Strategic choice in the analysis of action, structure, organizations and environment: retrospect and prospect

Abstract

This paper examines the place of the strategic choice perspective in the study of organizations and considers its contemporary contribution. The main features of the original analysis are summarized, followed by a review of the key issues which arise from it. The paper discusses the integrative potential of strategic choice theory within organization studies and examines its contribution to an evolutionary perspective on the subject.

Descriptors: action, environment, evolution, learning, structure, organization

Introduction

The 'strategic choice' perspective was originally advanced as a corrective to the view that the way in which organizations are designed and structured is determined by their operational contingencies (Child 1972). This view overlooked the ways in which the leaders of organizations, whether private or public, were able in practice to influence organizational forms to suit their own preferences. Strategic choice drew attention to the active role of leading groups who had the power to influence the structures of their organizations through an essentially political process. It led to a substantial re-orientation of organizational analysis and stimulated debate on three key issues:

1. the role of agency and choice in organizational analysis,

2. the nature of organizational environment,

3. the relationship between organizational agents and the environment.

Since the intention was to redress an imbalance in organization theory, the exposition of strategic choice at the time contributed to the diversity of perspectives on the subject, along with other emerging approaches such as critical organization theory. Twenty-five years later, the formerly orthodox emphasis on a situationally determined organizational order has become a minority approach, and the field is now extremely diversified with a veritable plethora of competing perspectives, each of which seeks to lead it in different 'new directions' (Reed and Hughes 1992).

There is a growing feeling that something must be done to pull together the different perspectives on organizations if progress in the subject is to be made (e.g. Reed 1985; Aldrich 1992). The view adopted in this paper is that, while different theoretical perspectives or paradigms may be irreconcilable in their own philosophical terms, when applied to the study of organizational phenomena they are not necessarily incommensurable. In other words, it does not follow from the attachment of quite different meanings to the same concept, or of different interpretations to the nature of organizational relationships, that reference is being made to wholly different phenomena. In that case, without an attempt to draw upon, and even to reconcile, the insights offered by its various perspectives, organization studies will run a serious risk of becoming little more than an arena of 'clashing cymbals' (or indeed symbols), making little real theoretical advance and having nothing useful to say for practice either.

A contemporary contribution of strategic choice analysis derives from its potential to integrate some of the different perspectives in organization studies. This integrative potential derives from the fact that strategic choice articulates a political process, which brings agency and structure into tension and locates them within a significant context. It regards both the relation of agency to structure and to environment as dynamic in nature. In so doing, the strategic choice approach not only bridges a number of competing perspectives but also adopts a non-deterministic and potentially evolutionary position. Strategic choice, when considered as a process, points to the possibility of a continuing adaptive learning cycle, but within a theoretical framework that locates 'organizational learning' within the context of organizations as socio-political systems. Strategic choice is thus consistent with a model of organizations in which organizational learning and adaptation proceed towards not wholly predictable outcomes within the shifting forces of organizational politics. This model finds some resonance in the new evolutionary political economy that bids to revitalize micro-economics.

The following section summarizes the main features of the original strategic choice analysis. The second section then considers the key issues arising from this analysis and how they have been interpreted. The third section explores the integrative potential of strategic choice analysis within the contemporary study of organizations. The fourth section discusses how the dynamics of strategic choice in regard to action, structure and environment can inform current thinking on organizational evolution.

Strategic Choice Analysis

By the early 1970s, organization studies had seen the completion of several major research programmes which investigated the components of organizational structure and their relationships with situational variables ('context') on a systematic comparative basis (e.g. Blau and Schonherr 1971; Hall 1962; Pugh et al. 1968, 1969). The mode of research was cross-sectional and positivistic, involving the statistical examination of associations between phenomena which were regarded as objective in nature. The processes accounting for any statistical correlation were left to be inferred. The inferences which were being drawn reflected the predominant theoretical orientation at the time, which was one of structural determinism. This assumed that what the Aston school termed 'contextual' factors, especially size, technology and ownership, imposed certain constraints upon the structural choices managers could make without incurring unacceptable performance costs (Pugh et al. 1963). The general argument was that 'if organizational structure is not adapted to its context, then opportunities are lost, costs rise, and the maintenance of the organization is threatened' (Child 1972: 8). (1)