Corporate strategy as plural rationality

Abstract

Conflicting model-based prescriptions for strategy are viewed from the
 perspective of the extended general theory of rational decisions. The
 conflicts are re-cast as general meta-rational arguments and this
 perspective yields diagnostics for evaluating strategy-models. There
 follows a quite radical re-formulation of the prescriptive dimensions of
 strategic-management, such that the general theory of rational decisions
 is seen as the latent prescriptive theory of strategy. In "Strategy as
 Rationality" the strategic-entity (individual, group, organization,
 network, etc.) is cast as a plurally-rational agent, with rationality
 informing strategy and vice-versa. Meta-rational and meta-ethical
 arguments then project this new framework into the ethical domain, with the
 stra tegic-enti ty now cast as a moral-agent. The extended framework of
 "Strategy as Moral Philosophy" carries with it further implications for
 prescription in strategic management, whilst is also complements an
 emerging re-integration, at the systemic level, of Economics with Ethics.
 The new conceptual framework is then applied to: (i) the strategic
 mystery of corporate investment decisions with sunk costs, involving the
 set of backward-looking rationalities, (ii) competitor-analysis and
 strategic-intelligence, involving a view of other strategic entities as
 plurally-rational agents, and (iii) capital-budgeting methodologies. The
 latter application prescribes modification and confinement of some
 traditional decision-rules for strategic investments.