CIPS Exam L6M2 Topic 4 Question 3 Discussion

Evaluation of Intended Strategy vs. Emergent Strategy

Introduction

Strategy formation is a critical process that determines how businesses achieve their objectives. Two contrasting approaches exist:

Intended Strategy -- A deliberate, planned approach, where management defines a clear course of action.

Emergent Strategy -- A flexible, adaptive approach, where strategy evolves in response to external changes.

Both approaches have advantages and constraints, and organizations often combine both to maintain strategic direction while adapting to market uncertainties.

1. Intended Strategy (Planned Approach to Strategy Formation)

Definition

An intended strategy is a structured, pre-planned approach where an organization sets long-term goals and develops a roadmap to achieve them.

Key Characteristics:

Clearly defined mission, vision, and objectives.

Top-down decision-making with structured implementation plans.

Focus on forecasting, market research, and competitor analysis.

Example:

McDonald's follows an intended strategy by expanding its franchise model using structured business plans and operational guidelines.

Advantages of Intended Strategy

Provides a clear vision and direction -- Ensures all departments align with corporate goals.

Supports long-term resource allocation -- Helps in budgeting and investment planning.

Enhances risk management -- Allows organizations to prepare for potential challenges.

Ensures consistency -- Ideal for stable industries with predictable market conditions.

Constraints of Intended Strategy

Inflexible in dynamic markets -- Struggles with unforeseen changes (e.g., economic crises, technology shifts).

Can lead to missed opportunities -- Focuses on execution rather than adaptation.

Slow response time -- Delays decision-making in fast-changing industries.

Key Takeaway: Intended strategy works best in stable environments where long-term planning can be executed without major disruptions.

2. Emergent Strategy (Flexible & Adaptive Approach to Strategy Formation)

Definition

An emergent strategy is a responsive, flexible approach where businesses adapt their strategies based on real-time changes in the market.

Key Characteristics:

Strategy emerges from trial and error, experimentation, and learning.

Encourages bottom-up decision-making, allowing employees to contribute.

Focuses on short-term flexibility and continuous adjustments.

Example:

Amazon's move into cloud computing (AWS) was an emergent strategy, as it originally started as an online bookstore but adapted to market opportunities.

Advantages of Emergent Strategy

Highly adaptable -- Allows businesses to pivot in response to market shifts.

Encourages innovation and experimentation -- Promotes new ideas and flexible problem-solving.

Reduces risk of failure -- Companies can adjust strategies before fully committing to large-scale investments.

Works well in unpredictable environments -- Essential for industries like technology, fashion, and e-commerce.

Constraints of Emergent Strategy

Lack of clear direction -- Can create confusion in organizations with no defined strategic goals.

Resource inefficiency -- Constant adjustments may lead to wasted time and investment.

Difficult to scale -- Unstructured decision-making can cause inconsistencies.

Key Takeaway: Emergent strategy is ideal for fast-changing industries where adaptability is more valuable than rigid planning.

3. Comparison: Intended Strategy vs. Emergent Strategy

Key Takeaway: Most successful organizations blend both approaches, using intended strategy for stability and emergent strategy for adaptability.

4. Conclusion

Both intended and emergent strategies have strengths and weaknesses.

Intended strategy is best for structured, long-term growth in stable industries.

Emergent strategy allows for rapid adaptation in volatile markets.

Most businesses use a combination of both approaches, balancing planning with flexibility.

By integrating intended and emergent strategies, organizations can maintain stability while responding effectively to market changes.