Long Range Planning 41 (2008) 291e308
http://www.elsevier.com/locate/lrp
The Drafts of Strategy:
Opening up Plans
and their Uses
Martin Giraudeau
This paper aims to show empirically that strategic plans may contribute to the emergence
of new strategies, and not just to programming of predefined strategies. It does so thanks
to a novel approach to planning, in which the analyst opens strategic plans, reads their
contents, and studies how business actors use them. This method is applied to the analysis
of Renault’s investment strategy in Brazil in the mid-1990s. The author demonstrates that,
although the planning process may have acted during this investment as a constraint on
innovative strategising, the plans that were produced in order to prepare the investment
were open, creative documents. Thanks to their visual and textual representation of contexts and strategies, these plans enhanced strategic imagination more than they hindered
the conception of new strategies. The paper argues that all plans may play such a role,
depending on how they are written and read. It concludes with recommendations on how
to best read and write plans.
Ó 2008 Elsevier Ltd. All rights reserved.
Introduction
According to Henry Mintzberg, ‘‘plans by their very nature are designed to promote inflexibility e
they are meant to establish clear direction, to impose stability on an organisation’’.1 This paper
aims to deconstruct this conception of plans in two ways. First, it discusses the existence of a single
‘‘nature’’ of plans by focusing on the heterogeneity of corporate plans. Implemented programmeplans can be distinguished from draft plans, which are explicitly designed to enhance debate inside
companies and stimulate strategic imagination. Second, the paper shows how such plans do promote flexibility, depending on how they are written and read. The paper concludes with suggestions
on how to help plans contribute to the design of novel strategies rather than to the entrenchment of
known ones.
This perspective helps to account for the historical evolution of strategic planning practices.
Studies agree that firms still largely resort to planning tools and techniques.2 This goes along
0024-6301/$ - see front matter Ó 2008 Elsevier Ltd. All rights reserved.
doi:10.1016/j.lrp.2008.03.001
with an enduringly high demand for strategic planners on the job market.3 These facts contradict
the supposed ‘‘fall of strategic planning’’, which was claimed by Mintzberg in 1994.4 Our intention,
after so many criticisms of planning, is to shed light on the reasons why planning is still treated by
strategists as a useful practice.5
We do so thanks to a new approach to strategic planning. This approach focuses more closely on
the features of plans as artefacts, and those of managers as craftsmen.6 It takes into account how
business executives devising a plan have to carry out such tasks as writing texts and drawing
sketches, as well as assessing their various drafts, before presenting the ultimate outputs of this production process as definite plans. The issue is, therefore, to understand what degree of strategic flexibility is allowed by plans themselves while they are being made and read. What uses do these
specific artefacts authorise? To answer this question, we propose: 1, to open and read corporate
plans, to scrutinise how they can either enable or constrain action; and 2, to analyse the decisions
that are made once the plans have been presented to senior executives, in order to assess the real
influence of plans on these decisions. This method is based on data from our case study of Renault’s
large-scale investment in its Brazilian operations in the mid-1990s.
Our methodological choice to open the plans and read them along with corporate actors leads to
a demonstration of how strategically open plans may be. We highlight the important role, in the
strategy formation process, of many transient plans, that do have a role in strategy-making although
they are not necessarily used and/or even designed as constraining programmes. The study of their
contents shows that these plans were conceived as supportive tools to help executives represent and
observe possible strategies. In other words, these plans were drafts of strategy. We argue that such
plans contribute to the definition of new and innovative strategies because, as for any kind of draft,
they provide food for thought and imagination.
The openness of plans may take two radically different forms: either implicit or explicit. We demonstrate that closed programme-plans, when read adequately, allow for or even stimulate the creativity of business executives. They do remain open, but in an implicit way. But we also show that
plans may be directly written as open documents, which bring forth and develop original strategies.
In the latter case, the reading of plans consists of an attempt to close down strategies, in order to
make decision possible. These two opposite situations are presented successively in the paper, after
a plea for our revised approach of planning and a presentation of the case study from which our
conclusions are drawn.
Literature review: plans as target for attacks
Corporate strategic planning has become a favourite target for attack by strategy scholars in the past
30 years.
The empirical use of formal strategic planning has been questioned repeatedly. Although a proponent of strategic planning, Ansoff observed as early as 1977 that ‘‘the state of practice in planning systems’’ didn’t exactly prove as satisfactory as planning theorists had first expected: many
firms still didn’t consider formal strategic planning as a desirable method.7 In 1994, in his analysis of the role and place of strategic planning in management theory and practice, Mintzberg
concluded on its historical ‘‘fall’’. Such observations made scholars look for the possible pitfalls
of planning.
Strategic planning was mostly criticised because of its uncertain effects on performance.8 Conceptual critique of strategic planning went in two complementary directions. Planning was accused
of lacking realism, in relation both to present and future contexts. Mintzberg saw a first ‘‘fundamental fallacy of strategic planning’’ in the excessive ‘‘detachment’’ it would foster between strategising
and the other activities of the firm, as well therefore as with its present external contexts. And planning, furthermore, claimed to predict middle or long-term futures, a particularly hard, if not impossible, task.9 Mintzberg formulated this problem as the second fallacy of strategic planning e that
of ‘‘predetermination’’. But it was also argued, on top of this lack of realism, that planning could act
as a brake on strategic innovation. Its fallacious ‘‘formalisation’’ would favour analysis over intuition and make planning contradictory to strategy itself as a creative practice.
292
The Drafts of Strategy
These criticisms of corporate strategic planning oppose two models of action. Mintzberg suggests
this when he appeals to the distinction between ‘‘deliberate’’ and ‘‘emergent’’ strategies so as to justify his critical insights into planning.10 This distinction, which later crystallised into the ‘‘planning’’
vs ‘‘learning’’ controversy, can be summarised as opposing a type of action that would exclusively
follow a predefined plan with an action that would build progressively according to the situations
actors are confronted with. In all situation-based models of action, ‘‘plans are best viewed as a weak
resource for what is primarily ad hoc activity’’.11 But the relevance of these two models for anyone
who wishes to account for strategic planning activities in the business world is uncertain. If one
follows their conclusions, the main explanation for the persistence of planning should be found
in the varied conditions under which firms operate: some firms could plan, while others would
have less ‘‘plan-ability’’, depending on the types of markets they operate in, as well as their internal
organisation.12 Surprisingly for such attempts at reconciliation, conditions, situations, environments or contexts are thickly analysed, but planning is described as having unique, stable
properties.13
Indeed, although studies dealing with strategic planning are innumerable, most don’t actually
analyse strategic plans themselves. Their focus is on the planning process, which is responsible
for the ‘‘detachment’’ of strategic planning from the other activities of the firm. The planning sequence appears to be too rigid, too bureaucratic for contemporary firms in their rapidly changing
environments.14 But this tells us more about the rigidity of predefined processes than about the
specificities of planning itself. On the other hand, the supposedly fallacious ‘‘predetermination’’
and ‘‘formalisation’’ of plans are made stable and exclusively negative properties of plans, without
their actual uses being questioned. But the predetermination of strategies could just as well be considered as an imaginative practice, which could lead to the invention of new strategies. And formalisation may be used as a means to synthesise possible strategies in order to make their collective
discussion easier.
The planning sequence appears to be too rigid, too bureaucratic for
contemporary firms in their rapidly changing environments
Hence the necessity for a closer empirical scrutiny of plans and their uses. This focus leads us not
only, as some authors have tried, to articulate the two (planned and situated) models of action, but
to reject them both at the same time.15 Their existence appears as a strong cognitive bias. It blocks
the refined analysis of empirical cases, which often involve influential situations and strategic plans.
Our aim is not to understand how much planning and, respectively, how much situated learning
there is in corporate action, but rather to improve our understanding of how plans contribute
to strategy formation and how they may be used fruitfully.
Research approach: plans as tools for practice
Our aim here is therefore to do things the other way around: rather than presupposing any ‘‘essence’’
of planning, we start our analysis from the close study of plans and their uses. We won’t consider the
strategising process before examining the specific arts, facts and artefacts that compose it. In so doing,
we draw widely on the strategy-as-practice (SAP) perspective, which insists on the necessity to take
‘‘the practice inside the [strategy formation] process’’ into account.16 This practice may be described
as a combination of different types of work.17 One of these is the ‘‘planning work’’.18
This type of work relies entirely on the use of a specific management tool: plans. In order to account
for the contribution of this tool to the strategising practice, we therefore draw, besides SAP, on a second theoretical perspective, that of Actor-Network-Theory (ANT).19 The leading ANT advocate,
Bruno Latour, defends the idea that objects participate in action as true actors (or ‘‘actants’’, to be
specific), alongside ‘‘human’’ actors.20 He holds that artefacts are more than just ‘‘intermediaries’’
Long Range Planning, vol 41
2008
293
between humans, as they do not constitute neutral vehicles for information, and should therefore
rather be designated as ‘‘mediators’’, which transform in a particular way the information they
convey.21 Another way to put this idea is to refer to the notion of ‘‘affordance’’, first developed by
Gibson.22 The idea behind this notion is that, although every artefact is subject to numerous interpretations and uses, it doesn’t allow, or ‘‘afford’’, any interpretation or use: its constituent properties have
specific effects on action. We aim to exhibit some original affordances of strategic plans.
Although this focus on artefacts was first developed in the study of scientific practices, which obviously depend on the use of specific observation tools, it seems particularly relevant to the study of
organisations.23 Organisations rely massively on original management technologies, and they are
a very favourable environment for textual and visual artefacts.24 Such artefacts play a significant
part in communication inside the organisation, as Yates’s and Orlikowski’s recent study on PowerPoint presentations proved.25 Some texts and images, such as accounting tables, also act as powerful
control tools.26 These roles of textual and visual artefacts (communication and control) are linked
to their representational abilities. Representing the firm, its accounts, products, projects, etc. helps
corporate actors to co-ordinate around common visions of their firm’s organisation and activities.
We contend that the roles of the textual and visual artefacts that are used in organisations cannot
be limited to those of communication and control. For example, science studies have described
‘‘paper’’ technologies as powerful supports for intellectual creativity inside laboratories.27 A botanist, for instance, may use small cards to describe the plants he is interested in and spread these
paper traces on his desk. This operation, which is both material and cognitive, will help him recombine the different types of plants into new categories, and eventually develop an innovative theory
of their relations.28 Hence, for Latour, the idea that ‘‘most strokes of genius, flashes of intuition that
we impute either to the neurones of researchers or to ‘cognition’ can be explained by the proximity, on
the tables of laboratories, of recombined traces’’.29 The same thing may be observed inside the strategy
formation process of organisations, with activities such as ‘‘serious play’’.30 Our perspective on strategic plans draws from that and tries to analyse the possible contribution of these more conventional management artefacts to strategic creativity.
But what are the possible creative affordances of plans? The only two roles Mintzberg attributes
to plans are those of communication and control.31 As these two roles may also be played by other
management artefacts, one has to specify, along with Mintzberg, the fact that strategic plans have
the particular ability to communicate and control future action. They may act as programmes: like
a theatre programme, they may announce what is to come; and, like a computer program, they may
constrain coming action. Such roles have nothing to do with strategy formation, nor therefore with
creativity. They are only a means of communicating and implementing strategy.
However, if one allows that the immediate objective of plans may not always just be their implementation, other roles of plans may emerge. Many plans do not get implemented: not only because
they may be ill-adapted to the organisation or its environment, but also because they may simply be
designed or used as supports to strategic thinking and debates. This is partly what scenario planning
calls for: a multiplication of the plans that could be developed.32 However, such perspectives only propose options for managers, who would make their choice according to the firm’s external contexts.
Our idea is that plans may be more than univocal options that could either be adopted or rejected.
Their writing and reading is not just binary. The dense information they draw on and present is actually food for thought for decision-makers, whose strategic imagination they may therefore foster.
This paper argues that analysts and decision-makers shouldn’t consider plans as mere programmes: instead they are documents likely to stir and enhance strategic imagination. In order
to make this point clear, we propose to dig out the various possibilities offered by plans, by
both reading them ourselves and showing how corporate actors read them.
Method and data: plans as archives for research
Artefacts have one big advantage for research: once they have been produced and used, they may be
conserved as archives. Like the stones of archaeologists, once they have been dug out of the ground,
their forms are stable over time and can be submitted to study.
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The Drafts of Strategy
Our case study of Renault’s Brazilian strategy formation was based on the personal archives of
one of the project members in the 1990s and present head office executive of Renault in France.
These archives consist of a dozen ‘‘intermediary planning documents’’ of 20 to 100 pages, which
add up to some 500 pages. They are intermediary in two ways. First, they occupy an intermediary
place in the temporal course of Renault’s investment in Brazil: they were produced between Renault’s return in Brazil as an imported brand in 1993 and the opening of its first Brazilian plant
in 1998. Second, these documents circulated in an intermediary area of Renault’s organisational
hierarchy. They were designed, with the help of some head office departments (e.g. international
affairs, or planning), by the project team Renault constituted to prepare its settlement. The plans
were destined for top executives, including Renault’s CEO, who used them as a basis for debates
during two types of meetings: the executive committees and the general progress assessment meetings of the investment project.
These documents were first analysed for themselves, in their chronological sequence, regardless of
the uses that had been made of them by corporate actors. But such textual and visual artefacts may
have little meaning ex-post for the analyst. Various methods were therefore used to obtain information on how they were produced, used and perceived by actors at the time of the project.
This was done through in-depth interviews with key actors, with whom we met repeatedly (e.g.
four interviews of up to four hours with our main informant).33 We also studied other contemporary written documents (memos, reports, e-mails.), press articles and public information produced by Renault about its Brazilian settling. Juxtaposing these two sets of data e plans and
information about how they were used e proved to be a crucial element in the analysis of the
affordances of plans, as it revealed both what the plans could seem to say or show at first glance
and what they actually allowed decision-makers to draw out of them.
Two of these documents are presented here. These two plans are crucial documents (probably the
key documents of Renault’s Brazilian investment planning process). Both were presented to Louis
Schweitzer, Renault’s then CEO, and other senior executives at the turning points of Renault’s Brazilian strategy-making process: in March 1994, just before Renault decided to look into constructing
a plant in the country; and in June 1995, immediately before the decision was taken to build the plant.
Renault do Brasil: a brief corporate history
The Renault do Brasil Automoveis (RdoBA) case is a typical case where strategic planning played
a major part in strategic decision-making.
The French carmaker was rediscovering a country it had forgotten for decades, and therefore had to
become familiar with it and its markets again. Renault cars had been produced in Brazil in the 1950s
and 1960s. Exports then replaced this production for a few years and Renault then completely abandoned the country until the 1990s. However, it had stayed in Argentina, where it kept producing cars,
as well as in a few other smaller South American countries. Renault returned to Brazil in 1992 as an
imported brand, before announcing on July 27 1995 its intention to build a plant in the country.34
The plant was inaugurated on December 4 1998 near Curitı́ba, capital of the Paraná state, in the
south of Brazil. Some $1bn was invested in the plant, which had a maximum capacity of 200,000
cars a year. In such a capital-intensive industry and in a rapidly changing country e which had just
started to stabilise its monetary inflation e thorough planning was considered as a necessity. On
top of that, this new investment was considered as a challenge for the French carmaker. It was
the first plant that Renault had constructed in almost 20 years. And, as the firm was being privatised
in the mid-1990s, entry into the Brazilian market was meant to demonstrate its international competitiveness (along with other projects, such as the sponsoring of a Formula 1 teame which is also
why the new plant was judiciously named after Brazilian driver Ayrton Senna). Renault was simultaneously undergoing a general ‘‘projectification’’: project management was introduced in all decisional processes, in order to promote strategic innovation.35 The project team that was created in
the country e which at the beginning of 1996 numbered just 15 but then grew rapidly e recalls
having felt under the spotlight, with everyone inside and outside the firm looking at their activity.
The decisions that were to come out of the plans they produced were therefore one of the big issues
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295
for Renault and the French car industry at the time. Such a combination of excitement and pressure
may well have contributed to the specific forms and uses of the plans that are studied here.
March 1994: the plan as an implicitly open programme
Renault returned to Brazil in 1992, thanks mainly to the taxes imposed on carmakers by the Argentinean government which incited them to export more e and Brazil was a nearby candidate for
‘‘Made in Argentina’’ cars. Renault therefore signed a contract with a Brazilian importer, CAOA,
based in S~ao Paulo.
On March 26 1994, a ‘‘Brazil Plan Meeting’’ took place in S~ao Paulo between the small group of
Renault managers working at CAOA and executives from the head office, including Renault’s CEO.
The meeting developed around a 60-page document, which had been prepared by the French Renault head of marketing at CAOA.
This document applied a typical SWOT analysis to the Brazilian market, and developed a precise
three-year programme of action in favour of Renault imports in Brazil. It was not meant to be a draft
of strategy. But, this programme-planning document also provided Renault executives with information about Brazil, its markets and the success of Renault cars in Brazil. This information therefore allowed uses other than the proposed action programme. Because of this and of the open reading that
was made of this plan, it became a draft for a strategy different to the one which was explicitly set forth.
A programme: developing a coherent importation strategy. This document proposed a series of
‘‘goals’’ for Renault imports in Brazil: ‘‘1. A retail network, reaching our standards, all over the country; 2. First of all imported brands in volumes; 3. Establish Renault’s reputation; 4. A quality of service
at the best local level; 5. Organise imports; 6. Reach financial equilibrium as soon as possible.’’ It constructed a specific logic of action. Goals, represented by distinct bullet-points, were separated, revealing various constituents of corporate action. These separate points were also organised as
a logical sequence, starting with the brand’s relation to markets and ending with the organisational
and financial consequences of this market action. The first goals on the list were the means of reaching the last ones. The resulting action, presented in a logically ordered list, was made coherent, and
could therefore be designated under the unifying title as the one and only ‘‘Renault Strategy’’.
The structure of this action was further elucidated in the document. The scope of action was
made measurable by the indication through provisional tables of quantitative objectives for each
of the six previously specified goals e page 60 concluding on the financial plan. This structure
of action was also a temporal structure: the presented goals were only reached after a three-year
period, which was divided in yearly stepping-stones (Figure 1). Such a programme-plan defines
the logic, size and timing of a unique corporate strategy, and makes each of these measurable.
The possibility for measure allows future monitoring of actual action.
But the coherence of the programme also serves as a self-constraining justification of its demands. Well-organised goals and means led to a demand for ‘‘necessary support’’ (p. 59) from
the head office (creation and financing of new posts, sending of qualified taskforce to train local
workers, etc.). The programme therefore also propped up specific demands. This action text
may therefore also be considered as a pretext for its authors to obtain what they wished from
the head office. This is interesting because it comes as a first proof of possible ‘‘parallel’’ affordances
of plans: even when strictly designed as programmes, they may serve other purposes.
A vision: seeing Brazil and its markets. There was another major factor that made the March 1994
planning document more than just a programme. Most of this document (i.e. its first 50 pages)
consisted of a textual and visual representation of Brazil, providing its readers with a specific vision
of the country and its markets. The programme couldn’t therefore be separated from this account
of the Brazilian environment, as it built precisely on it. But this account had a value in itself: its
strategic potential went beyond the proposed programme.
The document included a broad presentation of the Brazilian context. Environmental scanning
started with 15 pages of a geographic, demographic, economic, monetary and political description
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The Drafts of Strategy
Figure 1. Programming Strategy over Time1 (p. 55: ‘‘Establishing Renault’s reputation’’)
1
Translation: ‘‘6.3 Establishing Renault’s reputation. Actions: Campaign on the theme of quality and innovation (through Formula
1)/Campaign on product innovation with the Twingo car/Co-operative advertisement and homogeneous communication over the country/Strong presence at the S~
ao Paulo trade show/Test centres in Rio and S~
ao Paulo’’.
of the country, which showed the distribution of Brazil’s population and industries, the evolution
of all main economic indicators and the main contents of the Mercosur agreements that would be
enforced from January 1995 as well as those of the latest stabilisation plan promoted by President
Cardoso that year. The scrutiny of the environment was not limited to industry and competitive
analysis. This planning document could therefore be used, not just as an elaboration of the specified
programme of action, but as a tool to analyse the country and its possible evolution.
The document did not just contain useful text: it also presented the country’s geographic and
demographic properties in map form (Figure 2). This contributed to making the Brazilian context
more familiar to decision-makers from Renault’s head office, who only came to the country for
short and intense missions. Furthermore, such a representation was a good support for international strategic vision. The author of the March 1994 plan recalls: ‘‘I remember this meeting with
Schweitzer in 1994. I had the impression he knew Renault had to come [to Brazil]. He had seen: he
had his America, with Colombia, Argentina, Mexico. and the big green patch’’ (emphases added).
As this impression shows, representation is more than an objective description of an object’s
contours (in our case: Brazil): the Brazilian land was also visually qualified, both in its relative size
(‘‘big’’ e in comparison with neighbouring countries) and its availability (‘‘green’’ e as a land without
cars). Other such visual qualifications were also included in the studied document. The proportions of
the Brazilian economy were represented in a single table that compared the economic indicators of
Brazil, Argentina, Chile and Mexico. Lines depicting inflation and GDP were made continuous, hence
projecting economic growth. The context of the Cardoso stabilisation plan was graphically polarised,
separating its positive aspects from its negative ones so that the overall picture couldn’t but elicit
a clear-cut view of the context: negative aspects were outnumbered by the positive ones.
The March 1994 document illustrating the Brazilian environment therefore made it possible to evaluate the potential of the country from various perspectives. In doing so, it became a suggestive document
that brought about much more than the definition of a single medium-term programme for imports.
A test: Renault’s commercial fit in Brazil. The 1994 import programme provided food for thought
on how well Renault would fit into the Brazilian market. Such information was of course meant to
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297
Figure 2. Representing Contexts Synthetically2 (p. 4: ‘‘Geography’’)
2
Translation: ‘‘1. Geography: 8,500,000 sq. km e 16 times the size of France e 4th country in the world/4,300 km from north to
south and from east to west/7,400 km of coast/16,000 km of frontiers/Paris-Rio: 9,200 km/Amazon river: 6,000 km e Pico da Neblina:
3,014 m’’.
justify the proposed import strategy. But it obviously left space for a more open interpretation,
notably one that would consider a possible Brazilian investment by Renault.
The document, once it started presenting the Brazilian car market and industry, also tested the
way Renault fitted in the Brazilian environment. This test was made through various visual association techniques. The main ability of these techniques was to provide executives with an image of
the firm’s actual and potential relation to Brazil. The first, traditional, one was the positioning of
Renault cars in markets that were given the shape of tables crossing market segments and brands.
The fit between Renault and Brazil was then judged against its ranking (visualised via ordered lists),
in terms of car sales and number of retailers. Reputation in the view of customers was finally put
face-to-face with a list of properties of Renault cars and organisation (Figure 3).
This epitomises what a planning document can do. The presentation of lists of the company’s
properties (lack of industrial flexibility on the continent and, therefore, inadequate products)
and of the Brazilian customer’s perception of Renault (reputation problems, high prices) revealed
the limitations of how Renault was currently fitting in Brazil. But this presentation could also make
new actions emerge e such as the potential local production of cars, which could solve the bad
reputation of the ‘‘Made in Argentina’’ tag.
Even though this 1994 document was presented as a closed programme for action, it proved to be
a support for quite open strategic thinking. But this depended, of course, on the ability of decisionmakers to allow their reasoning power to go beyond the explicit propositions of the plan, i.e. not to
take the plan too seriously as a definitive proposition. This is precisely what happened during the meeting where the document was presented. ‘‘This was an important meeting. I saw my multinational company CEO acting just as if he had been in a board of directors meeting. He was participating. He was
working’’. The contradictory use of this plan, to draft new strategies rather than to just confirm a given
programme, is attested by what followed. A small team of managers from various departments (international affairs, planning, engineering) was soon set up in France to work on whether or not to invest
in Brazil. The apparently closed plan served as a basis for the further imagination of possible strategies.
298
The Drafts of Strategy
Figure 3. Confronting the Firm to Contextual Elements3 (p. 44: ‘‘The Renault Problematic e The brakes to
success’’)
3
Translation: ‘‘The brakes to success. What blocks our product offer.: CIADEA product plan/Lack of innovation (R19 car with
a 1.6 C engine)/Lack of quality (R19>>R21)/Outdated product (R21 saloon car)/Little industrial flexibility. What blocks our clients
on their way to our products.: No impression of car range/High prices/Low reputation of the brand/Low reputation of the product/
Made in Argentina’’.
June 1995: the plan as an explicitly open project
The Renault head office in Paris kept a close eye on Brazil in 1994 and the first half of 1995. A first intermediary project, which proposed a local production of some 70,000 to 100,000 cars, was discussed
in a September 1994 executive committee meeting, which led to a demand for a new ‘‘study’’ which
would ‘‘continue the [previous one] by aiming at a capacity of 200,000 cars per year with a partner’’. Discussions with such a partner (Mercedes-Benz) were started. On June 26 1995, an executive group committee took place, and discussed the 90-page ‘‘Mercosur Project’’ document: this was the document that
was prepared by the aforementioned French team, who made a few short and secret trips to Brazil to
collect data, with the help of the local French managers of the import company.
The formal structure of this planning document looks very much like that of the previous one: after
a five-page executive summary, it presented a 15-page ‘‘Brazil panorama’’, before developing the ‘‘Renault strategy and project’’ over more than 50 pages, and concluding with a series of proposed decisions. But the two documents differ strongly with respect to the mode in which they are written: the
1994 one was affirmative, whereas the 1995 one was tentative; it called ‘‘project’’ what the other one
called ‘‘plan’’, and presented itself as a ‘‘study’’. It was an explicit draft of strategy. Those who asked for
the document, as well as those who produced it, all knew it was only one in a long series of plans to
come. Its aim was to sketch out possible strategic lines and to evaluate how convincing they could be;
it could also eventually be used to provide elements of justification for a strategic decision. It did so by
extending the frame in which new strategies could be thought of, by constructing these strategies like
identikits one could recompose, and by leaving conclusions open.
Those who asked for the document, as well as those who produced it,
all knew it was only one in a long series of plans to come
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299
An extension: setting attractive limits. The frame imposed by this plan on strategic imagination was
the widest one since Renault’s return in Brazil. This frame was set by the Paris head office and
described in the study’s foreword. The study had to bear geographically on the whole of the Mercosur area. The new plant’s suggested production capacity was doubled. Accordingly, the temporal scope of the project was extended to 10 years. In such a wide frame, the available options
seemed more numerous, notably in terms of shared production between the existing and envisaged South American plants. This aimed at stimulating the imagination of planners, to make
them go beyond their previous plans. The head office imposed on them explicit demands regarding what possibilities had to be specifically worked upon. The partnership with Mercedes had to
be analysed, as well as the opportunity to conceive a small-engined Twingo for the Brazilian market (because the Federal State offered tax exemptions on such cars) and sell ‘‘at least 70,000’’ cars
each year.36
These demands were also explicitly justified in the plan, and this justification reinforced their impact. The 200,000 cars per year production, for instance, was designed to act as a cognitive attractor
more than just an extreme outer limit. This was done, in the market data provided to the project
team by the Forecasts and International Affairs departments, through a teleological assimilation of
this number to a projection for the Brazilian market, this projection being based on actual external
markets. Indeed, 200,000 was viewed as amounting to 10 per cent of a 2 m car market, both these
figures being defined as ‘‘potentials’’, in reference to ‘‘actual’’ foreign markets. Renault had reached
a 10 per cent share of the very competitive European market in the 1990s e and the round 10 per
cent number was a clear and good attractor in itself; and 2m cars sold every year was what would
make the Brazilian car ownership rate catch up with the Argentinean one in 10 years. This made the
200,000 figure particularly realistic, and therefore attractive, at least for the dotted line of market
volume forecasts (Figure 4). The possible lines of strategic action remained undefined, but new
directions were suggested for them, and the plan therefore developed in a wider, more imaginative
scope.
An identikit: sketching out multiple ideas. This wide scope for strategic imagination was fully used
by the authors of the 1995 plan. They proposed various scenarios that fit into the range of production that had been suggested by Renault’s board. Two product scenarios (‘‘MERCO 1’’ and
‘‘MERCO 3’’) were thoroughly developed: the first one started with Twingo sales; the second
plan combined Mégane sales with Mercedes ‘‘A Class’’ sales.37 Scenario planning may be described as a basic feature of draft plans. Obviously, proposing various strategic options is an
Figure 4. Setting Attractive Limits (p. 17: ‘‘Brazilian markets: Total Market evolution e Brazilian growth cycle’’)
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The Drafts of Strategy
important step towards a greater openness of plans. But scenario planning does or may do more
than that.
Proposing various strategic options is an important step towards
a greater openness of plans
On the one hand, the comparison between various scenarios imposes some sort of synthetic
vision. It thus makes plans less analytic. This synthetic vision may be seen for instance in the conclusion charts of the document (Figure 5). Each scenario, in order to be compared with others, has
to be developed completely, i.e. up to the calculation of a synthetic indicator of its relevance e in
this case the scenario’s profitability and cash flows. Thanks to this, readers of the plans may grasp
a whole strategic option in one glance and visualise the consequences. Scenario planning helps strategists put a distance between themselves and strategies, and hence renew their ideas concerning
each strategy.
On the other hand, the more analytic part of scenario planning may also prove quite creative.
The Renault do Brazil case is particularly interesting in this respect. In the 1995 plan, analysis wasn’t
limited to only two scenarios: a wide range of other possible strategies was suggested. The reason for
this is that various choices were proposed for most dimensions of Renault’s Brazilian strategy.
There were two product scenarios (MERCO 1 and 3), but also two production scenarios (one
with a common plant with Mercedes-Benz, and the other one without), two commercial scenarios
(here again, one with Mercedes-Benz and the other without) and three different legal and financial
scenarios. This makes the 1995 plan look like an identikit of Renault’s Brazilian strategies: various
options were envisaged for each part of the firm’s strategy, and this provided the reader of the plan
with a wide range of possible combinations of these options. Renault could therefore choose to stick
with Mercedes-Benz for production and/or commercially and/or in a common legal and financial
entity, etc. It could even merge the two product scenarios e i.e. sell Renault Twingo cars first and
then Mercedes-Benz Class A cars e if both proved profitable. The ‘‘faces’’ of strategy resulting from
this identikit were numerous. Most of them were not drawn entirely in the document; they were
Figure 5. Comparing Synthetic Indicators of Opposite Strategies (p. 87: ‘‘Profitability (operating income and
profit before tax) and cash flow’’)
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just sketched out and given a quick first draft. The merely commercial (but not productive) partnership with Mercedes-Benz was just suggested, for instance, in the legal and financial part of the
analysis, but its commercial consequences were not specifically considered. Scenario analysis, because it is based on the idea that strategies are yet to be defined, allows planners to sketch out
emerging ideas. These ideas may then be taken up by the readers of the plan. or remain unexploited if the ‘‘array of strategies’’ these readers have in mind is limited.38
An open-end: proposing uncertain decisions. The 1995 ‘‘Mercosur Project’’ study did draw some sharp
conclusions (p. 79). A mechanical production unit had to ‘‘be set up in Argentina in all cases’’. And
CAOA (the importer) had to lose its exclusivity ‘‘necessarily in the beginning of 1996’’. While certain
options were closed, others remained open. The partnership with Mercedes-Benz was, for example,
presented as offering ‘‘significant but not decisive synergies’’. The main problem was that Renault’s
most promising car commercially on the Brazilian market e the Mégane e was the least adapted
for production in a joint plant with Mercedes-Benz, as it competed with the German company’s ‘‘A
class’’. This explains the idea that the partnership ‘‘[had to] subscribe to a common vision’’ if it were
to be established. External elements, such as wider international synergies between the two companies, were called for to support the decision.
So while some options closed, and others stayed open, there were other major options that
remained undecided upon and appraised in terms of relative ‘‘risk’’. The ‘‘Twingo first’’ option,
for instance, was ‘‘risky in terms of product and profitability’’, while the ‘‘Mégane first’’ option
was ‘‘not risky’’ in these terms.
The 1995 plan’s openness went even further than just leaving some options undecided. It also
suggested some radically new strategies, on the basis of the analyses that had been conducted.
The array of proposed new strategies was extremely wide. For example, it went as far as proposing
an extremely low-ambition strategy: ‘‘if no R/MB agreement: plant ¼ 45 000 VH/year (?) e New
study to be conducted’’. This very modest plan called prudently (notice the question mark.) for
further studies of original strategies that had emerged in the minds of planners while they were
writing the plan. Even though it did stick to the directions that had been prescribed for this
plan, it left the door open for emergent strategies. On the whole, proposed decisions were conditional, and the main condition was generally the realisation of a new study.
But the planning document also called for a decision, so that the new studies could have clear
lines of action to explore. However modest the 1995 plan may have been when drawing conclusions, it was explicit on the strategy formation calendar: ‘‘Decisions submitted to the executive group
committee: 1. Take the decision to go to Brazil with the Mégane first, and announce it’’. Immediately
after this planning document was drawn up, Schweitzer responded to this call for a clear-cut decision: the building of a 200,000 capacity plant in Brazil was announced. This decision was typically
entrepreneurial: it was an individual, rather than a consensual decision; it went against part of the
internal logic of this long nationalised firm. But it was also planned in the June 1995 document as
a possibility.
Discussion: opening up plans and their reading
Plans allow multiple uses. A few of these have been shown in this paper (see Table 1). Plans may of
course help programme predefined strategies, i.e. set a course of action to be followed, and define
stepping stones that will make it possible to evaluate the way the plan is implemented. Plans may
also help justify analytically the strategic choices that are to be made (or have been made). But plans
may also be used in order to:
1.
2.
3.
4.
5.
Build synthetic visions of contexts and/or strategies;
Test the relevance of imagined strategies;
Orientate the imagination of executives in specific directions or widen its scope;
Provide their readers with multiple identikits of possible strategies;
Sketch out peripheral strategies that ought to be thought of.
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Table 1. How to make plans creative: reconceiving roles for planning, plans, and planners
Planning Plans
Planners
Planning doesn’t just aim at producing a single and committing plan
Planning often implies the production of temporary, draft plans
This part of planning is an opportunity for debates across hierarchies
Plans can convey information about contexts and hence ‘‘educate’’ their audience
Numerous strategies can be presented in plans, including peripheral strategies
The comparison of strategies is made possible by their synthetic, side-by-side
presentation in plans
Planners may chose to read and/or write plans openly or not
They can use plans as a legitimate means to gain senior management attention
over certain strategies
Open plans can provide a basis or justification for entrepreneurial decisions that close down choices
All these affordances of plans are made possible by their visual and textual characteristics, which
make it possible to draw multiple (and sometimes sketchy) strategic directions as well as to represent them and their consequences in synthetic forms.
All the possibilities afforded by plans may either be used or not during the writing and reading of
these documents. The differences between Renault’s 1994 plan and the 1995 plan show this clearly
when it comes to writing: the plan may be written as a pure programme, or be openly constructed
as a draft strategy. Obviously, these opposite plan-writing options responded to the requirements
of those who had asked for the plans. But the Renault do Brasil case also shows that things are subtler
than that, as the reading of a plan may contradict its writing. A closed programme-plan such as the 1994
one could be read openly, as some sort of hint towards new strategies. And an open scenario-plan such
as the 1995 one could be used in order to narrow down the range of decisions. The existence of such
readings reveals that all affordances of plans tend to remain present in actual plans, even when they
were not required. Some affordances of plans remain implicit, but may be used by readers if they
wish to do so. Plans therefore prove to be far more flexible in their uses than their usual image suggests.
Our approach to strategic planning hence leads to two complementary lines of discussion. The
first deals with the contents of plans, and the second with their uses.
Opening up plans: plans as simulation tools
Because plans are usually considered as inflexible tools, strategic planning is generally considered as
contradictory to innovative strategising. Of course, in a large industrial firm such as Renault, which
would be described by Mintzberg as a ‘‘machine organisation’’, rigid programme-planning is inevitable.39 Strategic decisions are imposed durably: the market life of a car is at least seven years; the
construction of a plant is a large and durable investment. Hence the necessity to provide the company with deeply formalised scripts which will be implemented widely and lastingly. But, before
major strategic decisions are made, and especially when large-scale industrial projects are being
thought about, the use of plans as drafts of strategy may well prove quite productive.
Considered as temporary documents, plans have the same use as thought experiments. They
make it possible to evaluate in a forward-looking way the relevance of new strategies, and to suggest
new ones if the experiment proves unsuccessful. Imagined strategies, when developed in plans as
complete programmes of action, may prove their internal (in)coherence. And when confronted
by market data, they may prove their external (in)adequacy. Of course, experimenting with strategy
cannot only be done by plans. Thought experiments themselves often contribute to the evaluation
and construction of new strategies though they are not easy to communicate. Other more methodical practices do the same, such as laboratory tests (e.g. product clinics), actual experiments (e.g. the
creation of Renault’s commercial subsidiary in 1993), past experience (e.g. Renault’s foray into the
US in the 1970s which proved to be a failure). But plans, just as firms themselves, are a very specific
type of ‘‘laboratory’’ for strategic experiments.40 Compared with thought experiments or product
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clinics, plans allow a thorough analysis of complete and sometimes complex strategies. Compared
with laboratory tests, actual experiments or the past experience of the firm, plans allow entirely
fictional experiments; they are simulations of strategies.
Because of this, the biggest competitive advantage of plans over other experimentation practices is
their low price. But also, because they are more disconnected from reality than other experimentation practices, they may be considered as the most creative experimentation tools, because they allow
simulation of extreme strategies. Such an observation calls for a better use of this ability of plans,
which could be used to develop unexpected, peripheral, but potentially interesting strategies e
especially in the long run. This would reinforce the otherwise accidental contribution of plans to
the emergence of new strategies. Some lack of realism often proves quite suggestive. The risk is of
course to construct and experiment these extreme strategies in too abstract a manner, without
taking into account their relevance to the firm and to the real economic world. But this risk cannot
justify a complete renouncement to the advantages of plans in terms of simulation.
Because plans are more disconnected from reality, they may be
considered as the most creative experimentation tools
Opening up the uses of plans: redefining the planning process
The acceptance of the simulation abilities of plans implies changes in the planning process. If plans
are to be creative, they first need to be authorised to be so, and then to be considered as serious
contributors to strategy-making.
In the four years that followed the opening of the plant in 1998, Renault succeeded in achieving
a market share of 4e5 per cent in Brazil. But the growth of Renault’s Brazilian sales stopped from
2002, and the firm only started to see its situation get a little better after 2005.41 That year, the plant
worked at approximately a third of its production capacities. Renault shared these relatively bad
results with many of the other carmakers that invested in Brazil in the 1990s e 10 of which
were newcomers. This was because the car market didn’t grow as expected and because Renault
didn’t meet its goals in terms of market share. It may therefore seem fair to make Renault’s planners
responsible for this relative failure. But our analysis of the plans that were produced to prepare Renault’s settlement tends to prove the opposite. The carmakers that succeeded better in the mediumterm in Brazil e such as Toyotae were those that had opted for smaller plants, of a capacity three to
four times smaller than Renault’s (200,000 cars per year). The 1995 plan did indeed suggest the relevance of such a strategic option. This was, one has to admit, quite an imaginative choice on the
part of the planners for two reasons. First, the authors of the plan had been encouraged by the
firm’s board to plan a large rather than a small plant. Second, the idea of a small plant seemed
strange at the time in such a capital-intensive industry, and especially for Brazil, where the longterm demand for cars promised to be particularly high. It is therefore quite hard to make plans
exclusively responsible for the strategic choice that was made. The judgment on plans has to be distinguished from the judgment on the whole strategising process.
If plans shouldn’t be blamed, maybe the planning process should. Renault’s most imaginative strategic options for Brazil were soon abandoned. The creative potential of the plans which suggested
alternative strategies was neglected and further studies of these options were not conducted. There
are some good reasons for this. The keen worldwide competition in the car industry made it seem necessary to make a quick decision, in order to enter Brazil before competitors and to build on the success
of Renault’s exports to Brazil in the early 1990s. The internal context of the firm, which was about to go
private and would therefore benefit from higher capital resources, also pushed it towards a rapid investment into important markets abroad. Whatever the planning work that had been made, circumstances imposed clear-cut entrepreneurial decisions. We see here that although entrepreneurial
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‘‘vision’’ is an essential part of imaginative management, it may also paradoxically act as a brake upon
strategic thought, and hence prevent other forms of imagination, such as that which appears inside
draft plans. And once the decision has been made, plans are bound to prepare the actual implementation of the chosen decisions and hence to remain mainly as programme-plans.
If plans may be open, the problem is therefore to let them be so or not, i.e. to use them as tools for
the programming of predefined strategies, or as cognitive supports for the formation of new strategies. The latter option first means that the emergence of peripheral strategies in plans should be authorised: the writing of plans should include these strategies; and the reading of plans should consider
these unexpected strategies as seriously as others. This option then implies that the further analysis of
peripheral strategies should be allowed rather than banned or only marginally authorised, especially if
these strategies have been foreseen as possible solutions to the limits of more conventional strategies.
The risk is of course to slow down the planning process. But this practice could be developed as a parallel activity in the planning process, with an individual and insightful planner being responsible for
the further analysis of such emergent strategies. These strategies, if presented more thoroughly, could
prove to be realistic and convincing. And they could at least cast doubt on the main strategic lines and
favour constructive debates about their possible limits.
Conclusion
Conclusion for practitioners
The main conclusion for practitioners is that plans should be asked to do what they can do, but also
all they can do. Programme-plans play a crucial role in the co-ordination of actions inside the firm
once strategies have been decided upon. But plans may also play a part in strategy formation, if
some guidelines are followed:
e Strategy makers shouldn’t consider written plans as fixed lines of action, but rather as simply
cognitive supports for further thinking. Accepting the temporariness of plans even when they
are presented as programmes, and hence leaving open the possibilities for new strategies
favours strategic innovation.
e Assuming that plans may act as drafts gives planners scope to develop neglected, improbable,
peripheral strategic lines. The local suggestions that can be found in many a plan ought to be
further developed, besides the main, expected and straight line of action that was proposed by
the executives who ordered the plan.
Conclusion for researchers
The main conclusion for research is related to the risks of excessive analysis. Intellectually distinguishing strategic methods is often necessary and useful. But the resulting, crystallised categories,
such as ‘‘planning’’ in the case treated here, may end up being too rigid and simplified to describe
well enough the complexity of actual business practices. Our paper does not escape these risks, with
its categories of ‘‘draft-plans’’ and ‘‘simulation’’ for instance, which should therefore be enriched
empirically through the further observation of planning practices. A particularly insightful way
to refine this analysis of strategic practices and question existing categories would be to keep a close
eye on the rich abilities of all the artefacts that are used in strategy formation. For these ‘‘things’’ can
often do more than we think they do.
Acknowledgements
The research that lead to this paper wouldn’t have been possible without: Alain Tissier (Renault
Head of Marketing for Americas), who opened Renault’s doors to me; Professor José Carlos Durand (sociologist, member of the Focus research group, Education Faculty of Campinas/UNICAMP
Long Range Planning, vol 41
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University), who invited me to work with him in S~ao Paulo and made my stay there a both productive and pleasant time; the Getulio Vargas Foundation Business School in S~ao Paulo (FGVEAESP), which provided me with all the necessary academic facilities during my Brazilian stay;
the French Ministry for Research, which financed my research in Brazil with its ‘‘Cultural Areas’’
fund. Let them be thanked here, as well as Aurélie Tricoire for her personal support and encouragement. I am also grateful to both co-editors of this special issue, to Franck Cochoy, to Laurent
Gubert, to two anonymous LRP reviewers, to Charles Baden-Fuller, and to the participants of
the Crafts of Strategy colloquium, all of whom made helpful comments and suggestions on earlier
drafts of this article.
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Biography
Martin Giraudeau is a French sociologist. He holds a Master’s degree in economics and sociology from the École
Normale Supérieure de Cachan (Paris) and is a laureate of the Agrégation de Sciences Économiques et Sociales. He is
now a PhD student and a teaching assistant at the University of Toulouse. His ongoing research concerns a
‘‘sociology of business plans’’, which stands at the crossroads of a sociology of (entrepreneurial) finance, a history
of (planned) rationality and an anthropology of (economic) anticipations. He has conducted fieldwork in areas
ranging from small business entrepreneurship and finance to big industrial project design. [email protected]
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