Torres, Juan Pablo, Kunc, Martin and O'Brien, Frances A. (2017) Supporting strategy using system dynamics. European Journal of Operational Research, 260 (3). pp. 1081-1094. doi:10.1016/j.ejor.2017.01.018 ISSN 0377-2217.

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Abstract

This paper presents a protocol for supporting strategy development via system dynamics (SD) modeling in consultation with Chief Executive Officers (CEOs) of small organizations; it also reports on the effectiveness of this protocol one year after an initial study was conducted. The protocol was applied in five small organizations; it involves the development of a SD model that is used to generate scenarios of alternative strategic situations an organization may face. We found that when the CEOs identified more feedback loops and causal relationships among key resources through their modeling analyses, they increased their capacities to generate new strategic ideas through more developed mental models. However, those CEOs who were not able to generate alternative strategic ideas to overcome the challenges of scenarios presented during the simulation sessions found it difficult to make strategic decisions when the scenarios occurred one year after our intervention. This finding suggests that SD modeling can affect firm performance when the facilitation process helps CEOs reflect on potential strategic actions that can be taken in the future. When CEOs cannot change their strategic plans by imagining what should be done in a challenging scenario, they are not able to address challenging situations when they arise.

Item Type:	Journal Article
Subjects:	H Social Sciences > HD Industries. Land use. Labor
Divisions:	Faculty of Social Sciences > Warwick Business School
Library of Congress Subject Headings (LCSH):	Business planning , Chief executive officers, Small business
Journal or Publication Title:	European Journal of Operational Research
Publisher:	Elsevier Science BV
ISSN:	0377-2217
Official Date:	1 August 2017
Dates:	Date Event 1 August 2017 Published 14 January 2017 Available 10 January 2017 Accepted 9 October 2015 Submitted
Volume:	260
Number:	3
Page Range:	pp. 1081-1094
DOI:	10.1016/j.ejor.2017.01.018
Status:	Peer Reviewed
Publication Status:	Published
Access rights to Published version:	Restricted or Subscription Access
Date of first compliant deposit:	17 January 2017
Date of first compliant Open Access:	14 January 2019

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