Ten Schools of Strategy
The word strategy has been used in different sense for a long time. Initially, it sprung from the need for people to defeat their enemies (Horwath, 2006). The word strategy itself evolved from the military jargon, before it was used to describe corporates. The word strategy as used today has also been defined in a number of ways. Wright and his associates described Strategy as top management’s plans to attain outcomes consistent with the organization and goals (Wright, Pringle, & Kroll, 1992). This definition concentrates on the fact that a strategy is a plan, which a corporation uses to achieve its goals. Along with the plan view that has been described here, Minzberg and his associates have described 3 different viewpoints for defining ‘strategy’ (Mintzberg, Ahlstrand, & Lampel, 2002). Strategy as a Pattern:
The authors argue that the strategy is not always planned but sometimes it just happens. They cite an example of the restaurant, which started purchasing locations in urban areas. Later it became the restaurant’s strategy to open urban restaurants. This was because of the preceding pattern. Thus it can be easily argues that strategy in fact is nothing but a pattern that the organization has been acting in. Strategy as a Position:
The third way Mintzberg describes strategy is as a position. This position is in fact in the minds of the customers and the strategy is to create this position of advantage in their minds. The authors here cite the example of McDonalds fast-food restaurants chain, which introduced egg sandwich to entice customers to eat breakfast in their restaurants. The strategy here was positioning the Egg McMuffin in the breakfast market. Strategy as a perspective:
Strategy normally is looking inside out but sometimes it helps to look inside the company or organization creating a product which in fact plays on the strengths of the organization. Strategy as a ploy:
After these four different definitions of strategy, Mintzberg went ahead to define the fifth usage of strategy as an maneuver intended to outwit an opponent. This definition encompasses every definition as the purpose of any strategy is in fact to outdo any opposition. Strategic management in companies is evolving continuously. Different schools of thought have evolved since the inception of concept of corporate strategy. These schools can be divided into three groups as follows (Mintzberg, Ahlstrand, & Lampel, 2002) i. Prescriptive Schools of Strategy
ii. Descriptive Schools of Strategy
iii. Configuration School of Strategy
Prescriptive schools of strategy tend to prescribe the way in which a strategy should be formulated whereas the descriptive schools of strategy give the description of what actually the strategy is. All these schools have evolved since 1960s and are actually still evolving. These schools have been listed below (Mintzberg, Ahlstrand, & Lampel, 2002): 1. The Design School
The design schools evaluates the internal capabilities in terms of strengths and weaknesses of an organization as well as its external environment for the opportunities and threats in the industry environment and seeks to find a fit or match between the two. The origins of this strategy school can be the writings of Philip Selznick and Alfred D. Chandler. This basic model of this school involves evaluating Strengths, weaknesses, Opportunities and Threats to create a strategy that is compatible with the social responsibility of the management as well as their managerial values. The problem with this school of thought is that it might lead to excess simplification which may actually distort reality. An example of use of this school of thought may be the way Tata Motors evaluated their internal capabilities to produce cars as well as the external opportunity in the mid-size car market in India before starting the production of Tata Indica.
Bibliography: Horwath, R. (2006). The Origin of Strategy. Retrieved 7 14, 2010, from Strategy Skills: http://www.strategyskills.com/Articles/Documents/origin_strategy.pdf
Mintzberg, H., Ahlstrand, B., & Lampel, J. (2002). Strategy Safary. FT Prentice Hall.
Wright, P., Pringle, O., & Kroll, M. (1992). Strategic Management and Cases. Allyn and Bacon.
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