Strategy (130 page)

Read Strategy Online

Authors: Lawrence Freedman

23
. Dilbert had an example: After the executive was told that he could gauge his success by the number of repeat customers, he proudly reported that “virtually every customer gets another unit within three months of buying the first one!” When asked what happened if he did not “count warranty replacements,” he replied, “Ooh then we don't look so good.” Adams,
The Dilbert Principle
, 158.

24
. R. S. Kaplan and D. P. Norton, “The Balanced Scorecard: Measures that Drive Performance,”
Harvard Business Review
70 (Jan–Feb 1992): 71–79, and “Putting the Balanced Scorecard to Work,”
Harvard Business Review
71 (Sep–Oct 1993): 134–147. Stephen Bungay,
The Art of Action: How Leaders Close the Gaps Between Plans, Actions and Results
(London: Nicholas Brealey, 2011), 207–214.

25
. Paula Phillips Carson, Patricia A. Lanier, Kerry David Carson, and Brandi N. Guidry, “Clearing a Path Through the Management Fashion Jungle: Some Preliminary Trailblazing,”
The Academy of Management Journal
43, no. 6 (December 2000): 1143–1158.

26
. Barry M. Staw and Lisa D. Epstein, “What Bandwagons Bring: Effects of Popular Management Techniques on Corporate Performance, Reputation,
and CEO Pay,”
Administrative Science Quarterly
45, no. 3 (September 2000): 523–556.

27
. Keith Grint, “Reengineering History,” 193 (see chap. 33, n. 20).

28
. Guillermo Armando Ronda-Pupo and Luis Angel Guerras-Martin, “Dynamics of the Evolution of the Strategy Concept 1992–2008: A Co-Word Analysis,”
Strategic Management Journal
33 (2011): 162–188. Their consensus definition: “the dynamics of the firm's relations with its environment for which the necessary actions are taken to achieve its goals and/or to increase performance by means of the rational use of resources.” This has yet to catch on.

29
. Damon Golskorkhi, Linda Rouleau, David Seidl, and Erro Vaara, eds., “Introduction: What Is Strategy as Practice?”
Cambridge Handbook of Strategy as Practice
(Cambridge, UK: Cambridge University Press, 2010), 13.

30
. Paula Jarzabkowski, Julia Balogun, and David See, “Strategizing: The Challenge of a Practice Perspective,”
Human Relations
60, no. 5 (2007): 5–27. To be fair, the word had been around since at least the 1970s.

31
. Richard Whittington, “Completing the Practice Turn in Strategy Research,”
Organization Studies
27, no. 5 (May 2006): 613–634. (Note the attractions of alliteration.)

32
. Ian I. Mitroff and Ralph H. Kilmann, “Stories Managers Tell: A New Tool for Organizational Problem Solving,”
Management Review
64, no. 7 (July 1975): 18–28; Gordon Shaw, Robert Brown, and Philip Bromiley, “Strategic Stories: How 3M Is Rewriting Business Planning,”
Harvard Business Review
(May–June 1998), 41–48.

33
. Jay A. Conger, “The Necessary Art of Persuasion,”
Harvard Business Review
(May–June 1998), 85–95.

34
. Lucy Kellaway,
Sense and Nonsense in the Office
(London: Financial Times: Prentice Hall, 2000), 19.

35
. Karl E. Weick,
Sensemaking in Organizations
(Thousand Oaks, CA: Sage, 1995), 129.

36
. Valérie-Inès de la Ville and Elèonore Mounand, “A Narrative Approach to Strategy as Practice: Strategy Making from Texts and Narratives,” in Golskorkhi, Rouleau, Seidl, and Vaara, eds.,
Cambridge Handbook of Strategy as Practice
, 13.

37
. David M. Boje, “Stories of the Storytelling Organization: A Postmodern Analysis of Disney as ‘Tamara-Land,' ”
Academy of Management Journal
38, no. 4 (August 1995): 997–1035.

38
. Karl E. Weick,
Making Sense of the Organization
(Oxford: Blackwell, 2001), 344–345. It appears in a number of versions in his work, starting in 1982.

39
. Mintzberg et al.,
Strategy Safari
, 160 (see chap. 30, n. 29).

40
. This led to accusations of plagiarism. Thomas Basbøll and Henrik Graham, “Substitutes for Strategy Research: Notes on the Source of Karl Weick's
Anecdote of the Young Lieutenant and the Map of the Pyrenees,”
Ephemera: Theory & Politics in Organization
6, no. 2 (2006): 194–204.

41
. Richard T. Pascale, “Perspectives on Strategy: The Real Story Behind Honda's Success,”
California Management Review
26 (1984): 47–72.
The California Management Review
38, no. 4 (1996) had a roundtable to discuss the implications of this story which included Michael Goold (author of the original BCG report), “Learning, Planning, and Strategy: Extra Time”; Richard T. Pascale, “Reflections on Honda”; Richard P. Rumelt, “The Many Faces of Honda”; and Henry Mintzberg, “Introduction” and “Reply to Michael Goold.” Pascale was challenging a report by the Boston Consulting Group commissioned by the British Government to explain the precipitate decline of the British motorcycle industry from a commanding market position. BCG blamed “a concern for short term profitability” in Britain while reporting on how the Japanese had managed to develop a massive internal market for small motorcycles. This meant that costs were low, so when they decided to export there was no way that British firms geared to large motorcycles could compete. Honda achieved stunning economies of scale: producing about two hundred motorcycles per worker per year compared with fourteen motorcycles in British factories. Boston Consulting Group,
Strategy Alternatives for the British Motorcycle Industry
, 2 vols. (London: Her Majesty's Stationery Office, 1975).

42
. Henry Mintzberg, “Crafting Strategy,”
Harvard Business Review
(July–August 1987), 70.

43
. Andrew Mair, “Learning from Japan: Interpretations of Honda Motors by Strategic Management Theorists,”
Nissan Occasional Paper Series
No. 29, 1999, available at
http://www.nissan.ox.ac.uk/_data/assets/pdf_file/0013/11812/NOPS29.pdf
. A shorter version appears in Andrew Mair, “Learning from Honda,”
Journal of Management Studies
36, no. 1 (January 1999): 25–44.

44
. Jeffrey Alexander,
Japan's Motorcycle Wars: An Industry History
(Vancouver: UBC Press, 2008).

45
. Mair, “Learning from Japan,” 29–30. The debate is reviewed in Christopher D. McKenna, “Mementos: Looking Backwards at the Honda Motorcycle Case, 2003–1973,” in Sally Clarke, Naomi R. Lamoreaux, and Steven Usselman, eds.,
The Challenge of Remaining Innovative: Lessons from Twentieth Century American Business
(Palo Alto: Stanford University Press, 2008).

46
. Phil Rosenzweig,
The Halo Effect
(New York: The Free Press, 2007).

47
. John Kay,
The Hare & The Tortoise
, 33, 70, 158, 160.

48
. Stephen Bungay,
The Art of Action: How Leaders Close the Gap Between Plans, Actions and Results
(London: Nicholas Brealey, 2011).

49
. A. G. Laffley and Roger Martin,
Playing to Win: How Strategy Really Works
(Cambridge, MA: Harvard Business Review Press, 272), 214–215.

50
. Richard Rumelt,
Good Strategy, Bad Strategy: The Difference and Why It Matters
(London: Profile Books, 2011), 77, 106, 111.

51
. Ibid., 32. “Fluff” involved superficial restatements of the obvious, raised to a higher level by neologisms, or abstruse concepts which could give an appearance of profundity. It was reflected in a tendency to string abstract nouns together, each with a positive connotation. Rumelt blamed the academic world, where the manipulation of abstractions was often a way of making authors appear cleverer than they are, and could require constant translation with real examples to give meaning to the ideas.

52
. Ibid., 58.

36 The Limits of Rational Choice

1
. Cited in Paul Hirsch, Stuart Michaels, and Ray Friedman, “‘Dirty Hands' versus ‘Clean Models': Is Sociology in Danger of Being Seduced by Economics,”
Theory and Society
16 (1987): 325.

2
. Emily Hauptmann, “The Ford Foundation and the Rise of Behavioralism in Political Science,”
Journal of the History of the Behavioral Sciences
48, no. 2 (2012): 154–173.

3
. S. M. Amadae,
Rationalising Capitalist Democracy: The Cold War Origins of Rational Choice Liberalism
(Chicago: University of Chicago Press, 2003), 3.

4
. Martin Hollis and Robert Sugden, “Rationality in Action,”
Mind
102, no. 405 (January 1993): 2.

5
. Richard Swedberg, “Sociology and Game Theory: Contemporary and Historical Perspectives,”
Theory and Society
30 (2001): 320.

6
. William Riker, “The Entry of Game Theory into Political Science,” in Roy Weintraub, ed.,
Toward a History of Game Theory
, 208–210 (see chap. 12, n. 19).

7
. S. M. Amadae and Bruce Bueno de Mesquita, “The Rochester School: The Origins of Positive Political Theory,”
Annual Review of Political Science
2 (1999): 276.

8
. Ibid., 282, 291.

9
. See Ronald Terchek, “Positive Political Theory and Heresthetics: The Axioms and Assumptions of William Riker,”
The Political Science Reviewer
, 1984, 62. Also on Riker see Albert Weale, “Social Choice versus Populism? An Interpretation of Riker's Political Theory,”
British Journal of Political Science
14, no. 3 (July 1984): 369–385; Iain McLean, “William H. Riker and the Invention of Heresthetic(s),”
British Journal of Political Science
32, no. 3 (July 2002): 535–558.

10
. Jonathan Cohn, “The Revenge of the Nerds: Irrational Exuberance: When Did Political Science Forget About Politics,”
New Republic
, October 15, 1999.

11
. William Riker and Peter Ordeshook,
An Introduction to Positive Political Theory
(Englewood Cliffs: Prentice-Hall, 1973), 24.

12
. Richard Langlois, “Strategy as Economics versus Economics as Strategy,”
Managerial and Decision Economics
24, no. 4 (June–July 2003): 287.

13
. Donald P. Green and Ian Shapiro,
Pathologies of Rational Choice Theory: A Critique of Applications in Political Science
(New Haven, CT: Yale University Press, 1996), X. One counterattack appeared in Jeffery Friedman, ed., “Rational Choice Theory and Politics,”
Critical Review
9, no. 1–2 (1995).

14
. Stephen Walt, “Rigor or Rigor Mortis? Rational Choice and Security Studies,”
International Security
23, no. 4 (Spring 1999): 8.

15
. Dennis Chong quoted in Cohn,
The Revenge of the Nerds
.

16
. William A. Gamson, “A Theory of Coalition Formation,”
American Sociological Review
26, no. 3 (June 1961): 373–382.

17
. William Riker,
The Theory of Political Coalitions
(New Haven, CT: Yale University Press, 1963).

18
. William Riker, “Coalitions. I. The Study of Coalitions,” in David L. Sills, ed.,
International Encyclopedia of the Social Sciences, vol. 2
(New York: The Macmillan Company, 1968), 527. Cited in Swedberg,
Sociology and Game Theory
, 328.

19
. Riker,
Theory of Political Coalitions
, 22.

20
. Mancur Olson,
The Logic of Collective Action: Public Goods and the Theory of Groups
(Cambridge, MA: Harvard University Press, 1965); Iain McLean, “Review Article: The Divided Legacy of Mancur Olson,”
British Journal of Political Science
30, no. 4 (October 2000), 651–668.

21
. Mancur Olson and Richard Zeckhauser, “An Economic Theory of Alliances,”
The Review of Economics and Statistics
48, no. 3 (August 1966): 266–279.

22
. Avinash K. Dixit and Barry J. Nalebuff,
The Art of Strategy: A Game Theorist's Guide to Success in Business and Life
(New York: W. W. Norton, 2008), x.

23
. Anatol Rapoport,
Strategy and Conscience
(New York: Harper & Row, 1964). For Schelling's response, see his review in
The American Economic Review
, LV (December 1964), 1082–1088.

24
. Robert Axelrod,
The Evolution of Cooperation
(New York: Basic Books, 1984), 177. The episode is covered in Mirowski,
Machine Dreams:
see Chapter 12, n. 11, 484–487.

25
. Dennis Chong,
Collective Action and the Civil Rights Movement
(Chicago: University of Chicago Press, 1991), 231–237.

26
. Robert Jervis, “Realism, Game Theory and Cooperation,”
World Politics
40, no. 3 (April 1988): 319. See also Robert Jervis, “Rational Deterrence: Theory and Evidence,”
World Politics
41, no. 2 (January 1989): 183–207.

27
. Herbert Simon, “Human Nature in Politics, The Dialogue of Psychology with Political Science,”
American Political Science Review
79, no. 2 (June 1985): 302.

28
. Albert Weale, “Social Choice versus Populism?”, 379.

29
. William H. Riker, “The Heresthetics of Constitution-Making: The Presidency in 1787, with Comments on Determinism and Rational Choice,”
The American Political Science Review
78, no. 1 (March 1984): 1–16.

30
. Simon, “Human Nature in Politics,” 302.

31
. Amadae and Bueno de Mesquita, “The Rochester School.”

32
. William Riker,
The Art of Political Manipulation
(New Haven, CT: Yale University Press, 1986), ix.

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