Strategic Planning as Competitive Advantage

Powell, Thomas (1992) Strategic Planning as Competitive Advantage. Strategic Management Journal, 13 (7). pp. 551-558.

Abstract

Since 1970, over forty empirical studies have examined the performance consequences of formal strategic planning. This line of research has drawn heavy criticism from reviewers on methodological grounds, and has produced confusing, apparently contradicatory results. This article reevaluates the planning-performance relationship from a resource perspective, arguing that strategic planning does not satisfy the criteria for sustainable competitve advantage-- although it may produce economic value, it is easily imitated and may be substitutable. The article suggests that previous studies produced inconsistent results because they did not account for the dissemination of strategic planning over time, or for industry differences in strategic planning factor markets. An empirical test in two industries funds that formal strategic planning and financial performance are unrelated in a 'planning equilibrium' industry, but positively related in an industry with strategic planning factor market imperfections.

Item Type: Article
Keywords: Strategic planning; Competitive advantage; Resource theory
Subject(s): Strategy; Entrepreneurship & Global business
Centre: Faculty of Strategy, Entrepreneurship and International Business
Date Deposited: 22 Jan 2012 16:32
Last Modified: 23 Oct 2015 14:06
URI: http://eureka.sbs.ox.ac.uk/id/eprint/1945

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