Strategic management as distributed practical wisdom (phronesis)

This article claims that effective strategic management requires distributed wisdom (which the philosopher Aristotle called “phronesis”). Strategy is created out of one's existential belief or commitment to a vision of the future, the ability to interpret one's environment and resources subjectively, and the interaction between subjectivity and objectivity. These abilities need to be distributed among organizational members. Strategy as distributed phronesis thus emerges from practice to pursue “common goodness” in each particular situation since a firm is an entity that pursues a universal ideal and a particular reality at the same time. Such idealistic pragmatism means that in a specific and dynamic context knowledge can be created and refined to become wisdom. Copyright 2007 , Oxford University Press.