The previous chapter reviewed some developments in the theory of the firm in order to provide some early pointers to the way in which economic analysis may assist our understanding of corporate strategy. In this chapter, we first consider the role of the corporate strategist in a little more detail, and then seek to justify that role in principle (section 2.2) and by reference to the experience of corporate planners (section 2.3). At this stage we are still concerned with a very general view of strategic planning. Specific planning problems will be dealt with in later chapters.

The role of the strategist

Our initial definition suggested that the strategist is concerned to identify policies which contribute to the long-term goals of the organization. Implicit in this definition are several intellectual tasks that must face all managers involved in the formulation of corporate strategy. First, they must identify the value systems and the long-term objectives that are to be sought by the members of the organization, including the obligations that are acknowledged to outsiders. Secondly, they must define the current and expected future state of the environment in which the organization operates, so as to pick out the opportunities which may arise and the threats which may have to be faced. Thirdly, they must consider the organization's relative strengths and weaknesses in responding to those opportunities and threats.