Strategic Management: Formulation and Implementation

Levels Of Strategic Changes

Strategic change can be viewed as a continuum running from no variation in strategy to a complete change in an organization's mission. For analytic purposes, it useful to divide strategic change into the five discrete stages:

Continuation Strategy
This strategy in one which the same strategy that was used in the previous planning period is repeated. Successful implementation is largely a matter of monitoring activities to ensure that they are performed on schedule.
Routine Strategy Change
It involves normal changes in the appeals to attract customers. An important type of routine strategy changes involves positioning or repositioning a product in the minds of consumers.
Limited Strategy Change
A limited strategy change involves offering new products to new markets within the same general product class. There are many variations at this level of strategic change, because products can be new in a variety of ways.
Radical Strategy Change
A radical strategy changes involves a major reorganization within the firm. This type of change is common when mergers and acquisitions occur between firms in the same basic industry. Radical changes can also involve numerous changes in the organizational structure and multiple acquisitions and sales of subsidiaries.
Organizational Redirection
One form of organizational redirection involves mergers and acquisitions of firms in different industries. The degree of strategic change depends on how different the industries are and on how centralized management of the new firm is to be. Another form of organizational redirection occurs when a firm leaves one industry and enters a new one.