The complete guide through the wilds of strategic management
Strategy Safari
Written by: Henry Mintzberg, Bruce Ahlstrand, Joseph Lampel
1. The Strategic Management Beast
Since no one has had the vision to see the entire beast, everyone has grabbed hold of some
sport or other and ‘railed on in utter ignorance’ about the rest.
- ‘We are the blind people and strategy formation is our elephant’.
Why ten?
In a colourful article entitled ‘The magical number seven, plus or minus two: some limits on
our capacity for processing information, psychologist George Miller (1956) asked why we tend
to favour a quantity of about seven for categorizing things.
- Seven is about the number of ‘chunks’ of information that we can comfortably retain
in our short-term memories.
o Those interested in strategy are no ordinary mortals and should be able to
comprehend one more than the magic number seven plus two → 10 schools
of thought on strategy formation.
Cognition aside, ten distinct points of view did emerge. Each has a unique perspective that
focuses, like each of the blind men, on one major aspect of the strategy-formation process.
The schools
The schools, together with the single adjective that seems best to capture its view of the
strategy process, is listed below:
Prescriptive schools: more concerned with how strategies should be formulated rather than
with how they necessarily do form.
1. The Design School Strategy formation as a process of conception.
• Strategy formation as a process of informal design.
2. The Planning School Strategy formation as a formal process.
• Strategy making as a more detached and systematic process of formal
planning.
3. The Positioning School Strategy formation as an analytical process.
• Focuses on the selection of strategic positions in the economic marketplace.
Descriptive schools: have been concerned less with prescribing ideal strategic behaviour than
with describing how strategies do, in fact, get made.
4. The Entrepreneurial School Strategy formation as a visionary process.
• Strategy formation as a process in terms of the creation of the vision by the
great leader.
5. The Cognitive School Strategy formation as a mental process.
• Use the messages of cognitive psychology to enter the strategist’s mind.
6. The Learning School Strategy formation as an emergent process.
• Strategies must emerge in small steps, as an organization adapts or learns.
7. The Power School Strategy formation as a process of negotiation.
• Strategy formation as a process of negotiation, whether by conflicting groups
within an organization or by organizations themselves as they confront their
external environment.
8. The Cultural School Strategy formation as a collective process.
• Fundamentally collective and cooperative process.
9. The Environmental School Strategy formation as a reactive process.
• Strategy formation is a reactive process in which the initiative lies not inside
the organization, but with its external context.
10. The Configuration School Strategy formation as a process of transformation.
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, • People in this school cluster the various elements of the beast into distinct
stages or episodes → different kind of schools in different phases of strategy
making.
A field review
The literature of strategic management is of a very great extent and it continues to grow
larger every day.
- Not all of this comes from the field of management. All kinds of other fields make
important contributions to our understanding of the strategy process.
Strategy formation is not just about values and vision, competences and capabilities, but also
about the military and Machiavelli, crisis and commitment, organizational learning and
punctuated equilibrium, industrial organization and social revolution.
- It is a field review: we seek to cover the literature and the practice to set out its
different angles, orientations, and tendencies.
Five Ps for Strategy
What does strategy mean?
The definition of strategy is:
According to Wright et al (1992): ‘’top management’s plans to attain outcomes consistent with
the organization’s missions and goals’.
→ According to Mintzberg (1987) strategy requires a number of definitions, five in particular.
Strategies as plans and patterns
(1) Strategy is a plan, a direction, a guide or course of action into the future, a path to get
from here to there. Strategy is intended.
- Strategy is developed consciously and purposely for a future situation.
o However, when you ask a person to describe the strategy that his or her own
organization actually pursued over the past five years. You will find that most
people are perfectly happy to answer that question, oblivious to the fact that
doing so violates their very own definition of the term.
(2) Strategy is a pattern, consistency in behaviour over time, which means looking at the past
behaviour. Strategy is realized.
- With strategy as a pattern, we learn to appreciate that what was successful in the
past can lead to success in the future.
Both definitions appear to be valid: organizations develop plans for their future and they also
evolve patterns out of their past.
- Must realized strategies always have been intended?
o The vast majority of people mention a bit of this and a bit of that. Perfect
realization implies brilliant foresight, not to mention an unwillingness to adapt
to unexpected events, while no realization at all suggests certain
mindlessness.
▪ The real world inevitably involves some thinking ahead as some
adaptation en route.
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,Strategies as deliberate and emergent
Intentions that are fully realized can be called deliberate strategies.
- Those that are not realized at all can be called unrealized strategies.
An emergent strategy is where a pattern is realized that not expressly
intended.
- Actions were taken, one by one, which converged over time to some
sort of consistency, or pattern.
All real-world strategies need to mix these in some way: to exercise control
while fostering learning.
- Strategies have to form as well to be formulated. Thus reflect the
conditions at hand, notably the ability to predict as well as the need to react to
unexpected events.
o Umbrella strategy means that the broad outlines are deliberate, while the
details are allowed to emerge en route.
Strategies as positions and perspective
(3) Strategy is a position, namely the locating of particular products in particular markets.
- With position strategy is about how the organization relates to its competitive
environment, and what it can do to make its products unique in the marketplace.
- Position looks down to the ‘x’ that marks the spot where the product meets the
customer, as well as out to the external marketplace.
o Example: Egg McMuffin, for the breakfast market.
(4) Strategy is a perspective, namely an organization’s fundamental way of doing things.
- Perspective emphasizes the substantial influence that organizational culture and
collective thinking can have on strategic decision making within a company.
- Perspective looks inside the organization, inside the heads of the strategists, but also
up to the grand vision of the enterprise.
o Example: the McDonald’s way.
We need both definitions. But while changing position within perspective may be easy,
changing perspective, even while trying to maintain position, is not.
- Example: Big airlines competing with their new discount rivals.
All the Ps
(5) Strategy is a ploy, that is a specific ‘manoeuvre’ intended to outwit an opponent or
competitor.
- Mintzberg says that getting the better of competitors, by plotting to disrupt, dissuade,
discourage, or otherwise influence them, can be part of a strategy.
Combing plan and pattern with position and perspective, we can derive four basic approaches
to strategy formation, which correspond to some of the schools.
- Strategic planning: planning, design and positioning schools
- Strategic visioning: entrepreneurial, design, cultural and cognitive schools
- Strategic venturing: learning, power and cognitive schools
- Strategic learning: learning and entrepreneurial schools
Deliberate Plans Emergent patterns
Tangible Positions Strategic Planning Strategic Venturing
Broad Perspective Strategic Visioning Strategic Learning
Strategies for better and for worse
For every advantage associated with strategy, there is an associated drawback or
disadvantage.
1. ‘Strategy sets direction’
Advantage: the main role of strategy is to chart the course of an organization in order
for it to sail cohesively through its environment.
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, Disadvantage: strategic direction can also serve as a set of blinders to hide potential
dangers. Setting out on a predetermined course in unknown waters is the perfect way
to sail into an iceberg. It is also important o look sideways.
2. ‘Strategy focuses effort’
Advantage: strategy promotes coordination of activity. Without strategy to focus
effort, chaos can ensue as people pull in a variety of different directions.
Disadvantage: ‘groupthink’ arises when effort is too carefully focused. There may be
no peripheral vision, to open other possibilities.
3. ‘Strategy defines the organization’
Advantage: strategy provides people with a shorthand way to understand their
organization and to distinguish it from others.
Disadvantage: to define an organization too sharply may also mean to define it too
simply, sometimes to the point of stereotyping, so that the rich complexity of the
system is lost.
4. ‘Strategy provides consistency’
Advantage: strategy is needed to reduce ambiguity and provide order. Strategy is like
a theory: a cognitive structure to simplify and explain the world, and thereby facilitate
action.
Disadvantage: every strategy is a simplification that necessarily distorts reality.
Strategies and theories are not reality themselves, only representations or reality in
the minds of people.
The major role of strategy in organizations is: it resolves the big issues so that people can get
on with the little details.
- We can take some things for granted, at least for some time.
Even though the concept of strategy is rooted in stability, so much of the study of strategy
focuses on change.
- While the prescription for strategic change may come easily, the management of that
change comes hard.
o The very encouragement of strategy to get on with it, impedes their capacity
to respond to changes in the environment.
Strategies are to organizations what blinders are to horses: they keep them going in a straight
line, but hardly encourage peripheral vision.
- Strategies can be vital to organizations by their absence as well as their presence.
Strategic management in the classroom
As Hart has noted, ‘High performing firms appear capable of blending competing frames of
reference in strategy making. They are simultaneously planful and incremental, directive and
participative, controlling and empowering, visionary and detailed’’ (1991).
2. The Design School: strategy formation as a process of
conception
The design school represents, without question, the most influential view of the strategy-
formation process.
- The design school proposes a model of strategy making that seeks to attain a match,
or fit, between internal capabilities and external possibilities.
o ‘’Economic strategy will be seen as the match between qualifications and
opportunity that positions a firm in its environment.’’
Origins of the design school
Philips Selznick introduced the notion of ‘distinctive competence’: the need to bring together
the organization’s internal state with its external expectations, and argued for building ‘policy
into the organization’s social structure’, which later came to be called implementation (1957).
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