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Class 7 Stone Finch Inc.


• Porter said that real money lies in the industry you go to;
picking the right industry
○ Weak customers
○ Weak competitors
○ No substitute products
○ Very few competitors; incompetent
○ Low entry barriers
• Mintzberg: advocate different approach
○ Emerging pattern
 I can look backwards at past activities, I tend to
deal with things like this  kind of pattern 
○ Strategy comes from a process of evolution
 Slowly moving in the right direction
 Managers with experience
 Selecting; knowing what works and killing what
 Keeping and spreading  local adaptations
○ Bottom up, emergent strategy
 Individual actors know the resource of ideas.
 Experiment in terms of different products,
marketing strategies, production, and
 If you’re gonna have this as a emerging pattern;
you’ll need the individual line/middle managers to
come up with these ideas.
○ Structures; patterns, resources, roles
• Which strategy is better?
○ As a plan?
○ As a pattern?
○ Diffused: information is at all levels of the organization
○ Pyramid: process takes a lot of time; in stable
environment this is ok. In rapid changing environment
you need more experiments and evolutionary approach.
• Four types of generic strategies
○ Focus low cost
 Defender/harvester
○ Synergetic low cost
○ Focused differentiator
○ Synergetic differentiator
• ……..
○ Exploration  greater task uncertainty
 Divisions aren’t related to each other
 Different companies/subunits  different kind of
○ Exploitation  less taks uncertainty
 Exploit existing competencies
 Market is predictable
○ Broad scope  greater complexity
 Not only ur narrow line, coordinating/arranging a
range of different uncertainties. More complexity
in given activity
○ Narrow scope  less complexity
 Closely related to each other
• Possible exploration and exploitation?