Environmental School of Thought

According to Mintzberg, the environmental school of thought is a strategy dealing with the forces outside the organization. Unlike the other schools in his book, Strategy Safari, the environment plays a central role in the strategy formation process alongside leadership and the organization where the organization becomes subordinate to the external environment. The environmental school assumptions are that during the formative period of the organization the company shapes itself in response to the environment, but after that period is increasingly unable to respond to the environment. Moreover, the organization long term survival depends on the early choices made during its formative period. Over time, Mintzberg states, leadership becomes progressively less able to influence the performance and survivability of the organization.
The environmental school of thought has three different views in looking at the influence of the environment on the organization. The first view, the Contingency, states that there is no one best way to run an organization, it all depends on four main dimensions of the environment. According to the stability dimension, an organization's environment can range from stable to dynamic. A variety of factors can make an environment dynamic, including unstable governments, unexpected changes in consumer demand or competitor supply, a rapidly changing technology or knowledge base, and even weather that can not be forecasted. The complexity dimension deals with an environment that is complex to the extent that it requires the organization to have a great deal of sophisticated knowledge about products, customers, and supply. It becomes simple when this knowledge can be rationalized and broken down into easily comprehended components. The third dimension is market diversity where organizations can vary from ones who sell their only product to one main distributer to ones that sell their many products to many other companies all around the world. The