Academic journal article Public Administration Quarterly

Demographic Data and Strategic Analysis

Academic journal article Public Administration Quarterly

Demographic Data and Strategic Analysis

Article excerpt


Advances in information technology transform the collection and analysis of demographic data. As organizations witness the proliferation of computer networks, powerful programs develop for data base management and statistical analysis with an ever growing capacity to retrieve, store, and recall data at higher speeds. These developments provide managers with potent tools for learning about and monitoring the human component of the environment. This, in turn, can help managers develop a better understanding of the context in which their organizations function.

Some writers on strategic planning include the study of demographic variables as part of the broader probe of en environment (Vogel and Swanson, 1988; Kaufman and Jacobs, 1987; Steiner, 1979; Morrison, 1988; Sorkin et al., 1985). Others, including writers of leading textbooks on strategic planning, do not address the issue of demography directly and devote little space to discussing its importance (Bryson, 1988; Fahey, 1989; Hatten and Hatten, 1987; Boseman and Phatak, 1989; Quinn et al., 1988; Thompson and Strickland, 1987).

Yet, there seem to be some good reasons to justify not only the study of present and emerging characteristics of the population, but for making it the preliminary/meta stage of any strategic planning effort. After all, characteristics of the population determine the demand for goods and services and, thus, the survival of the organization producing them.

This article suggests that demographic education is a necessary preparation for strategic planning. It seems that demographic analysis should take place before strategic planning. Thus, demographic analysis should be a part of the initial stage of the effort. The results of this analysis should then be used to guide the development and design of the rest of the strategic planning process itself.

Gronhaug and Falkenberg (1989:349) note that "the basic idea behind strategic management is that a firm needs to match its capabilities to its ever changing environment if it is to obtain best performance." Like them, this article acknowledges that the strengths and weaknesses of an organization cannot be assessed in a vacuum. However, this article sets out to correct a flaw in the logic from which some writers derive the basic idea of strategic planning as stated above.

Gronhaug and Falkenberg (Ibid.), for example, conclude that strengths and weaknesses "are relative, as the firm's offerings in the market place will be compared with those of its competitors." However, as demonstrated by the American automobile industry in the 1970s, comparison with the competition may not be enough. To the dismay of the car manufacturers in the United States, the competition was also oblivious to important changes in the environment. As it turned out, each of the manufacturers was paying too much attention to competitors but not enough attention to its other stakeholders. The obsession of car manufacturers with the competition since the end of the war in 1945 may have been the reason for the development of the myopic vision in Detroit.

Because of this obsession, "the environment" became a synonym for "the competition" even though the latter is only one component of the environment car manufacturers should have considered. If, as Gronhaug and Falkenberg (1989:350) conclude, "It is of crucial importance to develop relevant capabilities, and use these capabilities in the best possible way," organizations cannot limit the study of the environment to the study of competitors. In the same vein, it is unlikely that an organization will develop "relevant capabilities" without understanding the full makeup of the population that interacts with the organization.

This article asserts that, since changes in demography alter the relevant environment of an organization, understanding demographic trends can focus the strategic planning effort on critical issues. While this assertion holds true for all organizations, it is of particular importance in the case of public agencies. …

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