Analyzer organizations share characteristics with prospector and defender organizations; thus, they face the
entrepreneurial problem of how to maintain their shares in existing markets and how to find and exploit new
markets and product opportunities. These organizations have the operational problem of maintaining the
efficiency of established products or services, while remaining flexible enough to pursue new business
activities. Consequently, they seek technical efficiency to maintain low costs, but they also emphasize new
product and service development to remain competitive when the market changes. The administrative problem
is how to manage both of these aspects. Like prospector organizations, analyzer organizations cultivate
collaboration among different departments and units. Analyzer organizations are characterized by balancea
balance between defender and prospector organizations.
Reactor organizations, as the name suggests, do not have a systematic strategy, design, or structure. They are not
prepared for changes they face in their business environments. If a reactor organization has a defined strategy
and structure, it is no longer appropriate for the organization's environment. Their new product or service
development fluctuates in response to the way their managers perceive their environment. Reactor organizations
do not make long-term plans, because they see the environment as changing too quickly for them to be of any
use, and they possess unclear chains of command.
Miles and Snow argued that companies develop their adaptive strategies based on their perception of their
environments. Hence, as seen above, the different organization types view their environments in different ways,
causing them to adopt different strategies. These adaptive strategies allow some organizations to be more
adaptive or more sensitive to their environments than others, and the different organization types represent a
range of adaptive companies. Because of their adaptive strategies, prospector organizations are the most
adaptive type of company. In contrast, reactor organizations are the least adaptive type. The other two types fall
in between these extremes: analyzers are the second most adaptive organizations, followed by defenders.
Since business environments vary from organization to organization, having a less adaptive strategy may be
beneficial in some environments, such as highly regulated industries. For example, a study of the airline
industry in the 1960s and 1970s indicated that the defender airlines were more successful than the prospector
airlines in that the business environment changed slowly during this period because of the heavy regulation.
Hence, the emphasis on efficiency by the defender airlines worked to their advantage.
On the other hand, prospector organizations clearly have an advantage over the other types of organizations in
business environments with a fair amount of flux. Companies operating in mature markets in particular benefit
from introducing new products or services and innovations to continue expanding. As Miles and Snow note, no
single strategic orientation is the best. Each onewith the exception of the reactor organizationcan position a
company so that it can respond and adapt to its environment. What Miles and Snow argue determines the
success of a company ultimately is not a particular strategic orientation, but simply establishing and maintaining
a systematic strategy that takes into account a company's environment, technology, and structure.
FURTHER STUDIES
Scholars have attempted to verify the reliability and validity of the Miles and Snow typology. Such a study by
Shortell and Zajac indicated that this typology of strategic orientations and its predictions generally were
accurate. They found that prospectors are likely to be the first organizations to adopt new products and services,
analyzers are likely to be the first organizations to adopt new managerial procedures and systems, and defenders
are usually the first organizations to adopt new production-related technology. Moore carried Miles and Snow's
framework to the retail environment, and concluded that the typology is generally applicable to retail contexts.
Other researchers further broadened the scope and applicability of Miles and Snow's typology, relating the
strategic approaches strategic decision processes, international strategies, and functional areas within
organizations. Subramanian, Fernandes, and Harper found that strategic types differed in terms of how managers
perform environmental scanning. Prospectors tended to be more proactive in their scanning, followed by
analyzers; defenders tended to be less proactive or "ad hoc."
As an example of the effects of functional expertise in an international context, Naranjo-Gil explored the impact
of sophisticated accounting information systems on strategic performance among hospitals in Spain. Findings
indicated that performance was enhanced primarily through sophisticated accounting information systems' role
in implementing the prospector strategy.
Clearly, the Miles and Snow typology has contributed to our understanding of organizational behavior in a
variety of settings. As demonstration for its further applicability, Peng, Tan, and Tong studied firms in the
emerging Chinese economy. These authors concluded that the type of firm ownership can help predict strategic
group membership. Specifically, state-owned enterprises tended to adopt defender strategies, and privatelyowned enterprises tended to adopt prospector strategies. The analyzer orientation was also represented, most
commonly under collective and foreign ownership. Future research efforts aimed at the extension of Miles and
Snow's typology to international settings appears warranted.
FURTHER READING:
Fox-Wolfgramm, Susan J., Kimberly B. Boal, and James G. Hunt. "Organizational Adaptation to Institutional
Change: A Comparative Study of First-Order Change in Prospector and Defender Banks." Administrative
Science Quarterly, March 1998, 87.
Ghobadian, Abby, et al. "Evaluating the Applicability of the Miles and Snow Typology in a Regulated Public
Utility Environment." British Journal of Management, 15 September 1998, S71.
Miles, Raymond E., and Charles C. Snow. Organizational Strategy, Structure, and Process. New York:
McGraw-Hill, 1978.
Moore, M. "Towards aConfirmatory Model of Retail Strategy Types: An Empirical Test of Miles and Snow."
Journal of Business Research 58 (2005): 696704..
Naranjo-Gil, D. "The Role of Sophisticated Accounting Systems in Strategy Management." International
Journal of Digital Accounting Research 4, no. 8 (2004): 125144.
Peng, M. W., J. Tan, and T.W. Tong. "Ownership Types and Strategic Groups in Emerging Economies." The
Journal of Management Studies 41 (2004): 11051129.
Ramaswamy, Kannan, Anisya S. Thomas, and Robert J. Litschert. "Organizational Performance in a Regulated
Environment: the Role of Strategic Orientation." Strategic Management Journal, January 1994, 63.
Shortell, Stephen M., and Edward J. Zajac. "Perceptual and Archival Measures of Miles and Snow's Strategic
Types: A Comprehensive Assessment of Reliability and Validity." Academy of Management Journal (1990):
817.
Subramanian, R., N. Fernandes, and E. Harper. "An Empirical Examination of the Relationship Between
Strategy and Scanning." Mid-Atlantic Journal of Business 29 (1993): 315330.
Source: http://www.referenceforbusiness.com/management/Mar-No/Miles-and-Snow-Typology.html