Corporate strategies for political action

Abstract

Discussions of the firm's relationships with its environment have usually concluded that the firm should make adaptive decisions to non-market areas, and proactive or strategic decisions in market areas. Predicating strategic responses upon the differences between market and non-market relationships is inappropriate and misleading, reduces the capacity of the firm to respond effectively to its environment, and distorts the process of environmental scanning. When the firm's relationships with its environment are examined as inter-organizational relationships, market and non-market relationships are structurally similar, and the same types of strategic responses can be selected for both areas. The strategic responses available to the firm in inter-organizational terms are: adaptation; pre-emption, co-optation; interpenetration; conflict and withdrawal. These processes and choices are structurally similar to traditional market related strategic options and can be used to respond to market and non-market factors. The manager scans the environment not only to identify opportunities for adaptation, but to identify groups which affect the integrity of the firm, the processes for interaction, the character of relationships, and occasions for strategic choice. The strategic decision process under a framework of inter-organizational transactions is illustrated by the cases of Sun Life Insurance Co., and the pulp and paper industry in Quebec.