Planning school of thought views the strategy formation and implementation as a formal process that requires formal procedures to be followed. It suggests that all the activities in a certain process should be formally taken in a particular set of steps that will provide the only way of success. The school recommends that the analysis of the business situation be objective by focusing more on a particular problem rather than implementing any procedure that was implemented before the particular problem. The concept suggests that each organization should analyze different problems in each situation by exploring the different factors in a problem that will include both internal and external factors. Before dealing with a particular problem, the current condition of the business should also be analyzed so as to learn on the available options that the company has.
After analyzing the various conditions and determining the position of the company, it will be easier to help know the various options that the company has. The company will establish on the best strategy to solve the problem and devise a strategy that will be easier to implement. The school of planning encourages brainstorming of the various problems because each problem is different from the other (Gibbert, 2010). The school establishes that no problem will be similar to another, and it is for this reason that every problem is a different case, different from any previous problem.
Planning school of thought also encourages innovation on the different ways of dealing with a certain problem. There will be no single way of dealing with a particular problem and hence, innovation levels should be high enough so as to make sure that all the problems that arise during business get tackled with ease. The company will be able to establish goals and objectives which will help the company allocate resources according to their needs. Planning school helps a company make its decisions about specific problems with ease rather than having specifically fixed means of solving a problem. It also helps minimize the chances of failure of the decisions implemented; this is because the decisions to be made are tailor made specifically for that particular issue rather than a predetermined method of solving the problems.
The planning school ideology is similar to the five tasks of strategic management process, and it is for this reason that it will find use in the current trends of the business and management practices. The planning concept drains most of its influence from urban planning, system theory and cybernetics. The planning school is better placed than the design school since it creates room for innovation. It states that different problems taken differently, is more efficient method and there should be enough innovation with the management so that they can solve the problems faster rather than having strict single method of doing the activities.
The only disadvantage that the planning school has is the possibility of creating a conflict between various managers. The concept advocates on having a flexible system of solving the problems instead of implementing one single way, for this reason, different managers, will have different ideas about solving particular problems. There are higher chances that between the managers, due to the difference in understanding of various phenomenon that they will not have similar views on tackling particular problems. If the various managers have different opinions on the ways of solving a particular problem, there will arise a conflict between the managers.
Implementation part of the project is also difficult since the managers have to settle on one of the best way of setting the problem. The best way of solving the problem will depend on the managers instinct rather than the facts that are available.
An example of a firm that has incorporated planning school is Clear Shampoo, a manufacturer of cream for the treatment of dandruff. The company used Christian Ronaldo, a famous football player and Rain, a famous pop singer. Using the popular icons was a well-organized strategy that involved widespread research establishing it as the best method to use. In the long run, the company was successful as it recorded a near 3.9% of the growth in the total sales.
Positioning school of thought use most of the planning and designing schools principles. It emphasizes that the strategies to be implemented should be specific in nature. The school views the strategy formation as more of an analytical process that places the business within the context in the industry. It focuses on how the organization can improve its strategic positioning within the industry.
The concept usually recommends that attention be drawn on the current position of the company, with the current conditions of the company, it is easier to make a decision that would help change the current position of the company. The concept suggests that companies should focus on strategies that will change the position of the company by increasing both the market share and having a better approach to the company.
This strategy will only be useful for large firms and highly inefficient for small firms. Restructuring a small company will require heavy investment as it will mean changing all the activities and the means which the company carries out its activities (Gibbert, 2010). The concept also does not account for the external factors but purely focus on the profit returns out of new ventures. Failing to account for external factors such as the political, cultural, technological and social factors might have adverse effects on the company as it will fail on the basic requirements of accounting for all factors affecting the company.
Toyota has been successful in using the positioning school of management. Before, they were known to produce average cars for average people. They needed to reposition themselves so that they could start producing luxury cars and for this reason, they started producing the luxury cars under the brand name Lexus. The cars received positive feedback from the customers despite the company having lower reputation with the customers before the adoption of the positioning strategy.
Design schools are different from the positioning strategy by the fact that design school do not put any limit on the strategies that are available for a certain situation. The positioning school of thought suggest that there only exist some few ways of solving a problem with the presence of some more preferred methods and approaches than the others. Design school also emphasizes that strategies should be substantial and wide in scope of the options while the designing school suggests that the scope of the problem solving and implementation processes should be narrow and focus more on the current conditions rather than being futuristic.
Design school sees strategy as a form of achieving essential fit between internal strengths and weaknesses and the threats to development and lastly opportunities. The senior management will formulate clear strategies in a process that will be carefully thought of basing the ideas on the facts that are available. On the other hand, planning will involve the use of various managers instincts (Hitt, Ireland and Hoskisson, 1999). There will be no single best way to conduct the activities and for this reason, the managers are given the freedom to choose on the best method they think is appropriate to apply. They can settle on any decision they personally feel they can comfortably implement and bring about positive changes.
In Design school, SWOT analysis will be used; it will be applicable where the environment is stable. It is different from the planning school since it emphasizes on using only the internal environment ignoring the external environment. Changes are constant both in the external and the internal environment and for this reason; it should be tracked on both the internal and the external environment.
Planning school focuses more on its customers so as to improve its quality and service delivery. When making strategic changes, the school emphasizes that focus should be put on the customer side by ensuring that the customers are consulted and are free with the change. On the other hand, design school focuses more on the organization and not the employees or its customers. It will be purely based on the SWOT analysis and hence the emphasis will be put on maximizing the use of the strength of the organization so as to maximize on the production. For this reason, design school will be difficult to use its own since it will only focus on the optimal production of the company but ignore customer satisfaction or demand of the product.
Planning school is purely based on the creativity of the employees and the management in adapting to the various situations facing the company, on the other hand; design school will encourage the use of the existing data to make decisions about the company. Using the existing data about the company will limit the amount of innovation needed in the decision making. Strategic management without any level of innovation that is purely based on past figures will be a problem to use since the environment might change and hence bringing complications about the current conditions (Hitt, Ireland and Hoskisson, 1999). Also, the current environment in business conditions will encourage innovation and companies that will not be innovative enough will lose the credibility of the customers and for this reason design school might only be applicable in improving the service delivery or performance of the firm. A company should not rely on the design school of thought alone as it will produce at the optimal level and focus on improving quality but in the long run, their products might be termed obsolete since they did not consult with the customers so as to identify the product on demand.
Entrepreneurial school of strategic management suggests that each organization should have a visionary leader; the leader is bestowed with the authority of making all strategic decisions. The leader is assumed to have widespread knowledge about the issue and also have the best interest of the company at heart. The entrepreneurial school of thought will be mostly applicable on cases where a single person came up with the idea and for this reason, the rest of the people are expected to follow what was originally in the mind of the one who innovated the product or the company (Calvin, 2002). Any future decisions are left to the same manager to decide. All the decisions made in this school are centralized to only one person, this brings problems with the other managers who are not consulted
Entrepreneurial school is different from the planning school due to the freedom given to the managers. While planning school gives the managers the freedom to brainstorm on a particular issue, entrepreneurial school will not give the managers any chance of exercising their freedom. In the entrepreneurial school, all decisions are made by one person for the whole organization; all the suggestions that are put across by the managers must be scrutinized and approved by a single person. Although it will help the organization stay in line with the original goals, it will limit the freedom of the managers and most likely make the managers feel discontented (Calvin, 2002).
While the positioning school focuses on changing the position of the organization, entrepreneurial school will not focus on changing the position but rather, it will focus changing the organization as crafted so as to achieve the original goals. The school will focus only on the fact that the organization was established by a particular individual and for this reason, all the plans that are made should be in line with the original plan and only minimum or no deviation should be allowed.
Planning school will encourage the managers to brainstorm on a particular issue so as to help solve the problem. The managers will be free to decide the best course of action so as to come up with the best course of action. The school encourages creativity as the managers have to be creative enough so as to make the best decisions for their company. In contrast to this, the entrepreneurial school will limit the level of creativity the managers have. Although they can give suggestions to the top manager, they will not be able to have a direct influence on the way the activities get carried out or on the decisions that the top manager will choose.
All decisions in a positioning school are on facts if a decision is to be made; all facts must get analyzed so as to come up with the best action that the company should take. On the contrast to this, facts are not necessarily followed in the entrepreneurial school (Mintzberg, Ahlstrand and Lampel, 1998). Managers are free to pass their views to the CEO but despite this, the CEO is not limited to choosing a course of action to take from the facts provided. The CEO can freely choose any method without necessarily following any instructions but instead basing the decision on the personal feelings.
The cognitive school suggests that organizations following the concept should formulate their strategy by analyzing the psychological needs and desires of the customers. The organizations will focus on giving the customer maximum satisfaction psychologically. The process will have a setback by the fact that it will be expensive to carry out and the fact that it will consume much time conducting the research. There is a setback to the cognitive strategy owed to the fact that its founded on many assumptions, some of these assumptions might be wrong (Sloan, 2006). Strategy makers may rely much on their psychological feelings out of which there will arise a mismatch between what the customers want and what the managers feel. The strategic managers are more likely to be biased to focus on what the company is already producing and work to improve it whereas the customers might not need the current product but rather they may need newly different product.
Cognitive school is different form the planning school due to the level of dependence and freedom the strategy makers have. Cognitive school dictates that the decision to be made must be made on the basis of the customer priorities. Limiting the course of action to pure dependence on the customer view limits the managers on the level of creativity they should exercise. The managers must follow the instructions given from those in field research, and they have limited options on the plans they can implement as they have to be in line with the customer tastes and preferences.
Planning and cognitive schools have a sharp contrast on their implementation basis. While planning stage will be purely based on the instincts of the managers, implementation of the cognitive school must be based on the findings. Cognitive school will involve extensive research on the psychological needs of the customers and hence; it will give the basis for implementation. On the other hand, planning will rely on the managers future expectations of the same and hence not limited to the findings but rather based on management expectations.
Planning school and the cognitive school have some things in common. One of the facts that they both hold is the fact that they both focus on the external environments, and that includes the customer. Although planning school strategic management will be dependent on various factors, it will also focus on the external environment that is the customers. Cognitive school will establish the psychological needs of the customer while the planning school will evaluate all customer factors including current and expected demand for the product.
The positioning school and the cognitive school of strategic planning are similar by the fact that they focus on the customers mind. Positioning school will focus on changing the current position of the organization and at the same time focus on changing the customer mentality about the organization. To do these, both schools call for extensive research about the matter identifying the customers feelings about the current position of the product and the projected change on the same.
The positioning school and the cognitive schools have a difference in the way thy handle the customers. Positioning school will carry out research and implement plans so that they can change the current mentality of the customers about the organization. The organization strategic planners will seek to establish the customer views about the current conditions of the company. From the knowledge, they will come up with the plans on how to shape the organization so as the customer can change the view about the company. On the other hand, decisions in the cognitive school will be purely based on the psychology of the customer. The research will be conducted to establish any customer requirements.
Basing on the above discussion, each school that is suggested above has both weaknesses and strongholds which will make it both favorable and unfavorable to use.
Planning school will be relevant in an environment where the conditions are static, and the environment is bound to change. It will be relevant since it will respond fast to the conditions as the managers can decide on their own according to the current conditions.
However, planning school will have a problem with the implementation due to the divergent views of the managers. Different managers will have different views regarding the same topic. For this reason, each manager will want to have his or her opinion implemented, this will lead to conflict especially if no manager is willing to step down and let another person head the implementation.
Positioning school will be useful if the company is willing to change its style. It will be particularly of great importance if the company producing a particular brand of products wishes to reestablish itself by producing better products that will be more acceptable by the customers.
Design school purely focuses on the SWOT analysis disregarding any external environment including the customers view. The school will only be applicable if the company wants to increase efficiency, but will not be applicable if the organization aims at retaining the customer base.
Entrepreneurial school will only be applicable if the organization aims at remaining on a particular track for a given period (Calvin, 2002). The school only allows for the uniformity of the activities in an organization to ensure it sticks to the original track for establishment.
Entrepreneurial school will not be applicable if the managers require flexibility. This is because each manager would like to feel his or her influence in the management decisions that are made; the managers might not be motivated to carry out the activities they did not take part in developing.
Cognitive school emphasizes on the customer satisfaction through studying the psychology of the customers. The school is highly applicable where the products are the main focus of the organization and it is striving to deliver the best results
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