Half-Course: Strategic Reasoning Laboratory

Course Number 1225

Associate Professor Giovanni Gavetti
Early Winter, 15 session half course
1.5 credits
Exam
Enrollment: Students may choose the Field Study Seminar version for 3 credits or the Half Course for 1.5 credits

Target Audience

The course is targeted at students who expect to bear responsibility for the overall strategy of a corporation or a business unit, and to students who plan to work as management consultants or in private equity firms.

Course Overview

Major developments are occurring in the cognitive, biological, and social sciences that shed light on how we think. These advances also identify common pathologies in the way we think. Strategy theory and practice are just starting to consider these advances. The course draws from those developments, and seeks to push the frontier of how strategists can use them. Rather than surveying all that is known about cognition, the course focuses on the aspects that are most relevant to strategy-makers - factors that are known to affect the quality of strategic choice and action. Second, the course not only identifies what pathologies typically affect strategic thinking but also specifies "fixes" and tools that strategy-makers can use routinely. Because we are creatures of habit, we need fixes that both counter our cognitive pathologies effectively and can also become habitual.

Pedagogical Approach and Course Organization

The pedagogical premise of the HC: Strategic Reasoning Laboratory (HC: SRL) is that it is hard to understand and improve what goes on in our minds without directly experiencing it. Therefore, as in a typical laboratory, students will directly produce a significant portion of the "raw material" for discussion. That is, through simulations, surveys, written exercises, and traditional cases, students will replicate the reasoning that is typical in strategic decision-making settings. This raw material will then be used as the basis for class discussion.

The Half-Course Strategic Reasoning Laboratory (HC: SRL) is related to the Field Study Seminar: Strategic Reasoning Laboratory. Students who wish to explore a topic in HC: SRL can enroll in the full course, titled "Field Study Seminar: Strategic Reasoning Laboratory." Students enrolled in the Seminar will attend the same 15 class sessions as enrollees in the half-course, but will also complete (individually or in teams) a field-based report. The Field Study Seminar provides an opportunity to work closely with a faculty member.

Course Content and Organization

The laboratory consists of two interrelated parts. The first focuses on strategic choice, and the second on strategic action.

Strategic Choice. This module offers students knowledge and instruments to improve the quality of reasoning that underlies strategic choice. It builds on two premises. First, intuition, pattern-recognition, analogy, and other forms of heuristic reasoning are powerful because they economize on information and time, yet usually provide satisfactory outcomes. Yet there are systematic biases and failures in how we use these cognitive shortcuts. These biases can be damaging, particularly if they become engrained in individuals' mental habits. Second, individuals develop persistent, habitual ways of framing or modeling strategic problems. These habits can be dysfunctional when they inhibit individuals from adapting their mental models to fit changing external conditions. We develop ways of correcting such dysfunctions in this module.

Strategic Action. This module helps students recognize and overcome cognitive impediments to strategy execution. In it, we concentrate first on knowledge management, particularly on the transfer of complex knowledge, as well as benchmarking and imitation. We then explore a central problem of strategy execution: persuasion. Firms often fail to execute strategic changes that depart from the status quo because their top managers cannot persuade the organization that such change is necessary. This difficulty is frequently rooted in the cognitive inertia of an organization's lower ranks, and we will practice with tools aimed to break this inertia. Specifically, we will explore how to use language and communication to change people's minds and accelerate strategy execution.