Mintzberg and Strategic Managment - Assignment Example

Introduction The objective of this study is to discuss, evaluate and situate the work of Mintzberg in the field of Strategic Management. The strategic management of the organization is responsible to analyze the workforce or the resources that are available to the organization and align them to the mission, goals and the objectives of the organization. Although, the work of Mintzberg has consistently been used by several leading organizations but the ideas and work of Mintzberg has continually been criticized and contradicted by several analysts. This is prominently due to the understanding of Mintzberg where he indicated that employees are the most crucial assets of an organization and must be treated equally so that they can be made adaptable by the system. Rather than forcefully implementing the system on the employees, the employees should be provided with strong and solid reasons to change. Nonetheless, forcefully implementation of the system would make the employees become rigid which will eventually impact the achievement of organizational goals and objectives. To overcome strategic management related issues, organizations have consistently implemented the theories proposed by Mintzberg with an aim to overcome the issues in an effective and efficient manner (Landrum, Gardner and Boje, 2013). Mintzberg has spent several years in the study of strategic management. He has provided several models and arguments relating to strategic management which are still used today. The propositions of Mintzberg and the contradictions towards his propositions will be discussed in this report. This report will discuss the categories of strategy formation along with the model of 5 P’s proposed by Mintzberg for the strategy formation. There are two categories of the strategy formation, the deliberate and the emergent strategies (Landrum, Gardner, &Boje, 2013). These will be discussed to highlight the steps involved in the forming of the five P’s of strategy formation. This report will also discuss the four levels of strategy formation with respect to the hierarchy of the organization. The decision and the strategies which are formed on different hierarchal levels and their implementation in the organization will also be discussed in this report. Additionally, the fallacies proposed by Mintzberg focuses on planning to overcome the unforeseeable events before it even occurs (Mintzberg, 1994). Strategic management tends to focus on the development and formation of strategies that could help an organization in the achievement of desired goals and objectives. In order to do so, the concept of diversification plays a dominant role under various situations. For instance, an organization can distinguish itself in the market through diversification in new market, diversification of the organization to achieve and improve efficiency along with diversification through innovativeness (Mintzberg, 1994). For an organization to significantly increase its efficiency and to reduce the costs associated with the business, the organization focuses upon the use of diversification and outsourcing of products. The reduction in the cost of production reflects that the organization would have an opportunity to enhance its revenues along with profitability to great extent (Landrum, Gardner and Boje, 2013). In particular, the aim of this research would be to highlight the contributions of Mintzberg towards strategic management. The ideas and concepts proposed by Mintzberg significantly contradict the traditional methods and theories that are followed through centuries. In order to gain clear understanding, the debates contradicting Mintzberg’s work and contribution have been taken into consideration. For further assistance, Apple Inc. would be taken as an example that is continually applying the theories proposed by Mintzberg for the formation of strategies to accomplish and achieve the desired goals and objectives in the forthcoming years. Henry Mintzberg’s Contribution towards Strategic Management Mintzberg’s contribution in the field of strategic management is unquestionably outstanding. The overview of the major contributions of Henry Mintzberg in the field of strategic management is as follows; I. Deliberate and Emergent Strategies Deliberate and emergent strategies are two distinguished categories of strategy formulation that have proved to be useful for variety of organizations in the world till today. Both the strategies could be defined as; Deliberate Strategies The deliberate strategy is the process where the organization tends to ignore the formulation of strategies and implements them without having clear understanding of the mission, vision, goals and objectives of the company. These strategies are the mirror reflection of intention that is abrupt in implementation due to lack of formation phase. Emergent Strategies This category of strategy focuses highly on the careful and accurate analysis of the company’s goals and objectives along with the mission and vision of the company. After the evaluation, the resources available are effectively analyzed for the accurate implementation of the strategy. Both the categories of strategy are currently employed by several organizations across the globe. Both the strategies have been used by several organizations to overcome the challenges faced in recent years. With the passage of time, the organizations have witnessed severe changes in the implementation of strategy to achieve the desired goals and objectives. Organizations that are still implementing strategies rigid to change are continually having difficulties in the achievement of desired organizational goals and objectives. Although, both the strategies are equally important in today’s competitive environment but only single category of strategy is relevant today. As the strategies are analyzed by organizations from time to time, the decisions taken by the organization to fuel organizational growth are pivotal part of the emergent strategies. Taking an effective decision relies highly on proper planning and implementation due to which is has become an important part of management’s responsibility to remain aware of the goals and objectives along with the mission of the company. For instance, Apple Inc. first plan and then implement strategies as the company is highly aware that implementation without planning would lead to problems within the strategy which would eventually distract the company from its desired goals and objectives. Through effective planning, the company learns about the practices in today’s environment and then implements it flawlessly to gain competitive edge over others in the consumer connectivity gadget industry. Although, both the strategies are being used but deliberate strategies (i.e. Porter’s strategies) are getting a bit long in the tooth for organization in today’s different word. Meanwhile, the emergent strategy ideas are more relevant to meet the needs of today’s world which means that organizations that would focus on deliberate strategies would have higher chances to fail. Emergent strategies allow the organizations to plan for long-term and are considered to be the reality in most of the industry. This is the prominent reason due to which organizations first analyze, plan, formulate and then implement a strategy so that any flaws or bottlenecks within a strategy could be eliminated effectively. II. Mintzberg 5P’s of Strategy Formation According to Mintzberg (1987), the basic role of the strategic management was to evaluate the resources available within an organization so that the desired goals and objectives of the organization could be effectively achieved. Moreover, the management is responsible to mold the behavior of the employees towards the system rather than changing the system according to the behavior and actions of the employees (Mintzberg, 1990). For an organization to be successful in a highly competitive environment, it brainstorms the opportunities with the environment and then plans how to take advantage of the opportunities to accomplish the desired growth in the market. Unfortunately, every organization within the business environment is doing so which means that to be successful, the organization would have to think-out-of-the-box while considering the competitors’ reaction along with the culture and capabilities of the organization. Mintzberg’s proposition was directly related to the process of strategy formation, and the implementation of strategies formulated to witness its impact and influence on the performance of the organization after the implementation of the strategies formulated. The traditional method/practice to formulate strategy focused highly on taking the mission and vision statement of the organization along with the intended goals and objectives to be accomplished into consideration. The intended goals and objectives were aligned in such a way that it reflects the mission and vision of the company. In order to do so, SWOT analysis was conducted which presented the company with its internal strengths and weaknesses along with external opportunities and threats. This significantly helped in the selection and implementation of appropriate strategy by the management (Thompson, Strickland and Gamble, 1998). The development of a robust business strategy relies highly on taking full advantage of the capabilities and strength of the organization. According to Mintzberg, the formation of effective strategy relies highly on the manager to focus on five pivotal areas (Pearce and Robinson, 1997) that are as follows; Strategy as a Plan For a manager to develop a robust strategy for the organization, the manager should focus on analyzing the challenges faced by the organization. This means that the effective development of strategy relies highly on the assessment of organization’s internal strengths and weaknesses. Furthermore, the employees should be aware of the strategic goals and objectives that the organization aims to achieve in the forthcoming years. The problem with planning is that it cannot stand alone and is quite weak on its own. For the strategy to be solid, other 4P’s are essential for the organization to come into play. Strategy as Ploy Getting the better of the competitors is an essential part of a successful strategy. For organizations to achieve its desired goals and objectives, the organization should get the better of competitors through plotting. Plotting can discourage, disrupt and influence the competitors to make a wrong move or could significantly damage the strategy of competitors to achieve their desired goals and objectives. Ploy being an essential part of the strategy significantly helps the organization to set its ground in front of the competitors but in order to do so, the organization must be potentially aware of its strengths and capabilities. This could help the organization to reflect its intentions to the customers in more accurate and inevitable manner (Mintzberg, 1987). Strategy as Pattern Strategy as pattern could be regarded as the reflection of earlier strategies (i.e. plan and ploy). Sometimes, the past organizational behavior gives rise to a strategy which is completely unintentional. These strategies are formed by companies through a pattern that is built on past experiences. Therefore, these decisions are spontaneous and take longer period for the strategy to be formulated and implemented. This reflects that the strategy as pattern is in contrast to the deliberate practices of plan and ploy. Being a consistent and successful way of doing business in earlier years, organizations tend to develop this pattern as a strategy to further enhance their success within the business environment (Mintzberg, 1987). Strategy as Position Positioning, in short, an alternative to define strategy i.e. how an organization decides to position itself in the marketplace. By doing so, the organization is able to identify the fit between its capabilities and its environment which helps in the development of sustainable competitive advantage. To effectively do so, the organization is required to assess its challenges along with the resources available to overcome the challenges and problems. The management focuses on aligning the employees to achieve the goals and objectives in relation to the mission and vision of the company. According to Mintzberg, position strategy allows the organization to position itself in the market according to the mission and vision statement. By doing so, the organization would have an opportunity to develop its competitive advantage (Mintzberg, 1987). Strategy as Perspective Culture within an organization plays a dominant role in the development of strategy. For an organization to achieve the desired results, it is essential that the employees should be delivered with the perspective of the strategy. Employees are the most valuable asset of an organization and can help the organization to great extent in the achievement of desired goals and results. According to Jasper and Crossan (2012), for an organization to achieve satisfactory results through the strategy, the organization must communicate and deliver the perspective of strategy to the employees. This reveals that for an organization to successfully implement a strategy, it must communicate and collaborate with the employees to do well. Considering the technologically advanced giant Apple Inc. all the five 5P’s are reflected within the organization’s strategy formulation and implementation. This reflects that Apple Inc. is continually focusing on getting as much value it can from the market through its well devised strategies. For instance, Apple focuses highly on planning due to which the organization was provided with an opportunity to gain the leading position in the consumer connectivity gadgets. Additionally, the consistent innovation and industry transformational efforts of the company are acting as a ploy for competitors. For example, Apple accused Google after the acquisition with Motorola (i.e. loosing giant in the consumer connectivity gadget’s industry) through its own developed iOS. Similarly, the innovativeness of the company could be regarded as the pattern of organization to enhance the success ratio within the industry. As a result, the organization was provided with an ability to position itself as the innovative leader in the consumer connectivity gadget industry. The development of such strategies at Apple, the employees are consistently delivered with the culture and organization’s perspective due to which the employees work towards the achievement of organizational goals and objectives rather than personal goals. The 5Ps of the strategy formation are not just limited to a single organization or a single country but it has continually been used by several organizations in the development of robust strategies. For instance, the ministries of health were continually facing difficulties due to decentralized operations along with operation of policies. With this model at work, the inefficiencies and the problems associated with the health ministry were analyzed which provide the ministry with an opportunity to formulate and implement strategies to eliminate the challenges. This reveals that after several years, the 5Ps to strategy formulation are still used by several organizations for the formulation and implementation of effective strategies to gain value and to achieve the desired goals and objectives. When compared to Porter’s five forces, it was revealed that both (Henry’s 5P’s of strategy formulation and Porter’s five forces) holds equal importance in the 21st century. The porter’s five forces provide the organization with an insight regarding the competitive environment which is used for the development of strategy to accomplish the desired goals and objectives within the same competitive environment. Whereas, Mintzberg 5P’s of strategy formulation provides the organization with an opportunity to analyze the competitive environment through proper planning. However, the apparent shifts in the business environment may tend to indicate that Porter’s five forces has certain limitations due to which the theory proposed by Porter would not suffice in the modern business environment. For instance, the model proposed by Porter failed to acknowledge the benefits of competition on dynamic level. The globalization has significantly increased competition within the market. As a result, remaining competitive in today’s business environment has become far trickier than ever1. This means that Henry Mintzberg’s theory regarding the 5ps of strategy formulation is still relevant in today’s competitive environment. III. Strategy Development For an organization to operate smoothly within a business environment, it must ensure effective strategy development. Diversification and innovation are the most frequently used strategy to penetrate a market or to expand the product. As the organization goals and objectives are aligned with these strategies, it has become essential for the organization to accurately analyze the internal and external factors (Hussey, 2012). A strategy needs to be effectively planned as it reduces the firm’s risks and losses. For an organization to focus of diversification and innovation it must focus highly on planning and analysis of consumer buying behavior. Diversification and Innovation This strategy is used when the expansion of the product is required within the same markets or the new markets. The product expansion can be done by innovation. Different strategies have been used by firms to grow and innovation has been one of the successful strategies (Mintzberg, Ahlstrand, and Lampel, 2009). New product developments and targeting it in a particular market is also referred to as diversification. In the fast growing and competitive world diversification and innovation work hand in hand. The organization which is quicker to respond to the market change are the once which can sustain in the markets. Marketing strategies are formed to improve the functionality of the business, increase the profitability of the company and to increase the value of the product for the customers. Innovation creates value for the product in the eyes of the customers. The proper implementation of the strategies increases the value of the product for the customers. This increased value results in the profitability for the firm. This strategy which is used for this purpose is the Blue Ocean Strategy. This strategy revolves around the basic principles of creating a product which has no competition in the existing market. This strategy becomes red when the competitors start entering in the market (Boyd, Haynes, Hitt, Bergh, & Ketchen, 2012). Diversification and Entering New Markets When a company plans to diversify and enter into new markets it needs to form the strategies which are very necessary for the establishment of the products. In the new markets the culture is different; the economic factors are also different. In such a market it is very important that the management considers the factors which can turn out to be a threat for the company. The management to ensure the efficiency of the and proper functioning of the policies needs to form the strategies which are required to overcome the challenges (French, 2009). For instance, Apple Inc. is constantly ensuring growth by capitalizing its resources and its ability to provide the customers in the market with new and innovating products. Moreover, the company is continually providing the wide array of customers with technologically advanced related-products in variety of markets to meet their needs effectively and efficiently. The comparison of strategy development of firms with Ansoff’s idea revealed that both the theories are significantly similar to one another. In addition, the ideas presented within the theory are equally important that for an organization to enhance its growth it must penetrate a market (i.e. through product improvement, updating and building existing product) or it must develop new products for the existing market. In addition, the organization can also find a new market or it should diversify in a totally unrelated market. This reveals that both the theories could be used for the development of growth strategies while increasing the efficiency and effectiveness of the organization in the local and international markets. Conclusion The argument in this report revolves around the basic fundamentals of the strategy formulation and its implementation. This report reflects the comments, discussion and conclusions which are necessary for efficient strategic management decisions which are required to be made. The discussion of the deliberate and the emergent strategies which are used by the management for making the strategies have been discussed. This report comprises of the proposition which Mintzberg gave and the debates which were raised as the time passed. Mintzberg model contradicted the traditional approach of strategy formation. He proposed that a strategy could not be assessed as good or bad until it was properly implemented. The employees are the assets of the organization and they must be aligned to the goals which the company wishes to achieve. Mintzberg is considered as one of the main contributors in the field of strategic management. The definition of strategy presented by Mintzberg is still considered as valid. Moreover, the 5Ps presented by Mintzberg are still used by number of firms around the world while they formulate their strategies. Despite of criticism on Mintzberg’s contribution, the model and work of Mintzberg is still used within several organizations for the achievement of desired goals and objectives. The organization and its management have to face several challenges to ensure efficiency in the operations. The management must be capable to foresee the challenges and form strategies with the increasing challenges to deal with challenges. This is the function of the strategic management of the organization. The purpose of the strategic management is to ensure that the employees working for the organization are aligned to the objectives which the company wishes to accomplish. The most renowned work presented is from Porter and Mintzberg. 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