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2017
The fog of strategy: Some organizational
perspectives on strategy and the strategic
management challenges in the changing
competitive environment
Augier, Mie; Marshall, Andrew W.
Routledge Taylor & Francis Group
Augier, Mie, and Andrew W. Marshall. "The fog of strategy: Some organizational
perspectives on strategy and the strategic management challenges in the changing
competitive environment." Comparative Strategy 36.4 (2017): 275-292.
http://hdl.handle.net/10945/59931
This publication is a work of the U.S. Government as defined in Title 17, United
States Code, Section 101. Copyright protection is not available for this work in the
United States.
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COMPARATIVE STRATEGY
, VOL. , NO. ,–
https://doi.org/./..
The fog of strategy: Some organizational perspectives on strategy
and the strategic management challenges in the changing
competitive environment
Mie Augieraand Andrew W. Marshallb
aGraduate School of Business and Public Policy, Naval Postgraduate School, Monterey, CA, USA; bAlexandria, VA, USA
ABSTRACT
The purpose of this article is to discuss some conceptions of strategy (and why
it is dicult) and the need for a long-term perspective on strategy (including
carefully studying competitors/opponents), and to emphasize the organiza-
tional nature of strategy (most strategies are developed by and implemented in
organizations). We oer elements of an organizational framework for thinking
strategically about national security, and some thoughts about implications for
the education of future strategists.
1. Introduction
“Strategy is the great work of the organization. In situations of life or death, it is the Tao of survival or extinction. Its
study cannot be neglected”—Sun Tzu,TheArtofWar
The purpose of this article is to explicate aspects of the nature of strategy and strategic thinking,
to illustrate and emphasize the organizational nature and context, to provide elements of a framework
for thinking strategically about key competitions, and to point to the need for an interdisciplinary and
empirically driven framework for strategy. By doing so we hope to contribute to a better understanding
of the organizational content and context of the process of strategy development, and the education of
future strategic thinkers.1
Secretary Mattis noted that strategy is about connecting ends, means and ways.2Strategy often (if
not always) begins with a good understanding of one’s situation and basis for competitive advantages,
taking into account strengths and weaknesses of oneself and opponents as well as the trends in the strate-
gic environment.3Thus, in this article we understand strategy as the process of identifying, creating, and
exploiting asymmetric advantages that can be used to achieve or improve sustainable competitive advan-
tages.Inthenationalsecuritycontext,itisalsousefultoseetheprocessofstrategydevelopmentas
an extended process that takes place between dierent organizations (nations/groups/interests). Under-
standing those organizationsand opponents and how they think and view the competition are central to
strategy and often requires sustained eort. Assuming the opponents/competitors are “just like us” is a
great danger. Strategy also deals with shaping and coordination of the higher-level activities, resources,
and competencies in organizations, and focuses on longer-term issues; thus strategic thinking requires
minds that focus on shaping the future competition in the longer run (not just reacting to nearer-term
events) in ways to proactively create or utilize asymmetries to one’s advantage. Also, nally, strategy is an
ongoing process involving continuing diagnosis (understanding of situation); setting strategic objectives;
development of appropriate strategies; attention to implementation; and ongoing learning, assessment
and adaptation of strategies as one’s situation (and competitors) change.4
CONTACT Mie Augier augier@stanford.edu;meaugier@nps.edu
© Taylor & Francis
276 M. AUGIER AND A. W. MARSHALL
One point we hope to make is the importance of strategy as empirically driven and truly interdisci-
plinary. Strategic decision making and understanding behavior does not t one or two academic per-
spectives, but crosses many that are not necessarily natural allies within normal scholarly communities.
In particular, if we are to develop useful concepts and real, empirically relevant analytic frameworks for
thinking about strategic issues, we must not limit ourselves to our own subdisciplines or home perspec-
tives. If we do, we risk contributing to developing not a greater capacity for strategy, but an incapacity for
strategic thinking and strategy, as viewing the world through analytic models can result in serious biases
and pitfalls, especially when trying to apply such analysis to real-world strategic situations and orga-
nizations.5Issues of culture, psychology, demography, and bio-social anthropology, for instance, might
not t into any political science or economics-based analysis of the world (to mention a few disciplines
strategy scholars sometimes come from), but are essential to understanding the decision making and
behaviors in real-life strategic competitions. We need to both understand how they think and observe
what they do; something which takes sustained eorts of looking into how history, organizations and
culture inuence behavior (both our own and our competitors). This has important implications also6
for how we educate strategists for the future.
The structure of the rest of article is the following. The next section introduces the concept and some
problems with existing denitions (section 2). Section 3 discusses the organizational aspects of strategy
and the need to see the competition as one between systems of organizations. Section 4 then introduces
elements of a strategic organizational-process framework for thinking strategically, one that builds on
assessments of strengths and weaknesses of the U.S. as well as (potential and current) opponents and
alliances, and on understanding the fundamental asymmetries, dynamics, and irrationalities character-
izing the competition and the players involved. Section 5 summarizes some elements central to strategic
thinking and the education of future strategists.
2. What is strategy? (And why is it dicult?)
“We have lived too long now in a strategy-free mode.”—James Mattis7
In order to begin an informed discussion on strategy and strategic thinking, it may be useful to have
some clarity regarding what we mean by “strategy.” This section will provide some denitions and reasons
why strategy is dicult (yet not impossible), and a few words on what strategy is not. The diculties stem
both from intellectual problems getting the initial assessment and diagnosis right, and of really knowing
one’s own strengths and weaknesses (and that of the opponents). So from the outset there is a lot of
thinking that needs to go into getting the diagnosis right. There is a lot of insight that one needs to have
to even begin to develop a strategy. Additional diculties stem from the fact that the strategies we are
most interested in are the strategies of organizations and that it often takes strong, decisive leaders to
implement strategy that cut through organizational and bureaucratic red tape.8
As Sinnreich points out,9the term strategy itself is also fraught with confusion (and if there is little
agreement on the basic terms, that itself can be a barrier for developing strategies). Within national secu-
rity, strategy can refer to, among other issues of “How do nations behave?” “Who are our allies?” “How
do we respond to certain threats?” and “What determines success or failure in the international strategic
competition?”10 In the area of business strategy, we often nd a similar confusion of terminology, with
strategy referring to issues such as “What are the goals of the organization?” “How do we respond to
competitive pressures in certain industries?” and “How do we plan for a new product development?”
There also is a danger that some might confuse strategy with goals or subgoals. Confusing strategy
with goals—however well-intended ones—can be damaging to strategic analysis. For instance, it invites
ignoring the trade-os and even potential conicts between certain objectives, and assumes automatic
implementation, rather than careful considerations, of the limitations to strategic tools.11
Since strategy and strategic planning in the national security environment (as well as within busi-
ness, competitive situations) is often a complex process involving multiple players, multiple goals, and a
good deal of uncertainty, ambiguity, and unpredictability, a broader, forward-looking meaning of strat-
egy seems appropriate. In a dynamic and changing environment, our conception of strategy might benet
COMPARATIVE STRATEGY 277
from being proactive, not just static and reacting to certain events, but focused at least in part on shap-
ing the future competitive environment and, in that context, guiding the evolution and the organization
of our capabilities and resources over time accordingly. For example, during the Cold War, it was use-
ful to focus on the competition as a long-term competition between two complex organizations and to
understand that competition in the context of other organizations, allies, resources, constraints, tech-
nologies, and so on. Thinking about the competition as a set of organizations and decision makers with
strengths and weaknesses determined in part by their own cultural, psychological, and organizational
issues allows for thinking about how to develop and position one’s own capabilities and to shape the
competition, and to avoid focusing on investing and building competencies based on narrow (political
or disciplinary based) reactive needs.
In addition to the lack of clarications on several dimensions relevant to strategy, a further puz-
zle/paradox complicates matters even more: While the concept and practice of strategy and strategic
thinking is essential for military and business organizations, there are many factors in organizations that
work against strategic thinking and developing proactive strategies. These factors include: bureaucratic
processes, political biases, the tendency for organizations to be “stuck” in suboptimal situations, individ-
ual and organizational myopia, the diculties of organizational adaptation, and the general resistance
to change and competency traps which are characteristic of large organizations. This is perhaps one
reason why there seems to be a deciency in the national security establishment of people who think
strategically.12 We shal l d i s cus s t h e se, as we l l a s ot her barriers to strategy, later. Finally, the lack of good
practice in the area increases the problem: it is not easy to think strategically in any case, and people don’t
see successful strategies very often (and when they do, they sometimes develop a “strategic xation” on
those successes). This also creates additional challenges for the educating future strategists and strategic
thinkers.
Earlier eorts in the national security context duringthe Cold War seemed more attentive to providing
along-termview.Forinstance,Eisenhowerinitiatedanexercisehavingdierentteamsmakethecase
for three dierent strategies, exploring strategies in dealing with the Soviet Union ranging from waging
peace to rollback, each team developing and presenting their strategies.13 This resulted in Eisenhower
pursuing a strategy to deter Soviet aggression, building up U.S. strengths and utilizing Soviet weaknesses,
and acknowledging the key asymmetries and uncertainties involved, rather than ignoring and avoiding
them.14
Although there are examples of good strategic thinking in national security, it may be fruitful to look
to the eld of business strategy for inspiration and clarication. Business organizations, like nations, deal
with changes in the competitive environment; understanding their own and others capabilities, strengths,
and weaknesses, and the business literature has a histor y of building on analytic frameworks and concepts
that are at least somewhat interdisciplinary. While these may not be perfectly applicable to the national
security context, they can still oer some value and point to interesting dimensions of strategy worth
exploring.15 A few early denitions point to the linking of organizational goals, means, and ends:
Alfred Chandler wrote that:
Strategy is the determinator of the basic long-term goals of an enterprise, and the adaptation of courses of action
and the allocation of resources necessary for carrying out these goals.16
Kenneth Andrews saw strategy as:
the pattern of objectives, purposes, or goals and major policies and plans for achieving these goals, stated in such a
way as to dene what business the company is in or is to be in and the kind of company it is or is to be.17
Later conceptions of strategy in business added important distinctions between strategy and planning,
the importance of strategic thinking and of forward looking exploration of alternative futures, and an
emphasis on strategic thinking requiring real intellectual eorts.18
Despite such useful insights, we can sum up some of the reasons for our shortcomings in the tradi-
tional strategy area:
◦Problem of (missing) analysis.Manystrategistsaswellasstrategicmanagementscholarsmaybe
tempted to try to formulate strategies without adequate analysis rst. As the strategic landscape
278 M. AUGIER AND A. W. MARSHALL
and strategic decision making involve uncertainty, ambiguity, and rapidly changing contexts, a solid
interdisciplinary and empirically oriented analysis of the strategic landscape and situation is impor-
tant. In fact, one can argue that this element of diagnosis is the most important element in strategy,
and clearly sets it apart from policy. A central issue here is emphasizing understanding the right
questions. Even a partial understanding of the right questions is more valuable than coming up
with “solutions” to the wrong ones.
◦Problem of language. Many discussions of strategy do not distinguish between levels of strategy
or focus of strategy, making the term strategy both too broad and too inclusive.19 And it is often
not precise; using additional adjectives (“operational” strategy; “grand” strategy, “national” strategy,
etc.) as well as words referring to the specic connotations of strategy might be useful.
◦Problem of substance. There is a tendency to talk about strategy as “goals” or list of “good things”
one wants to achieve. But strategy is about setting (realistic) strategic goals and about ideas and
insights that may achieve them (not just listing them). It also is a process that we can shape, and not
just react to. Thus, strategy is a proactive tool. In addition, good strategic thinking may also often
involve thinking about not-so-pleasant things, which do not go away by avoiding thinking about
them.
◦Problem of context and culture. The ambiguity of the concept of strategy itself across dierent cul-
tures and contexts adds to the confusion. For example, the Russian denition of strategy diers
from the Chinese denition. An interesting question thus is: To what extent do their dierences in
denitions reect their style of strategic thinking, and implementation of strategy in the country’s
military?
◦Problem of implementation. Discussion of strategy often assumes automatic implementation of
strategy, or at least doesn’t consider the many barriers to strategy that exist. Those barriers exist
both on our and our opponent’s side and include also bureaucratic behaviors and organizational
rigidities.20
Understanding the nature of strategy and the importance of strategy in national sec urity involves
examining these problems and issues. A good, broader denition is also important for getting the strategy
right later in the process of implementation and for a good understanding of the strategic situation that
one is in. Extending and elaborating Mattis/Chandler/Andrews view on strategy as essentially being
about connecting goals, ends, and means, we suggest understanding strategy as:
The dynamic process of identifying, creating, and exploiting asymmetric advantages that can be used to create, achieve,
or improve sustainable competitive advantages. Strategic thinking is about looking for possible current and future asym-
metric advantages that can be used to achieve or improve our competitive advantages in the long-term competitive
situation. As a central part of this, we must understand how the organizational characteristics of ourselves as well as
our competitors both contribute to facilitating as well as creating obstacles to strategy; and we must understand how
cognitive, psychological, and cultural factors inuence the decision makers in and among the organizations.21
In such a strategic organizational-process framework, strategy is inuenced by a variety of factors
relating to the strategic competition, including the role of opponents, the basics of human nature and
decision making, and technology. Schlesinger, although trained as an economist, was keenly aware of
the importance of these factors in strategic thinking and analysis, just as he was of the diculties and
limitations. Thus, it is important to keep in mind also what strategy is not:
!Strategy is not a goal,butanever-endingprocessofidentifyingandcreatingandutilizingasymme-
tries; of gaining insight into and understanding of the opponents’ cultures, histories, and psychol-
ogy, and of the shaping of the competitive environment.
!Strategy is not a wish list and it is not always pleasant; but thinking through why we cannot accom-
plish everything or solve all the problems in the world is essential part of strategy, too. A key feature
of strategy and strategic thinking is that it deals with uncertainty, rather than trying to repress it.
The future is unknowable, but it is not unimaginable.
!Strategy is not easy,butitisnotimpossibleeither;itismessyandacontinuingprocess,notarational
plan. Therefore, strategies are often emergent in nature. Strategy often deals with structures (orga-
nizations), patterns, and institutions that are relatively stable. Ideas from business strategy seem
possibly useful in understanding strategic issues in the security context, too.
COMPARATIVE STRATEGY 279
Despite all these diculties, conceptual as well as practical, it is important to note that strategy is
dicult, but not impossible. In fact, when thinking about strategy as being about organizations, being
mostly developed by and implemented in organizations, there is much we can learn from looking at
strategy through an organizational lens.
3. The interconnectedness of strategy and organizational behavior
“There was the growing interest in organization theory. …Simon and March’s Organizations was out, then there
was subsequently Cyert and March’s ABehavioralTheoryoftheFirm.…For me, this [literature] was a revelation
on the road to Damascus; and the concept that organizations satisce, rather than try to maximize anything, was
central”—James R. Schlesinger (personal conversation, September 2009)
So far, we have mentioned the importance of understanding that most strategies take place in orga-
nizations. Here we elaborate some of the aspects on how organizations impact strategy.
The realization that much of strategy and strategic thinking is essentially organizational in nature,
and therefore that the competition and our thinking about strategy can be seen as one between systems
of organizations, is important for at least the following (partly overlapping) reasons:
!First, understanding the behavior of an opponent who is a nation, or a group within a nation, is best
understood in terms of it as a collection of organizations, each with dierent individuals, rational-
ities, cultures, rules, systems, hierarchies, and so on.
!Second, our own structure and behavior also can be viewed as a system of organizations. In partic-
ular with regard to bureaucratic processes and decision making, this can put barriers on our ability
to think and act strategically.
!Third, the fact that we are dealing with behavior of nations-as-organizations (and not nations-
as-individuals) has both a positive and a negative side. On the one hand, it makes some aspects
of the behavior relatively stable and (therefore) predictable, which makes it possible to under-
stand some likely future security issues. On the other hand, it complicates issues regarding the
implementation and execution of strategy, because of the bureaucratic politics and processes of
organizations.
!Fourth, the changing nature of competition (in business as well as warfare) may make necessary
certain changes in the organizational structure and decision-making processes in our military orga-
nizations. But organizations, in particular large organizations, do not adapt well to change, exter-
nally or internally. Organizations also tend to get stuck in certain “competency traps,” which may
have proved relatively ecient during a certain period, but may not be appropriate for current or
future competitions.22
To some extent, the organizational nature of strategy was naturally built into the eld of business strat-
egy and strategic management in the business domain from the beginning (although that eld was devel-
oped after the early works in military strategy). For example, in the 1930s, Chester Barnard (then a top
executive at AT&T) introduced the idea of managers being aware of “strategic factors,” which depended
on “personal or organizational action.” The realization of the need for a formal approach to business strat-
egy based on thinking through strengths and weaknesses rst arrived with Alfred Sloan (then at General
Motors) developing a strategy that was based on perceived weaknesses of the competitor of General
Motors, Ford. In addition, several organizational mechanisms and specic insights into the nature of
decision making in organizations were developed in the 1950s and 1960s in the behavioral research of
Herbert Simon, James March, and Richard Cyert. Several of those ideas are relevant to thinking about
strategy and strategic management in a national security context, including: understanding the charac-
teristics of decision makers in organizations, understanding the characteristics of the competition, seeing
organizations as systems of coalitions and conict, and understanding the importance of activities and
competencies in organizations.23 Understanding these organizational aspects of strategy can help get a
good diagnosis and understanding of one’s situation, of competitors and of the competitive environment,
of developing realistic strategic goals (and implementing them), and of the potentials for creating and
maintaining a competitive advantage.
280 M. AUGIER AND A. W. MARSHALL
A. Characteristics of decision makers in organizations
Herbert Simon pointed out the important role of human nature: “Nothing is more fundamental in set-
ting our research agenda and informing our research methods than our view of the nature of the human
beings whose behavior we are studying.”24 Many models of strategic interaction rely on the assumptions
that human beings are rational (with the underlying idea of decision making as being about self-interested
human beings (with a well-ordered set of transitive preferences) and are assumed to act purposefully
in order to optimize their subjective utilities). This takes place in a free (and institution-less) market
where agents can make the “best” decisions according to their self-interest. Such a way of thinking has
been applied to economics, strategic management, political science, international relations, and other
areas. And with similar results; despite its possible analytic elegance, if we approach the world from the
point of view of only one model or way of thinking, we will leave out important parts. The rational
perspective denies the existence of irrational, random acts and biases; mistakes and regrets are all vio-
lations of the concept of rationality, although that is precisely what observations tell us about human
behavior.
One of the most fundamental assumptions of a more realistic conception of behavior (and thus, of
strategy) is built on the idea of bounded rationality, which was rst introduced in Simon’s critique of
the assumption in economics of perfect information and unlimited computational capability. Limited
rational decision makers give rise to all kinds of biases and behaviors (such as satiscing, routines, and
search) that are better understood in an adaptive (not rational) framework.25 The scholarly work on lim-
ited rationality and organizational behavior pioneered at Carnegie by Simon, March, and Cyert in the
1950s and early 1960s underlies much modern work in strategic management (at least in the evolutionary
and competence-based traditions), as well net assessment, the strategic framework in security originat-
ing from Andrew Marshall’s work at RAND with collaborators.26 Thus, understanding the behavior of
organizations—ourown as well as other’s—needs to be grounded in understanding of the limits of ratio-
nalities, and the processes, strengths, and weaknesses of the bureaucracies and organizational structures
involved.
In addition to being shaped by their limited-decision making capacities, people in organizations and
organizational settings are shaped profoundly by their historical, cultural, psychological, and even bio-
logical prehistories and backgrounds.27 Understanding how national, organizational, professional, and
other cultures and histories shape behavior is dicult but important to understand strategy, organiza-
tions, and the strategic processes within and among organizations. The irrationalities and rationalities of
the decision makers maybe very dierent from ours, and dependent on the opponent’s own histories and
culture.28 The history and culture of the French, for instance, is very dierent from that of the Russian or
the Chinese, as most histories and cultures in the world are. The dierences in the histories, psychology,
and cultures of people have inuenced the nature and decision making of the strategies of their organi-
zations as they do on all other organizational and social aspects of society.29 It seems therefore likely that
at least some of the patterns and routines of strategic interaction are embedded in the way organizations
behave (in both business and government); and thus learning more about how cultures inuence, for
instance, the styles of negotiation, concepts of strategy, perceptions of the environment, and other key
issues may help us not just understand how other decision makers and organizations behave, but also
how our own strategies may be inuenced in global interactions as well as our opportunity to shape them.
B. Characteristics of competition
The nature of the competition has changed during the last decades, and not just because of forces of
“hyper-competition” and globalization. During the Cold War, the competition was relatively simple:
bipolar, two big players, and even though we didn’t know everything about them we knew a lot more
about their behavior than we do about many current competitors. Today, the competition is increasingly
complex, with multiple players and opponents and, as a result, more complicated alliances and dynam-
ics. In military organizations, there has been a tendency to lose the strategic focus and get xated on
COMPARATIVE STRATEGY 281
short-term goals (often conicting ones). Another general characteristic is that organizations have
become more complex, and their interaction less about big hierarchical organizations to more decom-
posed, exible, and uid ones. This illustrates that strategy and strategic thinking is a never-ending
process; even seemingly “sustainable” competitive advantages are often temporary. It is a process of
“evolution with design”: trying to adapt while at the same time shaping the environment to sustain and
build one’s future competitive advantages.
C. Organizations as systems of coalitions with conicting goals
Limited rationality does not mean that all action is unintentional or that behavior can’t be driven by
goals—just that it isn’t goal driven in any optimizing sense. Another feature of the organizations who
interact in the strategic competition is that they are best understood as systems of coalitions of dierent
actors and dierent (and often conicting) interests.30 This applies to both our own and our opponents’
organizations; thus, understanding the composition and conicts in competitor organizations can be
a central element to opponent analysis. Again, the nature and sources of conicts in organizations in
our opponents can be quite dierent than ours. We must not assume that their (ir)rationalities, goals,
and conicts are the same as ours. Moreover, decisive (strategic) leaders can make a dierence in the
management of organizational conicts and in the setting and execution of strategic goals.31
D. Activities, competencies, and strategic t
The fundamental aspects of strategic behavior and decision making also inuences the nature of activities
and competencies in the competition. An insight from the business strategy domain is that achieving “t”
between activities is important for competitive advantages and that better t helps in making competitive
advantages more enduring (or rather, making the continuous creation and looking for ways to maintain
competitive advantages a continuing process). In the military competition, others’ weaknesses are often
rooted in opponent’s organizational dimension, and since they present potential strategic opportunities
for us, it is important that we understand as much as possible the behavior of other nations and people
and cultures.
An organization that has superior performance relative to its competitors has a competitive advan-
tage, but as organizations and their environment change, past competitive advantage is no guarantee
for future ones. Organizations may lose competitive advantages, for example, if they fail to adapt to the
changes in the competitive environment, technologies, and internal organizational issues, or if they try to
do too much or set unrealistic strategic goals. Diversifying into products, competencies, or competitions
that are too far unrelated to its core competencies, for instance, may lead an organization to fragmenta-
tion of its competencies and capabilities. This can be dicult in practice for both business and security
organizations. Strategic managers and leaders may want to grow the organization beyond its core com-
petencies, and it can be tempting to compete in areas where we may not have a natural competitive
advantage (which would be harder to sustain if one is achieved temporarily). Sometimes organizations,
to be competitive, have to do less; thus, strategy is also about deciding what not to do.32
The organizational nature of strategy is also a double-edged sword. While viewing the strategic com-
petition as one between organizations makes them in principle more understandable and predictable
(we can pay close attention to the patterns of behavior and rules and routines of organizations), the
people doing strategy are themselves embedded in organizations, which creates diculties when execut-
ing strategies and strategic change. Understanding that you are in an organization means that strategic
options are limited and not all strategies are open to you. There are important aspects in which organi-
zational behavior interacts with both the conception of appropriate strategies and facilitates—but also
imposes limits on—the feasibility of carrying out those strategies.
Using these organizational aspects of strategy as building blocks, we can outline a strategic
organizational-process framework for thinking about strategy, a framework which Schlesinger con-
tributed to both intellectually and institutionally.
282 M. AUGIER AND A. W. MARSHALL
4. Elements of a strategic organizational-process framework for thinking about strategy
The framework that became known as “net assessment” as a framework for strategy shares many of the
intellectual foundations and roots of some of the dynamic, behavioral, and evolutionary perspectives
in (business) strategic management, including the emphasis on limits to rationality, the importance of
organizations, decision making, and cognitive and computational constraints. It takes one (or a few) more
steps further into the interdisciplinary domain than many business strategy perspectives, recognizing the
centrality of the psychocultural nuances and dierences in the players in the strategic competition.
These aspects were also important to Schlesinger’s approach to defense and defense strategy at least
since the early 1960s, when he came to RAND.33 Educated at Harvard (Joseph Schumpeter was one of
his teachers), he taught at the University of Virginia (1955–1963) before coming to RAND, spending his
rst summer there in 1962. Schlesinger began working as Marshall’s research assistant in the economics
department, but his mind was already much broader than those of most economists, and Marshall and
Schlesinger’s conversations quickly expanded to discussing ideas from zoology and cultural anthropol-
ogy; Robert Ardrey’s work was particularly important to him early on. He also was interested in the
emerging work on psychoanalysis (a topic later developed by Nathan Leites, whose work Schlesinger
greatly admired and had known already before he came to RAND), and in issues such as perceptions
and the inuence of music on troop morale.34
A key step on the path toward incorporating organizations into thinking about strategy was Marshall’s
early interest in the behavior of organization (and the organizational behavior literature) and how aspects
of organization’s behavior relate to their strategy. Thus, the ideas from the eld of business strategy and
its organizational roots were almost built into net assessment from the start. Later, Marshall (along with
James Roche) also explicitly examined, in several memos, the potential use of some of the business strate-
gic ideas for defense strategic planning. This insight didn’t occur overnight, and steps in the evolution of
this perspective included the following.
The rst was work with Joseph Loftus on how to improve estimates of the Soviet Union. It started as
discussions at RAND, with Loftus and Marshall being frustrated that the disciplinary-minded colleagues
estimated Soviet capabilities based on (rational) theories of Soviet behavior, rather than on data about
them. Loftus and Marshall realized that a better way to think of the Soviet Union was as an organiza-
tion (as opposed to a rational planner)—or a set of organizations—with decision makers having limited
rationalities, and the organizations having certain characteristics and organizational and bureaucratic
constraints. They continued their conversations and developed several papers on the topic. Schlesinger
joined these conversations, too, and recalled in looking back, “they [the political scientists at RAND]
refused, absolutely refused, to look at what the Soviet Union was actually doing” (personal conversation,
September 2009). Central to the approach they found more useful was an ability to understand the think-
ing and behavior of opponents and their organizations, and try to analyze the most likely reactions to
decisions and events. (There are of course many uncertainties and ambiguities involved, but not trying
to understand the world through the opponent’s eyes is a rst step to getting it wrong).
Second, over the next decade, this rst step and realization that insights into estimates and capabilities
of opponents could be improved through trying to build on the studies and literature on organizational
behavior and decision making in organization quickly became a key intellectual focus for Marshall. He
presented this to the RAND board of trustees35 and organized several discussions on the topic, inviting
scholars such as March, Bower, and others to join. He also organized another set of discussions with a
group of people with Graham Allison as rapporteur. Marshall also worked on developing the conceptual-
models framework, and in particular the organizational-process model to better understand intelligence
estimates, the interaction of U.S. and Soviet military postures, and arms-negotiations issues.36 Emphasis
here was on the importance of treating political-military actors as organizations or collections of orga-
nizations, rather than as individual decision makers, and to take seriously their organizational character.
In particular, they introduced the organizational-process model, which grew out of Marshall’s work with
Loftus, and developed a three-part argument: rst, that analysts of international relations often think
about the competition in terms of conceptual models/frames of references, which signicantly inu-
ences what they think; second, that most analysts tend to explain the behavior of national governments
COMPARATIVE STRATEGY 283
and their organizations (such as their military establishments) in terms of a rational framework, the
“rational policy model”; and third, that their alternative conceptual model, the organizational-process
model, added additional explanatory power.37
While the focus on organizations did not stay central at RAND, it did stay central in the ideas and
work of Marshall and Schlesinger when they moved to Washington in the late 1960s, and remained an
important foundation for net assessment and in the work they did when Schlesinger later was Secretary
of Defense, as well.
An early explicit articulation of the organizational view in terms of strategic framework was
Marshall’s paper titled “Long-Term Competition with the Soviets: A Framework for Strategic Analy-
sis.”38 The starting point of the paper is the competition with the Soviet Union: how to understand the
nature of it, how to understand them (the Soviets), and the importance of development of a strategy
for the long-term arms competition between the United States and the Soviet Union. Given the existing
and continuing strategic-arms competition with the Soviet Union, Marshall developed a framework for
(a) assessing the nature of the strategic competition, (b) clarifying the goals of the United States, and (c)
developing a strategy for ecient competition. The belief was that such a framework and the implied
ability to analyze programs to improve the U.S. strategic force posture would have several potential
payos, including helping to rebut arguments against programs that would focus on strategic stability
as the main U.S. goal, providing a basis for developing improved policies for R&D procurement and
raising the issue of how well the U.S. was really doing in the competition with the Soviets. It was an
extension of the earlier work,39 an extension that explicated the organizational aspect as well as the
long-term perspective, emphasizing that the strategic competition was likely to extend a decade or more,
and raising questions about how to build strategy on one’s natural, enduring strengths and exploiting
enduring weaknesses and vulnerabilities in the competitor.
Moreover, Marshall and Roche wrote a paper in 1976 titled “Strategy for Competing with the Soviets
in the Military Sector of the Continuing Political-Military Competition.”40 It drew on the existing con-
cepts of business strategy at the time, as well as Marshall’s earlier work, urging a longer time horizon,
setting up longer-term goals or aspirations for the competition, and taking into account Soviet strengths
and weaknesses and the organizational nature of their decision making. It also noted that strategy isn’t
(and should not be) the same as strategic planning, although it could potentially be very useful for the
strategic-planning processes.41
Having discussed the nature of strategy and why it is dicult, and presented elements of an organi-
zational perspective, we turn to some implications for the education of future strategists.42
5. Some thoughts about the education of strategists
Good strategy often (if not always) begins with good strategic thinking. Being able to think dierently
and generate new ideas within organizations is not just a question of how smart or bright people are;
they also have to be people who can see things perhaps a bit dierently, can understand that the impor-
tant issues usually are interdisciplinary (and often involve various economic, political, organizational,
cultural, and social elements), and can be abstract and think about the big issues and big questions.43
Natural questions to ask when discussing the nature of strateg y and considering examples of strategies
is: How does one become a good strategist? How much of strategic thinking can be taught? What is the
role of education, training, and the institutional environment in the development of strategists?44 These
are not easy questions and are related to the fundamental diculties in dening strategy (discussed ear-
lier). But, seeing strategy as being about the ability to create, identify, and utilize asymmetries to develop
competitive advantages in the long run, one can point to at least some generalizable traits, or ways of
thinking, that seem to be helpful when one tries to do strategy and strategic thinking.
A. Living the questions: The role of uncertainty
First, strategists/strategic thinkers must be able to live with (and through) uncertainty and ambiguity.
This might make traditional disciplinary-minded scholars (as well as policy people) uncomfortable, as
284 M. AUGIER AND A. W. MARSHALL
there is often a desire to model, predict, and put the world into models. But human nature does not
t optimizing models, as Herb Simon and Herman Kahn long ago argued, so a key requirement for a
strategist or strategic thinker is that he must be “comfortable being uncomfortable,”; comfortable not
knowing where the analysis is going to lead, and be willing to explore all alternatives, even create new
ones. A strategist must explore the questions, since only then can he remain open to understand, adapt to,
and maybe even anticipate some of the developments in the strategic environment. Pursuing questions
from roads less traveled and unusual angles may also help us understand issues or areas that are otherwise
neglected, yet important: the parts of the future that people are inclined to ignore or pay insucient
attention to.45
B. Focus on diagnosis (and long term), not on policy (and short term). And be open to
being wrong
Afocusondiagnosis,notprescription,isacentralelementofstrategy/strategicthinking.Ifwefocus
on prescription or on generating answers, our ability to conduct strategic analysis suers on several lev-
els, from disabling us from understanding what might be the real central problems in the long run (as
opposed to some aspect of it we want to solve in the short run), and corrupting the analysis due to
the biases inherent in trying to be prescriptive. Focusing on the questions and insights generated from
the data also may help avoid the bias of thinking that the one perspective that is right is one’s own. As
Schlesinger noted: “The most damaging forms of bias spring from an honest, if misguided, conviction of
the correctness of one’s own views.”46 Astrategicfocusmustincludeunderstandingandrespectingthe
dierences in societies and cultures (and the asymmetries they imply) that have evolved over centuries,
rather than trying to “strategically export” certain models of the world which do not themselves easily
“transplant.”47 Additionally, focusing on the questions invites learning and adaptation, making strategy
adaptive to change as well as able to create change. A willingness to learn from failures (not repress them)
also helps.
C. Being empirically driven
Avoiding bia s c alls for tryin g to und erst a nd the p roblems and the is sues f rom di ere nt sid es and p e r-
spectives. Herb Simon called for an empirically driven microeconomics, one that was behavioral and
informed by real-world problems.48 Strategy, too, needs to be behavioral and empirically driven. This
may be very dicult today, as most minds often operate mostly in terms of one or a few related
disciplines—not trying to bridge, say, economics with cultural anthropology and demographics and psy-
chocultural neuroscience.49 When we look at strategic competition, for example, it is important to under-
stand not just how we view it, but also how other cultures and countries perceive it. What aspects do they
focus on in their long-term strategies? What are the aspects they are paying attention to?
D. Being interdisciplinary
Thinkers such as Herb Simon and Herman Kahn also reminded us that real-world problems don’t t any
one discipline very neatly, and thus our analytic frameworks and tools should be interdisciplinary if we
are to understand the issues (not just the parts of the issues and problems that t a particular discipline
or two). That is not the same as “everything goes” or being undisciplined; we need intellectual struc-
tures for what we do. That was how Marshall and Schlesinger came to see the importance of research
on organizational behavior as well as the evolutionary and psycho-cultural perspectives. Thinking of the
strategic competition in the 1950s, the question of the competition between the United States and the
Soviet Union could be seen as a competition between organizations, or sets of organizations, both mili-
tary and industrial. Thinking of the literature in that area lead to March, Cyert, Simon, and Crozier, and
this became an important foundation stone for the long term-competition framework, mentioned above.
In addition, Schlesinger and Marshall were already reading books such as The Territorial Imperative and
COMPARATIVE STRATEGY 285
works by Mead and Benedict. The limited rationality that March and Simon wrote about was further illu-
minated in the cultural and evolutionary psychology literature; people have evolutionary histories and
programmed behaviors. In keeping with this perspective, when Schlesinger was Secretary of Defense he
had Herbert Goldhamer and Nathan Leites do research on topics such as perception of foreign leaders,
knowing that it is not just important what we think of the world (and our theories of how others behave),
but also what the world thinks of us through their eyes. What opponents do and how they think is key.
Each of these features that we nd essential for strategists/strategic thinking may not be so rare. For
example, several business school scholars and intellectual communities have as part of their intellectual
DNA some emphasis on empirically driven analysis and the need to use a few dierent disciplines to
understand real-world issues.50 But for the future education of strategists, it is important to go beyond
the traditional interdisciplinary approach of using, say, economics and psychology, or sociology and
organization theory, in addition to crossing the boundaries that sometimes exist within the business
school subdisciplines. This is extremely dicult as we are all biased, consciously or not, toward certain
perspectives; human nature naturally prefers certainty not uncertainty. Yet, strategy and strategic change
requires not just thinking outside the box but also the invention of entire new boxes, categories, and ways
of thinking.51
RAND
Given the diculties of strategy and strategic thinking, it may be useful to mention briey one institution
successful in generating strategists.52 RAND was a result of the post-WWII era. It came about through the
recognition of the need for a group of scientists working full time on military matters in peacetime, which
shortly after was constituted as a nonprot corporation. At RAND there was a sense early on of working
on important strategic problems in a unique organizational setting, where ideas and thinking mattered
more than titles and “expertise.” Nobel Prize winners as well as graduate students were encouraged and
valued for what they contributed to the discussions. There was also freedom to work on the problems
and issues that RAND felt were important, and a set of important organizational leaders who helped
create a unique environment conducive to the mentoring of strategic minds.
For a few decades, RAND was a unique collection of engineers, physicists, mathematicians,
economists, statisticians, and others interested in solving complex decision problems through systematic
application of mathematical tools, including statistical decision theory and game theory. RAND oper-
ated under the premise that military problems did not conform to disciplinary boundaries and did not
often t a particular academic category very neatly. Frequently, once employees began research projects,
the projects would migrate through several departments, involving researchers of dierent skills. RAND
became a major source of ideas, particularly about systems analysis and economics, some of which would
prove applicable to issues in management, defense, and organizations ranging from the Pentagon to the
University of California.53 However, the growth of systems analysis (and RAND) was a mixed bless-
ing for strategy and strategic thinking. Analytical methods have been rened, but often at the expense
of understanding the important questions and issues. Another danger with systems analysis was that it
focused often on certainties, assuming away key uncertainties in the situation.54
Other approaches trying to deal with the uncertainty of the future (and with trying to improve strate-
gic thinking) included role-playing games and simulations, involving some of the earliest computer-
based simulations. A key point with the early games was to focus not on the certainties but on the
uncertainties of the future. Modern versions of this type of work range from advanced computerized
war-games to scenario planning—although the approaches that have most in common with the early
RAND spirit are those that are empirically realistic (but perhaps not scientically or methodologically
fancy)—such as table-top games. In business, the tools of scenario planning also seem to capture the
thinking-through of improbable, but not impossible, futures. Other methods at RAND included detailed
content analysis and psychocultural approaches, many of them central to Schlesinger at RAND and after.
Thinking more strategically is related to how to get people to think dierently and live the questions,
not focus on the answers. It can be encouraged through things like games and simulations where players
get exposed to views they may not otherwise have. One can try to foster organizational change and
286 M. AUGIER AND A. W. MARSHALL
strategic thinking by nudging people to think dierently and more strategically. But as organizations
age and grow, as “received wisdom” grows, that becomes more and more dicult due to a variety of
issues ranging from bureaucratic encrustation, time-sheet mentality, and (aging) organizations attracting
people who are less and less inclined to work for the ideas.55 DARPA has tried to counter some of these
mechanisms by building in time limits on managers, and other things.
Another way one can hope to facilitate better strategic thinking is careful attention to the concepts
used. Words and categories are important, and inuencing the ones people use can be important tools for
encouraging and initiating change and strategic thinking within organizations. One can also stimulate
strategic thinking through detailed examination of cases and historical studies. For instance, exploring
how major changes in the conduct of war has actually occurred, especially changes in operational con-
cepts and organizational arrangements. Looking at examples or cases of big strategic and organizational
changes may help people understand that big changes can happen (although it is dicult and many forces
are against it); that it takes time and it is important to adapt to changes in the strategic competition and
understand what might happen if one ignores the competitive environment and refuses to change, but
others do change to adapt to new competitive ways. People (and organizations) often gain condence
before they gain competence (and even when they have competencies, they often get stuck doing more
of the same); and it is easy to rely on existing capabilities and ignore the need to change them.56
The absence of institutions like RAND (as it was in the 1950s) is an additional barrier to strategy
and the education of strategists for the future. The absence of a bipolar, cold war environment also cre-
ate additional challenges (as it served in a way as a focal point and seemed to attract and help sharpen
the minds of those inclined to think strategically).57 But it doesn’t mean we can’t try. Our educational
institutions can (and sometimes do) cultivate important elements of strategy and strategic thinking, and
perhaps the future will see smaller think tanks integrating some of the thinking and dynamics of strate-
gic management in business with the issues in security and defense. Successful strategic thinking and
strategies involves leaders who are strategists (not merely managers) and are able to live uncertainty and
think outside the mainstream, so to the extent that we are educating future leaders and strategists in our
existing institutions, we can hope to encourage and instill a sense of strategy in the students.
6. Closing
“National security is the problem of our age. In order to survive, the West will be obliged to combine intelligent
analysis of strategic problems with eective action. It cannot allow its policies to be governed by the appealing but
deceptive catch phrases that currently dominate political discussion of the security issue[s].”—James Schlesinger58
The need for strategic analysis and thinking that Schlesinger pointed to more than sixty years ago is still
very pressing; in fact there is a need now probably greater than ever for a “rebirth” of strategic thinking
and strategy.
One of the challenges to getting the intellectual/analytical conception of strategy right is the many
misunderstandings and misconceptions in strategy. One relates to the ambiguity of the concept of strategy
itself; one often hears discussions about strategy and strategies in which “strategy” seems to be merely a
list of goals or nice things. This is a fundamentally wrong way of conceptualizing (or not conceptualizing,
really) the strateg y process and does not capture the essence of strategic thinking. If we base our strategies
on a fundamentally awed understanding of strategy and the strategic environment, our strategies and
policies for dealing with the competition also become very suspect. In the context of modern warfare as
well as the global business landscape, such misunderstanding can therefore be (very) damaging. In this
article we have tried to sketch out some conceptions, misconceptions, and examples of strategy and to
describe both what it is not and some barriers to implementing it in organizations, using examples from
both business and security. Although neither a comprehensive theory of strategy nor a blueprint for how
to think strategically, we tried to discuss some of the dimensions and concepts relevant to understanding
strategy. It is our hope that explicating some insights and ideas relevant both to business and military
strategy might be a step toward improving our understanding of the nature of strategy (and also, by
implication, the education of future strategists).
COMPARATIVE STRATEGY 287
To sum up, the kind of strategic thinking we suggest does not build on just one or two disciplines,
an important point for our institutions trying to educate future strategists. Strategic management in
business took omostly from economics (adding organizational behavior insights early on). Strategy
in international aairs often builds on political science/policy perspectives. To paraphrase Schlesinger,
many academics and policy scholars are notinterested when problems stray beyond disciplinary bound-
aries, thinking (or saying), “not my eld”; or, just as unconstructive, when they view just the parts of the
world that do t their disciplinary lens.59 But the framework for strategy that is needed is much broader.
It does use certain ideas and insights from economics, organization studies, and strategic management—
but also many more insights and ideas from other areas and disciplines including psycho-cultural studies
and biosocial anthropology.60
If we are to be able to do strategic thinking and develop strategies, we must not let disciplinary
(or political) boundaries determine how to think.61 Rather, it is the nature of people, organizations,
countries, and cultures, and how they behave and make decisions, which underlie real empirically
driven interdisciplinary strategic thinking. Although such an interdisciplinary and empirically driven
perspective goes against the centripetal forces inherent in most disciplines, for the long-run develop-
ment of strategy and the education of future strategists, we believe it is quite central. Herb Simon saw
the development of science as the collection and eventual synthesis of dierent models and methods.
“This,” he said, “has been the path of development of even the most successful of the sciences.”62 And,
we hope, this can also be a basis and a path of development for successful strategic thinking and strategy
and the education of strategists in the future.
Acknowledgements
This article grew out of discussions (in particular with Jim March and Jim Schlesinger) about the organizational aspects
of strategy and on the organizational dynamics of institutions conducive to the development of strategic thinkers. One of
our greatest strategic minds, James Schlesinger, passed away recently, and we would like to dedicate this article to him.
He always had a very good understanding of strategy, and in particular how organizations could both help and hinder
strategy and strategic change, and the inescapable organizational nature of strategy that is easy to overlook in the quest
for rational analysis, yet so central to understanding the dynamics of the development of strategy. We are grateful to Steve
Lambakis and Ann Schlesinger for comments on an earlier draft.
Notes
1. In the article, we use examples and illustrations mostly from the national security area; but with some ideas and
concepts also from business strategy/strategic management. There is clearly room for more cross-fertilization of
ideas between business and military strategy.
2. James Mattis, “Statement of James N. Mattis before the Senate Armed Services Committee,” January 27, 2015,
https://www.armed-services.senate.gov/imo/media/doc/Mattis_01-27-15.pdf
3. This oftentimes, if not always, begins with diagnosis and insight. See an excellent discussion of this is in Scooter
Libby’s (and collaborators’) recent examination of French strategy, and in particular the vision and insight of Duke de
Choiseul during a period of French grand strategy (1758–1783). Thatis a part icularlygoo d example of the importance
of insight, diagnosis, long-term vision,andbroad general strategy.Itbeganwithaninsightrunningcountertothe
general French view (paying attention mostly to continental opponents) that the real challenge in the longer run was
the English (who also had reducing French power as a strategic objective). From this insight and diagnosis that the
English were the central strategic problem, Choiseul observed that to compete with them in the long run, France
needed to build up its navy; upgrade the equipment on its ships; develop an alliance with the Spanish; and remain
competitive economically through trade. The French also understood that the American colonies in the longer run
wanted to detach themselves from England, and that it would be something the French would want to help encourage
as well. The resulting implementation took more than a decade, and as it was pursued, the details of implementations
were subject to challenges and changes, but the overall strategic vision remained. (S. Libby, The Art and Practice
of American National Security Strategy: Crafting Grand Strategy for a Weary Superpower [Washington, DC: Hudson
Institute Report, 2016]). Another example of good diagnosis and strategy is the Gerald of Wales advice on how to
conquer Wales, discussed in C. J. Rogers, “Giraldus Cembrensis, Edward I, and the Conquest of Wales,” in Successful
Strategies: Triumphing in War and Peace from Antiquity to the Present,editedbyW.MurrayandRichardH.Sinnreich
(Cambridge, UK: Cambridge University Press, 2014), 65–99.
288 M. AUGIER AND A. W. MARSHALL
4. Business strategy management scholars and practitioners have developed basic frameworks for strategic manage-
ment processes involving such steps, aiming to capture the main stages in strategic management to ensure atten-
tion to internal and external trends, resources, strengths and weaknesses, and so on. Each of the dierent stages
in the process has its own challenges that need to be understood. For example, when getting a good diagnosis
of the situation it is important to not overestimate one’s own strengths or underestimate competitors’ advantages
(given their histories and cultures) in a certain area of competition. And during the steps of implementing strategies,
one must think hard to understand the barriers and challenges that organizations and bureaucratic behavior might
pose. An application to national security is Thomas Mahnken’s discussion of Reagan’s strategy formulation and exe-
cution, “The Reagan Administration’s Strategy toward the Soviet Union, in Murray and Sinnreich, eds. Successful
Strategies.
5. James R. Schlesinger, “The Uses and Abuses of Systems Analysis,” testimony to Congress during conrmation
hearings of James R. Schlesinger to become Secretary of Defense in “Nomination of James R. Schlesinger to be
Secretary of Defense Hearing, Ninety-Third Congress” (Washington, DC: U.S. Government Printing Oce, 1967).
Agooddiscussionofseveralofthepitfallsin(systems)analysisisH.KahnandIMann,Te n C o m m o n P itfall s,RAND
Research Memorandum, RM-1937 (Santa Monica, CA: RAND Corporation, 1957).
6. In other words, many of the central issues relating to strategy and organization do not t academic or disciplinary
perspectives, particular if we really want to understand the complexity of decision making with all its cultural and
psychological aspects, as captured, for instance, by the phrase “culture eats strategy for lunch.” Schlesinger himself
had a very broad understanding of the factors relevant to strategy (including, for example, the instinctual basis of ter-
ritorial behaviors and the inuence of psychoculturalelements; unusual perhaps for someone educated in economics,
but needed for real strategic thinking).
7. Mattis “Statement.”
8. A good discussion of some of these problems is Robert Gates, Duty: Memoirs of a Secretary of War(New York: Alfred
Knopf, 2014), especially chapter 4 (titled “Waging War within the Pentagon”). Also see R. H. Sinnreich, “Afterword,”
in Murray Sinnreich, eds., Successful Strategies, 432–447. The importance of good strategic leaders for the implemen-
tation of strategy is clearly an important topic that deserves more discussion.
9. Sinnreich, “Afterword,” 432.
10. Also, “a strategy” in the national security context might mean that it is a policy to defend certain geographical areas,
or to strengthen our position in the Far East, in which case a strategy seems to mean a “policy” to follow certain
guidelines which our action will follow. Or, a strategy can be a list of broader goals for the future, say, ten to twenty
years; a list of key areas of current advantages and weaknesses, accounting for dierent current opponents or those
likely to become so in the future, and so on.
11. As James Schlesinger noted: “A plethora of...[strategic] objectives has been put forward, as if all could be successfully
and simultaneously pursued. We are urged to advance democracy and all its procedures, human rights, civil liberties,
equality before the law, protection of minorities, self-determination, an orderly world, international law, economic
growth, free markets, privatization, free trade, limits on environmental degradation, curtailment of the arms trade,
prevention of the spread of advanced weapons, etc. The list is almost endless. What is ignored is that some of these
objectives are atly in conict and that all require the careful examination of trade-os ….With so many dierent
objectives and with an inability to focus those means appropriate for achieving a limited set of objectives, now foreign
policy is likely to be shaped by a capricious ow of events—rather than dened guideposts and a careful plan.” James
R. Schlesinger, “Quest for a Post–Cold War Foreign Policy,” Foreign Aairs, 72, no. 1 (1992–1993): 18–19.
12. Mattis, “Statement.”; Aaron Friedberg, Strengthening US Strategic Planning,” Washington Quarterly 31, no. 1 (2008):
47–60.
13. B. Lee, “American Grand Strategy and the Unfolding of the Cold War, 1945–1961,” in Murray and Sinnreich, eds.,
Successful Strategies.
14. There also were serious eorts during the Second World War (and after) to understand competitor behavior and
other cultures at a distance. Some of the eorts (also resulting from closer collaboration with academic institu-
tions at the time) and approaches are captured in Mead’s edited book on studying cultures at a distance, featuring
psycho-cultural and anthropological approaches that were using in getting insights into the behavior of other cultures
(M. Mead and R. Metraux, eds., The Study of Culture at a Distance (Chicago: University of Chicago Press, 1953).
15. There are several limitations, of course, in looking for analogies between business and military strategy and we do not
argue that success in the business domain of a given concept, or practice, or strategy necessarily means success in the
national security context. Among other things, the nature of the competition is dierent; in business, companies do
not kill each other and the nature of conict is dierent. Schlesinger also noted in a recent conversation (September
2007) about the similarities between business and military strategy: “Osama is not Dell,” a point he used to make the
argument that the opponents we face are creating competitive advantages based on cultural and religious asymmetries
that we cannot compete with. The dierences between military and business organizations is an important one, but
there are similarities too, both are about competition between organizations and both are shaped by (and can shape)
the performance of others; and it is those that form the basis for the arguments we make here.
16. Alfred Chandler, Strategy and Structure: Chapters in the History of American Industrial Enterprise.(Cambridge:MIT
Press, 1962), 13.
COMPARATIVE STRATEGY 289
17. Kenneth Andrews, The Concept of Corporate Strategy (Homewood, IL: Dow Jones–Irvin, 1971), 23. These broad def-
initions indicate strategy as being about the long term, about key trade-os, and about deciding what industry the
organization is (or should be) in. Also emphasized by later strategic management scholars such as Michael Porter
(Strategy is “a combination of the ends (goals) for which the rm is striving and the means policies.” Porter, “What Is
Strategy ?” Harvard Bu siness Rev iew 74, no. 6 [1996]: 61–78); and RichardRumelt (“Strategy is the craft of guring out
which purposes are both worth pursuing and capable of being accomplished, and how best to pursue them.” Rumelt:
Good Strategy, Bad Strategy (New York: Crown Books, 2011), 66. In a book that became the foundation for much
of modern business strategy/strategic management, Michael Porter argued that strategy was mainly about relating
the company to its environment by analyzing ve basic structural forces (determining the competitive intensity and
potential for prot), and assessing competitors. Michael Porter, Competitive Strategy: Techniques for Analyzing Indus-
tries and Competitors (New York: Free Press, 1980). Despite Porter’s competitive forces still being used in strategic
management, some business strategy scholars have argued that the (somewhat narrow) analytic focus on (mainly
economic) forces came at the expense of empirical insights taught by the earlier strategy scholars. Joseph Bower,
“The Teaching of Strategy: From General Manager to Analyst and Back Again?” Journal of Management Inquiry 17,
no. 4 (May 2008): 269–275.
18. Robert Burgelman writes: “Strategy has a strong thinking component. Strategic thinking is forward looking and con-
cerned with exploring multiple scenarios, alternatives, and options. …incisive strategic thinking at its best requires
considerable intellectual eort.” Burgelman, Strategy Is Destiny: How Strategy-Making Shapes a Company’s Future
(New York: Free Press, 2002), 4. Henry Mintzberg sees strategy as “a pattern in a stream of decisions” and also notes
that strategic planning “often spoils strategic thinking.” Mintzberg, “The Rise and Fall of Strategic Planning,” Harvard
Business Review 72, no. 1 (1994): 107–114. Mintzberg’s discussion also captures part of what we discussed above: that
strategy is not a list of goals, and that it is not about reacting to other’s strengths or threats (a “threat based” strat-
egy); it is much more fruitful, from a strategy point of view, to be building on one’s own strengths and opponents’
weaknesses.
19. There are levels of strategy for nations as well as for rms and other organizations that are developing strategies.
At the broadest level, strategy would involve all aspects of the competition (political, military, economic, etc.), with
somewhat more conned strategies at lower levels. The fact that there are many levels of strategy (national security
policy, the Department of Defense; and military service levels) and the fact that each level has its own systems of
organization (and budgets)complicates the process of dening, understanding, and practicingstrategy t remendously.
One organizational level’s strategy may be another organizational level’s tactics, and one level’s strategies may impose
goals for which another level must develop strategies to achieve.
20. Robert Gates’s book, Duty, has discussions on many of those political and organizational barriers and how in his
experience they proved very destructive to strategic eorts.
21. While this conception of strategy may be more art than science, part of the strategic competition is amenable to
scientic reasoning, understanding, and approaches. In particular, our denition openst he doorto dis cussingcer tain
key elements and characteristics of strategy that are familiar to the eld of business strategy, including understanding
the nature of the external environment and competitors, the organizational nature of strategy and the need for a long-
term focus in strategy, the importance of strategic thinking and vision, and some elements of the cultural inuences
of organizations and of psychocultural elements on decision making. M. Crozier, (Chicago: University of Chicago
Press, 1964); Lucien Pye and Nathan Leites, “Nuances in Chinese Political Culture,” RAND Working Paper P-4504
(Santa Monica, CA: RAND Corporation, 1970).
22. James G. March, “Exploration and Exploitation in Organizational Learning. Organization Science,2,no.1(1991),
71–87.
23. Schlesinger followed these developments with interest, but also had a strong interest in the literature around the
evolutionary, zoological, and biosocial approaches (early on, in particular Robert Ardrey, The Territorial Imperative
[New York, NY: Atheneum, 1966]), in addition to also the psychocultural ideas, later also exemplied with Nathan
Leites’ work (Nathan Leites, The Operational Code of the Politbureau [New York, NY: McGraw-Hill, 1951]). Marshall
and Schlesinger, in their work in trying to establish a department of organizational behavior within RAND, had in
mind building on the ideas of Herbert Simon, James March and Richard Cyert and Michel Crozier from Carnegie
Mellon University, in addition to work from Harvard Business School, to study organizations and their strategies.
The department was not set up but the vision and ideas stayed with Marshall and Schlesinger and became key to
their eorts in Washington.
24. Herbert A. Simon, “Human Nature in Politics: The Dialogue of Psychology with Political Science,” The American
Political Science Review,79,no2,293–304.
25. James G. March and Herbert A. Simon, Organizations (New York: Blackwell, 1958). Richard Cyert and James G.
March, ABehavioralTheoryoftheFirm(New York: Blackwell, 1963).
26. Andrew W. Marshall, “Improving Intelligence Estimates through the Study of Organizational Behavior,” paper pre-
sented to the RAND Board of Trustees, RAND Corporation, Santa Monica, CA 1968. Schlesinger notes in his discus-
sion of organizations also not emphasizing organizations and treating them as individuals can be a serious fallacy:
“[T]he instinctively anthropomorphic treatment—in which the large organization appears as simply the (presum-
ably) rational individual or small group writ large—is perhaps the most eminent of the intellectual fallacies that
290 M. AUGIER AND A. W. MARSHALL
appear in the debates” James Schlesinger, “Organizational Structures and Planning,” in Schlesinger, Selected Papers
on National Security, 1964–1968 (Santa Monica, CA: RAND Corporation, 1974), 55.
27. Lionel Tiger and Robin Fox: The Imperial Animal (New York: Holt, Rinehart and Winston, 1971).
28. This makes the thinking about asymmetries and weaknesses more dicult, since it requires us not imposing our own
irrationalities on others’ behavior. Yet again, not impossible. It was this kind of thinking that motivated Loftus and
Marshall thinking of the vulnerabilities of the Soviet Union.
29. Crozier, The Bureaucratic Phenomenon; A. George, “The Operational Code: A Neglected Approach to the Study of
Political Leaders and Decision Making,” International Studies Quarterly 13, no. 2 (1969): 190–222. Pye and Leites,
“Nuances.”
30. Herbert A. Simon, Administrative Behavior (New York, Free Press, 1947); Cyert and March, ABehavioralTheoryof
the Firm. James Schlesinger noted this too, e.g., in a 1966 article on “Organizational Structures and Planning,”: “Large
organizations suer from a geometric increase in the diculty of (a) successfully communicating intentions and pro-
cedures, (b) establishing an harmonioussystem of incentives, and (c) achieving adequate cohesion among numerous
individuals and subunits with sharply conictingwills.” Schlesinger, “Organizational Structures and Planning,” p. 66.
31. Sinnreich, “Afterword.”
32. Steven Jobs refocusing on Apple after he came back is an example from business; eliminating several products/areas
and focusing on the few things they did better than other companies and on becoming better innovators based on
those core strengths. In a national security context, Sinnreich (cited above) mentions examples from the national
security context of “strategic overextension,” and the importance of match between competencies and strategic ambi-
tions (and the dangers of escalating strategic ambitions beyond core competencies). A use of the concept of core
competencies to understand changes in the defense industrial base is another example of the applicability of business
strategy ideas to national security strategy, found in the discussion in Barry Watts, “Sustaining the US Defense Indus-
trial Base as a Strategic Asset,” Background Paper (Washington, DC: Center for Strategic and Budgetary Assessments,
2013).
33. It is therefore not surprising that Schlesinger made important contributions to both the intellectual and institutional
foundations for net assessment. Marshall was the main person behind the intellectual foundations as well as insti-
tutional development of net assessment, but has pointed out several times the important role of Schlesinger in both
the underlying ideas and the early institutionalization of the ideas—so it is worth detailing their collaboration a bit.
In fact, at a conference on the past and future on net assessment, Marshall described Schlesinger as the “real father”
of net assessment, a comment to which Schlesinger responded that one would have to take a paternity test for that.
Marshall and Schlesinger shared the central ideas and visions that became embedded in net assessment as a frame-
work for thinking about strategy. They also shared a rare ability to not take credit for things, preferring instead to
“ge t t he wo r k don e .”
34. Schlesinger described his admiration for Leites in an essay from 1989, also noting how Leites was one of the people
who added tremendously to the early RAND organization and culture (James Schlesinger, “Nathan Leites: An Old-
Wor l d F i g u r e i n a N e w Wo r ld S e tt i ng,” in Remembering Nathan Leites: An Appreciation, edited by C. Wolf (Santa
Monica, CA: RAND, 1989).
35. Andrew Marshall, “Improving Intelligence Estimates.”
36. Graham Allison and Andrew W. Marshall, Explanation and Prediction of Governmental Action: An Organizational
Process Model RAND RM-5897-PR (Santa Monica, CA: RAND Corporation, 1969).
37. Graham Allison and Andrew W. Marshall, Explanation and Prediction,v–vi.
38. Andrew W. Marshall, “Long-Term C ompetition with the Soviets: A Framework for Strategic Analysis,” RAND R-862-
PR (Santa Monica, CA: RAND Corporation, 1972). Written while Marshall was the director of Strategic Studies at
RAND, the article was intended to provide a framework for the future directions of RAND’s research on U.S.-Soviet
behavior, and in particular to argue for the need for a long-term perspective.
39. Andrew Marshall, “Improving Intelligence Estimates”; Allison and Marshall, Explanation and Prediction.
40. Andrew W. Marshall and James G. Roche, “Strategy for Competing with the Soviets in the Military Sector of the
Continuing Political-Military Competition,” unpublished paper, July, 1976.
41. Although articulated when the major competition was with the Soviet Union, this way of strategic and organizational
thinking is relevant also to the competitive environment today. For example, the players in the strategic competition
can still be fruitfully viewed as actors who are limited rationally, and who are inuenced by their national and organi-
zational cultures and histories. Several of the chapters in Murray and Sinnreich, Successful Strategies,examineasetof
historical examples which illustrates the importance of organizational aspects in the development, implementation,
and execution of strategies.
42. We are aware of the fact that there may be certain elements of strategy that are very dicult to teach, and that good
strategic thinking may require certain personality traits, and almost certain psychological/temperamental character-
istics, e.g., a passion for really wanting to “win,” not just “get through the next four years without too much trouble.”
But we also believe that even if some parts of strategy may not be taught (easily), people who don’t become brilliant
strategists can improve their strategic thinking (and thus help upgrade the organization’s capacity for strategy as a
whole).
43. Another issue is that there may be opportunity costs; working on long-term big questions may not be career enhanc-
ing or “inuence” things. Of course, one could hope that the people attracted to working on the big problems are not
COMPARATIVE STRATEGY 291
worried about short-term individual gains. Alain Enthoven recalls that a big motivator for him to go to RAND early
on was working on big problems for the country; that was more important than a few publications in economics
journals (Enthoven, personal conversation).
44. This is not to say that all great strategists are shaped by their education (Steve Jobs is a famous example). The military
also has people who become good strategists through their experience, but who are also often shaped by their reading
a lot (and quite broadly). In thinking about strategy as a profession, Marshall noted that a combination of a business-
school background and military service can be useful for the ability to think broadly (Andrew Marshall, “Strategy as
aProfessionforFutureGenerations,”inOn Not Confusing Ourselves: Essays on National Security in Honor of Albert
and Roberta Wohlstetter, edited by Andrew Marshall, J. Martin, and Henry Rowen (Boulder, CO : Westview Press,
1991).
45. In national security, that could be dierent issues, such as: What is the future worldwide maritime balance? What are
the demographic and cultural changes of the next fty years and how is that likely to inuence important balances?
46. James R. Schlesinger, The Uses and Abuses of Systems Analysis,5.
47. Ibid.
48. Herbert A. Simon, An Empirically Driven Microeconomics (Cambridge: MIT Press, 1997).
49. If this sounds like a stretch, consider the importance of understanding the long-term strategic nuclear competi-
tion. Given the proliferation (or “globalization”) of nuclear weapons in the last decades, deterring conicts in that
area depends on issues such as the cultural-psychological traits of leaders in charge of nuclear states, the neuro-
psychological underpinnings of dierent cultures (inuencing, for instance, what they see as a threat, or fear), and
the future economic and demographic features of dierent nuclear actors.
50. Business schools (along with other professional schools) also have a history of a particular way of teaching strategy
through cases, which might be conducive to help nurturing thinking through strategic problems and situations, as it
emphasizes broad empirical foundations for strategic decision making. Thus, there may be lessons from both using
business strategy examples/cases in a national security context and from rewriting national security examples of good
(and bad) strategies in teaching-case format.
51. Some military organizations seem to be quite aware of this, reected, for instance, in the recent Marine Corps com-
mandant’s call for “disruptive thinkers.”
52. A much longer organizational analysis of RAND and its ability to attract strategic minds is in our companion article,
Mie Augier, James March, and Andrew Marshall, “The Flaring of Intellectual Outliers,” Organization Science,26,no.
4 (2015): 1140–1161.
53. See, e.g., Stephen Enke, “Think Tanks for Better Government,” TEMPO Working Paper (Santa Monica, CA: TEMPO,
General Electric Company, 1967); Alain Enthoven and Harry Rowen, Defense Planning and Organization (New York:
National Bureau of Economic Research, 1961); and Charles Hitch, “Management Problems of Large Organizations,”
Operations Research,44,no.2:257–264.
54. H. Kahn and I. Mann, (1957): Ten C o mmon Pit f a l l s RAND Research Memorandum, RM-1937 (Santa Monica, CA:
RAND Corporation, 1957).
55. Augier et al., “The Flaring of Intellectual Outliers”; Robert Gates, Duty.
56. In business, Kodak is an example. In the military, the British Navy did not adapt to the changes in the interwar years.
57. Schlesinger noted how the changes away from the Cold War make it even more important to focus on the long-term,
broader objectives and on shaping the long-term competition, rather than narrow goals that may not be realistic:
“With the end of the Cold War …the world is becoming more rather than less anarchic. There are many trouble spots
in the world; there will be countless more. The United States is not called upon to, nor can it, cure all the world’s
misery. We represent a small—and now steadily shrinking—percentage of the world’s population. Nor are we tem-
peramentally suited to the policeman’s unhappy lot” (Schlesinger, “Quest,” 27). R. Betts also warns that conating
strategy with goals (focusing on “nice outcomes”) or with operations (focusing on “how to” manuals) drains strat-
egy of its content: “[s]strategy becomes whatever slogans and unexamined assumptions occur to them [politicians
and soldiers] in the moments left over from coping with their main preoccupations.” Richard Betts, “Is Strategy an
Illusion?” Inter national Security 25, no. 2:7.
58. James R. Schlesinger, The Political Economy of National Security (New York: Frederick Praeger, 1960), 255.
59. Schlesinger, Nathan Leites,56.
60. While the literatures is less integrated at present, a good start would be the works of people such as Nathan Leites,
Lucian Pye, Ruth Benedict, Margaret Mead, Lionel Tiger, and Robin Fox, which could enrich our understanding of
our own and competitor organizational behavior and decision making.
61. To this latter point, Schlesinger would sometimes note that “we need a national strategy; not a democratic strategy
or a republican strategy” (personal conversation with James Schlesinger, September 2009), urging us to think about
strategy and competitive advantages for us as a country.
62. Herbert A. Simon, Some Strategic Considerations in the Construction of Social Science Models,” in Mathematical
Thinking in the Social Sciences,editedbyP.Lazarsfeld(Glencoe,IL:FreePress,1954),391.
292 M. AUGIER AND A. W. MARSHALL
Notes on contributors
Mie Augier (augier@stanford.edu;meaugier@nps.edu) is associate professor at Naval Postgraduate School. Her research
interests include strategy, organizations, the rise (and decline) of innovative organizations, the education of strategists, and
the past and future of management education and business schools.
Andrew W. Marshall studied at the University of Chicago before joining RAND in 1949, where he did research in the
social science and economics departments for more than twenty years, before becoming the founding director of the Oce
of Net Assessment during the period when James Schlesinger was the Secretary of Defense. He led the oce for more than
four decades.
