Neurocognitive Inefficacy of the Strategy Process

Abstract

The most widely used (and taught) protocols for strategic analysis-Strengths, Weaknesses, Opportunities, and Threats (SWOT) and Porter's (1980) Five Force Framework for industry analysis-have been found to be insufficient as stimuli for strategy creation or even as a basis for further strategy development. We approach this problem from a neurocognitive perspective. We see profound incompatibilities between the cognitive process-deductive reasoning-channeled into the collective mind of strategists within the formal planning process through its tools of strategic analysis (i.e., rational technologies) and the essentially inductive reasoning process actually needed to address ill-defined, complex strategic situations. Thus, strategic analysis protocols that may appear to be and, indeed, are entirely rational and logical are not interpretable as such at the neuronal substrate level where thinking takes place. The analytical structure (or propositional representation) of these tools results in a mental dead end, the phenomenon known in cognitive psychology as functional fixedness. The difficulty lies with the inability of the brain to make out meaningful (i.e., strategy-provoking) stimuli from the mental images (or depictive representations) generated by strategic analysis tools. We propose decreasing dependence on these tools and conducting further research employing brain imaging technology to explore complex data handling protocols with richer mental representation and greater potential for strategy creation.