Framing Strategic Decisions in the Digital World

Arnaldo Camuffo, Alfonso Gambardella and Andrea Pignataro

Strategic Management Review, 2023, vol. 4, issue 2, 127-160

Abstract: This paper develops a conceptual framework to analyze the impact of digitalization on firms. Algorithms release cognitive resources of decision-makers who can focus on low-frequency/high-impact strategic decisions, such as innovation decisions, M&As, capital structure, and the acquisition of talent. In a digital world, different ability to frame firm strategies represents a key source of competitive advantage: by adopting a scientific approach to decision-making firms can embrace rather than escape uncertainty and rely on owners as strategists. We show that the growth of knowledge (Δ K) becomes the ultimate purpose of the firm, from which other purposes descend. We analyze some applications of the framework and conclude by suggesting a research agenda.

Keywords: Strategic decision-making; theory-based strategies; digitalization; algorithms; uncertainty; scientific approach (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:now:jnlsmr:111.00000055

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