Overview – Resource – Ten Major Strategic Management Schools #2

Mintzberg’s Ten Schools of Thought about Strategy Formation

Model Approach Basis Contributions Limitations Typical
The Design School
A process of conception
Clear and unique strategies are formulated. The internal situation of the organisation is used to match the external environment. Architecture as a metaphor. Order.
Reduced ambiguity.
Useful in relatively stable environment Support strong and visionary leadership.
Simplification may distort reality.
Strategy has many variables and is inherently complex.
Bypassing learning, inflexible in fast-changing environment.
High risk of resistance
SWOT Analysis Ashridge Mission Model
The Planning School
A formal process
A rigorous set of steps are taken, from the analysis situation to the execution of the strategy Urban planning, system theory, cybernetics Gives clear direction.
Enables resource allocation.
Can become too static
Risk of groupthink
Predicting is difficult
Top Management must create strategy from an ivory tower
Theory of Mechanistic and Organic Systems
Parenting styles
Levers of Control
Scenario Planning
The Positioning School
An analytical process
It places the business within the context of its industry and looks at how the organisation can improve its strategic positioning within that industry Industrial organisation and military strategy Strategic Management is a science. Provides content in a systematic way to the existing way of looking at strategy Focus on hard facts. Particularly useful in early stage of strategy development, when date is analysed. SAME AS PLANNING SCHOOL. Neglects power, politics, culture, social elements. Is biased towards large firms. Number-oriented. Competitive Advantage.
Five Forces.
Value Chain BCG Matrix.
Game Theory.
The Art of War (Sun Tzu)
The Entrepreneurial School
A visionary process
The visionary process takes place within the mind of the charismatic founder or leader of an organisation.
Rely heavily on intuition, judgement, wisdom, experience and insight
Economics A sound vision and a visionary CEO can help organisation to sail cohesively through muddy waters especially in early or very difficult years for the organisation.
Deliberate in broad line but flexible and emergent in the details.
Sailing a predefined course can blind someone for potential developments or unexpected dangers.
How to find the right leader?
Entrepreneurial, visionary leaders have a tendency to go too fat.
Being a CEO would be very demanding in this perspective
Entrepreneurial Government
Seven surprises for new CEO’s
Leadership styles

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