Lecture 1 – Strategic Decision Making
A. What are strategic decisions?
We make decisions all day:
• Some need additional information
• We ask advice for some decisions
• Some are made on the basis of pre-existing heuristics
• We try to narrow down the number of alternatives
• Organizations are also confronted with decision situations
• The key challenge to any decision is the reduction of uncertainty
Example & discussion
A publisher’s decision publish 500 copies of
• Turned down by 12 other publishers
• The 2016 worth of the franchise is estimated at 25 billion
• Why did Nigel Newton publish it (1996)?
Do you believe the decision behind this to be a good business decision? Why?
➔ his daughter kept reading and couldn’t stop reading, based on this opninion Newton
published this book
This was a good strategic decision eventually! Maar hij was hier misschien iets te voorzichtig
want als hij er veel meer had gepubliceerd was hij een stuk rijker geweest.
Four characteristics:
• Complexity: large number of aspects
• Uncertainty: unknown number of alternatives/solutions
• Rationality: try to reach a goal
• Control: intentionality
B. Course organization
60% individual exam
40% group assignment
Papers in the syllabus (see lecture 00 – literature)
C. Introduction of:
- Je moet de introduction text + module 0 snappen als basiskennis
I. General background in strategic management (module 0)
1. Basic strategy terminology
a) What is strategy?
b) What is strategy management?
c) What are the generic strategies?
d) What is competitive advantage?
2. Essential models & theories in strategy
a) Porter’s Five Forces Model
b) Environment analysis (PEST, PESTEL, DESTEP)
, c) SWOT analysis
d) Relevant organization theories
II. The integrative framework for SDs (simplified version)
Strategic decisions are defined as decisions committing substantial resources, setting
precedents, and creating waves of lesser decisions; as ill-structured, non-routine and complex;
and as substantial, unusual and all-pervading
Dimensions of interdependence:
- Interdecisional
- Interactor
- Intertemporal
Characteristics of strategic decisions plaatje over inter-
, decision list topics
Decisions are about something!
The SDM process is the process by which a strategic decision is made and implemented and
the factors which affect it, i.e. the process that leads to the choice of goals and means and the
way in which means are effectively deployed
II. Key assumptions of SDM
Reasons for this lie in a myriad of factors, amongst which analytical and organizational
complexity. To deal with this:
• Professionals develop tools based on decision analysis and/or evidence-based
approaches
• Researchers identify the factors that increase or decrease the quality of strategic
decisions from a multidiscliplinary viewpoint
, Look forward, look backward, variation, different, SDM process – effectiveness relationship
II. Key questions for the course
a) How can we understand variation and heterogeneity of the effects of context on SDM
processes?
b) How can we understand variation and heterogeneity of the
effects of context and SDM processes on outcomes?
Preliminay (voorlopige) categorical answers to questions:
• Antecedents
• Process dynamics
• Constraining & enabling factors
• Plaatje hier rechts hoort hierbij – good story → yes
More elaborately:
A. the way decision making processes unfold is subject to
decision-situational factors: not every situation is suited for an
approach rooted in information gathering and analysis in relation
to goals
B. In addition, the (collaborative) interactions between participants in the SDM process and
the dynamics of the process can unfold in different ways leading to different decisions
II. The introducory text
A. What are strategic decisions?
We make decisions all day:
• Some need additional information
• We ask advice for some decisions
• Some are made on the basis of pre-existing heuristics
• We try to narrow down the number of alternatives
• Organizations are also confronted with decision situations
• The key challenge to any decision is the reduction of uncertainty
Example & discussion
A publisher’s decision publish 500 copies of
• Turned down by 12 other publishers
• The 2016 worth of the franchise is estimated at 25 billion
• Why did Nigel Newton publish it (1996)?
Do you believe the decision behind this to be a good business decision? Why?
➔ his daughter kept reading and couldn’t stop reading, based on this opninion Newton
published this book
This was a good strategic decision eventually! Maar hij was hier misschien iets te voorzichtig
want als hij er veel meer had gepubliceerd was hij een stuk rijker geweest.
Four characteristics:
• Complexity: large number of aspects
• Uncertainty: unknown number of alternatives/solutions
• Rationality: try to reach a goal
• Control: intentionality
B. Course organization
60% individual exam
40% group assignment
Papers in the syllabus (see lecture 00 – literature)
C. Introduction of:
- Je moet de introduction text + module 0 snappen als basiskennis
I. General background in strategic management (module 0)
1. Basic strategy terminology
a) What is strategy?
b) What is strategy management?
c) What are the generic strategies?
d) What is competitive advantage?
2. Essential models & theories in strategy
a) Porter’s Five Forces Model
b) Environment analysis (PEST, PESTEL, DESTEP)
, c) SWOT analysis
d) Relevant organization theories
II. The integrative framework for SDs (simplified version)
Strategic decisions are defined as decisions committing substantial resources, setting
precedents, and creating waves of lesser decisions; as ill-structured, non-routine and complex;
and as substantial, unusual and all-pervading
Dimensions of interdependence:
- Interdecisional
- Interactor
- Intertemporal
Characteristics of strategic decisions plaatje over inter-
, decision list topics
Decisions are about something!
The SDM process is the process by which a strategic decision is made and implemented and
the factors which affect it, i.e. the process that leads to the choice of goals and means and the
way in which means are effectively deployed
II. Key assumptions of SDM
Reasons for this lie in a myriad of factors, amongst which analytical and organizational
complexity. To deal with this:
• Professionals develop tools based on decision analysis and/or evidence-based
approaches
• Researchers identify the factors that increase or decrease the quality of strategic
decisions from a multidiscliplinary viewpoint
, Look forward, look backward, variation, different, SDM process – effectiveness relationship
II. Key questions for the course
a) How can we understand variation and heterogeneity of the effects of context on SDM
processes?
b) How can we understand variation and heterogeneity of the
effects of context and SDM processes on outcomes?
Preliminay (voorlopige) categorical answers to questions:
• Antecedents
• Process dynamics
• Constraining & enabling factors
• Plaatje hier rechts hoort hierbij – good story → yes
More elaborately:
A. the way decision making processes unfold is subject to
decision-situational factors: not every situation is suited for an
approach rooted in information gathering and analysis in relation
to goals
B. In addition, the (collaborative) interactions between participants in the SDM process and
the dynamics of the process can unfold in different ways leading to different decisions
II. The introducory text
