Organization’s Strategy and Strategic Planning
Strategy and strategic planning have been viewed differently by different people. Mintzberg argues that strategic planning is often confused with strategic thinking but they are different aspects. Strategic planning leads to managers not following the real vision and thus strategic plans are mostly not successful. Strategic planning implies the expression of already existent visions or strategies. According to Mintzberg, the process of strategy making involves taking into account what the manager has learned and then making a vision out of the learning. It is the vision that is made that guides the direction to be taken in the business but not a plan.
Planning is generally about analysis; having the break down of a goal into step and implementing them almost immediately. This implies that it does not involve much of creativity. In management, managers are supposed to be committed and this implies that they involve the people in running the organization. This is where strategic planning fails in that it does not involve management commitment but rather is a calculating style of management; it focuses on the end result leaving out the process which is very important. Strategic planning misses the fact that before work processes can be programmed formally, they must be understood fully.
Strategies may develop unintentionally, without the top management being conscious of it and this is often through learning. Therefore, where strategic planning is being used as the main way of developing strategies, the learning process is hindered and this locks out possible strategies that would have resulted to the increased productivity of the organization. Similarly, Porter argues that for strategies to be effective and to involve learning, they should not be based on a single cycle of planning but rather on a decade or even more.
Contrary arguments to those of Mintzberg are given by Porter. He argues that organizations fail not because they make strategies but because they do not make appropriate distinctions between strategy and operational effectiveness. Porter argues that both strategy and operational effectiveness are important so as to improve performance. Strategy according to Porter is being different from the rival organizations. This is achieved by either being different in the way an organization performs its activities or performing activities that are different from those of the rivals.
Porter defines strategy as the creation of a valuable and unique position and this involves various activities. It means that the organization will be different from similar organizations and thus giving it a competitive advantage. This also involves considering the needs of the customers. The organization, through making strategies is able to tailor its activities so as to meet the specific needs of their customers. In this way, the company is able to keep their existing customers as well as attract new ones.
By incorporating various activities, the organization is able to improve on its reputation. However, this does not imply that the organization will try to be “all things” since it will result in confusing the customers even more. The organization is able to clearly form a framework of operation. This is why trade-offs will be important in strategy; the need for choice is created and this limits what the organization offers.
Further, contrary to the arguments of Mintzberg, Porter argues that to find strategies needs insight and creativity. Strategic planning will help an organization to discover previously overlooked but unique operational positions. Additionally, it helps the organization to achieve change and plan on the change management. Strategy is fundamental to an organization’s competitive advantage and also towards sustaining that advantage. This is because by making strategies, the building of positions is on a system of activities other than on individual activities which are not easily sustainable.
Mintzberg agrees with Porter in that his arguments do not imply that strategic planners are not necessary. However, what should be transformed are their modes of operations. Other than focusing inside the process of making strategies, they should focus around it. This implies that their job should not be on finding a specific correct answer but rather be broad and consider various issues.
References
Mintzberg, H. (1994). The fall and rise of strategic planning. Harvard business review. p. 107-114.
Porter, M.E. (1996). What is strategy? Harvard business review. p. 60-78.
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