Teaching guide: strategic drift

Strategic drift occurs when the strategy pursued by a business no longer fits with the environment around it. What may have been appropriate at one point is no longer suitable as conditions have changed.

Model/theory

Key points

The diagram above by Johnson and Scholes highlights how, as change in the environment increases, the business’s strategy may become increasingly inappropriate.

The business will end up in a state of flux, ie managers are uncertain what to do as they have fallen so far behind the trends in the market. At this point, they must either make major transformational change or the business will probably die.

Examples of strategic drift include Kodak, Nokia and Blockbuster videos.

When you can use this

• When teaching strategy, strategic drift highlights that managers must continually review their strategies to ensure they remain relevant and competitive.
• When considering the importance of anticipating, preparing and reacting to change.