Contrasting The Classical Schools Of Thought Commerce Essay

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Management strategies of Henry Mintzberg is based on the strategy on Design,Planning,Positioning,Entrepreneurial,Cognitive,Learning,Power,Cultural,Environmental,& finally Configuration.To understand strategic management,first one needs to understand the 5P's Of Strategy.They are nothing but the essential characteristics of strategic planning in an organization.The Five P's are:

Plan - Serves as a guide for a course of action to take place.

Pattern - It is the consistency of behaviour.

Position - Finds the location of products

Perspective - The ways in which services are provided

Ploy - Gaining a recognition among the competitors and retaining good market share.

A strategy is something that sets direction and is beneficial to an organization as it will lead to the growth of an organization in all ways.Strategy also focuses true effort.But sometimes the managers and his subordinates think only about a particular form by leaving out the new opportunities that are going to arise with that strategy.(Mintzberg,Ahlstrand,Lampel,1998)The organization's culture,the mission,vision are all based on the strategy that is been adopted.Thus a strategy defines an organization itself.By defining a strategy it provides consistency within the high level managers and their coworkers.But without having a clear market oriented reason it may prove wrong in one way.So careful and tedious attention need to be present while planning for a strategy.In todays competitive and complex business world,strategic planning is said to be indispensable in achieving superior management.Strategic business planning provides a practical advice for organising the planning system and acquiring and using the information,and finally translating the strategic plans into decisive action with the help of the invaluable resource of top and middle-level executives.

The Design school,the planning school,the positioning school tries to identify the directions for action based on the companies assessment.Whereas the Entrepreneurial school,Cognitive school,Learning school,Power school,Cultural school,Environment school,Configuration school tries to give the reasons why the given organization is where in a particular point of time that is being noted.

Design School:

With this approach,strategy gets formed as a process of conception and matching the internal environmental situation with the external environmental situation. By this way we can design the strategy of an organization so that it remains the best one to lead a company.Design school works as a strategy systems as Process of conception.Under Design school,the strategy system is prescribed to be deliberate in nature and the formation of strategy formation is regarded to be the process of conscious thought.The Chief Executive Officer must take the responsibility as he acts as the main strategist.The model of strategy formation needs to be kept as simple and informal as it could be. The best one must result from the process of individualized design.This is how the strategy needs to be.When strategies appear fully formulated then that is stage when the strategy system should be regarded as the true design process.This implies that the the strategies need to be explixit and need to be simple.The above mentioned things need to be noted as only after this we can implement a formulated strategy which is full blown,unique,explicit, moreover simple.The basic discipline with which the design school functions to mention is nothing in specific.The recources who act as champions in the design school of thought are the case study teachers,US leadership aficionados. The intended message for design school of thought is fit into the competitive business environment. But the thing realized is to think, that is make strategy as a casestudy.

Design approach is clear and unique as the strategies are formulated deliberately.In design school of thought the internal situation of the organization is matched with the external environmental situation.This is how the approach works. Let us discuss the features of the Design school of thought: With respect to the SWOT analysis the original view of strategy formation is in achieving the best and essential fit between the internal strengths and weaknessand the external threats and opportunities.As a deliberate process of conscious thought in this design school of thought,the senior management is the one who formulates clear and simple strategies which is neither formally analytical nor informally intuitive.And thereby communicating to staffs so that all the subordinates can implement the strategies.This kind of strategy system was more dominant and prevalent in the 1970s and giving most of its implicit influence mostly on teaching and practice.The main contributions of this approach is reduced ambiguity,simplicity,And it is very useful in stable environments.It helps in supporting strong,visionary leadership.Some demerits with this school of thought is it is neither analytical, nor intuitive.It seems to be too static with the era which undergoes rapid changes throughout.Limitations of this approach is that as we know more simplication can distort reality in the process.As this strategy has more variables and is said to be inherently complex and inflexible.Moreover it is weak in a random changing competitive environment.Always there is a risk of resistance in the behoviour of the design school of thought.

Planning School:

The formal process here is the strategy formation in Planning school.In this type of school,it follows a set of rigorous steps,by analyzing the situation and exploring the alternative scenarios present within the organization.

With planning school,the its roots are mainly based upon systems thinking and cybernetics.And the strategy systems is said to be controlled as it is a conscious process of planning in a formal way.Also strategy systems in planning school is decomposed into distint steps,each is delineated by checklists and supported by lot of prescribed techniques.

The responsibility in the overall process rests with the chief executive people,but the responsibility for execution rests mainly with the planners who are in practice.By comparing with design school we can find the resulting strategies appearing in this process seem to be more full blown and in depth detail is used.

The strategies here are explicit as when they are implemented detailed attention is done with regards to objectives,budgets,programs,various kinds of operating plans that is been prescribed.The thinking of planning school has led organizations,mainly in the seventies and early eighties,to build up significant staff department of analysers and planners in this kind of planning school has a large amount of advantages and disadvantages.In planning school the staff departments take over the process,the process is dominated by the staff,and planning systems is being designed virtually to produce no results,and the planning focuses on more exciting game of mergers,acquisitions & divestitures are at the expense of core business development;also the planning processes fails to develop true strategic choices;planning process neglects the accompanying organizational and cultural requirements of strategy;moreover single point forecasting acts as inappropriate basis for planning in an area of restructuring and uncertain nature[Mintzberg,1998]. The basic discipline with which the planning school functions with some cybernetics,urban planning and system theory.The recources who act as champions in the planning school of thought are the professional managers,MBA professionals, staff experts,financial consultants,US & France Government controllers. The intended message for planning school of thought is formalize.But the thing realized is to program rather than formulating. The planning school of thought grew in parallel with the design school of thought.But this planning school of thought predominated in the mid 1970s and though it faltered in the 1980s it continued to be of major importance today.

The features of planning school of thought can be discussed now.The planning school of thought is said to reflect most of the design schools assumptions.But one significant exception being,that this strategy system is not just cerebral but formal,decomposable into distinct steps,delineated by checklists,supported by techniques which are especially with regards to the objectives,budgets,programs and operating plans within an organization.Thus having the key players as the staff planners in the process and having the senior managers replaced by the staff planners.Today many of the companies get a little value from their annual strategic planning process.To meet the new challenges in the competitive market this kind of process needs to be redesigned to support the real time strategy making and encourage creative things to happen around the organization.This approach has set of rigorous set of steps right from the analysis of the situation to execution of the situation.The contribution of this approach is that it gives clear direction and enables firm resource allocation.With this approach the analysts can prescreen the information and judge the crafted strategies.The demerit of this approach is that it neither supports real time strategy making nor encourages any creative accidents in an organization.The limitations is that the strategy can become more static.Leading to difficulty in prediction.

Positioning School:

In this kind of approach,the formation of strategy is purely an analytical process by having the business within the industry context and working on how the company retains its position in the competitive industry.

In this school of thought,the main roots relies on the economics.and the strategy system is prescribed to focus mainly on the strategies that are generic in nature,that is specifically common,positions in the current marketplace and identifiable.Thus the marketplace in this context is economic and competitive in nature.Here the strategy systems undergo a major dominant process and therefore it is the one of the selection of the generic positions that is based on the analytical calculation.The analysyts play a major role in this school of thought,by feed the results based on their calculations to the managers who are officially said to control the choices.If we compare with the design and planning school,the strategies that are coming out of this kind of approach is first said to be articulated and then it undergoes implementation.Also the main difference of the positioning school of thought with that of the design and the planning school is that there is a strong focus in the external environment,and the market structures here are said to be believed as they drive deliberate positional strategies within the organisation.The basic discipline with which the position school functions is with the military history and the economics of the industrial organization.The recources who act as champions in the positioning school of thought are particular analytical staff types,writers and US consulting boutiques.The intended message for positioning school of thought is to analyze deeply. But the thing realized is making strategy as a calculation rather than creation or getting committed to it.The positioning school of thought was dominant in strategy formulation in the 1980s.The strategy system is based on positioning in academe and consulting.This strategy reduces to generic positions that gets selected through formalized analysis of industry situations that is prevailing.

The Positioning school of thought always sees strategy formulation as an analytical process.As it places the business environment within the context in the industry,it looks at how the organization can improve in its strategic positioning within the industry premises.We also know that the basis of discipline is industrial organization that is the economics within and the military strategy.The contributions of positioning school of thought is that the strategic management is transferred into science thus enables progress.Thus by providing full content in a systematic way.It focuses on hard economic facts.Mainly it is used in stages of strategy development when data is being analysed.The features with this school of thought is discussed below.Here the planners became the analysts.Thus it helped in proving lucrative to consultants and academics who usually sink into hard data and thus promoting their scientific truth to companies and journals.With this school of thought the literature tends to grow in all directions to include the strategic groups,game theories,value chains,and other ideas always having an analytical bend.The disadvantage of this approach is that the strategy system gets reduced to generic positions which is selected through formalized analysis that is based on the industry situations.The limitations included are it neglects power,culture,politics,social elements.Its nuber oriented and is fully biased with large organizations.

Comparison:

School Of Thought

Basic Discipline

Users

Messages intended

Messages realized

Demerits

Design

The basic discipline with which the design school functions to mention is nothing in specific.

The recources who act as champions in the design school of thought are the case study teachers,US leadership aficionados.

The intended message for design school of thought is fit into the competitive business environment.

But the thing realized is to think, that is make strategy as a casestudy.

Demerits with this school of thought is that it is neither analytical, nor intuitive.It seems to be too static with the era which undergoes rapid changes throughout

Planning

The basic discipline with which the planning school functions is with some cybernetics,urban planning and system theory.

The resources who act as champions in the planning school of thought are the professional managers,MBA professionals, staff experts,financial consultants,US & France Government controllers.

The intended message for planning school of thought is formalize.

Messages realized is to program rather than formulating.

The demerit of this approach is that it neither supports real time strategy making nor encourages any creative accidents in an organization

Positioning

The basic discipline with which the position school functions is with the military history and the economics of the industrial organization.

The users are Analytical staff types, writers and US consulting boutiques.

The intended message for positioning school of thought is to analyze deeply

Making strategy as a calculation rather than creation or getting committed to it.

The strategy system gets reduced to generic positions which is selected through formalized

The contribution of this earlier school toward the 7 next other school:

In all the ten schools of thought,the strategy formulation process is to be treated as a 'black box' as none of the them and none of the thoughts are able to explain clearly how an individual or a team is able to leap by gathering and analyzing the information and finally developing concepts realizing the set of course of action.We can draw into a conclusion that none of the ten approaches are able to complete.Each school of thought offers some strong points that help in understanding and some useful concepts too.

With regards to the contributions of the earlier school of thought with the seven other schools we can have few points with respect to design,planning and positioning school of thought. The main contributions of design school of thought is reduced ambiguity,simplicity,And it is very useful in stable environments.It helps in supporting strong,visionary leadership.

The contribution of Planning school of thought approach is that it gives clear direction and enables firm resource allocation.With this approach the analysts can prescreen the information and judge the crafted strategies.

The contributions of Positioning school of thought is that the strategic management is transferred into science thus enables progress.Thus by providing full content in a systematic way.It focuses on hard economic facts.Mainly it is used in stages of strategy development when data is being analysed. Thus it helped in proving lucrative to consultants and academics who usually sink into hard data and thus promoting their scientific truth to companies and journals.

Conclusion:

The ten school of thought provides a useful illumination of the origins and characteristics,features,contributions in formulating a strategy.There is always a need for a wider systematic perspective & better practice ,but a narrow technique or a theory.Thus there ends a theme for strategy systems in knowledge based economy.With Mintzberg's ten schools of thought we come to know that the strategy the needs to be formulated needs to be complex,multidimensional in nature with an enterprise for a knowledge based ecosystem.Alsoit points that there is a lack of coherence in the knowledge in a concerned field of strategy theory.Each of the ten schools of thought represent a specific angle and approach to strategy formulation.However [Mintzberg,2000] adds that each school of thought is concerned with a certain aspect of the total picture while ignoring the other aspects of the approach along the way.Also [Elfring and Volberda, 2001] adds that: If the contributions, shortcomings, assumptions and context of the diverse schools of thought are made more explicit, the fragmentation within strategic management is made painfully obvious".

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