The Feedback Structure of the Strategy Process and Top Management’s Role in Shaping Emerging Strategic Behavior

We explore the processes that drive firms’ strategic behavior in the long term. In the paper, we generate a qualitative model that provides a conceptual framework to address the mechanisms that explain strategic behavior. In our model, both the concept of feedback and the distinction between stock and flow variables illuminate time-dependent forces and pressures that interfere with the governance of a firm’s strategy process. In particular, we focus on the tension between top-down and bottom-up strategy processes and the role played by top managers in molding emergent patterns of strategic behavior. As a consequence of our theoretical speculation, we elicit a number of constructs to improve the description, and support the analysis, of a firm’s strategy process.