Strategy making as iterated processes of resource allocation
Article first published online: 5 JUL 2007
Copyright © 1996 John Wiley & Sons, Ltd.
Strategic Management Journal
Volume 17, Issue S1, pages 159–192, Summer 1996
How to Cite
Noda, T. and Bower, J. L. (1996), Strategy making as iterated processes of resource allocation. Strat. Mgmt. J., 17: 159–192. doi: 10.1002/smj.4250171011
- Issue published online: 5 JUL 2007
- Article first published online: 5 JUL 2007
- strategy process;
- resource allocation;
- role of top managers;
- new business development;
- strategy and evolution
Capitalizing on the Bower-Burgelman process model of strategy making in a large, complex organization, we investigate the multilevel managerial activities that lead firms facing similar new business opportunities to respond with different strategic commitments. Our field-based data provide evidence on (I) the role of ‘corporate contexts’ that reflects top managers' crude strategic intent in shaping strategic initiatives of business-unit managers; (2) the critical influence of early business development results on increasing or decreasing middle managers' enthusiasm to the new businesses and top managers' confidence in these middle managers in a resource allocation; (3) the escalation or deescalation of a firm's strategic commitment to the new businesses as a consequence of iterations of resource allocation. We conclude that it is useful to conceptualize strategy making in a large, complex firm as an iterated process of resource allocation.