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eCOACH You Company Customer Management Organization Strategies Processes Innovation Finance Buy
By Vadim Kotelnikov, Founder, Ten3 BUSINESS eCOACH – Innovation Unlimited!, 1000ventures.com
"Effective managers live in the present – but concentrate on the future." – James L. Hayes
Instead of Introduction
Ten deeply embedded, though narrow, concepts typically dominate current thinking on
strategy. These range from the early Design and Planning schools to the more recent
Learning, Cultural and Environmental Schools.1
While academics and
consultants keep focusing on
these narrow perspectives,
business managers will be
better served if they strive to
see the wider picture.2 Some
of strategic management's
greatest failings, in fact,
occurred when one of these
concepts was taken too
seriously.
Recall the story of the blind
men measuring an elephant
to one, the elephant seemed
"very much like a wall", and to
another, grasping the
elephant's trunk, it felt very
much like a snake. "We are all
like the blind men and the
strategy process is our elephant", say Mintzberg, Ahlstrand and Lampel.3 "Everyone has
seized some part or other of the animal and ignored the rest. Consultants have generally
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STRATEGIC MANAGEMENT: Comparative Analysis of Ten Major Schools http://www.1000ventures.com/business_guide/mgmt_inex_stategy_10schools.html
gone for the tusks, while academics have preferred to take photo safaris, reducing the
Inspirational Business Plans
animal to a static two dimensions. As a consequence, managers have been encouraged
Successful Innovation to embrace one narrow perspective or another, like the glories of planning or the
wonders of core competences. Unfortunately, the process will only work for them when
Operational Plan: "We don’t have a traditional strategy process, planning they deal with the entire beast, as a living organism".
process like you’d find in traditional technical companies. It allows Google to The lesson in all this is that there is a need for a wider systemic perspective and a better
innovate very, very quickly, which I think is a real strength of the company." – practice, not neater, but narrow technique or theory.
Eric Schmidt... More
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STRATEGIC MANAGEMENT: Comparative Analysis of Ten Major Schools http://www.1000ventures.com/business_guide/mgmt_inex_stategy_10schools.html
Based on the Sloan Management Review1, 1999
Features of the Ten Major Strategy Schools
Bas ed on "Strategy Safari: A Guided Tour Trough the Wilds of Strategic Management", Henry Mintzberg, Bruce Ahlstrand, and Joseph Lampel, 1998
The Design School
The original view sees strategy formation as achieving the essential fit between internal strengths and
weaknesses and external threats and opportunities (see SWOT analysis). Senior management formulates clear
and simple strategies in a deliberate process of conscious thought which is neither formally analytical nor
informally intuitive and communicates them to the staff so that everyone can implement the strategies. This was
the dominant view of the strategy process at least into the 1970s given its implicit influence on most teaching and
practice.
The Planning School
This school grew in parallel with the design school. But the planning school predominated by the mid1970's and though it faltered in the 1980's it continues to be an important influence
today. The planning school reflects most of the design school's assumptions except a rather significant one: that the process was not just cerebral but formal, decomposable into distinct
steps, delineated by checklists, and supported by techniques (especially with regard to objectives, budgets, programs, and operating plans). This meant that staff planners replaced
senior managers, de facto, as the key players in the process. Today, many companies get little value from their annual strategicplanning process. To meet the new challenges, this
process should be redesigned to support realtime strategy making and to encourage 'creative accidents'.
The Positioning School
This prescriptive school was the dominant view of strategy formulation in the 1980's. It was given impetus especially by Harvard professor Michael Porter in 1980, following earlier work
on strategic positioning in academe and in consulting, all preceded by a long literature on military strategy, dating back to 500 BC and that of Sun Tzu, author of The Art of War. In this
view, strategy reduces to generic positions selected through formalized analysis of industry situations. Hence, planners became analysts. This proved especially lucrative to consultants
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STRATEGIC MANAGEMENT: Comparative Analysis of Ten Major Schools http://www.1000ventures.com/business_guide/mgmt_inex_stategy_10schools.html
and academics alike, who could sink their teeth into hard data and so promote their "scientific truths" to companies and journals alike. This literature grew in all directions to include
strategic groups, value chains, game theories, and other ideas but always with this analytical bent.
The Entrepreneurial School
Much like the design school, the entrepreneurial school centered the process on the chief executive, but
unlike the design school, and in contrast to the planning school, it rooted that process in the mysteries of
intuition. That shifted the strategies from precise designs, plans, or positions to vague visions, or
perspectives, typically to be seen through metaphor. The idea was applied to particular contexts –
startups, niche players, privately owned companies and "turnaround" situations, although the case was
certainly put forward that every organization needs the discernment of a visionary leader,
The Cognitive School
On the academic front, there was interest in the origin of strategies. If strategies developed in people's mind as frames, models, or maps, what could be understood about those mental
processes? Particularly in the 1980's, and continuing today, research has grown steadily on cognitive biases in strategy making and on cognition as information processing. Meanwhile,
another, newer branch of this school adopted a more subjective interpretative or constructivist view of the strategy process: that cognition is used to construct strategies as creative
interpretations, rather than simply to map reality in some more or less objective way.
The Learning School
Of all the described schools, the learning school became a veritable wave and challenged the omnipresent prescriptive Christian College
schools. Dating back to early work on "incrementalism", as well as conceptions like "venturing", "emerging strategy", (or the Indiana Wesleyan University offers
growing out of individual decisions rather than being immaculately conceived) and "retrospective sense making", (that we act in Christianfocused college classes
order to think as much as we think in order to act), a model of strategy making as a learning developed that different from the IndWes.edu/christiancollege
earlier schools. In this view, strategies are emergent, strategists can be found throughout the organization, and socalled
formulation and implementation intertwine. PGPM Program in India
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This comparatively small, but quite different school has focused on strategy making rooted in power, in two senses. Micro www.Pgpm.co.in/S.P.Jain
power sees the development of strategies within the organization as essentially political, a process involving bargaining,
persuasion, and confrontation among inside actors. Macro power takes the organization as an entity that uses its power over Meeting Management Tips
others and among its partners in alliances, joint ventures, and other network relationships to negotiate "collective" strategies in Free Slideshow Offers 10 Tips to
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The Cultural School
As opposite to the power school that focuses on
selfinterest and fragmentation, the cultural school focuses on common interest and integration. Strategy
formation is viewed as a social process rooted in culture. The theory concentrates on the influence of
culture in discouraging significant strategic change. Culture became a big issue in the United States and
Europe after the impact of Japanese management (see Kaizen and Competitive Advantage: US versus
Japan) was fully realized in the 1980's and it became clear that strategic advantage can be the product of
unique and difficulttoimitate cultural factors.
The Environmental School
Perhaps not strictly strategic management, if one takes that term as concerned with how organizations use their degrees of freedom to create strategy, the environmental school
nevertheless deserves attention for the light it throws on the demands of the environment. Among its most noticeable theories is the "contingency theory", that considers what responses
are expected of organizations that face particular environmental conditions, and "population ecology", writings that claim severe limits to strategic choice.
The Configuration School
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STRATEGIC MANAGEMENT: Comparative Analysis of Ten Major Schools http://www.1000ventures.com/business_guide/mgmt_inex_stategy_10schools.html
This school enjoys the most extensive and integrative literature and practice at present. One side of this school, more academic and descriptive, sees organization as configuration
coherent clusters of characteristics and behaviors and so serves as one way to integrate the claims of the other schools: each configuration, in effect, in its own place, planning for
example, in machinetype organizations under conditions of relative stability, entrepreneurship under more dynamic configurations of startup and turnaround. But if organizations can be
described by such states, then change must be described as rather dramatic transformation the leap from one state to another. And so, a literature and practice of transformation more
prescriptive and practitioner oriented (and consultant promoted) – developed as the other side of the coin. These two very different literatures and practices nevertheless complement one
another and so belong to the same school.
New Business Systems Approach to Strategy Formulation
Returning to the blind men and the elephant metaphor, "scholars and consultants should certainly continue to
probe the important aspects of each school, for the same reasons that biologists need to know more about the
tusks, trunks and tails of elephants", say Mintzberg, Ahlstrand and Lampel.3 "But more importantly, we must move
beyond the narrowness of each school. We need to ask better questions to allow ourselves to be pulled by
concerns out there rather than pushed by concepts in here, whether in consulting or in research... In addition to
probing its parts, we must pay more attention to the integral beast of strategy formulation. We shall never find it,
never really see the whole. But we can certainly see it better."
Think of growing your business as growing a perfect human being – in all his or her complexity and integrity.
Think of this human being as a multiskilled sportsman who is to win various competitions, both individually a 100
m sprint run, a tennis tournament, and a chess match – and as a team player – a relayrace, safari rally, and football. He is also to live a harmonious family, social and cultural life, grow
his children and support his elders... Clearly, narrow strategies aimed at perfecting different functions of this person – bodybuilding, thinkingbuilding, or personalitybuilding – would not
create a perfect man. The same is also correct for the business strategy development in the new era of systemic innovation where good in parts is no good at all. The old linear and static
approaches might work well for the old era of slow, linear and incremental change. The emerging era of rapid, systemic and radical change requires more flexible, systemic and dynamic
approaches to strategy formulation.
Thus today, corporate strategy formulation should be a combination of different currently practiced approaches described
above – judgmental designing, intuitive visioning, and emergent learning; it should be about transformation as well as
perpetuation; it has to involve individual cognition and social interaction, cooperative as well as conflictive; it must include Meeting Management Tips
analyzing before and programming after as well as negotiating during; and all of this must be in response to what can be a Free Slideshow Offers 10 Tips to
demanding environment. Running More Effective Meetings
Certain positive moves in this direction have been seen recently. Some of the more recent approaches to strategy formulation www.itbusinessedge.com/meetingtips
take a wider perspective and cut across the above ten schools in eclectic and interesting ways, for example Learning and
Design in the "Dynamic Capabilities" approach, or the "Dynamic Strategy" one based on knowledge working. Marketing&Business Degree
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view of the company as a collection of capabilities. This view of strategy has a coherence and integrative role that places it well
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the need for a fit between the external market context in which a company operates and its internal capabilities. According to www.Hult.edu
this view, a company's competitive advantage derives from its ability to assemble and exploit an appropriate combination of
resources. Sustainable competitive advantage is achieved by continuously developing existing and creating new resources and
capabilities in response to rapidly changing market conditions...More
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Bibliography:
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STRATEGIC MANAGEMENT: Comparative Analysis of Ten Major Schools http://www.1000ventures.com/business_guide/mgmt_inex_stategy_10schools.html
1."Sloan Management Review"
2."Strategy Safari: A Guided Tour Trough the Wilds of Strategic Management", Henry Mintzberg, Bruce Ahlstrand, and Joseph Lampel
3."Strategy, Blind Men and the Elephant", Henry Mintzberg, Bruce Ahlstrand, and Joseph Lampel
4."Strategic Management Competitiveness and Globalization", M.A. Hint, R.D. Ireland, and R.E. Hoskisson
5."Strategy and the Delusion of Grand Designs", John Kay
Map R anked #1 S earch Glo ssary Free D o w n load s P ro du cts Testimo nials T rain in g C o ntact
We invented Business eCoaching in 2001 Ten3 Business eCoach
Today, we have customers in 100+ countries! Inventor, Author & Founder – Vadim Kotelnikov
Our customers: © Vadim Kotelnikov, GIVIS
3M, ABB, Adidas, Alcatel, American Express, Bayer, Boeing, British American Tobacco, BP, Canon, Cisco, Citigroup, Colgate, Corning, Deloitte, Ernst & Young, FujitsuSiemens, GE, Goldman Sachs, HP, Hitachi,
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