INTRODUCTION: NEW CHALLENGES FOR STRATEGIC MANAGEMENTAuthor(s): Raymond-Alain ThiétartSource: International Studies of Management & Organization, Vol. 8, No. 4, NEW CHALLENGESFOR STRATEGIC MANAGEMENT (WINTER 1978-79), pp. 3-6Published by: M.E. Sharpe, Inc.Stable URL: http://www.jstor.org/stable/41575570 .

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INTRODUCTION: NEW CHALLENGES FOR STRATEGIC MANAGEMENT

Today a quite common leitmotiv is the claim that we are in a state of turbulence, discontinuity, surprise, and complexity, caused by such factors as the rapidity of technological changes, the reinforcement of international competition, an increase in the sociopolitical interface between the environment and the firm, the erratic behavior of the world economy, and unpredict- able demands from work forces. This turbulence is all the more critical because of an increased complexity in decision making. More and more, strategic decision- making - until now performed at the top management level - has to be shared with other participants in the organization. Consumers, sup- pliers, unions, antibusiness groups, government, and middle and lower management tend to influence the shaping and the content of strategic management. As a result, the firm has be- come more sensitive to external forces: social, political, eco- nomic, national, and international.

This sensitivity has exacerbated the need to develop adaptive strategic behaviors to match these forces. Looking at existing theories, however, one feels disappointed: no one theory fits what is required. Even worse, inconsistencies among concepts add some confusion to the existing body of literature.

In an attempt to clarify the situation and to challenge old ideas, my colleagues Igor Ansoff, Michel Montebello, and I de- cided to organize a yearly seminar entitled "New Approaches, New Trends, and New Targets for Strategic Management." The first seminar took place in April 1978 at the Ecole Supérieure des Sciences Economiques et Commerciales (ESSEC) business

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4 Raymond-Alain Thiétart (France)

school in Cergy, France. It was organized jointly with the In- stitut d'Administration des Enterprises (IAE), Aix-en -Provence, France, and the European Institute for Advanced Studies in Man-

agement (EIASM), Brussels, Belgium. We. received the support of the French Foundation for Management Education (FNEGE). Seventy specialists, educators, and managers, from ten differ- ent countries, attended the seminar, at which fifteen papers were presented.

The four articles presented here are part of a series of eight that will appear in two issues of International Studies of Man- agement & Organization. They represent a fairly good selection of what was discussed at the seminar at Cergy.

The authors of the articles in this issue have accepted the challenge of defining new approaches to strategic management or suggesting improvements in the traditional but inadequate ones. For instance, Pethia and Saias propose to take into ac- count the new problems to be solved by adapting the organiza- tional system of management to new environmental character- istics. They start their analysis by identifying the principal be- haviors required by each task- environment attribute. To each combination of attributes (simplicity or complexity, stability or change, independence or relatedness, homogeneity or diversity) a specific strategic behavior must respond. Because of the firm's multiplicity of activities, this analysis is made at the

product- market level. Each strategic business unit (product- market) has its own interface with an environment and therefore needs to develop its specific behavior.

The contribution of Pethia and Saias is important and chal-

lenging. Nevertheless, many questions still have to be tackled. Under what conditions is a specific behavior recommended? What is the required behavior ? Why that particular behavior and not another ? Except for opinions about what should be done, there is a lack of strong evidence about what constitutes adequate behavior. How to achieve the right behavior ? How to implement what should be done ? Finally, they look only at four attributes. And what about the very important uncertainty di- mension? Nevertheless, the paper offers - in my view - an

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New Challenges for Strategic Management 5

excellent starting point for future studies. Horovitz takes another stand. Like Pethia and Saïas, he

points out that companies increasingly doubt the effectiveness of their planning activities. According to Horovitz, part of this doubt stems from the turbulence of the environment, and part of it is attributable to the "lack of control and monitoring of long-run and strategic planning by top management." He sup- ports his assertion with empirical evidence from a study about planning and control practices at top- management level in three European countries: Germany, Great Britain, and France. To improve the effectiveness of corporate long-range and strategic planning activities, Horovitz proposes to implement a control that will match such planning and focus on the following areas : key assumptions about the evolution of the environment and of the internal resources of the firm, key areas of competence, and key performance results and priorities.

Horovitz does not question, as Pethia and Saïas do, the lack of fit between strategic behavior and task- environment attri- butes. He just stresses the fact that one link is missing in the strategic planning process, namely, strategic control. If this is the case, top management is offered a new challenge: to avoid monitoring short-term performance and to develop skills in monitoring strategy instead. This would require from top levels self -discipline and clarification of standards in some areas where they may not want them.

Murray and Nees deal with another topic: the decision- making process. Murray points out that "a more or less rational- analytic model is prescribed to handle the environmental-scan- ning, strategic -analysis, and strategic -response processes." He adds, however, that it is time to revise this approach if organi- zations want to face the challenges of the late seventies. Fol- lowing a review of the main approaches to strategic decision- making (rational actor, organizational process, bureaucratic politics, cybernetic, and cognitive approaches), Murray pro- poses to adopt a contingency framework to provide a better fit between a changing environment and diverse strategic modes. Like Pethia and Saïas, he suggests that the strategic response

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6 Raymond- Alain Thiétart (France)

should be coherent with the tasks of the firm and its environ- ment. In consequence, he points out that there is no reason for assuming that a single decision mode is desirable or optimal.

Nees, in her field survey of the divestment decision process in multimarket, multiproduct companies, reaches the same con- clusion. She shows that "no model ... is able to contain the whole reality of the divestment decision process," but that "each model provides a part of a very complex truth" and that such "strategic decision processes are of a multimode nature."

Although the reasoning and the empirical proof seem to be convincing, one can be tempted to argue that multimode ap- proaches are so contingent on environmental and internal fac- tors that no generalizations can be made. Therefore, the ex- ternal validity of such a theory may be quite limited. We may also wonder what the managerial implications are. Neverthe- less, the progress is important. We may hope to see the deci- sion-making process presented no more as a monolithic whole, even though we may continue to use a specific frame of refer- ence, for simplicity's sake.

Great new challenges face strategic management. We hope that this issue will contribute to some of them.

Raymond- Alain Thiétart

Dr. Thiétart is Associate Professor of Business Policy and

Management and Dean of the Faculty at the ESSEC group of French business schools, Cergy, France.

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