The Importance Of Strategy

Over the last few years, research about relations between strategy approaches and organisations ’performance has increased. The rules of management within organisations have evolved and managers had to adapt their operating models to all these changes. Nowadays, the environment becomes wild and more complex, it is primary for companies to be very flexible and able to react quickly to any changes on the market or related to competitors. Analysis and evaluation of practises are constantly required to reach the « best practises », the methods which will bring the add value and benefits. Over the time, competition’s level is becoming bigger and bigger and competitive advantage is hard to be reached by most of the companies (Segal-Horn, 2004). They

They become strategic when they help companies differentiate themselves from competitors over a long time period (Mazzucato, 2002). Strategy is seen as an advantage that a company get over its competitors. Regular improvements aren’t the key to success; it is not enough to keep the leader position. Strategy is how to perform differently from others rather than perform more efficiently, competitors can’t be aware of strategic decisions made by the organisation and can’t copy. For instance, Japanese companies are reputed to be strong in operational effectiveness, trying to improve constantly their activities giving to customers the best value product for the smallest prices (Lee & Trim, 2008). However these companies are missing a clear strategic position, they’re all similar because they copy each other, and it is hard for them to keep their leading position on the market. On the other side, there is company such as Ikea, the international furniture retailer which has established a clear strategy designed to facilitate the customer buying experience: giving them decoration ideas, simplifying the search, avoiding the help from sellers or decorators. Competitors never had the necessary skills to copy Ikea’s strategy, resulting in a superior strength and the key to efficiency and

However, this approach is too simple, basic and can appear to be unworkable under certain conditions, not able to anticipate the future and forecast the next business trends. Guidelines and rules don’t give clear answers; they are just simplifying a really complex environment. Therefore, strategies are made only by the direction because of the mechanistic structures of companies using this approach. What the direction think without being able to react quickly to sudden changes such as customers habits and behaviours, market demands, competitions, technology advancements and a lot more. Kodak company is a perfect example to illustrate this argument. Kodak was the top leaders in the photographic film product area in the 80 – 90’s, directed and protected by the Japanese group Fujifilm. The old and traditional Japanese group in charge of Kodak has provoked its downfall in establishing a rational strategy, opposed to changes and obstinate to keep the company’s old strategies, values and activities. However, competitors have developed more dynamic strategies able to adapt their products and services to the digital revolution. A teacher and specialist in Strategic management has declared: “One common explanation for Kodak 's demise is that it missed the digital revolution” (Pangarkar, 2012, p.1). The rational strategy