- Strategic Management Tutorial
- Strategic Management - Home
- Strategic Management - Introduction
- Strategic Management - Types
- Strategic Management - Process
- Strategic Leadership
- Organization Specifics
- Performance Issue
- The Top Leadership
- Entrepreneurial Orientation
- The External Environment
- Organization & Environment
- Analyzing the External Environment
- Judging the Industry
- Mapping Strategic Groups
- Organizational Resources
- The Resource Based Theory
- Intellectual Property
- The Value Chain
- Other Performance Measures
- Company Assets: SWOT Analysis
- Business Level Strategies
- Different Types
- Cost Leadership
- Niche Differentiation
- Focus Strategies
- The Best-Cost Strategy
- International Marketing Strategies
- Pros & Cons
- Drivers of Success and Failure
- International Strategies - Types
- International Markets - Competition
- Cooperative Level Strategies
- Concentration Strategies
- Vertical Integration Strategies
- Diversification Strategies
- Downsizing Strategies
- Portfolio Planning
- Strategy and Organizational Design
- Organizational Structure
- Creating an Organizational Structure
- Organizational Control Systems
- Legal Forms of Business
- Strategic Management Resources
- Strategic Management - Quick Guide
- Strategic Management - Resources
- Strategic Management - Discussion
- Selected Reading
- UPSC IAS Exams Notes
- Developer's Best Practices
- Questions and Answers
- Effective Resume Writing
- HR Interview Questions
- Computer Glossary
- Who is Who
Strategic Management - Types
In a stable and predictable environment, strategic planning can enable an organization to achieve, manage and maintain success. But in real-world situations, only a few organizations and their executives experience a perfectly stable and predictable situation. That is why it is important to understand the concepts of intended, emergent, and realized strategies. Similarly, deliberate and non-realized strategies are important as well.
An intended strategy deals with the intentions of the organization. It is the strategy that an organization in the market hopes to execute. Therefore, intended strategies are often described in detail in the organization’s strategic plan. A strategic plan made for a new firm is known as a business plan. This plan is a rough strategy that intends to keep the organization on track. It is, therefore, an intended strategy.
The FedEx Intended Strategy
Frederick Smith, an undergraduate student at Yale in 1965, had the task to prepare a business plan for a company as an assignment. His plan was of a courier service. Smith had described a new delivery system made effective by shipping the packages via a central hub and then ship these packages to their destinations.
Smith liked the idea so much that he started Federal Express (FedEx) that followed the business plan he had prepared as a project. Today, Frederick Smith has a wealth of over $2 billion, and FedEx is the eighth of World’s Most Admired Companies as described by Fortune magazine. So, we can say that Smith’s intended strategy has worked out much effectively than even he could have dreamed.
An emergent strategy is the one that emerges with time. It is an unplanned strategy that is created by an organization while acting in response to the various unexpected threats, opportunities and challenges. Emergent strategies are also dynamic in nature. Emergent strategies may result in both success and failure depending on the effectiveness of the strategy. Following is an example of failed emergent strategies.
Failure of FedEx’s ZapMail Emergent Strategy
In the mid-1980s, FedEx drifted away from its intended strategy to focus on package delivery to monetize from a new and an emerging technology: the facsimile (fax) machines. FedEx developed a new service, known as ZapMail, where documents were faxed between FedEx offices and then delivered to customers’ offices. The ZapMail system had been plagued by technical glitches that only frustrated the customers. ZapMail was discontinued before long, and the company lost hundreds of millions of dollars.
A realized strategy is a real and practical strategy. It is the strategy that a firm actually follows. Realized strategies are often a by-product of an organization’s intended strategy (i.e., the firm’s plans), the firm’s deliberate strategy (i.e., the portions of the intended strategy that an organization continues to pursue over time), and its emergent strategy (i.e., what the firm does in response to unexpected opportunities and challenges).
In most other cases, however, firms’ original intended strategies are lost during its journey. The abandoned sections of the original and intended strategy are known as non-realized strategy. Following is an example of successful non-realized strategy.
Success of Non-realized Strategy at Avon
David McConnell was an aspiring and struggling author looking to sell his books. He decided to offer complimentary perfume with his books. McConnell’s books never tasted success, but his perfumes became popular. The California Perfume Company was born, which is now known as Avon. For McConnell, a non-realized strategy to become a successful writer never took shape, but through Avon, a very successful realized strategy evolved.
The Social Network
Facebook owner Mark Zuckerberg’s original concept in 2003 was mediocre. He created the “FaceMash” where the attractiveness of young women could be voted on. Later on it became an online social network called The Facebook that was for Harvard students only.
It had become surprisingly popular, and was transformed into Facebook, to be used by everyone. Facebook’s emphasis on building a friends’ circle is different from Zuckerberg’s original low-spirited concept. In fact, Zuckerberg’s emergent and realized strategies turned out to be far more effective than the intended strategy.