THEME 1: Strategic Thinking

Flashcards to study Strategic Thinking

What 2 Articles are Related to Strategic Thinking?

Theory Based Learning & Experimentation and Strategizing Before Strategic Decision Making

What are the 4 Main Concepts for Theory Based Learning & Experimentation

1: The core elements of Theory Based Learning consist of conjectures, premises, and theories. 2: Encouraged Experimentation and Learning from Failures 3: Developing Counter Theories and Objections 4: Deducive logic & Belief Strength

What are the core elements of theory based learning?

Conjectures, Premises, Theories

What are conjectures?

A belief or hypothesis about a possible future state

What are Premises?

The necessary conditions that must be true for a conjecture to be true

What are theories?

The bridge, tieing the strategist conjectures with a set of premises, outlining the necessary and sufficient conditions

Should theories be factual and perfect?

No, they must be falsifiable. They can be tested and potentially disproven.

How does experimentation contribute to strategic decision making?

Strategists can learn from both successfull and unsuccessfull experiments

What is are the 3 steps for a systematic process for experimentation in theory based learning?

1. Identify the weakest premise. They represent the highes risks to the success of the strategy. Disproving these could invalidate the entire conjecture. Validating it, shows the integrety and strength of the overall conjecture

2. Design experiments. Test the weakest premise in the real world

3. Learn from results: If validated move on, if not adjust the strategy accordingly

What are counter theories?

Alternative theories that challenge the strategist’s assumptions

What do counter theories do?

Offer a different perspective on the same problem and may propose objections to the strategist’s premises or conjecture

How are counter theories useful?

By considering them, and testing the objections they raise, strategists can identify potential weaknesses in their own theories and refine the strategy

What is this process of refining ones beliefs on new evidence and alternative perspective called?

Belief Revision

What is deductive logic?

A strategist’s belief in a conjecture is only as strong as the weakest premise that supports it

What is belief strength?

How confident a strategist is in a particular premise, which are those that are least certain and carry the most risk.

What are the key concepts of Strategizing Before Strategic Decision Making

1. What is a strategic Problem - a situation where an organization’s long term survival, comeptitive advantage or value creation is at stake

2. The 2 Types of Strategizing Processes are Problem Formulation & Solution Generation

3. The Importance of Comprehensive Problem Formulation to avoid type 3 errors

4. Problem formulation is a group level activity

5. Using Modified nominal group technique as group level activity to problem formulate (mNGT)

What is a strategic Problem?

A situation where an organization’s long term survival, competitive advantage or value creation is at stake

Explain the 2 types of Strategizing Processes

1. Problem Formulation: Identifying & Conceptualizing the fundamental problem that needs to be solved. (What is the most fundamental proble we see?)

2. Solution Generation: Generating alternative strategies that can address the problem. Using analytical tools to evaluate different options. SHOULD ONLY HAPPEN AFTER STEP 1

Why is it important to have a comprehensive problem formulation?

Without it, leaders may fall into the trap of focusing on the wrong problem and much rather the symptoms only instead leading to type 3 errors.

How is problem formulation conducted best?

Problem formulation is best conducted on a group level. While individual congnition is a part of it, strategic problem formulation typically requires group discussions.

What is mGNT

mGNT stands for (Modified Nominal Goup Technique), requiring a first set of individual brainstorming, and then allowing individuals to speak their mind first, turn by turn, and then discussing and reflecting on each idea of each individual, to build a consensus and come to a decision.