Business strategy at a turning point: From posture to organizational capability

Veronique Bouchard, University of Pennsylvania


Business Strategy--as a conceptual field and a discipline--is presently at a turning point. The new emphasis on operations, organizational flexibility and interfirm cooperation is, apparently, incompatible with the normative contents of Business Strategy and the prevailing formulation process. This thesis argues that strategy formulation constitutes an irreplaceable activity and that a Systems Approach can help reconcile seemingly incompatible requirements. A Systems Approach demands a simultaneous reflection on strategic choices and on the conditions that permit to effect such choices. At the basis of a valid strategy, there is a set of organizational skills which together constitute the "Strategy Capability" of an organization. This capability is unequally developed across organizations and we need to understand the nature of the obstructions that hamper its unfolding. The thesis posits that Strategy's ultimate goal consists in the optimization of the firm's relations with its environment from a dependence/power perspective and that an excessive emphasis on uncertainty reduction/avoidance on the part of the organization--because it is incompatible with the goal of dependence optimization--constitutes a major obstruction to the unfolding of a "Strategy Capability". The thesis also establishes the existence of a dynamic relation between (1) Strategic Postures in terms of products/markets, (2) Dependence Profile vis-a-vis the key entities of the transaction environment of the organization, (3) accumulation of resources (Organizational Slack) and (4) Strategy Capability and shows how choices regarding Strategic Postures affect, often negatively, a firm's Strategy Capability. The turbulent settings into which many firms presently operate are characterized by a high level of uncertainty and accelerated causal cycles. Such settings exasperate dysfunctional behaviors and accentuate systemic tensions. Yet, the probability and cost of error increase, and the value of Strategy as well$\...$ The thesis indicates and develops various themes which constitute strategic responses to turbulence: (1) the passage from "hard" to "soft" competitive advantages, (2) externalization, a design solution which allows--via cooperation--to "do more with less", (3) the passage from Market/Product Posture definition to the management of a system of interrelated key variables comprising Posture, Operations and Organizational Resources (Capabilities and Slack).

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Recommended Citation

Bouchard, Veronique, "Business strategy at a turning point: From posture to organizational capability" (1993). Dissertations available from ProQuest. AAI9321360.