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Discussion 2: To plan or not to plan? All Sections 3636 unread…
Discussion 2: To plan or not to plan?
All Sections
3636 unread replies.3838 replies.
Later in the Introduction to the Strategy reading, a section addresses the need to determine a consistent value proposition. The supplemental reading goes into different schools of thought on strategy and planning. These different schools of thought are one of the key reasons that getting an agreement on the best practices for strategy is difficult.
As we venture into the practice round of the simulation next week, you and your team are going to have to figure out the value proposition and strategy for your company. Some experts would suggest you undertake a structured process to plan your strategy. These experts believe with enough industry analysis, review of data, and insights into the markets you are going to compete in, you can develop a comprehensive strategic plan. Of course, a company still needs to execute the plan to be successful.
In the last 15 years, give or take, other strategy experts have challenged the value of a structured strategic plan. One of the most notable is Henry MintzbergLinks to an external site.. Henry is a highly regarded professor from Canada. He wrote a book called The Rise and Fall of Strategic Planning. In the book, he goes into detail on how ineffective strategic planning processes are for companies. He suggests that the world is too dynamic and by the time these structured planning processes are complete, the world has likely changed and at least parts of the plan, if not the whole plan, are no longer relevant. A possible solution to this issue is described in the reading as an emergent strategy.
Clayton ChristensenLinks to an external site., a highly regarded strategy and innovation professor from Harvard, had a similar but not exactly the same view as Henry Mintzberg. Clayton suggested that because of the constant change in markets, it was better to use a test-and-learn approach to strategy. By regularly adjusting a company’s strategy, you can avoid the risk of trying to execute a fixed strategic plan that might not match the market.
While the idea of less structured planning has grown in popularity, there is increasing concern that companies are becoming too “seat of the pants” in their approach and that absent any structured planning, you lose the disciplined thinking necessary to surface strategic insights and make better long-term decisions. Further, there is concern that, without some planning, companies are merely reactive to market shifts rather than driving new markets and value creation.
Each of you is about to become a strategic executive running a (simulated) company. What do you think about the plan vs no plan (emergent) approach to strategy?
