This week we are publishing the 150th MANAGEMENT TIPS. It seems like yesterday that we started the page and the weekly posts. How time flies! Thank you, dear reader, for taking this journey with us!
Today we will address another subject related to business strategy: the strategic behavior of executives from the 1978 study by Miles and Snow “Organizational Strategy, Structure and Process” (The Academy of Management Review, Vol.3, No. 3), coauthored by Alan Meyer and Henry Coleman, Jr.
The article identifies four types of strategic behaviors of companies and executives based on the way they analyze, perceive and adapt to the environment.
The different typologies of strategic behavior in relation to the environment can be observed in Figure 1.
Defenders approve and maintain an environment for which a stable form of organization is required. They are highly specialized executives in a specific area of operations, but they are not looking for new opportunities that go beyond their domains. As a result of the narrow focus, these companies rarely need to make significant adjustments to their organizational architecture, operations, or technology.
Prospectors are diametrically opposed to Defenders in their manner of response to their environments; prospectors continually seek market opportunities. They generate changes and uncertainties to which competitors must respond. An obsession with product and market innovation often comes at the expense of efficiency.
Analyzers are a combination of Prospectors and Defenders and represent a viable alternative to these two strategic options. Analyzer executives operate in two product-market domains, one relatively stable and one in permanent transformation. They closely monitor their competitors and their strategies and ideas, promptly copying those they think are most promising.
Reactors have a pattern of adaptating to the environment that is both inconsistent and unstable, lacking a set of response mechanisms that can be consistently executed when confronted with a changing environment. These executives often recognize the environmental changes and uncertainties they generate, but are not able to respond effectively to them. The absence of consistent alignment between strategy-structure and organizational architecture makes it difficult to make any kind of adjustment except that which is determined by pressures from the environment.
Which of these typologies do you and your company fit into? Advocates, Prospects, Analyzers or Reactors?