The concept of strategy has been explained by different authors in several ways. On going through these explanations, one conclusion that can be drawn is that there is no universally accepted definition. One view of strategy is that it is deliberate search for an action plan that will develop a firmâ€™s competitive advantage and help augment it. This search:
1. is an iterative process and
2. begin with recognition of, where you are, what you have now; where you want to go and in how much time you have to reach there?
The contribution of this approach to understanding strategy is that it induces focus in it. The focus is on competitive advantage and the frame within which the firm has to achieve this goal. The assumption in this thinking is intensive inter-firm rivalry within an industry and the firmâ€™s environment becoming complex.
Another fairly comprehensive definition of corporate strategy is the pattern of decision in a company that determines and reveals its objectives, purposes or goals, produces the principal policies and plans for achieving these goals, and defies the range of business the company is to pursue, the kind of economic and human organization it is or intends to be and the nature of the economic and non-economic contribution it intends to make to its share holders employees, customers and communities happy. As one can make out, the definition covers a very broad view of corporate strategy. It includes in it concepts like corporate mission, goals and objectives, organization structure and the benefits that the firm has to offer to its share holders. The problem with such definitions is that it does not help in sharply focusing our attention on the strategy concept.
Another perspective on strategy is given by another expert with the help of five definitions of strategy â€“ as plan, ploy, pattern, position and perspective. Strategy as a plan is a consciously intended course of action or a guideline to deal with a situation. Thus, strategies are well-though out plans to handle future scenarios. These action plans may be general or specific. For example, a strategy to gain competitive advantage through differentiation is general but a strategy emphasizing low price and higher value for the customer may be considered as a specific strategy. As a ploy, it is a specific â€œmaneuverâ€™ intended to outwit an opponent or competitor. For example, a firm may threaten to drastically reduce the price or expand the plant capacity to pre-empt the entry of any potential competitor. Strategy is a pattern visible in a stream of actions that a firm undertakes, from time to time, to strengthen its position in the market place. This is reflected by the consistency in the firmâ€™s behavior, whether intended or not intended.
As a matter of fact, most realized strategies are a combination of intended and emergent strategies. While action plans are worked out in advance, emergent strategies are the ones that market forces dictate.
Further, strategy depends on where and when one sits. In other words, strategy appearing to be tactical today could prove to be strategy tomorrow and hence greater care is required in using these terms. Strategy, as a position, therefore involves developing a fit between the organization and its external environment such that it is able to gain and maintain a sustainable advantage. Finally strategy as a perspective involves understanding the orientation and structure of an organization. It involves creating a shared perspective of the environment by employees at different levels in the organizational hierarchy.