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Mirroring Canadian Industrial Policy: Strategy Formation At Dominion Textile From 1873 To 1990

B. Austin, H. Mintzberg
Published 2009 · Political Science

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This study tracks the strategies of Dominion Textile Inc. in order to tell the history and infer lessons for strategic management of what, in many ways, is the quintessential Canadian company. Dominion Textile has figured prominently in the history of Canadian industry, much as the General Motors and DuPont described by Alfred Chandler (1962) figured prominently in the history of American industry. Indeed, following the evolution of this company is much like following the evolution of Canadian business in general, since not only did its business strategies mirror Canadian industrial strategy over the years, but even its evolving management style has reflected what has often been considered the stereotypical Canadian management style, including dramatic shifts in recent years. Thus, what follows is almost as much of a history of Canadian business as a history of a Canadian company in particular. This story of Dominion Textile is studied from 1873 until 1990, drawing on the first author's historical study of the company as her doctoral dissertation (Austin, 1985) and using a methodology that has been applied to several organizations in Canada (including Air Canada, ARCOP, Canadelle, the National Film Board, The Sherbrooke Record, and Steinberg see Mintzberg, Brunet, & Waters, 1986; Mintzberg & McHugh, 1985; Mintzberg, Otis, Shamsie, & Waters, 1987; Mintzberg, Taylor, & Waters, 1984; Mintzberg & Waters, 1982; Mintzberg & Waters, 1984 ). That methodology is based on the definition of strategy as not only intended, but also as realized (pattern in action), in order to contrast deliberate strategies that are formulated (intended strategies that were realized, i.e. plans manifested in patterns of action) with emergent ones that formed (pattern realized in the absence of, or despite, intended strategies; see Mintzberg & Waters, 1985). The research has proceeded in four steps: (1) Collection of basic data, in particular, traces of actions taken by the organization, studied in terms of main areas of activity, as well as supporting evidence on the organization's behaviour, its performance, and its context to help explain these strategies; (2) Inference of strategies as patterns or consistencies, in particular, streams of actions taken by the organization, as well as inference of periods in the history of the organization through consideration of significant points of change in these strategies; (3) Analysis of each period, based on the intensive study of internal documents, as well as interviews with available key players; (4) Synthesis of conceptual conclusions from the study, based on brainstorming around a series of theoretical questions, dealing with patterns of strategic change, relationships between deliberate and emergent strategies, and the interplay of environment, leadership, and organization in strategy formation. The study of Dominion Textile is based on an examination of shareholders, directors, and executive committee Minute Books in the company's possession, including the associated companies. The firm began in 1873 as the Hudon Cotton Company, became Hochelaga Cotton following a merger in 1885, and the Dominion Cotton Company, in 1890 in a consolidation with six small firms. Dominion Textile itself was created in 1905 by the consolidation of four cotton textile companies. Included in the company's collection of Minute Books are those of companies acquired by Dominion Textile, including Montreal Cotton (1873-1948) and Merchants Cotton (1880-1905). This information was augmented by new-paper articles (from the 1870s onward) and information in The Canadian Textile Journal since 1883 (Austin, 1983). Many interviews were held with retired and current company executives. E.F. King, who joined the company in 1920, was particularly helpful in explaining company policies for over fifty years. In addition, a thorough examination was made of several rival companies, including Wabasso (Austin, 1993) and Hamilton Cotton (Austin, 1992). …
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