Design School Mintzberg

Chapter 2

Design School

• The school proposes a model of strategy making that seeks to attain a match between internal capabilities and external possibilities

• Establish a fit is the motto of the design school

• Origins of the school can be traced back to books in MIT and UC Berkley written by Selznick and Chandler

• Selznick introduced “ distinctive competence” which is bringing the internal state together with external expectations and argued for building policy into organization social structure

• Chandler established design school notion of business strategy and its structure

• Business policy: text and cases, most popular book in the field – represents ideals in pure form written by Andrews ( Christensen et.al)

• Internal appraisal, Andrews touched on points such as organizations to known themselves.

• Once alternate strategies have been determined the next step is to evaluate and choose the best one

• Rumelt stated that strategy must not present mutually inconsistent goals, it must represent adaptive response to the external environment and must not overtax available resources

Premises of the Design School

• Number of basic premises underlies the design school. Some are evident and others are implicitly recognised

• 1) Strategy formation should be deliberate process of conscious thought – action must flow from reason. Andrews suggested that managers  “know what they are really doing” he argues that strategy making is an acquired, not a natural skill

• 2) Responsibility for the control must rest with CEO -  Hayes states that command and control goes to the top.  This leaves other members of the firm in subordinate strategic thinking. Problem with the school is it takes account of the environment to a minor role to be accounted for but not acted with

• 3) Model of Strategy formation must be kept simple and informal - view is if overcomplicated it takes away from the sap and essence.  Andrews had to tread a line between intuition and analysis known as the “ act of judgement”

• 4) Strategies should be one of a kind and formed from individualised design:  - it should be tailored to one case. Design school talks about process which strategies are developed

• 5)Design process is complete when strategies appear fully formulated as perspective

• 6) Strategies should be explicit so they have to be kept simple – must be simple so others in the organization can understand them

• 7) Only after strategies are formulated that they can be implemented

• It appears from the Design school that there is a clear distinction from the formulation of strategies and the implementation processes of these strategies as a whole. Structure must follow strategy

Critique of the Design School

Assessment of Strengths and Weakness: Bypassing Learning

• School promises strategic formation as a process of conception rather than one of learning. Design school says that firm knows its strengths and weaknesses by judgement analysis  and thought expressed verbally and on paper

• But are competences distinct even to an organization? Might they not also be distinct to context, to time, even to application?

• Strategic change involves some new experience, a step into the unknown, the taking of some kind of risk. Therefore no organization can ever be sure in advance whether an established competence will prove to be a strength or a weakness

• The point we wish to emphasize is: how could the firm have known this ahead of time? The discovery of "what business are we in" could not be undertaken merely on paper; it had to benefit from the results of testing and experience.

Structure Follows Strategy

• Design school promotes the dictum, first articulated by Chandler (1962), that structure should follow strategy and be determined by it.

• Yet what organization can wipe the slate clean when it changes its strategy? Claiming that strategy must take precedence over structure amounts to claiming that strategy must take precedence over the established capabilities of the organization,

• Conclude that strategy follows structure the way left foot follows the right foot. Development of the strategy both support organization as well as eachother

Promoting Inflexibility

• Once strategies have been created, then the model calls for their articulation. Failure to do so is considered evidence of fuzzy thinking

• Their point is that organizations must function not only with strategy but also in times when strategy is being formed

• Quinn notes it is impossible to formulate that all events such as internal  and external decisions as well as informational needs come together at on precise moment

• To summarize, certainly strategies must often be made explicit, for purposes of investigation, coordination, and support. The questions are: when? and how?

Marketing Myopia

• The basic point was that firms should define themselves in terms of broad industry orientation—"underlying generic need" in the words of Kotler and Singh (1981:39)—rather than narrow product or technology terms

• Levitt's intention was to broaden the vision of managers. At that he may have succeeded—all too well. As Kotler and Singh, also from marketing, argued: "very little in the world. is not potentially the energy business"

• He has essentially redefining what strategy is from position all the way to perspective and what one views as strategy

• Critiques have stated the danger of Levitt’s argument stating that "marketing hyperopia," where "vision is better for distant than for near objects" (Kotler and Singh, 1981:39), or of "marketing macropia," which escalates previously narrow market segments "beyond experience or prudence" (Baughman, 1974:65

Concluding Remarks

• External environment in which we operate is an unpredictable area in which idealisms of strategic forwardness may not always work, or an intended strategy may not fit

• There is a clear distinction in this chapter between formulation of strategies on one hand and the implementation of them on another.

• From reading I believe that one of the limits of the Design school is the lack of attention paid to the entrepreneurial approach, they argue for a strategy to be formulated on a collective basis

• The chapter argues that thinking and action must work in tandem for the successful implementation of strategies but surely there are times when thinking must precede action and vice versa?

Questions: In Chapter 2 it states that “Strategy provides Consistency” Of course Strategy is an imperative aspect to any organisation with its need to provide direction and a sense of order but the Design school and Andrews argues that strategies should be “ explicit for those who make them” and have to “ be kept rather simple”.   From reading the fundamental ideals of the Design school would it be a rational conclusion to assume that over simplification of strategies may be distorted from the economic reality in a given situation? Furthermore, would simplification essentially detract from the fact that strategy as a concept is inherently complex both from the side of its formulation and implementation?