The 10 schools of strategic planning
Manas Chakravarty | September 01, 2005
Some of the most interesting questions in business management centre around issues of strategy. Should a company diversify or stick to its knitting? Should it try to gain market share, or focus on return on capital? Is there a right time to adopt a specific strategy? Why do some strategies succeed while others fail?
Considering the scope of the subject, it's no wonder that strategic management has spawned a vast literature. The problem, however, is that management strategists tend to see strategy in the same way the six blind men saw the elephant -- one looked at the tusk and believed the elephant was like a spear, another grabbed the trunk and thought it was like a snake, another touched the ear and thought the animal was like a fan, and so on.
Henry Mintzberg, Bruce Ahlstrand, and Joseph Lampel, the authors of Strategy Safari: The Complete Guide Through The Wilds Of Strategic Management, point out that, similarly, experts on strategy saw the subject through their own limited experience, and there is a need to draw these diverse experiences together in order to grasp the subject in its entirety.
The authors identify 10 approaches to the subject. These include:
The design school, which sees strategic management as a process of attaining a fit between the internal capabilities and external possibilities of an organisation.
The planning school, which extols the virtues of formal strategic planning and arms itself with SWOT analyses and checklists.
The positioning school, heavily influenced by the ideas of Michael Porter, which stresses that strategy depends on the positioning of the firm in the market and within its industry.
The entrepreneurial school, which emphasises the central role played by the leader.
The cognitive school, which looks inwards into the minds of strategists.
The learning school, which sees strategy as an emergent process -- strategies emerge as people come to learn about a situation as well as their organisation's capability of dealing with it.
The power school, which views strategy emerging out of power games within the organisation and outside it.
The cultural school, which views strategy formation as a process rooted in the social force of culture.
The environmental school, which believes that a firm's strategy depends on events in the environment and the company's reaction to them
The configuration school, which views strategy as a process of transforming the organisation -- it describes the relative stability of strategy, interrupted by occasional and dramatic leaps to new ones.
The authors deal with each one of these approaches, placing them in the context of their background, mentioning the seminal papers that inspired each genre, and carrying out a thorough critique of each school of thought.
In the final chapter, they attempt to draw all the various threads together, pointing out that 'Every strategy process has to combine various aspects of the different schools. Can anyone possibly imagine strategy making in any serious organisation without mental and social aspects, without the demands of the environment, the energy of leadership, and the forces of organisation, without tradeoffs between the incrementals and the revolutionary? And can any strategy process be realistically pursued as purely deliberate or purely emergent? To deny learning is as silly as to deny control.'
'There are categories out there,' the authors conclude, 'but they should be used as building blocks, or, better still, as ingredients of a stew.'
Strategy Safari is a very good introduction to the entire field of strategic management. The authors are experts in the field, and have made outstanding contributions to it. Best of all, unlike a lot of management tomes, this book is refreshingly free from jargon, and can be easily understood by a lay person.
At the same time, the wealth of examples -- ranging from the introduction of Honda motorcycles into the US to American strategy in Vietnam -- not only breathe life into the subject, but are also helpful to the practising manager.
Perhaps the overall approach should be similar to the Chinese one of 'crossing the river by feeling for the stones,' the stones being the tools of strategic management.
The biggest lesson this book teaches is that, in management 'as in love, a concentration on technique is likely to lead to impotence.'
Review :
1 ‘And over here, ladies and gentlemen: the strategic management beast
Why ten?
A field review
Five Ps for strategy
Strategies for better and for worse
Strategic management as an academic discipline
2 The design school: strategy formation as a process of conception
Origins of the design school
The basic design school model
Premises of the design school
Critique of the design school
The design school: contexts and contributions
3 The planning school: strategy formation as a formal process
The basic strategic planning model
Sorting out the hierarchies
Premises of the planning school
Some more recent developments
Planning’s unplanned troubles
The fallacies of strategic planning
The context and contribution of the planning school
4 The positioning school: strategy formation as an analytical process
Enter Porter
Premises of the positioning school
The first wave: origins in the military maxims
The second wave: the search for consulting imperatives
The third wave: the development of empirical propositions
Critique of the positioning school
Contribution and context of the positioning school
5 The entrepreneurial school: strategy formation as a visionary process
Origins in economics
The literature of the entrepreneurial school
Visionary leadership
Premises of the entrepreneurial school
Contribution, critique, and context of the entrepreneurial school
6 The cognitive school: strategy formation as a mental process
Cognition as confusion
Cognition as information processing
Cognition as mapping
Cognition as concept attainment
Cognition as construction
Premises of the cognitive school
Critique, contribution, and the context of the cognitive school
7 The learning school: strategy formation as an emergent process
Formation vs formulation
Emergence of a learning model
New directions for the learning school
From organizational learning to the learning organization
Critique of the learning school
Contribution and context of the learning school
8 The power school: strategy formation as a process of negotiation
Micro power
Upper echelons theory: strategic management at the top
Macro power
Conclusion
9 The cultural school: strategy formation as a collective process
The nature of culture
Premises of the cultural school
Culture and strategy
The Swedish wing of the cultural school
Resources as the basis of competitive advantage
Critique, contribution and context of the cultural school
10 The environmental school: strategy formation as a reactive process
Premises of the environmental school
The contingency view
The population ecology view
Institutional pressures to conform
Critique, contribution, and context of the environmental school
11 The configuration school: strategy formation as a process of transformation
& nbsonfiguration and transformation
Splitters and lumpers
Premises of the configuration school
Researching configuration
Transforming organizations
Critique, context, and contribution of the configuration school
12 ‘Hang on, ladies and gentlemen, you have yet to meet the whole beast
Of tails and tusks, plans and patterns
Taming the wilds of strategic management
Toward seeing the whole beast
The hunt for strategic management
Source :
http://www.rediff.com/getahead/2005/sep/01strategy.htm
Strategy Safari – gives you the ‘big ten’ in the strategy jungle
