Why firms adhere to or deviate from their strategic plans is poorly understood. However, theory and limited research suggest that the process through which such plans emerge may play a part. In particular, top management decision-sharing—consensus-oriented, team-based decision-making—may increase the likelihood that firms will adhere to their plans, because those involved in the decision-making may be more committed to the chosen course of action, thereby increasing the likelihood that organizations will subsequently adhere to their plans.

However, the relationship between top management decision sharing and adherence to plans may be affected by a strategic mission (its fundamental approach to increasing sales revenue and market share, and generating cash flow and short-term profits). At one end of the strategic mission continuum, "build" strategies are pursued when a firm desires to increase its market share and is to sacrifice short-term profits to do so. At the other end, "harvest" strategies are used when a firm is to sacrifice market share for short-term profitability and maximization. Research and theory suggest that top management decision-sharing may have a more positive relationship with adherence to plans among firms with harvest strategies than among firms with build strategies. In a study of strategic practices in several large firms, managers in harvest strategy scenarios were more able to adhere to their business plans. As one of the managers in the study explained it, this is partly because "typically all a manager has to do [when implementing a harvest strategy] is that which was done last year." Additionally, managers under harvest strategies may have fewer strategic options than do those under build strategies; it may therefore be easier to reach agreement on a particular course of action through decision-sharing, which will in turn tend to promote adherence to plans. Conversely, in a "build" strategy scenario, individual leadership, rather than decision-sharing, may promote adherence to plans. Build strategies—which typically require leaders with strong personal visions for a future, rather than the negotiated compromise of the team-based decision—may be most closely adhered to when implemented in the context of a clear strategic vision of an individual leader, rather than through the practice of decision-sharing.


It can be inferred from the passage that which of the following firms would be the most to adhere to its strategic plans?


One that is pursuing a build strategy and whose strategic plans were developed through the process of decision sharing

One that is pursuing a harvest strategy and whose strategic plans were developed through the process of decision-sharing

One that is pursuing a harvest strategy and whose strategic plans were developed by an individual leader with a strong personal vision for the future

One that does not fluctuate between builds and harvest strategies

One that has a long—established practice of top management decision-sharing

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BiChu21-RC