Strategic Thinking: Strategy as a Shared Framework in the Mind of Managers

Abstract

Even though most academics, business people and consultants recognize that thepurpose of strategy formulation can no longer be to generate strategic plans, critics of formalstrategic planning offer little guidance on how to overcome its limitations and rarely addressCEOs’ concerns about turning strategic vision into an operational reality.This paper proposes a managerial approach to strategic thinking and strategyformulation which takes both process and content issues into account. Strategic thinking isunderstood as a deliberate and creative process as well as the resulting state of mind. Strategyis presented as a shared framework which guides managers’ daily actions. The approach isdeveloped in a way that attempts to respond to CEOs’ concerns regarding the need to manageby strategy in today’s rapidly changing environment. Key building blocks of the newapproach to strategy formulation are presented. Some initial empirical tests provide supportfor this approach. The framework outlined here seeks to contribute to top management’sefforts to build a shared understanding of strategic issues and encourage actions at the frontline which are consistent with the strategy pursued by the firm.