Strategic drift refers to the failure of an organization to respond to changes in its external environment, which includes factors such as competition and market needs (Hill & Jones 2012, pp. 77-98). The main causes of strategic drift include the following. First, it occurs due to strategic incrementalism in organizations. When managers are under pressure to change, they normally adopt strategies that are familiar to them.
This involves implementing incremental change in a piecemeal manner to adapt to changing trends in the external environment. However, incremental change often leads to strategic drift as businesses slowly lose touch with changes in their environment. Indeed incrementalism can be a conservative influence that hinders change rather than encouraging it. Incremental adaptation can also lead to strategic drift since it might not keep pace with rapid changes in the external environment.
Second, strategic drift usually occurs because of the irrelevance of the existing objectives of the organization. Conceptually, strategic objectives are set to enable the organization to respond to the trends in their environment. Thus, if the objectives are no longer aligned to changes in the external environment, strategic drift is likely to occur (Thompson, Gamble & Strickland 2006, pp. 110-156). Third, strategic drift occurs due to a lack of commitment to excellence in the organization. Lack of commitment among employees normally leads to a loss of strategic focus in organizations. As a result, scanning and reacting to changes in the external environment become very difficult, thereby causing strategic drift.
Organizations can avoid strategic drift in the following ways. To begin with, organizations should emphasize the importance of their clients. Customer-oriented organizations constantly monitor social and demographic changes in their communities.
Thus, they can understand shifts in tastes and preferences, which in turn allow them to make the right decisions to provide relevant products. An innovative culture is also needed to avoid strategic drift (Lee & Yu 2008, pp. 340-359). Organizations must create an environment that promotes the generation of new ideas, products, and services to respond effectively to competition, regulation, and preferences.
An effective risk management system should be put in place to avoid strategic drift. Risks that are likely to derail the implementation of strategic plans should be identified and addressed promptly (Cameron, Samwel & Quinn 2011, pp. 23-47). Strategic plans should be flexible to accommodate unforeseen changes in the external environment.
References
Cameron, S, Samwel, J & Quinn, R 2011, Diagnosing and changing organizational culture, Palgrave, London.
Lee, S & Yu, K 2008, ‘Corporate culture and organizational performance’, Journal of Managerial Psychology, vol. 19. no. 4, pp. 340-359.
Hill, C & Jones, G 2012, Strategic management: an integrated approach, Sage, London.
Thompson, A, Gamble, E & Strickland, J 2006, Strategy: winning in the marketplace: core concepts, analytical tools, cases, McGraw-Hill, New York.