Dan Schendel

Strategic responses to technological threats

Technological innovation can create new industries and transform or destroy existing ones. At any time, many businesses are confronted with a host of external technological threats. Managements of threatened firms realize that many threats may not materialize, at least in the short run. However, one or more of those potential threats may develop in ways that will have devastating impact. Providers of kerosene lamps, buggy whips, railroad passenger service, steam radiators, hardwood flooring, passenger liner service and motion pictures all have had to contend with such threats. Few environmental changes can have such important strategic implications. A typical sequence of events involving the traditional firms responses to a technological threat begins with the origination of a technological innovation outside the industry, often pioneered by a new firm. Initially crude and expensive, it expands through successive submarkets, with overall growth following an

STRATEGIC REFERENCE POINT THEORY

How can executives achieve a match between expected external environmental conditions and internal organizational capabilities that facilitates improved performance? This paper argues that a firms choice of ‘reference points’ can help achieve strategic alignment capable of yielding improved performance and potentially even a sustainable competitive advantage. Building upon prospect theory and other relevant theoretical perspectives, the strategic reference point (SRP) matrix is developed. A firms SRP consists of three dimensions: internal capability, external conditions, and time. A theory is developed which posits an optimal SRP structure, and propositions are offered which articulate the expected relationships between the SRP, strategic choice behavior, and firm performance. The paper closes with some suggestions for using strategic reference points in both research and practice.

Corporate Turnaround Strategies: A Study of Profit Decline and Recovery

Every business firm suffers declines in its fortunes from time to time. Of interest here are the management decisions and environmental changes that are associated with substantial decline and subsequent recovery in the performance of business firms in what can be called a turnaround in performance. Both the downturn and upturn phases of turnaround situations are worth study to learn what causes decline and what cures it. In general, we are interested in what management can do to spot and avoid declines in the first place, or turn the firm around once a decline is experienced. The basic problem with downturn is to separate the natural, but temporary decline every firm suffers, from one more permanent and damaging in its impact. Once decline sets in, the problem is what can be done to cause a turnaround, or improvement in performance. This paper reports a study of firms that have experienced turnaround and gives special attention to the management actions or decisions and environmental changes or events associated with the turnaround.

A Strategic Model of the U.S. Brewing Industry: 1952-1971

Quantitative models of business strategy can be developed upon the key relationship between a firms objectives, its strategy and the environment in which it operates. To be meaningful, this paper ...

Whistle-Blowing: Professionals' Resistance to Organizational Authority

Whistle-blowing is examined as an act of collective opposition to authority taking place within a context of political conflict. Organizations, viewed as private governments, provide members with numerous opportunities for political action to seek greater autonomy, to dissent from organizational policies, to oppose organizational authority, to depose existing leaders, and to transform the political structures within which they work. An in-depth case study of an incident of whistle-blowing is the basis for a series of propositions dealing with the preconditions for, and the process of whistle-blowing. Preconditions include structural features of organizations and some characteristics of careers and work roles that increase the likelihood of resistance to authority. The process of learning to oppose authority involves a series of escalated acts by professionals and management, and deterioration in the perception of motives attributed to each side in the dispute.

Simultaneous Multidimensional Unfolding and Cluster Analysis: An Investigation of Strategic Groups

This paper develops a maximum likelihood based methodology for simultaneously performing multidimensional unfolding and cluster analysis on two-way dominance or profile data. This new procedure utilizes mixtures of multivariate conditional normal distributions to estimate a joint space of stimulus coordinates and K ideal points, one for each cluster or group, in a T-dimensional space. The conditional mixture, maximum likelihood methodology is introduced together with an E-M algorithm utilized for parameter estimation. A marketing strategy application is provided with an analysis of PIMS data for a set of firms drawn from the same competitive industry to determine strategic groups, while simultaneously depicting strategy-performance relationships.

Strategy and Decision Processes: What is the Linkage?

Despite all of the attention that strategic decision making has received, there has been surprisingly little work that has explicitly examined the link between the processes by which strategic decisions are made and their influence on strategy. The purpose of this commentary is to discuss some important aspects of the decision process, content, outcome linkage.

EDITOR’S INTRODUCTION TO THE 1997 SUMMER SPECIAL ISSUE: THE INTERACTIONS OF ORGANIZATIONAL AND COMPETITIVE INFLUENCES ON STRATEGY AND PERFORMANCE

The 1997 Summer Special Issue of the Strategic Management Journal is introduced by the Editor-in-Chief, Dan Schendel. The Special Issue deals with what Guest Editors, Rebecca Henderson and Will Mitchell call ‘reciprocal interactions’ among environment, strategy, capabilities and performance. Why study of these reciprocal interactions may be useful to better understanding of performance outcomes is discussed. © 1997 by John Wiley & Sons, Ltd.