Introduction

The original release (first edition) of this textbook was winter 2016 under a Creative Commons license and used a grant from the Oregon State University Open Textbook Initiative. A second grant was awarded, and the second edition was released in winter 2018. This third edition was released in 2026.

The initial inspiration for this open-source textbook came from John’s adapting portions of the Principles of Management, v1.1 (CC BY-NC 3.0) by Carpenter, Bauer, and Erdogan in 2015 to allow him to abandon a traditional publisher’s textbook and teach strategy his way. The material has experienced many further adaptations, modifications, additions, and deletions since that initial use. In the early days, the textbook existed as a Google Doc in John’s strategy classes where he had commenting turned on and gave extra credit to students for suggesting alterations. This practice was formalized in the second edition when students recommended current events as examples, and those were incorporated as example boxes with student author names included with permission. The example boxes were dropped for this third edition as they proved too time consuming to manage. The textbook is published under a Creative Commons license, and as such there is no charge ever for this textbook.

The most important change from 2e is that we have added a second author, Sanjai Tripathi. Sanjai’s entrepreneurial business experience provides a fresh and more diverse perspective to John’s extensive corporate background. Together in this third edition of the Open Educational Resources (OER) textbook, we’ve strived to provide standardized structures, additional scaffolding and vocabulary, updated examples, new visuals, and to introduce diverse and international perspectives wherever possible within each chapter. We trust you’ll find these updates valuable and conducive to your learning of such a complex subject matter as strategic management!

We have chosen to write this textbook using first person pronouns (when referring to the authors) and gender-neutral pronouns when referring to the reader. The book is organized, as are most strategic management textbooks, with broad introductory chapters (Chapters 1 and 2) to provide context. The following three chapters (Chapters 3–5) provide the meat of content and are particularly well situated to be applied using the Micromatic (or other business simulation) software. The final four chapters (Chapters 6–9) provide more in-depth coverage of specific areas of interest in the college strategic management classroom. In particular, the final chapter on Analysis and Reporting provides student tools for understanding (analysis) and explaining (reporting) about strategic management topics; consistent with our times, it also addresses the use of artificial intelligence in analysis. This chapter was developed by author John in parallel with the Business Writing Style Guide, also an OER textbook supported by Oregon State University’s OER Unit.

Finally, this edition also benefited from the careful reading of colleagues who reviewed the full manuscript. We thank our internal reviewers — Dr. Jeff Barden, Dr. Jiyao Chen, and Dr. Sam Cho — along with three anonymous external reviewers identified by Oregon State University’s Open Education Resource Unit, led by Stefanie Buck, whose extensive comments and recommendations strengthened the final text considerably.

Topics in the Textbook

• Chapter 1: What is Strategic Management? – AFI strategy framework, above-average returns (AAR), the Strategy Diamond, external and internal models of AAR, risk.
• Chapter 2: Corporate Governance – governance, stakeholders, agency relationship, alignment of mission / vision / values / culture, organizational controls, balanced scorecard, triple bottom line.
• Chapter 3: External Environment – PESTEL analysis, Porter’s Five Forces, resource commonality and similarity, strategic groups.
• Chapter 4: Internal Resources – value chain analysis, value creation, VRIO analysis, SWOT analysis.
• Chapter 5: Business-level Strategy – strategic focus, generating advantage, value disciplines, strategy as trade-off, Porter’s generic business-level strategies.
• Chapter 6: Corporate-level Strategy – Ansoff’s matrix, directional strategies, concentration strategies, integration strategies, diversification strategies, cooperative strategies, stability strategies, downsizing, portfolio planning, BCG matrix.
• Chapter 7: Innovation Strategy – Schumpeter’s innovation framework, creative destruction, four types of innovation, innovation process, industry life cycle, innovation imperatives, strategic timing, blue ocean.
• Chapter 8: International Strategies – advantages of going global, challenges to going global, Porter’s diamond framework, CAGE framework, market entry mechanisms.
• Chapter 9: Analysis and Reporting – strategic issue identification, SBAR, using artificial intelligence, data visualization, actionable recommendations, case analysis framework, business writing style guide.

As with any complex and dynamic subject matter, you may find errors or content that has changed while reading the textbook. Please let us know using this OERU Errata Form and we’ll address your concerns and suggestions.

John Morris and Sanjai Tripathi, 2026