Patterns in Strategy Formation

Abstract

The literature on strategy formation is in large part theoretical but not empirical, and the usual definition of “strategy” encourages the notion that strategies, as we recognize them ex post facto, are deliberate plans conceived in advance of the making of specific decisions. By defining a strategy as “a pattern in a stream of decisions,” we are able to research strategy formation in a broad descriptive context. Specifically, we can study both strategies that were intended and those that were, realized .despite intentions. A research program suggested by this definition is outlined, and two of the completed studies are then reviewed—the strategies of Volkswagenwerk from 1934 to 1974 and of the United States government in Vietnam from 1950 to 1973. Some general conclusions suggested by these studies are then presented in terms of three central themes: that strategy formation can fruitfully be viewed as the interplay between a dynamic environment and bureaucratic momentum, with leadership mediating between the two forces; that strategy formation over time appears to follow some important patterns in organizations, notably life cycles and distinct change-continuity cycles within these; and that the study of the interplay between intended and realized strategies may lead us to the heart of this, complex organizational process.