It cannot be denied that scholars have reached an agreement on the Importance of strategy, but they do not reach a consensus about the definition of strategy. Until now, there are numerous kinds of definitions on strategy. Strategy always differs from situation to situation or from industry to industry. Even Michael Porter as a management guru does not clearly define what strategy means in his work “What is Strategy? “, though he repeatedly mentioned the concept of strategy.
Based on the debate on the definition of strategy, the purpose of this essay is to perspectives.
To be specific, the main body of the essay will discuss the meaning of strategy through comparing the strategic perspectives of different scholars. Following this, it will come to a short conclusion in terms of above discussion. Meaning of strategy Strategy was firstly used for military purposes and has already had a history of over 2,000 years until now. With the deepening of industrial revolution, the concept of strategy in the United States has gradually been applied to business field.
It is understood that the application of strategy in market and enterprises has been not popular until asses in the United States. Chandler as one of famous representatives in asses had identified the concept of strategy in his book Strategy and Structure. According to Chandler (1962), strategy is defined as “the decision of long-term goals and a series of actions taken and resource distribution required for realizing these goals”. Chandler’s definition against strategy plays a decisive role in researching the problem in relation to corporate strategic management.
From his point of view, structure follows strategy. However, Anions (1965) thought that strategy was a decision-making rule under the condition of incomplete information. He researched the problem regarding strategy from the angle of business internal decision. Andrews (1980), another influential strategic scholar in America, considered that strategy as the decision-making model of an organization determined or revealed business mission or goal, produced major policies and plans of reaching these goals, and identified the scope of business.
In the meantime, he still stressed that strategy was a process and was tightly associated with corporate structure, organizational behavior, corporate culture, and etc. By contrast, Porter, named as the father of odder competitive strategy, believed that strategy was positioning, choosing, and integrating while Miniature (1987) came up with APS of strategy and summarized strategy as plan, pattern, position, perspective, and ploy.
To be specific, strategy is a conscious, expected and organized plan providing development direction and way for an organization; strategy can represent a sequence of detailed actions and real results; to an organization, strategy refers to its position in the market; strategy reflects the value of business strategic decision maker; and strategy can also become means and methods in the course of an action in specific context (Miniature, 1987).
However, Barney (1991) defined strategy as a theory about how an enterprise to compete successfully in the market. In addition to above mentioned definitions, many other scholars have defined strategy. It can be seen from above that scholars have little in common in giving the definition of strategy, so strategy has many definitions to this day. The obscure definitions of strategy bring about the disorder against the academic study and business practice in the strategic domain.
In order to better understand he meaning of strategy, Miniature (1998) divided strategic theory into designing school, planning school, positioning school, entrepreneurial school, cognitive school, learning school, power school, cultural school, environmental school, and structural school from two dimensions of forming strategy, namely, controllable degree of school regards strategic formulation as a process of ideas work; planning school sees strategic formulation as a formal process; positioning school regards strategic formulation as an analytic process; entrepreneurial school regards strategic urination as a process of forecasting; cognitive school considers strategic formulation as a psychological process; learning school regards strategic formulation as a contingent process; power school regards strategic formulation as a consultation process; cultural school regards strategic formulation as a group thinking process; environmental school regards strategic formulation as a reaction process; and structural process regards strategic formulation as a transforming process (Miniature, 1998). Based on these definitions, it is obviously that strategic formulation is regarded as different processes by different schools. Miniature (1998) hoped others to see clearly about strategic management by such a classification. But contrary to expectations, his evasion to the essence of strategy and purpose of strategy makes readers still do not know what strategy really is so as to trap into Miniature dilemma. On top of this, it is really difficult to define strategy.
But, Integer’s understanding of strategy actually lays a good foundation for other scholars to understand the theory of strategy. In the following year, Miniature and Lempel (1999) put forward six ways of looking at strategy in chronological order, such as designing school (asses), planning school asses), positioning school (asses), learning school (asses), resource school (asses), and configuration school (asses). Each school of scholars holds a kind of strategic perspective. Of them, designing school and planning school have the deepest influences. In essence, Chandler’s theoretical understanding of strategy is in accordance with the idea of designing school and planning school. More specifically, the starting point of enterprise strategy is to adapt to environment.
And its essence is an adaptive process for an enterprise to relevant environment and a process of producing changes in the organizational internal structure. For this reason, business organizational structure must be corresponding to business strategy. Then, Michael Porter is the typical representative of positioning school. In his opinion, the achievement of competitive edges is the core of business strategy (Porter, 1998). In addition, designing school, planning school, as well as positioning school are based on the assumption that neither a strategy is correct or false. But, business managers are able to alter the strategy in order to recognize a more suitable strategy. Furthermore, this type of strategy can or cannot rely on previous strategies.
These perspectives are analogical to the definition of Camellias (2008). Strategy is defined as a wicked problem (Camellias, 2008). In another word, strategy is distinct. To obtain a better strategy, managers should be handled continuously. According to this feature of strategy, learning school also has something in common and considers that it is unlikely for strategists to shape a suit of an overall program for the enterprises because of the complexity of enterprise and environment. Besides, positioning school also defines strategy quite different from resource school. Resource school assumed hat business resources and capabilities are two main sources of competitive edges (Miniature and Lempel, 1999).
By contrast, Porter as the representative of positioning chain within a space for competition by classifying strategy into three levels, namely, corporate-level strategy, business-level strategy, and functional-level strategy as well Monsoons, et al, 2012). It is considered that market change development has led to that both schools have different definitions of strategy. It is well known that market is dynamic. When there is a relatively slow market development, there will not be so apparent changes in the space for competition. In this situation, market space can act as the basis for the focus of business strategy. Conversely, it is unsuitable for an enterprise to establish competitive advantage relying on a competition space in a dynamic market environment.
At last, configuration school thinks that strategy refers to a plan, a pattern, a positioning, a tactic, as well as an expectation. It is clear that the perspective of this school is similar to Integer’s APS for strategy. On the basis of Minter’s strategic perspectives, Johnson et al (2012) looked at strategy as design, experience, ideas as well as discourse. From the viewpoint of Johnson et al (2012), strategy is an organizational direction and scope in the long run, which obtains advantage in a changeable environment via its distribution of resources and competences with the purpose of meeting stakeholder expectations. This definition of strategy contains several levels of meaning.
First and foremost, strategy should be a long-term direction and scope of an organization; secondly, strategy can help organizations gain advantage in a changing environment by resources distribution and capabilities; and thirdly, strategy should aim at meeting he expectations of stakeholders. It can be easily found that Johnson et al (2012) also put an emphasis on the environmental impacts on business strategy. To this point, Chandler (1962) also took environment into consideration in analyzing business strategy. Similar to Miniature, Whetting (2001) also classified the theory of strategy and made great contributions to the understanding of theory of strategy. But its standard of classification is the process of strategic output and strategic formulation. On this basis, Whetting (2001) proposed four types of strategic perspectives, that is, lassie school, processors school, evolutionary school, and systematic school.
From the perspective of classical school, strategy can be planned accurately and the aim of strategy is to pursue profit minimization (Whetting, 2001). Market change can be accommodated and predicted by adopting the approach to compile plans. Moreover, the best strategic choice is to rationally analyze every step taken in business battlefield. The evolutionary school also takes a view that strategy aims to achieve profit minimization. Nonetheless, this school takes pessimistic attitude towards if market can be predicted (Whetting, 2001). From its standpoint, market is complex and unpredictable, so relatively practical strategy is to pursue efficiency, control cost, and pursue profit minimization rather than heavily invest in strategic plan.
The processors school agrees to evolutionary school’s Judgment on market but disagree with the view of regarding pursuing profit minimization as the goal of strategy (Whetting, 2001). It is considered that the planning based on predication makes no sense. Strategy is in fact a gradual learning and adaptive outcome in an interactive profit. On the contrary, an enterprise should have more to achieve. And processors school thinks that there is not a best strategy. The focus of strategy lies in finding a doing in accordance to local game rule (Whetting, 2001). It is very important for a strategy to be accepted by the local society, which is the basis of survival and development.
Among these four strategic perspectives, neither perspective is right or wrong. The key is if the strategy is accommodated to the characteristics of the industry that an enterprise operates in and the whole economy. For example, classical model born in asses was appropriate for the economy at that time, so tragic planning was possible in the context of whole upward economy. However, oil crisis in asses thoroughly broke down the sane of strategic planning. As a result, the processors model gradually was valued. In asses, the future became unpredictable with the emergence of information and technology. At that moment, the evolutionary model grasped the discursive power.
But in asses, it has experienced that the world is multi-dimensional so that the best strategy should fit the local game rule. (Whetting, 2001) It can be seen that there is not a correct strategic perspective. Everyone can establish a school to define strategy, only if he/ she can Justify himself/herself. This can explain why there are so many definitions of strategy to some extent. From the above, scholars have had different definitions of strategy. It cannot be said which definition is right or wrong, better or worse. That is because all of them can give their reasons of defining strategy in that manner. Moreover, many definitions of strategy should attribute to that scholars have carried out strategic analysis from different perspectives.
For example, designing school, planning school, as well as consisting school conducted analysis on strategic process in different ways, but all of their analysis is from top to down. That is to say, they reach an agreement on that strategic analysis and strategic formulation was the responsibilities of higher-level managers, and only strategic implementation required the involvement of lower-level managers and employees. By contrast, cultural school checked the strategic formulation at a lower level and found that one or several higher-level managers could not complete strategic formulation without the participation of lower-level managers and employees. In other words, strategic formulation should be an interactive process, which requires full employee involvement.
In addition to differences among the strategic perspectives of scholars, some similarities can also be identified. It is considered that it is urgent to reach a consensus on the essence of strategy and the aim of strategy so as to form a definition of strategy which can be accepted by most of people. Conclusion In a conclusion, the definition of strategy varies from scholar to scholar. This essay has critically discussed the definitions of strategy. Firstly, it has demonstrated little about the history of strategy. Then, it has presented lots of definitions of strategy to justify the statement that strategy has many definitions. Among these definitions, it has particularly focused on Integer’s APS strategy.
Except Miniature, it has After that, it has focused on discussing the definition of strategy from Integer’s, Miniature and Lamp’s, and Whittling’s classification of strategy except the understanding by Johnson et al. Based on the discussion, there are similarities and differences among the definitions of strategy. Most important, Integer’s and Whittling’s strategy is actually contributed for people to understand the strategic theory of different schools. However, various concepts of strategy provided by each school from particular realm and different perspectives might misguide the development of the theory of strategy. It is widely known that there is not a recognized formula against the theory of business strategy until now. This provides opportunities for scholars engaging in studying strategy.
Cite this essay
What is Strategy?. (2020, Jun 01). Retrieved from https://studymoose.com/business-strategy-21-new-essay