Using strategy tools to exercise power in a company

May 23, 2012

Popular strategy tools used by businesses include SWOT analysis and scorecards. Strategy tools are seen as a means that provides companies with practical ways of making use of scientific theories in order to improve competitiveness. However, this is only one side of the overall picture.

According to Juha Olava's doctoral dissertation completed at the Aalto University School of Economics, strategy tools can also be used to promote the views and interests of individuals and groups in a company. In his dissertation, Olava examines strategy tools as a means to participate in a company's internal power struggles and use power.

According to Olava, the organizational political use of strategy tools is based on two factors. Firstly, the prevailing discourses in provide ample justifications for the choice and customization of strategy tools, and the organizational political characteristics of these tools can be hidden behind these justifications.

Secondly, the moral systems of businesses ensure that the true reasons for the existing structures are not revealed. The moral systems in place make exposing the organizational political impacts of the tools in use extremely difficult.

Executives benefit from internal power struggles

According to the research results, different activity-based managerial groups may disagree about the most suitable strategy process due to organizational political reasons.

Managers actively defended the use of the strategy process models they preferred by presenting managerial and economic facts that supported their view. However, Olava's analysis reveals that each suggested model would have strengthened the position of the supporting managerial group in the strategy process.

According to Olava's study, the executives at the highest corporate level may benefit from the power struggle between different managerial groups. The executives can steer the competition for control over the choice of strategy tools from the present towards the future.

One way of doing this is launching new strategy tools designed for the calmer future in the middle of an ongoing change.

The power-hungry managerial groups can also be given special privileges in developing and implementing these strategy tool solutions of tomorrow. This can help to provoke the power struggle concerning the future strategy process and turn the attention away from the acute strategy process.

Explore further: Less-numerate investors swayed by corporate report presentation effects

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