Strategic Decision Processes in Silicon Valley: The Anatomy of a “Living Dead”

This term has been attributed to Franklin (“Pitch”) Johnson of Asset Management, a Palo Alto venture capital firm.

Chandler Alfred D. , Strategy and Structure (Cambridge, MA: M.I.T. Press, 1962); Quinn James Brian , Strategic Change (Homewood, IL: Dow Jones-Irwin, 1980); Mintzberg Henry Waters James A. , “Tracking Strategy in an Entrepreneurial Firm,” Academy of Management Journal, 25/3 (September 1982):465–499.

Pfeffer Jeffrey Salancik Gerald R. , “Organizational Decision Making as a Political Process: The Case of a University Budget,” Administrative Science Quarterly, 19/2 (June 1974):135–151; March James G. Olsen Johan P. , Ambiguity and Choice in Organizations (Bergen, Norway: Universitetsforlaget, 1976); Lindblom Charles E. , “The Science of ‘Muddling Through,”’ Public Administration Review, 19 (1959):79–88; Janis Irving L. , Groupthink (Boston, MA: Houghton Mifflin, 1982).

Vroom Victor H. Yetton Phillip , Leadership and Decision Making (Pittsburgh, PA: University of Pittsburgh Press, 1973); Gladstein Deborah L. Reilly Nora P. , “Group Decision Making Under Threat: The Tycoon Game,” Academy of Management Journal, 28/3 (September 1985):613–627.

Bourgeois L.J. III Eisenhardt Kathleen M. , “Strategic Decision Processes in High Velocity Environments: Four Cases in the Microcomputer Industry,” Management Science (forthcoming); Eisenhardt Kathleen M. Bourgeois L.J. III , “On Designing Top Management Teams,” Working Paper, June 1986. The results described in these papers are based on a study of 12 firms in the microcomputer industry undertaken between 1984 and 1986. Our intent was to investigate the process by which top management teams make major decisions in fast-paced high-technology industries. Using a multimethod approach, we obtained extensive qualitative data from over 70 executives, including personality descriptions from their colleagues, the frequency and nature of interactions with each other, as well as descriptions of their decision-making sessions in terms of climate, conflict, cordiality, etc. We also obtained extensive data from questionnaires completed by every executive. We measured firm goals, key decision areas, a variety of interaction patterns, political behavior, and power. We also traced the story of the making of a specific strategic decision in each firm from the perspective of every executive involved. Finally, we gathered secondary source data, including financials and business plans, and we observed the executives in meetings when appropriate.

A number of details in the story of Omicron Computer Corporation have been disguised and reflect a collage of the firms in our study whose financial performance places them in the category of the “living dead.”

Wilson John W. , The New Venturers (Reading, MA: Addison-Wesley, 1985), p. 196.

This midrange methods approach attempts to triangulate some of the precision of quantitative research with the insights of a qualitative approach.

The power maps indicate an individual executive's power relative to major decisions in the key functional areas.

Eisenhardt Bourgeois , op. cit.

Lindbloom , op. cit.; Quinn , op. cit.; March Olsen , op. cit.

Vroom Yetton , op. cit.

Janis , op. cit.

Van de Ven Andrew H. , “Review of In Search of Excellence” Administrative Science Quarterly, 28 (1983):621–624.

Cameron Kim S. Quinn Robert E. , “Organizational Paradox and Transformation,” in Quinn Robert Cameron Kim , eds., Paradox and Transformation: Toward a Theory of Change in Organization and Management (Cambridge, MA: Ballinger, forthcoming, 1988).