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The criticism against this thought scool are : No clarity in the organization in terms of it's strenghths and weaknesses. When ,how and when not should be the strategies formulated The major assumption is that the data can be aggregated and transmitted to the upper levels without substantial losses Other major assumption is that environment can always be understood and is sufficiently stable in the future.
Example : Design School Microsofts share has been falling in the recent past.The reason can be attributed to lack of long term contracts with OEM manufacturers and good design team which can influence the customers to a large extent.In order to bridge this gap,Microsoft entered in to a strategic alliance with NOKIA there by acquiring the capability internally.
The premises of this school are as follows : Strategies are a result of control,formal planning,breaking down in to steps with a checklist and support by techniques. Responsibility of the entire process vests with the leader(The CEO) Strategy needs to be made more explicit in terms of objectives,budgets,programs and operating plans.
The major criticism is : It assumes that the organizations can predict the future/environment remains fairly stable Effective strategy making connects action to thought process which in turn connects implementation to formulation which is missing. Formal systems could never internalize, comprehend and synthesize information.
Example : Planning School In the last quarter, results of INFOSYS were slightly on the lower side of the market.Now,in the process of improving these numbers it needs to analyse the following : Internal factors : Attrition rate , Number of new clients added External Factors : How European markets are performing,General GDP outlook,etc.
The criticism of This school are : 2 The focus is narrow. It's biased towards traditional big business
Example : Positioning School Positioning is a way to bring customers.Toyota is perceived as an affordable car manufacturer all around the world.When Toyota came with Lexus its luxury Sedan,it felt that its perception of affordable car manufacturer would hurt the sales of Lexus.Henceforth,it decided to hiveoff Lexus as its sub brand and launched it as a different brand.
The premises of the school are : Strategy exists as a perspective in the leader's mind The formulation process is conscious only to an extent Leader promotes vision and watches it cloasely and makes changes if necessary Strategic vision has got flexibility and hence the organizations.(Simple structure in response to Leader's directives)
The criticism of this thought school is that it centres the strategy formulation on the leader,an individual.In case of confusion the employees may become hostile and may demand a new leader. Example : Entreprenurial School GE is a very good example in this context which claim s to have produced largest number of CEOs than Harvard.When Jalk Welch took over the leadership he dismantled the way the organization was functioning under Jones and same was the case when Jeff took over Jack.
It says the external environment is very dynamic and can't be predicted by anyone even with utmost cognitive power. Example : Cognitive School Linked in has learnt over time that there is a need for the social networking at professional stage.They could foresee a need for such network and came up with the site.Now its a huge success.
The premises of the school are as follows : The complex and unpredictable nature of the organisation's environment makes formulation and implementation indistinguishable beyond an extent. Leader must learn but more commonly it is the collective system that learns. Learning takes place through behaviour through simultaion so that some sense can be made out of the action.
Criticism of this thought school are : There is always a threat of taking the extreme positions wrt strategy i.e No Strategy,lost strategy or wrong strategy.
The premises of the model are : Strategy is build up by power and politics either as a process with in the orhanisation or as a behaviour or of the organization itself in its external environment. Such emerging strategies which result from process take the form of positions and ploys. Micropower views strategy as an interplay and confrontation similar to how the politics works. Macropower views the organization as supporting the the organization's development by controlling and cooperating with other organizations by maneuvring in the forms of various networks and alliances.
The criticism of this school of thought is that though political dimension can have a positive impact we should not under estimate the disadvantages and the confusion it creates. The following are the major contribution to this field : Coalition Political Games Collective Strategy Significance of politics in promoting strategic change
Example : Power School Vedanta used its relations with higher ups in politics to get the rights for mining .Though it got in to trouble later on but the political relations worked out for it.
The premises of this school are : Strategy is formed based out of interactions with society and beliefs and understandings mutually shared by the members. Individuals acquire these over time through day to day interactions which is mostly tacit and non verbal rarely through some formal procedures. It takes the form of perspective above all even above positions which is rooted in the common good and it gets reflected in the patterns by which capabilities of the organization are protected and leveraged. Culture and in specific the ideology do not support the strategic changeso much as the perpetuation of existing strategy.
The criticism of this theory is that it's very vague.And it's hard to come up with with a strategic management with this philosophy.Nonetheless this shool of thought adds substantial value to the organization. Example : Culture School Some of the strategies are based on the social forces of the culture.The survey conducted to know the reason why attrition rate of women aged 25yrs was less in Infosys,the reason was found to be the campuses being big and well maintained in such a good way that they make them forget their family problemsonce they are in to the campus.
The criticism of this school is that environment is very subjective and vague.Contribution of the school gives central role to the environment in strategy formation. Example : Environment School When Toyota felt that there were issues ith the cars it manufactured and that the environment was turning hostile,they recalled the cars in huge numbers even though it was turning against them.
The four main patterns are : Periodic bumps Oscillating shifts Life Cycles Regular Progress
The premises of This model are : Most of the time an organisation is believed to have a certain static configuration of its attributes. Hence it adopts a form of structure which suits its needs and this gives rise to particular set of strategies These periods are sometimes disturbed by some processes. These successive patterns order themselves in to patterns over a period of time designing of strategy can be conceptual or a formal planning.
Example : Configuration School Google is one of the leaders in todays hyper competitive environment.It adapts itself to the environment.For example ,in response to witter it came up with Buzz ,In response to FaceBook it came up with GooGlePlus.It also entered the Operating System industry.It is in to mailing service and last but not the least in to data maintenance.In data collection and maintenance,it is the leader.In mailing service it is posing a tough competition to rest all service providers.
References :
http://www.strategologybyquattro.com http://facilitatingimpact.blogspot.com http://google.com