A scenario-based alternative to conventional tools for choosing the strategy in turbulent environments
Strategic decision-making is often complex and uncertain, especially in turbulent environments. A large number of frequently conflicting indicators, rapid and unpredictable environmental changes, and the long-term consequences of making a decision have revealed the need for managers to use more effi...
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| Main Author: | |
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| Format: | Article |
| Language: | English |
| Published: |
Ayandegan Institute of Higher Education,
2024-06-01
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| Series: | International Journal of Research in Industrial Engineering |
| Subjects: | |
| Online Access: | https://www.riejournal.com/article_196788_9582f96b56fe7c7bd66061701ad98ca3.pdf |
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| Summary: | Strategic decision-making is often complex and uncertain, especially in turbulent environments. A large number of frequently conflicting indicators, rapid and unpredictable environmental changes, and the long-term consequences of making a decision have revealed the need for managers to use more efficient tools. Today, for tomorrow, conventional tools such as Quantitative Strategic Planning Matrix (QSPM) and MADM help us make the best decision based on yesterday's information. In some scenario planning approaches, the number of scenarios is so few that it cannot represent future uncertainty. In MADM methods, the problem of calculation complexity arises due to the increase in the number of elements. To address these issues, this research proposed an alternative approach for choosing the best strategy in which the alternative strategies are defined by SWOT analysis, future scenarios are determined by applying a matrix approach, irrational scenarios are eliminated by using interpretive structural modelling, and strategies are assessed by implementing Robustness Analysis (RA). The proposed method involves a case study related to a distributing centre for a food and beverage company located west of Mazandaran province, Iran. Nine alternative strategies' performances were evaluated in twenty-two scenarios based on six significant indicators shaping the future environment, and the best strategy was selected. Finally, some directions for future studies were presented. This study provides managerial implications by showing that despite the classic strategy selection approach being appropriate for austere environments and the MADM models being reasonable for complex environments, RA produces more reliable results when dealing with turbulent environments. |
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| ISSN: | 2783-1337 2717-2937 |