. However, because any good vision of the future has to be rooted in an understanding of the past, strategic thinking is also seeing behind. Seeing above/seeing below 52 • Strategic thinking is seeing above – it is the ability to step back and take a bird’s eye view of the situation. • Strategic seeing is also the ability to see below – to recognise that day-to-day action/situation on the ground can be messy and complicated. • There is no big picture ready for the seeing. Rather, the strategist has to work hard to construct his/her own. 9/25/2023 • Seeing beside/seeing beyond • Strategic thinking calls for creativity/lateral thinking – the ability to see what others cannot see. This is called seeing beside. • Creative ideas have to be placed in context. Therefore, strategic thinkers have to see beyond – they have to construct the future/invent a world that would not otherwise be. • Seeing it through • Finally, strategic thinking is the ability to get things done – to ‘see it through’. 53 • Strategic thinking as seeing 54 9/25/2023 New Values, Morality and Strategic Ethics 55 New Values, Morality and Strategic Ethics strategy? The concept of ethics and morals applies to corporations just as it applies to individuals/humans. Wrong actions by companies can not only prove expensive, but also cause long-term damage. Further, the nature of the planning and implementation process in companies makes it difficult to change course mid-way. The changing perceptions of what is considered ethical or unethical makes the process complex as well. Such concerns make the idea of an ‘ethical strategy’ relevant. 56 9/25/2023 Is there a moral responsibility? Firms do not function in a vacuum. They function in the context of a social environment, which imposes on them certain moral demands and responsibilities. A company is a collection of human and social groupings. General expectations regarding acceptable conduct of others underpins such groupings. Values such as loyalty, credibility, diligence, cooperation, moral conduct, etc. are manifest in organisations, or at least, expected. 57 Structures of ethical reasoning The moral aspects of managerial logic are based on ‘instrumentality’ and ‘cooperation’. Business firms are highly instrumental social constructs – they are free to undertake organised, goal-oriented action, as long as it is within the purview of the law. Rationality, efficiency, hard work, loyalty and trustworthiness are other dominant structures of moral norms in economic action. 58 9/25/2023 Predicting changes in value patterns • Moral values change over time. • Some moral values change slowly, over centuries; others change more quickly, needing just decades. • Catastrophic events such as war, epidemic diseases, etc. may cause moral values to change abruptly. 59 We expect in the near future: • Morality is an aspect of culture – different cultures have different moral systems. Therefore, the dynamics of cultural change are a pointer to changes in moral values. • Two social and cultural changes can be anticipated, which could lead to ethical problems (of strategic concern for corporates) in the future: • The effect of rapid technological development • Digital techniques/practices may lead to infringement of the personal integrity of anyone in contact with the modern corporation. • The increasingly fast pace of action leaves little time for reflection and weakens the moral basis of business practices. • The cultural effects of environmental changes • Awareness of environmental issues – such as pollution, environmental ethics, and the effect of wrong practices on future generations – has given rise to a new category of moral and ethical concerns. 60 9/25/2023 Companies as value creators 61 Ethical strategy for the future? 62 9/25/2023 In this week - lecture on Strategic Management in Start-Ups Business Transformation II on Sept 27 - Seminar 4: SWEx's Strategic Transformation process and practices 63 64