STRATEGY FORMATION IN PUBLIC AGENCIES

The main contribution of this study is the identification of three modes of strategy for public agencies based on strategic thought in a corporate environment. Strategic design, internal strategic scanning, and strategic governance embody three distinct modes of strategy relevant in the public sector. Programming actions, combining capabilities, and formation of networks capture the essence of these strategic orientations. By offering an organization‐based view of public sector strategy, this study puts public agencies at the centre of strategic examination. The fundamental unit of analysis within agencies is administrative duty, which connects administrative action with the democratic decision‐making process. These three strategy modes are based on complementary and, in some respects, contradictory theoretical assumptions, but all offer opportunities for confronting the diverse environments faced by public agencies. Each strategic orientation has a distinct approach to such features as the role of management, occupational groups, the environment, and types of capital.