NINE SCHOOLS OF THOUGHT IN STRATEGIC MANAGEMENTA school of thought is understood to be the range of thought of aspecific group of researchers, which has crystallized within the field ofstrategic management (Brown, 1993).School of thought are divided into two category : Prescriptive Descriptive
PRESCRIPTIVE SCHOOL Prescriptive schools focus on more the process of strategy makingrather than the contents of the strategy where they are the only strategymaker in the organization and made without the help of any nonconscious intuition. (MacBeath, 2008). Prescriptive divided into threecategories, which are: Design Planning Positioning
THE DESIGN SCHOOL ( A N D R E W S, 1 9 6 5 ) The ‘design’ school is responsible for the development of theStrength Weaknesses Opportunities Threats (SWOT) model. In design key role played by board of directors and chairperson. Explicit prescriptive use as a strategy in design. the ‘design’ school it is very difficult to point to a specific rootdiscipline. the environment is seen as relatively constant.
THE PLANNING SCHOOL (ANSOFF, 1965) the ‘planning’ school has its theoretical roots in system theory and cybernetics. The central actor of planning is the planner of the company such as top management. Formulating, programming and budgeting are main steps of planning school . The steps are done in controlled and stable environment. For strategy made explicit plan to implement those steps.
THE SCHOOL OF POSITIONING ( P O RT E R , 1 9 8 0 ) The central focus of the ‘positioning’ school is the industrial– economic angle. Competitive position are analyzed by three generic strategies: cost-leadership, differentiation or focus. Economic variables are analyzed in positioning.
DESCRIPTIVE SCHOOL OF THOUGHT Entrepreneurial Cognitive Learning Political Cultural Environmental
THE SCHOOL OF ENTREPRENEURIAL (SCHUMPETER, 1934) In the ‘entrepreneurial’ school, the environment is not a stable factor;it can be influenced and manipulated. Entrepreneurs are capable of bringing new innovative products andservices into the market. It developed on the basis of idiosyncratic dynamics, quite detachedfrom the existing ‘laws’ of the market. It is the entrepreneurs with a vision of the future who determine theenvironment and not vice versa.
THE COGNITIVE SCHOOL ( S I M O N, 1 9 7 6 ) The cognitive school of thought has psychology of rootdiscipline. In the cognitive school the individual is the unit of analysis andstrategy formation is based on ‘mental maps.’ In particular, the concept of ‘bounded rationality’ has beenimportant.
THE LEARNING SCHOOL OF THOUGHT ( L I N D B L O M , 1 9 5 9 ; QU I N N, 1 9 8 0 A ) The learning school of thought has psychology of root discipline. This school consider the environment to be very demanding and/or difficult tocomprehend. In these schools strategy will be not so much planned, but rather incrementaland ‘emerging’. In this school strategists must develop a long-term vision while approaching theshort-term step by step. Quinn (1980a) concluded that incrementalism is logical because of the iterativecharacter of strategic management processes and the need to adjust strategiescontinuously.
THE POLITICAL SCHOOL OF THOUGHT ( A L L I S O N , 1 9 7 1 ; P E R R O W, 1 9 7 0 ) The political school of thought is non-logical incremental forms ofbase. The contribution of the political school of thought to the strategicmanagement field consists of concepts such as power and coalitions. This school of thought is strongly influenced by political science. The latter level of analysis is the meso level in which the environmentis clearly malleable.
THE CULTURAL SCHOOL OF THOUGHT (NORMANN, 1977) In the cultural school of thought, developing a common perspective for the organization is the central issue. A strategy can only be successful if it is deeply rooted in the company culture and, accordingly, the development of common values and insights is a central issue. The conceptual breeding ground for this school of thought is anthropology.
THE ENVIRONMENTAL SCHOOL OF T H O U G H T ( H A N N A N A N D F R E E M A N, 1977) This school has been strongly influenced by the work of ‘population-ecologists’. By analogy to biology this school look at organizations with the aid of the variation–selection–retention model. The key player of this school is stakeholders. This school of thought use in specific position as a strategy.