A case-study of the three largest aerospace manufacturing organizations: An exploration of organizational strategy, innovation and evolution Liz Varga & Peter M. Allen
Cranfield School of Management, Cranfield University, ENG
Many of the most successful firms have placed a strong emphasis on strategy. Strategies help decision-makers in organizations to think through what the organization needs to achieve and how these needs may be satisfied. This case study considers what the Chief Executive Officers of the top three aerospace manufacturers say about their strategies and how these strategies are being implemented. The aerospace manufacturing industry is interesting from a number of respects: its dependence on innovation, its global nature, its relationships with government and other firms, and the different characteristics of the civil and defence markets. This aerospace manufacturing triad is also interesting because of its industry sector coverage: one is a largely defence aerospace manufacturer, the second a largely commercial aerospace manufacturer and the third, an aerospace manufacturer with a balanced portfolio. Strategies are shifting to take an holistic view of the firm as the firm is increasingly being recognized as a complex system. This holism is particularly evident in the manufacturing firms examined, as they balance innovation, strategy and organizational characteristics in an evolutionary manner. Innovation is fundamental to evolution and this case study employs a novel holistic approach to innovation portfolio assessment. A complex systems perspective is taken for organizational analysis allowing the examination of how fluctuations, resource richness, freedom, capacity to innovate, culture, technology and strategy are balanced and made synergetic. This case study reflects upon how these organizations’ strategies are reflected in their organizational forms, their investments in innovations, their performance and ultimately in their potential to evolve.
he creation of strategies and acting strategically places a focus on the long term, and the things that are essential for evolution. Anderson (1999) applies complex systems models to strategic management and concludes that this leads to an “emphasis on building systems that can rapidly evolve effective adaptive solutions.” Strategic direction requires attention to environments and reconfiguration of organizational architecture to fit anticipated adaptation of agents. The allocation of resources in line with strategic plans ensures that short-term interruptions do not deflect from long-term goals. However, strategies need to be adaptable to changing circumstances. Exploration is fundamental to adaptation and complexity science provides a theoretical basis for empirical findings, in particular, archetypal patterns of strategy, structure and environment (Maguire, 1999). Strategy and strategic change itself are influenced by the extent to which leaders believe that it is driven by content (that is structure) and by process. Strategies driven by content are influenced largely by the field of economics and focus is on management activities that aim to achieve predetermined, optimum, rational objectives. These include: 1. The Strategy-Structure-Performance school, concerned with scale, scope and form of organizations; 2. The Structure-Content-Performance school concerned with position and market power, and; 3. Resource-Based View and core competencies. They are similar in that they make assumption about economic rationality and Newtonian concepts of equilibrium and stability (MacIntosh & MacLean, 1999). E:CO Vol. 8 No. 1 2006 pp. 48-64
There is now increasing recognition of the importance of key intangible organizational attributes, such as tacit knowledge, learning and intelligence that may...