2 - Putting PIMS into perspective: enduring contributions to strategic questions

Summary

This is an opportune time to put the PIMS program into an historical perspective. Not because it is yesterday's news, but in recognition of its continuing relevance. Indeed, it is striking how well the PIMS framework complements contemporary thinking on strategy-making.

This retrospective view also reveals some continuing dilemmas the field of strategy is struggling to address. While PIMS may not resolve these issues, the framework and the cumulative research using the database help to highlight and properly frame the questions.

The sources → positions → performance framework for assessing the competitive advantages (Day and Wensley 1988) of businesses will guide our exploration of the contributions of PIMS and the evolution of the field of strategy. The sources are the resources the firm deploys – their capabilities, assets, and controls – and the strategic choices of markets to serve and competitive positions to pursue. What one sees in the market, from the vantage point of a customer or competitor, is a positional advantage. These advantages can be achieved in a myriad of ways through some combination of lower costs and superior customer value (Markides 2001). These positional advantages should translate into superior performance (growth, profitability, and economic value creation).

The evolution of strategy

Firms have always had strategies, whether strategy is viewed as a choice of competitive position; as a collection of rules; as stretch and leverage; as intent; as the embodiment of a firm's values, or in other ways (Markides 2001).