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1. Introduction
Visualization is the “graphic representation of data, information and knowledge” (Eppler and Platts, 2009, p. 43). The expression, “One picture is worth a thousand words”, applies not only to journalism and publicity (Syracuse Post Standard, 1911), but also to a wide variety of phenomena, including business and strategy[1]. Indeed, because strategy is so complex, the use of visualization tools is especially valuable (Bürgh and Roos, 2003). Visualization tools in strategy have multitude of functions such as focusing attention, triggering memory, sharing and stimulating thinking, bridging missing information, challenging existing perceptions, identifying structure, trends and relationships, displaying multivariate performance, highlighting key factors, and representing complex data sets (Platts and Tan, 2004). Over the years, an assortment of visualization tools has been offered by scholars of business strategy. A review of many of these tools is presented by Eppler and Platts (2009). This paper focuses on one tool – strategic groups map.
A strategic groups map is a useful visualization tool for capturing the essence of the competitive landscape in an industry – issues like the extent of competition between and among strategic groups, mobility barriers, available niches, positioning and industry dynamics. A meaningful strategic groups map exhibits graphic excellence, consisting of “complex ideas communicated with clarity, precision, and efficiency” (Tufte, 1983, p. 51). It was first presented in Porter’s (1980, pp. 152-155) book “Competitive Strategy.”
The topic of strategic groups has been widely researched since the 1980s and continues to be used in research[2]. Yet, surprisingly, there has been very little done academically in the area of mapping these groups, leaving scholars of businesses and industries with few directions for constructing strategic groups maps[3]. Strategic management textbooks and internet “how-to” sources by and large omit the instructions on how to construct such maps, and the few that do so (Johnson et al., 2008, pp. 73-77; Mahoney, 2005; McGee, 2014, pp. 438-439; Power et al., 1986, pp. 18-19; Rothaermel, 2019, pp. 93-96; Wheelen et al., 2015, pp. 110-112), go very little beyond Porter’s (1980, pp. 152-155) instructions[4]. Though this tool is commonly used by practitioners, much of the knowledge related to it is uncodified. This paper aims to fill in the gap related to the construction and interpretation of strategic groups mapping....