Chapter Two
Strategic Planning and Organizational Design for Global Business Strategy: A Historical Perspective
If history can do anything it is to remind us that all our judgments are merely relative to time and circumstance.
Professor Sir Herbert Butterfield (1900-1979).
Historian, philosopher of history.
Introduction
Organizational life is such a pervasive feature of modern society that it has attracted scholars from a wildly disparate range of academic disciplines. From the Marxist scholar seeking explanations of appropriation to the industrial geographer advising retail companies on optimal location decisions, the study of organizations and how they are managed is enjoying exponential growth.
In developing its focus this book addresses a fundamental concern, that of organizational survival and prosperity in a context of unprecedented turbulence and discontinuity in international business market environments. Organizations are not living entities, but they do die. Within this paradox lies an abundant cavern of imperfect knowledge for researchers and charlatans to scavenge and plunder. Herein lies the rub. What possible sense can be made of such senseless material? How many exceptions to the rule must we have before the rule itself is redundant? How can we predict and plan and make and manage when uncertainty creates our context?
Before offering solutions, we must acknowledge the limitations represented by such rhetorical questions. Shouldn’t we? Of course, but we must also be aware that within paradox lies discovery and that discovery, in turn, requires an openness of mind. In a vigorous defence of the application of scientific inquiry to the subject of management, Professor John Kay (1993a) highlights the myopic character of many of the discipline’s critics and draws on a powerful precedent to make his point: “The Inquisitors who visited Galileo refused to look through his telescope since what he claimed to see could not be there.”
The simplest observation we will make throughout the pages of this book is that organizations, in their struggle for survival and prosperity, demonstrate a range of coping behaviours and adaptability, almost always a combination of ‘old’ and ‘new’ formulations (see Puranam, et al., 2014). We contend here that, if we understand the context of this struggle, we can go some way toward suggesting more appropriate organizational behaviours, both in a generic sense and for quite specific global business environments in a post-Bretton Woods, post-Brexit new-new world order. Organizations are not passive receivers of Darwinian natural selection since, to a substantial extent, they can craft their genetic code and genetically engineer their future (see, for example, Cichoki and Irwin, 2014).
The context we will identify in this organizational struggle for survival and prosperity is the globalization of the world economy, the ascendancy of capitalism and the harsh discipline of the market it imposes. The label we attach to capture the dynamic nature of this context is discontinuity. This seems appropriate if we consider the milieu of contemporary business conduct in the broad historical sweep of almost two and a half centuries of industrialisation, a period covering the rise and fall of colonisation and empire, two world wars, the great Soviet communist experiment, the emergence of a ‘two systems’, apparently sustainable, political economy (in China) and countless global skirmishes in pursuit of social, political and/or economic hegemony (see Appendix One, Milestones in the History of Globalization).
Unlike the infamous and premature assertions of Francis Fukuyama (1992), political scientist and author, the intention is not to peddle an ‘End of History’ thesis and no determinism is intended for the context we define. Rather, we specify a hiatus, a transitional stage in the tradition of the Hegelian dialectic of thesis/antithesis, a phase which, if understood, can be managed. A working theme for the book (and the subtitle of the Epilogue) is ‘Globalization – and how to survive it’ and it is within the limitations suggested by this phrase that any prescriptions that follow are made. But the message is clear. Strategy is real, it does matter, and it can be managed.
Concluding Remarks
The overarching message of this chapter reflects the need for researchers to leave their disciplinary functional silos and engage in collaborative work. We have presented a brief history of seminal, evidence-based perspectives on strategy, organizational design and change management alongside illustrations of recent research and managerial thought.
Most business schools are structured into departments that closely mirror the functional structures of traditional organizations. Academics and managers must realise that, in discontinuity, sustainable competitive advantage arises in organizational advantage and this, in turn, requires challenging orthodox thinking on strategic management, particularly its pseudo-scientific claims as peddled by many management consultants (no offence intended).
As the renowned sociologist Antony Giddens (1977) has argued, “daunting though the intellectual and practical problems facing us … may be, it is surely indisputable that they are above all organizational and institutional in character”.
New organizational forms and relationships are constantly evolving, as we will see in Part Three of this book, Creating Organizational Advantage. Concepts such as the boundaryless organization (Ashkenas et al., 2002) and a whole raft of new ways of organizational collaboration are challenging traditional perspectives on organizational design (see, for example, Fjeldstad, et al., 2012), while contemporary claims of new paradigms are challenged by older, wiser academic icons. Stanford professor Jerry Pfeffer, for example, who has written definitive texts on organizational design (1978) and power within organizations (1981, 2000) has earned recent critical acclaim for debunking much of the drivel emanating from many writers on Leadership in his no BS book Leadership BS (2015), a must-read for newly-minted MBA graduates and old hands alike.
That change is with us, and is discontinuous, and is rapid, is beyond doubt (Handy, 2002) and help is at hand from academics and consultants surfing its lucrative waves (e.g. Beer and Nohria, 2000; Hammer, 2004; Robertson, 2005; Ford and Ford, 2009; Burnes, 2011; Hughes, 2011; Mohrman and Lawler, 2012; Rafferty et al., 2013; Hamel and Zanini, 2014; Jacquement et al., 2015; Ewenstein et al., 2015).
Perhaps academic researchers – like Darwin before them – should leave their conceptual baggage behind and return to the field to observe this extraordinary turbulence. As Cold War novelist extraordinaire John le Carré noted, “A desk is a dangerous place from which to view the world”. And ‘good’ strategic management practice is in the ascendancy (Rumelt, 2017); it cannot afford to be weighed down by theoretical constraint or consultants’ baubles.
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