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SIM336 Strategic Management Assignment Help L2

SIM336 Strategic Management Assignment Help L2

SIM336 Strategic Management Assignment Help L2

Aims of the Lecture

• Compare and contrast the prescriptive, descriptive and configuration schools of thought with respect to strategic management.

• Explain the reasons for, and implications of, different approaches to strategy for the practising manager.

The Prescriptive School

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• The first three schools we shall examine are ‘prescriptive’ – they say how strategy should be formulated. They are:

– The design school

– The positioning school

– The planning school


The Design School

• In this model strategy formation is viewed as a process of conception

• The design school proposes a model of strategy making that seeks to attain a match, or fit, between internal capabilities and external possibilities (Mintzberg et al. (1998): 24).

• This approach has been the most influential in the development of strategic management, and is the underpinning for all ‘classical’ strategy courses.

• In this model:

– An internal appraisal of strengths and weaknesses are set against an external appraisal of opportunities and threats facing the organisation (a SWOT analysis).

– The environment is simplified into political, economic, social environments and the technological dimension (a PEST analysis).

– Strategy options are then evaluated against managerial values and social responsibility.

– The chosen strategy, thus conceived and designed, is then presented as the blueprint for implementation.

Shortcomings of Design School

• The key strategist is limited in his ability to assess internal and external conditions; • A solely top-down driven strategy formulation process can fail to tap the organisation’s knowledge

• Formulated strategies are inflexible to change;

• Both external changes in the environment and internal changes in the organization cannot be taken into account until a new round of strategy formulation begins

• Separation of strategy formulation from strategy execution lessens the ability to learn from one’s own mistakes

The Planning School

• In this model strategy formation is seen as a formal process

• It formalizes the strategy formulation process into distinct process steps with timelines.

• Strategies result from a controlled, conscious process of formal planning, decomposed into distinct steps, each delineated by checklists and supported by techniques.

• Responsibility for that overall process rests with the chief executive in principle;

• Responsibility for its execution rests with staff planners in practice.

Criticisms of the Planning School

• The criticisms of the planning school are very similar to those of the design school.

• The formal planning process assumes that the future can be predicted;

• It detaches ‘the plan’ from both the humans who are doing the planning and those who will carry out the implementation

• It can stifle creativity by excessive formalisation of the planning processes

• It pays relatively little attention to the possible influences of the organisation’s environment.

The Positioning School

• The positioning school focuses on strategy content and prescribes the use of analytical frameworks for strategic decision making.

• Strategies are generic, identifiable positions in a competitive marketplace.

• The strategy formation process is therefore one of selection of these generic positions based on analytical calculation.

• Analysts play a major role in this process, feeding the results of their calculations to managers who officially control the choices

Shortcomings of Positioning School

• It encourages organisations to follow generic strategies, rather than strategies that are specific to them,

• The analysis suggested by this school is narrow, since it considers the most important aspect of the organisation’s environment

• The school is generally biased towards the consideration of the activities of ‘big business’ in competition with each other, rather than studying the internal capabilities and capacity of a firm

The Descriptive School

• The next six schools we shall examine are ‘descriptive’ of the ways in which strategy is formed in practice. They are:

– The entrepreneurial school.

– The cognitive school.

– The learning school.

– The power school.

– The cultural school.

– The environmental school.

The Entrepreneurial School

• This school views strategy formation as a visionary process

• It describe strategy as the ‘vision’, created by the ‘intuition, judgement, wisdom, experience, insight’ of a single (and probably charismatic) leader.

Criticisms of the Entrepreneurial School

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• Entrepreneurial strategy exists primarily in the mind of the entrepreneur it may not be very clear to the the people expected to implement it.

• The organisation will be subject to centralised direction from the leader’s office.

• The whole enterprise hangs on the ability and personality of one individual, which may be both undesirable and risky.

The Cognitive School

• This school views strategy formation as a mental process

• Strategists are largely self-taught: they develop their knowledge structures and thinking processes mainly through direct experience.

• Experience shapes what strategists know, which in turn shapes what they do, thereby shaping their subsequent experience.

• Strategies are based on ‘objective’ approaches of observation, measurement and analysis and the ‘subjective’ interpretation of issues.

Criticisms of the Cognitive School

• The ideas of this school undermine the relevance and importance of the detailed planning activities of the first three schools.

• It seems unlikely that the human brain could take in and process all the information needed to make the comprehensive ‘objective’ analyses required.

• it is also probable that the inevitable ‘subjective’ interpretation that accompanies the passage of ‘plan’ into ‘action’ means that all strategy contains creative elements that are not explicit in the plan.

The Learning School

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• The Learning School views strategy formation as an emergent process

• It states that strategy is a result of learning that occurs at all levels throughout the organization.

• Strategies results from a variety of little actions and decisions made by all sorts of people (sometimes accidentally)

• Strategy is seen as the sum of a whole series of adjustments that people all over the organisation make, based on their own expertise or wishes. 

Criticisms of the Learning School

• In a strategic crisis there may be no time to learn – someone has to have a vision of the way forward, or a cunning plan for salvation.

• Some organisations may perform better if there is an explicit overall strategic direction within which learning can take place coherently.

• For some strategic choices, involving major or radical change, the learning, incremental approach will never deliver results.

• No description of external factors in the process of strategy formation

The Power School

• This school views strategy formation as a process of negotiation

• strategy formation is seen as an overt process of influence, emphasising the use of power and politics to negotiate strategies favourable to particular interests

• Strategy formation is thus seen in this school to be the result of competition or of bargaining and compromise.

Criticisms of the Power School

• There is a potential for conflict between owners and managers, and between manager and manager,

• Anyone who wields any power within the organisation could attempt to influence the way it is run to satisfy their own interests.

• As power shifts, so do the plans for the future; frequent changes in direction and the lack of rationality can be very demoralising to those expected to implement the strategies;

The Cultural School

• Strategy formation as a collective process

• This school is ‘the reverse image’ of the power school

• ‘Strategy formation is a process of social interaction, based on the beliefs and understandings shared by the members of an organization.

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