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Searching for Great Strategies

Author

Listed:
  • Thomas Fink

    (London Institute for Mathematical Sciences, Mayfair, London W1K 2XF, United Kingdom; Centre National de la Recherche Scientifique, 75016 Paris, France)

  • Pankaj Ghemawat

    (Stern School of Business, New York University, New York, New York 10012; IESE Business School, 08034 Barcelona, Spain)

  • Martin Reeves

    (BCG Henderson Institute, Boston Consulting Group, New York, New York 10001)

Abstract

We focus on answering the question posed for this special issue by elaborating a specific perspective, involving information-enabled search, in which firms add capabilities (or components) that expand what they can accomplish in the product market arena, and the key strategic choices concern the kinds of capabilities that are added. We establish that measuring how a new candidate component interacts with the components we already have can be a reasonable proxy for how they will combine with new components which we don’t yet have. This allows us to compare the performance of “impatient strategies” focused on the current usefulness of a new component and “patient strategies” focused on anticipated long-term usefulness. Their relative performance depends on how far the innovation process has progressed, and on the structure of the innovation space itself. In particular, a flattening in the increase of complexity implies an increase in the relative attractiveness of patient strategies over impatient ones, i.e., constitutes a signal to a switch strategies. It is therefore possible to construct information-based adaptive search strategies, which outperform either random strategies or fixed (patient or impatient) strategies for component selection. And there are broader implications for strategy as well.

Suggested Citation

  • Thomas Fink & Pankaj Ghemawat & Martin Reeves, 2017. "Searching for Great Strategies," Strategy Science, INFORMS, vol. 2(4), pages 272-281, December.
    • Handle: RePEc:inm:orstsc:v:2:y:2017:i:4:p:272-281
    DOI: 10.1287/stsc.2017.0052
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    References listed on IDEAS

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    1. T. M. A. Fink & M. Reeves & R. Palma & R. S. Farr, 2016. "Serendipity and strategy in rapid innovation," Papers 1608.01900, arXiv.org, revised Mar 2017.
    2. T. M. A. Fink & M. Reeves & R. Palma & R. S. Farr, 2017. "Serendipity and strategy in rapid innovation," Nature Communications, Nature, vol. 8(1), pages 1-9, December.
    3. R. E. Caves & B. T. Gale & M. E. Porter, 1977. "Interfirm Profitability Differences: Comment," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 91(4), pages 667-675.
    4. Teppo Felin & Stuart Kauffman & Roger Koppl & Giuseppe Longo, 2014. "Economic Opportunity and Evolution: Beyond Landscapes and Bounded Rationality," Post-Print hal-01415115, HAL.
    5. Ghemawat, Pankaj, 2016. "Evolving Ideas about Business Strategy," Business History Review, Cambridge University Press, vol. 90(4), pages 727-749, January.
    6. Lee Fleming, 2001. "Recombinant Uncertainty in Technological Search," Management Science, INFORMS, vol. 47(1), pages 117-132, January.
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    Cited by:

    1. Giovanni Gavetti & Joe Porac, 2018. "On the Origin of Great Strategies," Strategy Science, INFORMS, vol. 3(1), pages 352-365, March.
    2. Teppo Felin & Stuart Kauffman, 2023. "Disruptive evolution: harnessing functional excess, experimentation, and science as tool," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 32(6), pages 1372-1392.
    3. Gordon, Adam Vigdor & Ramic, Mirza & Rohrbeck, René & Spaniol, Matthew J., 2020. "50 Years of corporate and organizational foresight: Looking back and going forward," Technological Forecasting and Social Change, Elsevier, vol. 154(C).
    4. Adam Vigdor Gordon, 2024. "The place and limits of futures analysis: Strategy under uncertainty 25 years on," Futures & Foresight Science, John Wiley & Sons, vol. 6(2), June.
    5. Gilbert Giacomoni, 2022. "Towards a general framework for innovation shaped with AI to create and transform market offerings [Vers un cadre général d’innovation façonné par l’IA pour créer et transformer les offres du march," Post-Print hal-04083376, HAL.

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