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Today’s an organization want to achieve success, they should consider all aspects for reaching the desired ends and how to avoid difficulties to help plan successful strategies. When an organisation has a strategy it enables them to ensure that decisions made on a day-to-day basis fit in with its long term interests. Strategies are also important as any decisions an organisation makes today can have a negative impact on its future results. A strategy will also help encourage employees, departments to work together to achieve common goals. In this essay I will concentrate on three schools, including design school, planning school and positioning schools. Furthermore, I will clarify some points in others schools of thought by particular looking at the overall, key issues and assumptions of this theory.
According to Mintzberg, Ahlstrand, and Lampel (1998), they suggest that there are a lot of influential factors affect strategy. The schools will help organization to evaluate their macro and micro dynamics of a company. The first three schools that is design, planning and positioning schools of thought are prescriptive in nature. Those schools discuss how a strategy should be formulated. Accordingly, organization based on current situation and its environment to identify directions actions. The next six schools, entrepreneurial, cognitive, learning, power, cultural, and environmental are concerned with a specific aspect of strategy formation rather than prescribing an ideal strategic behaviour, it may be characterized as descriptive, emergent and subjective. Whereas, the configuration school alone constitutes the third group that integrates the various elements of strategy formation from all the previous schools mentioned.
The first of the prescriptive schools is the Design school. The value of this strategy formation is that it seeks to establish a fit between an organization’s strengths and weakness and its internal potential and external possibilities. This school also considers the role played by managerial values and social responsibility as important in the process of strategy making (Shekhar, 2009). Therefore, the CEO has a responsibility for a strategy formation. On the other hand, the strategy should be individualized, simple and explicit. According to his framework, a strategy formulated should be consistent in its goals as well as policies. Moreover, it must be adaptive to the changes in the organization’s environment, provide and maintain competitive and should be feasible. The advantage of this type of school is that it forces consideration of external factors and will be more appropriate in organisation that needs reorientation. In the assignment 2, I will concentrate on how both internal as well as external factors impact strategy of organization, and also according to this theory to provide some evaluation, selection, using SWOT analysis and Porter’s Five Force to descript how organization can fit between strength, weakness and the opportunities.
The next school that I will discuss is a Planning school. It is a member of the prescriptive schools and a strategy formulation also mention as a formal process. The principal of this school has a separation between strategy formulation and strategy implementation. According to this school, strategy is a plan, a direction, a guide or a course of action into the future. The planning school consent with most of the premises in the Design school. However, the execution of strategy became formalized. The CEO takes the responsibility for the formulation of the whole process. By applying powerful analytic tools such as rigorous strategic planning methodologies, scenario analysis, managers can forecast the future of their business and can be accurately enough to let them to choose a suitable strategic direction. I will discuss these issues in the next assignment.
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The Positioning school also is part of the first group of schools. This school is different from other schools, it also known as an analytical process. In the positioning school, there are only a few key strategies or positions in the market place, which is economic and competitive, while there are no limits to strategies in some schools, for example the design and planning schools. The process focused more narrowly on calculation and on the close-ended selection of strategic positions than on the development of integrated and unusual strategic perspectives or on the specification of coordinated sets of plans (Marko, 2004). Strategies developed under this school are generic, specifically common, identifiable positions in the marketplace. In addition, when compared with other schools, it is less emphasis on political effects, including internal and external on the strategy formation in an organization. In the next assignment, I will focus on tools, methods such as BCG matrix, Michael Porter’s Generic Strategies, Profit Impact of Market Strategies and some other tools to clarify how to analysis and calculate in order to support the process of developing the strategy.
In the next assignment, I will highlight some of the critical aspects of strategy formation in ten schools of through. In detail, the entrepreneurial school views strategy formation as a visionary process and visions can be set by a single or multiple founders of a company. The power school views strategy formation as a process of negotiation, the power refers to political power or the political relations surrounding an organization. The cognitive school views strategy formation as a mental process, it analyses how people perceive patterns and process information. The learning school views strategy formation as an emergent process of trial and error learning within an organization. The cultural school views strategy formation as a collective process, based on beliefs and understandings shared by the members of various groups and departments in organization. The environmental school views strategy formation as a reactive process, it described the relationship between particular dimensions of the environment. Thereby reacting to the challenges imposed the external environment. According to configuration school, this strategy formation is seen as a process of transforming the organization from one state of decision-making structure into another. Mintzberg, Ahlstrand and Lampel (1998) stated the key to this strategy if for the organisation to recognise the need for the transformation, however to be able to do this without damaging the organisation.
From this assignment I have learnt the importance of implementing strategic management into an organisation to gain competitive advantage. Applying Mintzberg’s schools could help an organization about evaluation, development and transformation. Using the schools, organization can be able to identify their objectives, its strengths and weakness, to help expand on potential, developing on their opportunities and strengths. The key point to the schools is finding which strategy making technique best fits into an organisation, and developing further on it. Having successful achieving these goals, it will transform and give an organisation higher strategic competence.
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