MIT Sloan Management Review

Senior executives weighing strategies appropriate for today’s global economy will hear contradictory advice. Some say you need to move quickly, before competitors, to establish a worldwide presence; others cite data showing that this approach is often less profitable. The reality is that neither approach is appropriate for every circumstance. Therefore, executives need to understand when to pursue one route and when to pursue the other.

Markets are changing, competition is shifting and businesses are suffering or perhaps thriving. Whatever the immediate circumstances, corporate managers ask the same questions: Where do we go from here, and which strategy will get us there? To figure out when it makes sense to pursue strategies of position, leverage or opportunity, managers must understand their company’s immediate circumstances, take stock of their current resources and determine the relationships among the various resources.

In a global economy, sustained competitive advantage arises from tackling social, political and environmental issues as part of a corporate strategy — not just pursuing business as usual.

If nothing else, Nilofer Merchant's The New How: Building Business Solutions Through Collaborative Strategy is ambitious.

In the National Public Radio broadcast "Can Economic Forecasting Predict The Future?" Adam Davidson and Alex Blumberg report that "economic forecasters, even the best, have a mixed record forecasting the economy." And "forecasters, at best, can say the economy will be somewhere between bad and good.

The field of forecasting has advanced significantly in recent years. But managers need to learn from history about what they can and cannot predict, and develop plans that are sensitive to surprises.

Where do you find inspiration? From great management thinkers like Peter Drucker? Political or military leaders? Great artists or musicians? Or, maybe, a gaudy wedding chapel on the strip in Las Vegas?

That last one probably doesn't rank high on your list. But maybe it should.

Innovation strategy expert Vijay Govindarajan thinks that businesses should be careful not to abandon innovation in their quest for efficiency and cost control during a recession — but they may need to reduce their focus on risky breakthrough innovation plans.

MIT Sloan School professor Arnoldo C. Hax, a well-known strategy expert, thinks companies need a different approach to thinking about strategy.

Recessions are a good time to disengage from businesses and practices that are weak and under pressure—but the volatile environment demands that managers let go of old approaches.

Image courtesy of Flickr user Sharon Drummond.

Any one of us—and any one of our organizations—could be forgiven for behaving at the moment like a bear confronting winter. I don’t mean behaving “bearishly,” as investors do. No, I mean behaving literally like a bear—which is to say, shutting down the system.

What does it take to create a successful radical innovation within a big company? New research offers some insights.

When seeking help from their network, top managers don”t leave it to chance. They think strategically about what type of advice to seek from what type of person.

If you devise strategy by thinking only about the positioning of your company’s product or service, you are missing a huge opportunity.

Organizations have often turned to well-established and very competitive global cities when looking to expand their markets. However, new research suggests that many corporations have been going to these cities for the wrong reasons and consequently have missed opportunities to build strategic advantages and organizational capability.

The strategic planning model is due for a “new release,” one that enables companies to keep pace with changing environments, quickly create and adapt strategy and empower people throughout the organization to make effective choices.

In today’s world, it seems, people want to characterize every utterance and action as strategic — as if the simple addition of the adjective elevates the importance and quality of the thinking.

Foreign competition has become a fact of life in industrialized countries. But the nature of that competition is changing, as new entrants increasingly arrive from countries with dramatically lower costs.

Under the right circumstances, companies of any size can grow to become platform leaders. And particular business and technology decisions can help platform-leader wannabes achieve their goals.

Not all growth is good. An analysis of Fortune Global 500 companies shows that the businesses that grew within the limits of their growth corridors performed far better than others — even those that grew faster.