Concept Of Fit

CONCEPT of FIT

Introduction

The Concept of fit describes one of the goals for the formal strategic planning. Its idea works on the concept of adapting current internal strategic environment strengths and weaknesses to fit with the external strategic environment opportunities and threats. In addition scholars have an indicates an internal concept of fit. This paper will provide a simple highlight the external and internal concept of fit.

Literature Review

Venkatraman and Camillus (1984) indicate that the concept of fit has been the central thrust to the development of middle range theories in many management disciplines specifically in the organization theory and the strategic management field. Bahaee (1992) point out that one popular stream of research in the strategic management literature on organizational performance relates to the concept of fit. He further highlight that the theoretical framework underlying this concept is that fit among various organizational factors has a significant positive impact on firm performance.

Strategic planning consists of the process of defining objectives and developing strategies to reach those objectives. One of the objectives is to fit both the external environment opportunities and threats with an organization's internal environment the strengths (resources and core competencies) and weakness. This fit has been described as the external concept of fit. The opportunity and threats as well as the strengths and weakness can be determined by performing a SWOT analysis. Adams (2005) stated that SWOT analysis can be used to gauge the degree of "fit" between the organization's strategies and its environment, and to suggest ways in which the organization can profit from strengths and opportunities and shield itself against weaknesses and threats

It is worthwhile to indicate that environmental opportunities are only potential opportunities unless the organization can utilize resources to take advantage of them and until the strategic leader decides that it is appropriate to pursue the opportunity.

The concept of fit has also an internal view. The fit between the organizations' chosen strategy and its management elements such as the organizations' structure, policies, . The internal concept of fit has been indicated by Jauch and Osborn (1981). They contend that the probability of organizational survival increases as the fit of environmental, contextual, and structural complexity increases. Bahaee (1992) also indicated that a fit between strategic orientation and planning comprehensiveness in small entrepreneurial firms creates synergy, promotes efficiency, and strengthens the firm's competitive position in today's turbulent environment.