Strategic Dissonance

Firms in high-technology industries frequently face the dangers and opportunities associated with strategic inflection points in their development trajectory. Strategic inflection points (SIPs) are caused by changes in fundamental industry dynamics, winning strategies, and dominant technologies. SIPs generate strategic dissonance in the organization because they are associated with divergences between the basis of competition and the firm’s distinctive competence, and between top management’s strategic intent and strategic action. Top management can take advantage of the information generated by strategic dissonance to develop new strategic intent and lead the organization through the turbulence and uncertainty associated with SIPs. This requires a capacity for strategic recognition on the part of top and senior management. Strategic recognition is facilitated by an internal selection environment that allocates resources based on competitive reality and values dissent and debate. Strategic recognition is the foundation for exerting strategic leadership: encouraging debate and bring debate to a conclusion that realigns the basis of competition and distinctive competence, and strategy and action.