Introduction

Planning comes after very next to the idea of a business. Starting a business, idea comes first, then comes planning which is how the business will be conducted. Strategy is the “planning” of action of a business. People might think of business without any strategy but business is impossible without it. For an example, setting a simple corner shop at the corner of a road can be a general business, but finding an idea of what type of corner shop likely; coffee shop, grocery shop or cyber cafe etc. could be hard. And it would be even harder to ‘ out of how to run or set the business. For this, business needs appropriate strategy.

Knowing some strategies or implementing some strategies into business is not enough. It is essential or the most important to know the appropriate strategy for a certain business. Otherwise a simple business can face failure.

What is strategy in business?

Strategy is the long term pathway to achieve business goals by utilizing its resources within a competitive environment for the satisfaction of stakeholders. Strategy can lead the business into the right direction. It can show what type of planning need to cope up in a difficult situation and to make the business better in that environment. It makes the most of its resources and fulfils the expectations of the stakeholder.

Strategy Concept:

Despite the vast literature on strategic management, there is no single or unique definition, According to Ansoff (1985). Strategic management is a systematic approach to position and relate the firm to its environment is a way which will ensure its continued success and make it secured from surprises (Ansoff, 1985). Cole argued that strategic management is basically concerned with setting the organization headlines aims, choosing the most suitable goals for such aims and achieving both over time. Strategy is then understood to be acting as a guiding map for the organisation to achieve its clear intention for development and growth.

There are many other different definitions generated from the nature of strategy approach, but they all have one thing in common, which is the aim to maximize the organization performance by enhancing its capability of competition with other organizations functioning in the same competitive environment. Although strategic management as a concept can be defined, it seems to have a lot of ambiguities and complications when it is approached or developed. Hamel supported this argument by stating that “anyone who claim to be a strategist should be intensely embarrassed by the fact that the strategy industry doesn’t have a theory of strategy creation” (Hamel 1998 p10).

The main aim of those business strategies are to find an appropriate business model, which emphasis on the appraisals of the external and internal situations and uncover the threats and opportunities in that business environment which will later reveal the strengths and weakness of the organisation.

Compare and Contrast (Whittington’s Strategy Approaches and Mintzberg’s 10 Schools of Thought):

There are different approaches used in strategy. Before implementing or making decisions which approaches to follow, people responsible for making strategy have to understand the approaches thoroughly and have to be efficient in strategic thinking. According to Whittington (2001) strategy can be categorized in four basic standard approaches: Classical, Evolutionary, Processual and Systematic which have different viewpoints about strategy. Classical approach defines the strategy as a rational process of premeditated calculation and analysis designed to maximize long term advantage and organisational profit. As the business environment has changed and market is much more competitive now many researchers argued that classical approach is not appropriate for any business practice, since classical approach has no mechanism to create strategy and is not suitable for the dynamic and competitive business environments. French (2009) concluded that radical change to open system thinking, especially complex self adapting system, is required (French 2009).

In evolutionary approach is different compare to classical approach. Competition is not detached calculation and analysis but by constant struggle for survival (Cuizon 2009). In evolutionary approach successful strategies appear as the process of the accepted selection, which deliver its result. According to Whittington, important decisions have to be taken based on the market not choices of managers. Evolutionary approach considers the markets too competitive and difficult to judge and believes it is unpredictable to plan for long term strategies though it has the similar view with the classical approach in terms of profit maximizing. But it generates an argument as the basic emphasis of this approach is on survival which obviously challenges the objective of maximizing the profit.

Procession approach has similarity with the evolutionary approach in terms of long term planning. This approach doubts the value of realistic long term planning but it disagrees with the evolutionary approach on the basis of the market to decide the profit-maximizing outcomes as the market is in chaos and has lot of uncertainty. Processual approach states that strategy is an emergent process of learning and adaptation (Whittington 2001); it adopts a pragmatic view aiming to make the sophisticated processes simple in light of the fact the environment is not ideal or perfect.

Systematic approach considers that the organisation should have the capabilities and should be able to plan and act effectively. This approach is much less pessimistic than processual approach about the capabilities of the people to carry out rational plans of actions and much more optimistic than evolutional approach about its ability to define strategy regardless of market forces. The approach believes strategies have to be efficient socially to understand the organisation’s business environment. This means that there shouldn’t be any separation between organisational activities and social factors to ensure success.

Table below explains the summery of Whittington’s thoughts of strategy:

Indicators

Classical

Processual

Evolutionary

Systemic

Deterministic – Emergent

Deterministic

Deterministic

Emergent

Emergent

Single goal or Pluralistic

Single

Plural

Single

Plural

Strategy Style

Formal

Crafted

Efficient

Embeded

Influences

Economics

Psychology

Economics/Biology

Sociology

Period (Decade of Influences)

1960s

1970s

1980s

1990s

Table[1] : Whittington’s four approaches of strategy development

Later Mintzberg elaborated those thoughts in contrast to Whittington’s these four approaches we discussed above. Mintzberg categorized strategy into ten schools of thought. Those schools of thought are categorized in two parts.

1. Prescriptive schools: This part contains three schools of thought (Design, Planning and Positioning). It explains how the strategy should be formulated. In 70s and 80s these strategies were in vogue though to some extend still loved by some of the organisations.

2. Descriptive schools: Contains 7 schools of thought (Entrepreneurial, Learning, Power, Culture, Environmental and Configuration). These schools look at the way strategy is and seen, in other words are more about how strategy arises and emerges.

The view of Mintzberg’s strategy was basically a reaction against the linear, rational view of strategy that had dominated strategic management until mid 80s (Mintzberg 1994; Mintzberg et al. 1998). He proposed a practical and incremental view of strategy. This approach is based on observation of how the organisations actually develop their strategies, which are patterns of behaviour that emerged and become ordered over time. Related to that of Mitzberg, Whittington’s approach differs subtly since the focus is upon strategy as a social practice.

Table bellow describes the summary comparison of Mintzberg’s school of thought and Whittington’s approaches of strategy: