Thematic Networks: Structuring the Organization for Strategic Fit

Competitive advantage derives from effective management of interdependent, sometimes conflicting strategic themes for superior fit. We develop a graph-theoretic formalism called thematic networks in order to study strategic fit by capturing and analyzing organizational manifestations of interacting strategic themes. A critical property of thematic networks is that they can be overlaid one on the other to construct increasingly more complex thematic networks. Consequently, resulting overlay structures can capture interacting strategic themes far beyond the extent possible in conventional overlay structures known in the literature. Another critical property of thematic networks is their duality. Namely a thematic network can be seen as a network of positions (the positional view) and also as a network of themes of strategically significant tasks (the thematic view). We show that one view is the dual of the other. We interpret this duality theorem through Giddensf structuration theory, and present a perspective on the organizational dynamics capable of reconfiguring its structural environment for superior strategic fit. In addition, given the importance of conventional reporting structures, we identify a class of thematic networks for which reporting hierarchies exist. We show that reporting hierarchies can be directly derived from the positional view, or indirectly through the thematic view, using the duality results.