In 1998, Henry Mintzberg, Bruce Ahlstrand and Joseph Lampel released a book called “Strategy Safari”. The book was published by The Free Press, New York.
Using the analogy of the blind men trying to describe an elephant (remember the story where the one feeling its tail thought it was like a rope, the one feeling its leg thought it was like a tree, the one feeling its tusk thought it was like a spear, etc.) Mintzberg, Ahlstrand and Lampel discuss various approaches to strategic planning. They identify 10 different schools of thought, and describe in chapters devoted to each, its history and origins, basic concepts, applications, advantages and disadvantages, and situations in which that approach to strategic planning may be appropriate.
At the outset of the book, in attempting to define this amorphous beast, they outline what they call ‘the 5 P’s of strategy’, which are really five different ways of thinking about the essential characteristics of strategic planning. These are:
- strategy as a plan a guide for a course of action, a path from a current state to a desired future end state
- strategy as a pattern “…that is, a consistency of behavior over time. A company that perpetually markets the most expensive products in its industry pursues what is commonly known as a high-end strategy, just as a person who always accepts the most challenging of jobs may be described as pursuing a high-risk strategy.” (p.9)
- strategy as position the location of particular products in particular markets.
- strategy as perspective “in Peter Drucker’s memorable phrase, this is the “theory of the business” (p.13) it represents strategy as a particular philosophy of the business in terms of interacting with the customer, or the way(s) in which goods or services are supplied.
- strategy as a ploy under this definition, strategy is a means of gaining market share through a specific maneuver, designed to outwit a competitor or opponent.
The authors also discuss at the outset of the book the pros and cons of the various reasons why strategic planning has been thought to be beneficial in an organization. These are:
- strategy sets direction while this is clearly beneficial, the danger is that the blinders that a strategic plan can impose upon an organization can make it difficult to appreciate new opportunities and possibilities as they arise
- strategy focuses effort true, but the downside risk is that managers within an organization can get locked into a particular form of “groupthink”, again missing out on potential new opportunities
- strategy defines the organization again true to some extent, but the danger here is that the rich diversity inherent within the organization can get overlooked or lost by an overly simplistic stereotype of “what the organization is all about”
- strategy provides consistency assuredly important, but consistency for consistency’s sake, without having a clear market-oriented reason for this, is the obvious danger here
So it is apparent that the authors do not necessarily regard strategic planning as a good thing in all cases; they clearly indicate that there are dangers that an overly rational or overly rigorous approach can pose.
The core of the book is a detailed description of each of the 10 schools. They differentiate between two categories in this regard: the prescriptive schools, which attempt to identify directions for action on the part of the company based on an assessment of its current situation and that of the environment within which it operates, and the descriptive schools, which simply attempt to understand the historical reasons why a given company is where it is at a particular point in time. The 10 schools are listed below:
- Design School: This approach regards strategy formation as a process of conception, matching the internal situation of the organization to the external situation of the environment. Thus the strategy of the organization is designed to represent the best possible fit.
- Planning School: Here strategy formation is seen as a formal process, which follows a rigorous set of steps from analysis of the situation to the development and exploration of various alternative scenarios.
- Positioning School: Under this approach, which is very heavily influenced by the works of Michael Porter, strategy formation as an analytical process placing the business within the context of the industry that it is in, and looking at how the organization can improve its competitive positioning within that industry.
- Entrepreneurial School: This approach regards strategy formation as a visionary process, taking place within the mind of the charismatic founder or leader of an organization.
- Cognitive School: This approach, based upon the science of brain functioning, regards strategy formation as a mental process, and analyzes how people perceive patterns and process information.
- Learning School: This school of thought regards strategy formation as an emergent process, where the management of an organization pays close attention to what works and doesn’t work over time, and incorporates these ‘lessons learned’ into their overall plan of action.
- Power School: Here strategy development is seen to be a process of negotiation between power holders within the company, and/or between the company and external stakeholders.
- Cultural School: This approach views strategy formation as a collective process involving various groups and departments within the company; the strategy developed is thus a reflection of the corporate culture of the organization.
- Environmental School: Here strategy formation is seen to be a reactive process: a response to the challenges imposed by the external environment.
- Configuration School: In this final approach, the purpose of strategy formation is seen as a process of transforming the organization from one type of decision-making structure into another.
In each of these schools, the process of strategy formulation itself is regarded as something of a “black box” none of them are able to clearly describe how an individual or group is able to leap from the collection and analysis of information, to the conceptualization of alternative courses of action (although they do concede that the cognitive school comes closest). Overall, the authors appear to prefer the ‘learning school’ (they are teachers, after all), because of the emphasis that it places on an organization incorporating input from its environment, and adapting over time.
In the final analysis, just as none of the blind men’s descriptions of the elephant was completely adequate, yet each contained elements of truth, none of these 10 approaches is complete in and of itself, either. Each offers some useful concepts, and some strong points to aid understanding, but has its disadvantages as well (again, see the chart).
As well as providing a useful illumination of the origins and characteristics of the different schools of thought, Strategy Safari also makes for a very enjoyable and entertaining read. Mintzberg et.al. have done an excellent good job of taking a difficult and potentially deadly boring subject and rendering it interesting. The book is highly recommended for anyone embarking upon, or engaging in, a strategic planning process.