strategic thinking or strategic planning

8/2/2019 Strategic Thinking or Strategic Planning

1/7

S T R A T E G Y A T T H E L E A D I N G E D G EN E W R E S E A R C H & C O N F E R E N C E R E P O R T S

Stra tegic T hinking or StrategicPlanning?Loizos Heracleous

O V E R F IF T EE N Y E A RS A G O M i n t z b e r g a r g u e d t h a tt h e m e a n i n g o f t h e t e r m ' s tr a te g i c p l a n n i n g ' w a sa m b i g u o u s , a n d t h a t t h e r e w a s a n e e d f o r a c le a ru n d e r s t a n d i n g o f t h a t t e r m . 1 N o w n o t o n l y i s " s t r a -t e g ic p l a n n i n g " s t il l u s e d i n a v a r i e t y o f w a y s , b u tt h e s i tu a t i o n i s m a d e e v e n m o r e c o m p l i c a t e d b y t h e

i n t r o d u c t i o n o f a m o r e r e c e n t t e r m , " s t r a t e g i c t h i n k -i n g " .

T h e r e l a t i o n s h i p b e t w e e n t h e t w o i d e a s o f s t ra t e g icp l a n n i n g a n d s t r a t e g i c t h i n k i n g i s b y n o m e a n s c l e a ri n th e l i t e r a tu r e , w h i c h i s i n a s t a t e o f c o n f u s i o n o v e rt h i s i s s u e . S t r a t e g ic p l a n n i n g i s o f t e n u s e d t o r e f e rt o a p r o g r a m m a t i c , a n a l y t i c a l t h o u g h t p r o c e s s , a n ds t r a t e g i c t h i n k i n g t o r e f e r t o a c r e a t i v e , d i v e r g e n tt h o u g h t p r o c e s s . T h e c o n f u s i o n , h o w e v e r , s t e m s f r o mt h e f a c t t h a t a l t h o u g h t h e r e a r e f r e q u e n t u s a g e s o f t h et e r m s i n t h e a b o v e w a y s , v a r i o u s a u t h o r s s ti ll u s et h e s e t e rm s i n f u n d a m e n t a l l y d i f fe r e n t w a y s . W h i l ef o r s o m e s t ra t e g i c th i n k i n g a n d p l a n n i n g a r e d i s t in c tt h i n k in g m o d e s w h i c h a r e b o t h u s e f u l a t d i f fe r e n ts t a g e s o f t h e s t r a te g i c m a n a g e m e n t p r o c e s s ( e .g .M i n t z b e r g ) , f o r o t h e r s , s t r a t e g i c t h i n k i n g i s n o t s o

P e r g a m o n P I I : S 0 0 2 4 - 6 3 0 1 ( 9 8 ) 0 0 0 6 9 - 7L o n g R a n g e P l a n n i n g , V o l . 3 1 , N o . 3 , p p . 4 8 1 t o 4 8 7 , 1 9 9 8 1 9 9 8 E l s e v i e r S c i e n c e L t d . A l l r i g h t s r e s e r v e dP r i n t e d i n G r e a t B r i t a in0 0 2 4 - 6 3 0 1 / 9 8 $ 1 9 . 0 0+ 0 . 0 0


2/7

m u c h c r e a t i v e a s a n a l y t i c a l ( P o r t e r ) ; f o r s o m e , s t r a -t e gi c p l a n n i n g h a s r e m a i n e d a n a n a l y t i c a l a c t i v it y b u tt h e o r g a n i s a t i o n a l p r a c ti c e s s u r r o u n d i n g i t h a v e b e e nt r a n s f o r m e d ; f o r o t h e r s, t h e r e a l p u r p o s e o f a n a ly t i c a lt o o l s o f s tr a t e g i c p l a n n i n g i s to f a c i l i t a t e c r e a t i v i t y( s t r a t e g i c t h i n k i n g ) ; a n d l a s t l y f o r o t h e r s , s t r a t e g i cp l a n n i n g i s u s e l e s s a n d s h o u l d b e s c r a p p e d i n fa v o u ro f s tr a t e g i c t h i n k i n g .

A n e x p l o r a t i o n o f th e l i t e r a t u r e r e v e a l s t h a t t h e r ei s n o a g r e e m e n t o n w h a t s t r a te g i c t h i n k i n g i s, w h a ts t r a t e g i c p l a n n i n g i s , o r w h a t t h e i r r e l a t i o n s h i ps h o u l d b e . T h i s p a p e r t h e r e f o r e : D i s e n t a n g l e s t h e r e l a t io n s h i p b e t w e e n t h e t e r m s" s t r a te g i c th i n k i n g " a n d " s t r a t e g ic p l a n n i n g " a sf o u n d i n t h e l i te r a t u re , i d e n t i f y i n g f o u r m a i n v a r -i e t i e s o f t h i s r e l a t i o n s h i p . C l a r if i es t h e n a t u r e o f s t r a te g i c t h i n k i n g a n d s t r a -t e g ic p l a n n i n g b y d e v e l o p i n g t h e a n a l o g y o f st ra -

t e g i c p l a n n i n g a s s i n g l e - l o o p l e a r n i n g a n d s t r a t e g i ct h i n k i n g a s d o u b l e - l o o p l e a rn i n g . P r o p o s e s a d i a l e c ti c a l v i e w o f th e r e l a t i o n s h i pb e t w e e n s t r a t e g i c t h i n k i n g a n d s t r a t e g i c p l a n n i n gw h i c h s e e s t h e m a s d i s t i n c t , b u t i n t e r r e l a t e d a n dc o m p l e m e n t a r y t h o u g h t p r o c e s se s .T h e f o l l o w i n g v i e w s o n t h e r e l a t i o n s h i p b e t w e e n s t ra -t e g ic t h i n k i n g a n d s t ra t eg i c p l a n n i n g a r e f o u n d i n t h el i t e r a t u r e :Stra teg ic Planning and S tra teg ic Think ing areT w o D i s t i n c t T h i n k i n g M o d e s , a n d S t r a te g i cT h i n k i n g S h o u l d P r e c e d e S tr a t eg i c P l a n n i n gA c c o r d i n g to th i s v i e w , p l a n n i n g c a n n o t p r o d u c es t r a t e g i e s b e c a u s e i t i s a p r o g r a m m a t i c , f o r m a l i s e da n d a n a l y t i c a l p r o c e s s ; it is r a t h e r w h a t h a p p e n s a f te rs t ra t e g ie s a r e d e c i d e d , d i s c o v e r e d o r s i m p l y e m e r g e .T h i s i s a v i e w a s s o c i a t e d w i t h H e n r y M i n t z b e rg , a r g u -a b l y t h e m o s t t r e n c h a n t c r i t ic o f p l a n n i n g . M i n t z b e r gh a s s o u g h t t o l i m i t th e t h e o r e t i c a l s p a c e o c c u p i e d b yt h e c o n c e p t o f st r at e g ic p l a n n i n g b y s u g g e s ti n g t h a t i ti s b a s e d o n c e r t a i n f a l l a c i e s . F i r s t l y , t h e f a l l a c y o fp r e d i c t i o n , t h e b e l i e f t h a t p l a n n e r s c a n p r e d i c t w h a tw i l l h a p p e n i n t h e m a r k e t p l a c e . S e c o n d l y , t h e f a l la c yo f d e t a c h m e n t , t h e p r e m i s e t h a t e f f e c ti v e st r at e g ie sc a n b e p r o d u c e d t h r o u g h f o r m a l i s e d p r o c e s s e s b yp l a n n e r s w h o a r e d e t a c h e d f r o m t h e b u s in e s s o p e r -a t i o n s a n d t h e m a r k e t c o n t e x t . L a s tl y , t h e f a l l a c y o ff o r m a l i s a t i o n , t h e q u e s t i o n a b l e i d e a t h a t f o r m a l i s e dp r o c e d u r e s c a n i n f a c t p r o d u c e s t r a t e g i e s , w h e r e a st h e i r p r o p e r f u n c t i o n i s t o o p e r a t i o n a l i s e a l r e a d ye x i s t i n g s t r a t e g i e s . 2

C r i ti q u e s o f p l a n n i n g i n a s i m i l a r v e i n h a v e b e e nw i d e s p r e a d i n t h e p o p u l a r m a n a g e m e n t l i t e ra t u r e . 3'4O t h e r a u t h o r s w i t h i n t h i s l i t e r at u r e h a v e a c c e p t e d t h ec o n v e n t i o n a l c r i t i q u e s o f s t r a te g i c p l a n n i n g ( e. g. t h ef a l la c i e s e x p l i c a t e d b y M i n t zb e r g ) , b u t h a v e g o n e f a rb e y o n d t h e m t o f i n d n o p l a c e f o r p l a n n i n g i n o r g a n i s a t io n s , a r g u i n g t h a t s t r a te g i c p l a n n i n g s h o u l d b e

s c r a p p e d c o m p l e t e l y a n d s t r a te g i c t h i n k i n g s h o u l do c c u r i n s t e a d . 5'6T h i s v i e w , t h e r e f o r e , e m p h a s i s e s t h a t s t r a t e g i ct h i n k i n g a n d s t r a t e g i c p l a n n i n g i n v o l v e d i s t i n c tt h o u g h t p r o c e s s e s , w h e r e s t r a t e g i c p l a n n i n g i s a n a -l y t ic a l a n d c o n v e r g e n t , w h e r e a s s t ra t e g ic t h i n k i n g i s

s y n t h e t i c a n d d i v e r g e n t . It q u e s t io n s s t r o n g l y t h e p r o -m i n e n c e a n d p r o m i s e a c c o r d e d t o s t ra t e g ic p l a n n i n g ,s e e k i n g to l i m i t p l a n n i n g t o t h e o p e r a t i o n a l i s a t io n o fe x i s t i n g s t r a t e g i e s r a t h e r t h a n b e i n g a b l e t o g e n e r a t er a d i c a l l y n e w a n d c r e a t iv e s t r at e g ie s .S t r a te g i c T h i n k i n g I s ( a n d S h o u l d B e )A n a l y t i c a lT h i s i s a v i e w a s s o c i a t e d m a i n l y w i t h M i c h a e l P o r t er ,w h o s e a n a l y t i c a l f r a m e w o r k s o f fi ve f o r c es a n a l y s is ,t h e v a l u e c h a in , t h e d i a m o n d m o d e l o f n a t i o n a l c o m -p e t i t i v e a d v a n t a g e a n d s t r a t e g y a s a c t i v i t y s y s t e m , a r ei m p o r t a n t c o n t r i b u t i o n s t o t h e s t r a t e g i c m a n a g e m e n tf i el d . A c c o r d i n g t o P o r t e r, f o r e x a m p l e ,

'strategic thinking inv olves asking two critical questions. First,what is the structure of your industry, and how is it likely toevolve over time? ... Second, what is your o wn company 's rela-tive position in the industry?'.7O t h e r s h a v e a l s o p r o p o s e d w e l l - d e f in e d , a n a l y t i c a la p p r o a c h e s a s c o n s t i t u t i n g s t r a t e g i c t h i n k i n g : Z a b -r i s k ie a n d H u e l l m a n t e l , 8 f o r e x a m p l e , s u g g e s t as e q u e n t i a l , w e l l - d e f i n e d si x - s te p p r o c e s s t o e n a b l es t r a te g i c t h i n k i n g , a n d E d e n i n a s i m i l a r v e i n , 9d e s c r i b e s a s t r a t e g i c t h i n k i n g p r o c e s s b a s e d o n c o g -n i t i v e m a p p i n g . A s i m i l a r a n a l y t i c a l a p p r o a c h h a sa l s o b e e n t a k e n i n t h e p o p u l a r l i t e r a t u r e , 1 w h e r e f o r -m a l i s e d a p p r o a c h e s a r e sa i d t o c o n s t i t u t e s t ra t e g ict h i n k i n g . P o r t e r a n d o t h e r s , t h e r e f o r e , u s e t h e t e r m' s t r a t e g i c t h i n k i n g ' n o t a s a s y n t h e t i c a n d d i v e r g e n tt h o u g h t p r o c e s s , b u t a s a c o n v e r g e n t a n d a n a l y t i c a lo n e ; i n t h e s a m e w a y a s o t h e r a u t h o r s w o u l d u s e t h et e r m s t r a t e g i c p l a n n i n g .T h e r e a l p u r p o s e o f s t ra t e gi c p l a n n i n g i s t oi m p r o v e s t ra t eg i c t h i n k i n gR e l a t e d t o t h e a b o v e v i e w , i s t h e s u g g e s t i o n t h a t th ereal purpose of strategic pla nnin g is to facilitate stra-tegic thinking, w h e r e s t r u c t u r e d p l a n n i n g t o o l s a r eu s e d t o a i d c r e a t i v e t h i n k i n g . T h i s i s a v i e w s t a t e ds u c c i n c t l y i n a s e r ie s o f H a r v a r d B u s i n e s s R e v i e wa r t i c l e s w r i t t e n b y f o r m e r s e n i o r m a n a g e r s a t R o y a lD u t c h / S h e l l . ~1-13 T h e s t r a t e g i c t o o l a s s o c i a t e d w i t ht h i s v i e w i s ' s c e n a r i o p l a n n i n g ' , a p r o c e s s o f e l i c i t i n ga p p r o p r i a t e r e s p o n s e s t o r e a s o n a b l y p o s s ib l e f u t u r e s ,d e s i g n e d t o q u e s t i o n m a n a g e r s ' g u i d i n g a s s u m p t i o n s ,a n d s e n s i t i s e t h e i r t h i n k i n g t o p o t e n t i a l c o m p e t i t i v ea r e n a s s u b s t a n t i a l ly d i f f e r e n t fr o m c u r r e n t o n e s .W a c k d e s c r i b e d t h e s c e n a r i o p l a n n i n g p r o c e s s a tS h e l l e m p h a s i s i n g t h a t

'scenarios serv e two main purposes. The firs t is protective:anticipating and understanding risk. The second is entre-

Strategic T hinkin g or Strategic Planning ?


3/7

preneurial: discovering strategic options of which you w ere pre-viously unaware ... Scenarios give managers something veryprecio us: the a bility to reper ceive reality'. 12D e G e u s s i m i l a r l y s u g g e s t e d t h a t t h e v a l u e o f t h e p l a n -n i n g p r o c e s s d o e s n o t r e s i d e i n t h e p l a n i ts e l f, 13 b u ti n c h a n g in g t h e m e n t a l m o d e l s o f m a n a g e r s i n v o l v e di n t h is p r o c e s s ( fo r s i m i l a r a r g u m e n t s s e e a ls oNa d le r ) . 14Strategic Planning has Over Time Evolved intoStrategic ThinkingI t h a s b e e n s u g g e s t e d t h a t " s t r a t e g i c p l a n n i n g h a sc h a n g e d d r a m a t i c a l l y s i n c e it s i n c e p t i o n i n th e e a r l y1 9 7 0 ' s . H a v i n g s u r v i v e d i t s o r i g i n a l d e s i g n f l a w s , i th a s e v o l v e d i n t o a v i a b l e s y s t e m o f st r a te g i c m a n -a g e m e n t ( o r s t r a te g i c t h i n k i n g ) " . 15 T h e m a i n c h a n g e s ,a c c o r d i n g t o t h i s v i e w , i n c l u d e t h e s h i f t o f p l a n n i n gr e s p o n s i b i l i t y f r o m s t a f f t o l i n e m a n a g e r s , t h e d e c e n -t r a l i s a t io n o f p l a n n i n g t o b u s i n e s s u n i t s , m o r e a t t e n -t i o n t o e n v i r o n m e n t a l s h i f t s , m o r e s o p h i s t i c a t e ds e l e c t io n o f p l a n n i n g t e c h n i q u e s , a n d m o r e a t t e n t io nt o o r g a n i s a t i o n a n d c u l t u r e a s v i t a l i m p l e m e n t a t i o nfac tor s . 16 R e l a t e d t o t h i s v i e w p o i n t i s t h e l i t e r a t u r ea r g u i n g t h a t s t r a t e g i c p l a n n i n g i s u s e f u l i f i t i s c a r r i e do u t i n a n a p p r o p r i a t e m a n n e r - - i n v o l v i n g l in em a n a g e r s , d e f i n i n g b u s i n e s s u n i t s c o r r e c t l y , h a v i n gc l e a r a c t i o n s t e p s a n d i n t e g r a t i n g t h e p l a n w i t h o t h e ro r g a n i s a t i o n a l c o n t r o l s , 17 t h e s e l a r g e ly c o r r e s p o n d i n gt o t h e s h i f ts i n t r a d i t i o n a l p l a n n i n g p r a c t i c e s r e p o r t e db y t h e p r o p o n e n t s o f t h is v i e w .

I n t h i s v i e w , t h e r e f o r e , s t r a te g i c p l a n n i n g a n ds t r a te g i c t h i n k i n g a r e id e n t i f i e d m o r e w i t h t h e o r g a n -i s a t i o n a l p r a c t i c e s s u r r o u n d i n g t h e m r a t h e r t h a n t h et h o u g h t p r o c e s s e s i n v o l v e d . S t r a t eg i c t h i n k i n g i s p o r -t r a y e d a s a n e v o l u t i o n f r o m s t r a te g i c p l a n n i n g , w h i c hi s s a i d t o h a v e b e c o m e l e s s e l i t i s t i n i t s o r i g i n s a n dm o r e o p e n a n d s o p h i s t i c a t e d i n i ts m e t h o d s .

Strategic Thinking as Double-loopLearningH a v i n g c o n s i d e r e d t h e v a r io u s v i e w s f o u n d i n th el i te r a t u r e , t h e r e i s a n e e d n o w t o c l a r i fy t h e n a t u r e o fs t r a te g i c th i n k i n g a n d s t r a t e g ic p l a n n i n g a n d t o p l a c et h e m i n a n a p p r o p r i a t e c o n t e x t . T h i s w i l l b e d o n e b ys u g g e s t i n g a d u a l a n a l o g y : s t r a t e g i c t h i n k i n g c a n b es e e n a s d o u b l e - l o o p l e a r n i n g , a n d s t r a t e g i c p l a n n i n ga s s i n g l e - l o o p l e a r n i n g . T h i s a n a l o g y i s h e l p f u l i nc l a r i fy i n g t h e n a t u r e o f s t r a te g i c t h i n k i n g a n d s t r a te g i cp l a n n i n g , a n d w h y t h e y a r e d i f f e re n t , b u t u l t i m a t e l yb o t h n e c e s s a r y a n d c o m p l e m e n t a r y .B a t e s o n , a p p l y i n g R u s s e l l ' s t h e o r y o f l o g i c a l t y p e st o t h e c o n c e p t o f l e a r n in g , d i f f e r e n t i a t e d b e t w e e n f i v et y p e s o f l e a r n i n g : 18Z e r o l e a r n i n g S p e c i f i c i t y o f r e s p o n s e n o t s u b j e c t t o

c o r r e c t i o n

L e a r n i n g I C h a n g e i n s p e c i f i c i t y o f r e s p o n s e b yc o r r e c t i o n o f e r r o rs o f c h o i c e w i t h i n as e t o f a l t e r n a t i v e s

L e a r n i n g I I A c o r r e c t i v e c h a n g e i n t h e s e t o f a l t e r-n a t i v es f r o m w h i c h c h o i c e is m a d e o ra c h a n g e i n t h e p u n c t u a t i o n o f e x p e r -i e n c eL e a r n i n g I II A c o r r e c t i v e c h a n g e i n t h e s y s t e m o fs e t s o f a l t e r n a t i v e s f r o m w h i c h c h o i c ei s m a d e

L e a r n i n g I V C h a n g e in t h e p r o c e s s o f l e a r n i n g I II ,b u t p r o b a b l y d o e s n o t o c c u r i n a n yl i v i n g o r g a n i s m o n e a r t h

A r g y r is c o n c e n t r a t e s o n t h e d i s t i n c ti o n b e t w e e n s i n -g l e - l o o p a n d d o u b l e - l o o p l e a r n i n g , w h i c h a r e a n a l -o g o u s t o B a t e s o n ' s l e a r n i n g I a n d I I. 19 S i n g l e - l o o pl e a r n i n g o c c u r s w h e n t h e r e i s a m a t c h b e t w e e n t h eo r g a n i s a t i o n ' s d e s i g n f o r a c t i o n a n d t h e a c t u a lo u t c o m e , o r w h e n s u c h m i s m a t c h e s a re c o r r e c te d b yc h a n g i n g a c t i o n s , b u t without critical examination ofthe governing variables for action. D o u b l e - l o o p l ea r n-i ng o c c u r s w h e n t h e c o r r e c ti o n o f m i s m a t c h e s i sa r r i v e d a t b y examining and altering the governingvariables for action and then the actions themselves.F i o l a n d L y l e s s i m i l a r l y d i f f e r e n t i a t e b e t w e e n l o w e r -l e v e l a n d h i g h e r - l e v e l l e a r n i n g . 2 L o w e r l e v e l l e a r n i n gi n v o l v e s t h e d e v e l o p m e n t o f c o g n i ti v e a s s o c i a t io n sw h i c h f a c i l i t a t e i n c r e m e n t a l o r g a n i s a t i o n a l a d a p -t a ti o n b u t w i t h o u t t h e q u e s t i o n i n g o f c e n tr a l n o r m sa n d f r a m e s o f r e f e r e n c e o f th e o r g a n i s a t i o n . H i g h e r -l e v e l l e a rn i n g o c c u r s w h e n t h e s e n o r m s a n d f r a m e so f r e f e r e n c e a r e c h a l l e n g e d a n d a l t e re d , a n d a m o r ea c c u r a t e u n d e r s t a n d i n g o f c a u s a l r e l a t io n s e x i s t s .T h e s e l e v e l s o f l e a r n i n g a r e al s o m i r r o r e d i n S e n g e ' sd i s t i n c ti o n b e t w e e n g e n e r a ti v e a n d a d a p t i v el e a rn i n g . 21 A d a p t i v e l e a r n i n g i s a b o u t c o p i n g w i t h i ne x i s t i n g f r a m e s o f r e f e r e n c e , w h e r e a s g e n e r a t i v el e a r n i n g i s a b o u t b e i n g c r e a t i v e , a n d r e q u i r e s n e ww a y s o f p e r c e i v i n g t h e w o r l d . F i g u r e 1 p o r t r a y s t h et e r m s u s e d t o d e s c r i b e t h e a b o v e l e v e l s o f l e a rn i n g :

W h i l e t h e r e a r e d i f f e r e n c e s i n t e r m i n o l o g y i n a l lt h e a b o v e a u t h o r s , t h e c e n t r a l c o n c e p t c o m m o n t o a l l

Long Range Plann ing Vol. 31 June 1998


4/7

i n v o l v e s t h i n k i n g a n d a c t i n g w i t h i n a c e r t a i n s e t o fa s s u m p t i o n s a n d p o t e n t i a l a c t i o n a l t e r n a ti v e s ; o rc h a l l e n g i n g e x i s t i n g a s s u m p t i o n s a n d a c t i o n a l t e r -n a t i v e s , p o t e n t i a l l y l e a d i n g t o n e w a n d m o r e a p p r o -p r i a t e o n e s . A n e x a m p l e w o u l d b e a n o r g a n i s a t i o nf a c e d w i t h d e t e r i o r a ti n g p e r f o r m a n c e , a n d w h i c hr e s p o n d s b y b e c o m i n g p r e - o c c u p i e d w i t h t y p i c a la c t i o n s s u c h a s c o s t c u t t in g , d e - l a y e r i n g o r re - e n g i n -e e r i n g w h i c h i t h a s a l s o t a k e n i n t h e p a s t ( u t i l i s i n gs i n g l e - l o o p l e a r n i n g ) . T h i s o r g a n i s a t i o n r e s p o n d s t oh a r d s h i p i n w a y s t h a t h a v e w o r k e d i n th e p a s t . It t a k e sa c t i o n f r o m a f i x e d se t o f a c t i o n a l t e r n a t iv e s a n d d o e sn o t c o n s i d e r o t h e r , n e w a n d p o t e n t i a l l y m o r e a p p r o -p r i a t e a n d c r e a t i v e a c t i o n a l t e r n a t i v e s s u c h a s i n n o -v a t i n g n e w p r o d u c t s t o r e v i t a l is e o r e x p a n d i tsm a r k e t s , o r f o r m i n g a l l i a n c e s t o c o m p e t e g l o b a l l y .T h i s w o u l d a m o u n t t o d o u b l e - l o o p l e ar n i n g i n th i sp a r t i c u l a r c o m p a n y , s i n c e i t s s e t o f p o t e n t i a l a c t i o na l t e r n a t i v e s w o u l d h a v e e x p a n d e d t o i n c l u d e n e wr e s p o n s e s a n d n e w w a y s o f t h i n k in g a b o u t t h e p ro b -l e m s f a c e d , l e a d i n g to d if f e r e n t r e s p o n s e s f r o m w h a tw a s d o n e i n t h e p a s t .

S t r a te g i c p l a n n i n g i n th i s f o r m u l a t i o n i s s e e n a s a na c t i v i t y c a r r i e d o u t w i t h i n t h e p a r a m e t e r s o f w h a t i st o b e a c h i e v e d , b u t d o e s n o t e x p l i c i t l y q u e s t i o n t h o s ep a r a m e t e r s , a n d i s t h e r e f o r e a n a l o g o u s t o s i n g l e - lo o pl e a rn i n g . S t r a te g i c p l a n n i n g m o s t o f t e n ta k e s a n a l re -a d y d e t e r m i n e d s t r a te g i c d i r e c t i o n a n d h e l p s s t r a-t e g i st s d e c i d e h o w t h e o r g a n i s a t i o n i s t o b e c o n f i g u r e da n d r e s o u r c e s a l l o c a t e d t o r e a l i s e th a t d i r e c t i o n . T h i ss i t u a t i o n h a s g i v e n r is e to a r e l a t i v e l y c o m m o n t h r e a do f t h e c r i t iq u e s o f s t r a te g i c p l a n n i n g , t h a t i t d e a l s w i t he x t r a p o l a ti o n s o f t h e p r e s e n t a n d t h e p a s t a s o p p o s e dt o f o c u s i n g o n h o w t o r e i n v e n t t h e f u t u r e ; a n i d e aw h i c h h a s b e e n e m p h a s i s e d i n r e c e n t a p p r o a c h e s t os t r a t e g y s u c h a s " s t r a t e g i c i n t e n t " o r " s t r a t e g y a srev o lu t i o n" . 22.23

T h e m o d e o f s t r at e g y - m a k in g w h i c h c a n b e a s so c i -a t e d w i t h s u c h r e - i n v e n t i n g o f t h e f u t u r e , t h e c r e a t io no f n e w c o m p e t i t i v e s p a c e a s o p p o s e d t o s tr u g g li n go v e r s l o w - g r o w t h o r e v e n s h r i n k i n g m a r k e t s , i s st r a-t e g ic t h in k i n g . S t r a te g i c t h i n k i n g q u e s t i o n s t h e s t r a -t e g ic p a r a m e t e r s t h e m s e l v e s , a n d i s t h u s a n a l o g o u s t od o u b l e - l o o p l e a r n in g . D i s c o v e r i n g a n d c o m m i t t i n g t on o v e l s t r at e g i e s w h i c h c a n r e - w r i t e t h e r u l e s o f t h ec o m p e t i t i v e a r e n a , n e c e s s i t a t e s r e l a x i n g o r s u s -p e n d i n g a t l e a st p a rt o f t h e c o n v e n t i o n a l w i s d o m a n da s s u m p t i o n s a b o u t th e i n d u s t r y , t h e i n d u s t r yr e c i p e s , 24 a s w e l l a s o n e ' s p s y c h o l o g i c a l f r a m e s 28 i nw h i c h t h e s e r e ci p e s a r e r e p r e s e n t e d , e n v i s i o n i n g an u m b e r o f p o t e n t i a l f u t u r e s , a n d c h a l l e n g i n g t h ee x i st i n g o p e ra t i n g a s s u m p t i o n s o n w h i c h c u r r e n t s tr a-t e g i es a r e b u i l t. T h e d e s i r e d o u t c o m e o f t h e c y c l e o fs t r at e g i c t h i n k i n g / p l a n n i n g i s n o t m e - t o o s t r a te g i e sb u t d i s t in c t p o s i t i o n in g s , s u p p o r t e d b y u n i q u ea c t i v i t y s y s t e m s . 25 F o r e x a m p l e , c o n s i d e r t h e f o l-l o w i n g e x a m p l e s : I n t h e e a r l y 1 9 9 0 s , ca r s w e r e b u i l t i n d i v i d u a l l y a n d

p a i n s t a k i n g l y b y c ra f t sm e n , a n d o w n i n g o n e w a s ap o t e n t s t a t u s s y m b o l . G o i n g a g a i n s t t h e p r e v a i l i n gw i s d o m o f t h e i n d u s tr y , H e n r y F o r d p r o c l a i m e d"I will build a car for the great multitude . . . I am going todemocratize the automobile . . . . When I 'm through, everybodywill be able to afford one, and about ev erybody will have one."T h i s w a s i n d e e d a c h i e v e d b y c o n t i n u o u s p r o -d u c t i v i t y i m p r o v e m e n t s i n m a n u f a c tu r i n g , t h eb r e a k t h r o u g h c o m i n g w i t h F o r d ' s i d e a t o i n i t i a t e am o v i n g a s s e m b l y l i n e . F o r d h a d t h e i d e a o n a t r i pt o C h i c a g o , w h e r e h e o b s e r v e d t h e w a y t h e m e a tp a c k e r s u s e d t h e o v e r h e a d t r o l l e y t o d r e s s b e e f ;c u t t i n g a p i e c e o f t h e c a r c a s s a s i t m o v e d a l o n g .F o r d r e v e r s e d t h i s p r o c e s s , h a v i n g a m o v i n g v e h i c l ea s s e m b l y l i n e w h e r e w o r k e r s a d d e d p i e c e s a s t h ev e h i c l e m o v e d a l o n g .

R a y m o n d K r o c , a f i f ty - t w o y e a r o l d m i l k - s h a k em a c h i n e s a l e s m a n s a w i n 1 9 5 4 t h e re s t a u r a n t o fM a u r i c e a n d R i c h a r d M c D o n a l d i n S a n B e r n a r d in o ,o p e r a t i n g l i k e a f i n e - t u n e d m a c h i n e i n a n i n d u s t r yi n w h i c h s u c h p r e c i s i o n a n d e f f i c ie n c y w a su n k n o w n . H e r e a l is e d t h is m o d e l w o u l d b e v e r ys u c c e s s f u l i f i m p l e m e n t e d e l s e w h e r e , b u t t h e tw ob r o t h e r s w e r e n o t i n t e r e s t e d i n g r o w i n g t h e b u s i -n e s s . H e c u t a f r a n c h i s e d e a l w i t h t h e m , a n d s t a r t e de x p a n d i ng w h a t w o u l d b e c o m e t he u n w i t t in ga p p l i c a t i o n o f H e n r y F o r d ' s m a n u f a c t u r i n ga p p r o a c h t o s a n d w i c h - m a k i n g , a n d a h u g e l y s u c -c e s s f u l b u s i n e s s w h i c h c r e a t ed n e w c o m p e t i t i v es p a c e i n t h e r e s t a u r a n t i n d u s t r y .( A d a p t e d f r o m G r o s s D . F o r b e s ' g r e a t e s t b u s i n e s s s t o -

r i e s o f a l l t ime . )W h i l e H e n r y F o r d w a s p a r t o f t h e U . S . v e h i c l e i n d u s -t ry , a n d R a y K r o c a t t h e m a r g i n s o f t h e U . S . r e s t a u r a n ti n d u s t r y , n o n e o f t h e m a c c e p t e d c o n v e n t i o n a l i n d u s -t r ia l w i s d o m a s g i v e n , e n v i s i o n i n g a l t e r n a ti v e , p l a u s -i b l e f u t u r e s w h i c h w o u l d u l t i m a t e l y r e d e f i n e t h e i ri n d u s t ri e s . M o r e i m p o r t a n tl y , n o n e o f t h e m c o u l dh a v e c o m e u p w i t h t h e i r r a d ic a l ( f o r t h e ir t i m e / c o n -c e p t i o n s o f t h e f u t u r e o f t h e i r i n d u s t r y a s a r e s u l t o ff o r m a l i s e d p l a n n i n g t e c h n i q u e s . E v e n t o d a y , c o m -p a n i e s w h i c h c u r r e n t l y a d d h i g h e r v a l u e a n d d e l i v e rs u p e r i o r r e tu r n s t o s h a r eh o l d e r s a r e t h o s e w h i c h c o n -s i s t e n t l y b r e a k t h e r u l e s o f t h e c o m p e t i t i v e g a m e . 27A D ialect ical View of StrategicThink ing and Strategic P lanningT h e t w o m a i n p o s i t i o n s o n t h e p r o p e r m e a n i n g a n di n t e r r e l a t i o n s h i p b e t w e e n t h e i d e a s o f s t r at e g i c t h i n k -i n g a n d s t r a te g i c p l a n n i n g a r e t h e o n e s b y H e n r yM i n t z b e r g a n d M i c h a e l P o r t e r . M i n t z b e r g b e l i e v e st h a t s t r a t e g i c t h i n k i n g a n d p l a n n i n g i n v o l v e d i s t i n c tt h o u g h t p r o c e s s e s , t h e f o r m e r b e i n g c r e a t i v e a n d t h el a t te r a n a l y t i c a l; w h e r e a s P o r t e r b e l i e v e s t h a t s t r a t e g ict h i n k i n g i s a c h i e v e d b y u t i l i s in g a n a l y t i c a l t o o l s . T h e

Strategic Think ing o r Strategic Plann ing?


5/7

under lyin g issue with regar d to these two views seemsto be a focus on different aspects of strategy. Mintz-berg, for example, sees strategies as patterns in astream of decisions and actions, whic h may be delib-erate at times, emer gent at other times, or mixed, andmostly based on managerial int uition and creativity. 28Porter, on the other hand, being highly analytical,sees strategies as particular configurations of thevalue chain whi ch are ideally uniq ue and sustainable,providing strategic positions which cannot be easilycopied by competitors. 25Porter drew attention to the need to understandboth the cross-sectional problem (the causes ofsuperior performance at a given point in time), andthe longitudinal problem (the dynamic process bywhich strategies are arrived a t ) . 2 9 Porter's con-tributions have t ende d to focus on the cross-sectionalrather than the longitudinal problem, however, andMintzberg's contributions have ten ded to focus on thelongitud inal rather than the cross-sectional problem.

Whereas Mintzberg's view of strategy is mo re process-focused (how strategies are arrived at in organ-isations), Porter's view of strategy is more pos-itioning-focused (what constitutes a sustainablestrategic position in terms of particular organisationalarrangements). These dif ferential loci lead their pro-ponents to suggest correspon ding thinking mode s forthe aspect of strategy they focus on; Mintzberg empha-sising the creative and synthetic, and Porter empha-sising the conv ergent and analytical.Being overly pre- occupie d with terminology, (e.g.what each author means by "strategic thinking" or"strategic planning") can make one miss the essentialpoint that, to the extent that they constitute distinctthinking modes, strategic thinking and strategic plan-ning are both necessary and none is adequate witho utthe other. Creative, ground-b reaking strategies emerg-ing from strategic thinking still have to be oper-ationalised through convergent and analyticalthought (strategic planning), and planning is vital but

Strategic ThinkingT h o u g h t p r o c e s s :Syn t he t i cD i v e r g e n tCreat ive

The pu rpose o f s t ra t eg i ct h i nk i ng i s t o d i scove r nove l , " N~i m ag i na t i ve s t ra t eg i es wh i chcan re -w r i t e t he ru l es o f thec o m p e t i ti v e g a m e ; a n d to e n v i s i o npo t en t i a l f u t u res s i gn i f i can t l y d i f f e ren tf r o m t h e p r e s e n t

The pu rpose o f s t ra t eg i cp l ann i ng i s to o pe ra t i ona l i set h e s t r a t e g i e s d e v e l o p e dt h r o u g h s t r a te g i c t h i n k i n g ,and t o suppo r t t he s t ra t eg i ct h i n k i n g p r o c e s s

Strategic Planning

Thouaht orocess. "Ana l y t i ca lC o n v e r g e n tC o n v e n t i o n a l

Long Range Planning Vol. 31 June 1998


6/7

c a n n o t p r o d u c e u n i q u e s t r a t e g i e s w h i c h c a n c h a l -l e n g e in d u s t r i a l b o u n d a r i e s a n d r e d e f i n e i n d u s tr i e s( u n l e s s i t s t i m u l a t e s t h e c r e a t i v e m i n d s e t i n t h ep r o c e s s , a s i n t h e c a s e o f u s i n g a l t e r n a t i v e s c e n a r i o sf o r t h e f u t u r e ) .T h e v i e w p r o p o s e d h e r e h o l d s t h a t s t ra t e gi c t h i n k -i n g a n d s t r a t e g i c p l a n n i n g a r e i n t e r r e l a t e d i n a d i a -l e c t i c a l p r o c e s s , w h e r e b o t h a r e n e c e s s a r y f o r e f f e c t i v es t ra t e gi c m a n a g e m e n t , a n d e a c h m o d e o n i t s o w n i sn e c e s s a r y b u t n o t s u f f i c i e n t . T h i s v i e w : S u g g e s t s a c l a r i f i c a t io n in t h e m e a n i n g o f t h e t e r m sb y d r a w i n g a n a n a l o g y w i t h l e v e l s o f l e a r n i n g ;i d e n t i f y i n g s t r a t e g i c p l a n n i n g w i t h s i n g l e - l o o pl e a r n i n g a n d s t r a t e g i c t h i n k i n g w i t h d o u b l e - l o o p

l e a r n i n g . C o m p l e m e n t s M i n t z b e r g ' s v i e w a b o u t t h e u s e -f u l n e s s o f b o t h s t r a t e g i c t h i n k i n g a n d p l a n n i n g , a n dh e l p s t o p l a c e t h e M i n t z b e r g / P o r t e r d e b a t e i n c o n -t e x t b y r e c o g n i s i n g t h a t f o c u s i n g o n d i f f e r e n ta s p e c t s o f s t r a t e g y ( th e l o n g i t u d i n a l v e r s u s t h ec r o s s - s e c t i o n a l p r o b l e m ) l e a d s t h e s e a u t h o r s t oa d v o c a t e c o r r e s p o n d i n g t h i n k i n g m o d e s , w h i c h i nt h e f i n a l a n a l y s i s a r e b o t h n e c e s s a r y a n d c o m p -l e m e n t a r y .M i n t z b e r g 's v i e w a b o u t t h e d i f f e r e n c e s b e t w e e n

s t r a t e g i c t h i n k i n g a n d p l a n n i n g a n d t h e i n a b i l i t y o fp l a n n i n g t o p r o d u c e g r o u n d - b r e a k i n g s t r a te g i es d o e sn o t n e c e s s a r i l y c l a s h w i t h P o r t e r ' s v i e w t h a t a n a -l y t i c a l t o o l s a r e n e c e s s a r y , a n d t h a t t h e y c a n a l s os t i m u l a t e c r e a t i v i t y . T h e t o o l s o n e u s e s a t e a c h s t a g eo f t h e s t ra t e gi c m a n a g e m e n t p r o c e s s , a r e n o t i m p o r -t a n t i n t h e m s e l v e s b u t a s t h e m e a n s o f e n c o u r a g i n gt h e c r e a t i v e a n d a n a l y t i c a l m i n d s e t . T h e r e i d e a l l yn e e d s t o b e a d i a l e c t i c a l t h o u g h t p r o c e s s o f b e i n g a b l et o d i v e r g e a n d t h e n c o n v e r g e , b e i n g c r e a t i v e a n d t h e ns e e i n g th e r e a l - w o r l d i m p l i c a t i o n s , a n d b e i n g s y n -t h e t i c b u t a l s o a n a l y t i c a l . I t a l l c o m e s d o w n t o t h ea b i l i t y t o go u p a n d d o w n t h e l a d d e r o f a b s t r a c ti o n ,a n d b e i n g a b l e to s e e b o t h t h e b ig p i c t u r e a n d t h eo p e r a t i o n a l i m p l i c a t i o n s , w h i c h a r e s ig n s o f o ut -s t a n d i n g l e a d e r s a n d s t r a t e g is t s .T h i s v i e w i s n o t m e a n t t o b e a d e s c r i p t i o n o f a c t u a lm a n a g e r i a l p r a c t i c e , b u t i t is m e a n t t o b e a s u g g e s t i o nf o r a n o r m a t i v e , b u t a c h i e v a b l e b e s t p r a c t i c e . H e r es t ra t e g ic t h i n k i n g a n d p l a n n i n g o c c u r i t e r a t i v e l y o v ert i m e , w h e r e t h e r e i s a c o n t i n u a l q u e s t f o r n o v e l a n dc r e a t iv e s t ra t e gi e s w h i c h c a n b e b o r n i n t h e m i n d s o fs t r a te g i s t s o r c a n e m e r g e f r o m t h e g r a s s r oo t s ; a s w e l la s e m p l o y m e n t o f a n a l y t ic a l p r o c e s s e s to d e t e r m i n es u c h i s s u e s a s t h e s t r a t e g i e s ' d e s i r a b i l i t y a n d f e a s i -b i l it y , a n d t o p l a n f o r t h e i r r e a l i s a t i o n .

References1 . H . M i n t zbe rg , Wha t i s p l ann i ng any way? Strategic Management Journal2, 319-2 4 (1981).2 . H. M in tzb erg , The fa l l and r i se o f s t ra teg ic p lan n ing , Harvard Business Review,J a n - F e b ,1 0 7 - 1 1 4 ( 1 9 9 4 ) .3 . K . A l b rech t , T he pow er o f b i f oca l v i s i on , Management Review,Apr i l , 4 2-46 (1994) .4 . T .B . K inn i , F ind the corp ora te hea r tbeat , Industry Week,Au gus t 15 , 43-47 (1994) .5 . W . J. A l t ie r , S t ra t eg i c th i nk i ng f o r t oday ' s c o rpo ra t e ba t t l e s , Management Review, N o v ,20-22 (1991) .6 . O . Ha ra ri , G ood / bad news ab ou t s t r a tegy , Management Review,Ju ly , 29-31 (1995) .7 . M . P o r t e r, K now yo u r p l ace , Inc.,Sept , 90-93 (1991a) .8 . N . B. Z ab r isk i e and A .B . H ue l l m an t e l , Deve l op i ng s t r a t eg i c t h i nk i ng i n sen i o r m an agem en t ,Long Range Planning24 (6) , 25-32 ( 1991 .9 . C. Eden, S t ra teg ic th ink ing wi th com puters , Long Range Planning23 (6), 35- 43 (1990).

10. G . L. M o r i ssey , E xecu t i ve gu i de t o s t r a t eg i c th i nk i ng , Executive Excellence, June , 5 -6(1990).11. P . Wack, Scenar ios : Unch ar ted waters ah ead, Harvard Business Review, S ep t -O c t , 73 -89(1985a).12. P . Wack, Scen ar ios : Sh oot in g the rap ids, Harvard Business Review, Nov-Dec , 2 -14(1985b).13. A . De Geus, P lann ing as learn in g, Harvard Business Review, M arc h -A p r i l . 70 -74 (1988) .14. D.A . Nad ler , Co l labo ra t i ve s t ra teg ic th ink in g , Planning Review,Sept -O ct , 30-31 (1994).15. I. W i l son , S t ra t eg i c p l ann i ng i sn ' t dea d - - i t changed , Long Range Planning 27 (4) , 12-24( 1 9 9 4 ) .16 . I . B onn and C . Ch r i s t odo u l ou , F rom s t ra t eg ic p l ann i ng t o s t ra t eg i c m ana gem en t , LongRange Planning29 (4), 543-55 1 (1996).17. D . H . G ray , Uses and m i suses o f s t r a t eg ic p l an n i ng . Harvard Business Review,J a n - F e b89-9 7 (1986).18. G. Bateson, Steps to an Ecology of Mind, I n ter tex t , Lon don , p . 293 (1972) .Strategic Thinking or Strategic Planning?


7/7

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - ~ ~ ~ - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -19. C. Argyris, Double loop learning in organizations, Harvard Business Review Sept-Oct, I15-125 (1977).20. C.M. Fiol and M.A. Lyles, Organisational learning, Academv of Management Review 10,803-81 3 (1985).21. P.M. Senge, The leader's new work: building learning organizations, Sloan ManagementReview, Fall, 7-23 (1990).22. G. Hamel and C.K. Prahalad, Strategic intent, Harvard Business Review, May-June, 63 -

76 (1989).23. G. Hamel, Strategy as revolution, Harvard Business Review, July-August, 69-82 (1996).24. Spender, Industry Recipes, Blackwell, Oxford (1989).25. M. Porter, What is strategy? Harvard Business Review, Nov-Dec, 61-78 (1996).26. D. Gross, Forbes ' Greatest Business Stories ofAll Time, John Wiley, New York (1996) .27. G. Hamel, Killer strategies that make shareholders rich, Fortune 12, June 23, 30-44 (1997).28. H. Mintzberg, Patterns in strategy formation, Management Science 24 (9), 934-948 (1978).29. M. Porter, Towards a dynamic theory of strategy, Strategic Management Journal 12, 95 -

117 (1991b).Loizos Heracleous, is atthe Department of Business Policy, NationalUniversity of Singapore, Singapore.

Long Range Planning Vol. 31 June 1998

strategic thinking or strategic planning

Documents