Strategic and Organisational Learning
Definition of strategy
“A strategy is a way through a difficulty, an approach to overcoming an obstacle, a response to a challenge.”(Rumelt, 2011)
Meaning of strategy
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Strategy is basically a plan that is formulated by businesses and mostly top level managers that sets limitations and boundaries which organisations comply with in order to reach a particular goal. Strategy directly or indirectly is a means to achieving an organisations goals more effectively. It includes every organisational and managerial function such as planning, organising, goal setting, organisational structuring and adaptation to the everchanging environments. Therfore strategy is a vital part of every organisation and without a basic strategy or plan of action, every organisation will fail to survive in the ever competitive present business environment.
Strategy is a very general term. There are many kinds of strategies that deal with every minor detail of organisational functioning. One of the more refined forms of strategy is a fairly new concept known as strategy as practice. Strategy as practice is a more practical managerial science that describes strategy as something that is practised within the organisation and functions that managers perform. Functions like strategy formulating and also the carrying out of these strategies .The definition below will help us have a better understanding of this subject.
Definition of strategy as practice
“Strategy a situated, socially accomplished activity…strategizing comprises those actions interactions and negotiations of multiple actors and the situated practices they draw on in accomplishing that activity” (Jarzabkowski, 2007)
Strategy as practice
“For many years now the dominant academic perspective on strategic management has looked at strategy as something that organisations have. The strategy as practice perspective, on the other hand, looks at strategy as something people do. It is concerned with the practice of strategising, encompassing both the formulation of strategy and how strategies are put into action to deliver strategic renewal and change. It therefore asks questions such as: what do people do to develop strategies in organisations; how do they translate their strategies into strategic action and change in organisations; what competences are required for this; how do they actually use the concepts and tools that are advocated for strategic management; what is good practice in managing strategy?”(www.lums.lanc.ac.uk)
As the statement above mentions that strategy as practice is a relatively new branch of strategic management, and is therefore still growing as a management science that people and organisations are slowly looking to for better solutions for strategising. This is because strategy has a direct effect on the performance of the organisation. Strategic concepts change as time passes and the business environment constantly changes, therefore strategy as practice is a new concept that holds new promises for the business world.
“Strategy as practice is a new measure to revitalise strategic theory and bring about change from the conventional strategic thinking to addressing various important questions on the functioning of an organisation and how the functioning differs from organisation to organisation. However strategy as practice is a more cautious approach as there are already a number of approaches to strategic thinking for every minute detail of firm positioning and managerial cognition.It is widely believed that there is more to learn from the day to day practices of the firm than the formulation of theories and principles that govern conventional strategy. Observations made on the functioning of the firm help us relate between different theories.” (Jarzabkowski, 2002)
According to Jarzabkowski strategy as practice has 3 core elements. They are Recursiveness, Adaptation and Strategy practice –in use.
Recursiveness
These theories are better explained by Jarzabkowski with the theories of structuration. Where the external environment which is a macro factor is used as a structure in which a lot of actors(managers) perform their day to day functions. And the interaction on a daily basis of actors with their environment on a daily basis as a practise is described as recursiveness of practice. Recursiveness is nothing but the daily routine of tasks and functions performed by managers. Recursiveness only occurs for tasks that are repetitive in nature i.e. tasks that have to be done repeatedly in order to gain recursiveness. Recursiveness is present at 3 levels- the actor, the organisation and the social institution. (Jarzabkowski, 2002)
Adaptation
Adaptation is a measure that has to be taken up by every organisation in order to adapt perfectly with its current environments in order to survive the constant changes of the environments in which the organisations function. Adaptation is a very important measure of strategic excellence. It show s to what extent an organisation or its manager are willing to go to keep the organisation afloat in the ever-changing macro environment.
Adaptation is not only seen at a macro level but even at a micro level of the firm. Adaptive organisational structures, adaptive managerial tasks, adaptive functioning to the changing needs of a firm etc are also considered adaptation. .(Jarzabkowski, 2002)
Strategy as practice in use
Managers or professionals who are strategic practitioners are said to be knowledgeable, purposive and reflexive in nature. Therefore when they practice they have the ample knowledge to go about their functions, they are full of intent which helps them adhere to the strategic principles of goal seeking. Strategic actors who practice strategy are the ones who usually take the recursive and adaptive route to strategy and succeed in doing it the right way. Strategy as practice as they say is the correct way of looking at strategic theory cause its a more practical hands on approach that could save the organisations from strategizing wrongly. .(Jarzabkowski, 2002)
Wrong strategies could lead to disasters
Wrong strategies could lead to disasters. This statement is very valid one once we ve seen how many firms fail in the present market conditions. They fail because they are not able to keep in tune with the market requirements and adapt constantly. All this may only occur when a firm has its priorities wrong. Every company has its own strategies and these strategies are formulated and followed up in order to reach the firm’s long term and short term goals. When the strategy fails to take into consideration one of the vital elements from both the micro and macro factors , the firm may have a troubled future. Strategies should be formulated in such a way that they are flexible to change through time, they should be simplistic and goal oriented and should be for the better functioning of the firm and not to compete with other firms. As Michael porter has said “ Bad strategy often stems from the way managers think about competition. Many companies set out to be the best in their industry, and then the best in every aspect of business, from marketing to supply chain to product development. The problem with that way of thinking is there is no best company in any industry.” Porter called this sort of competition “destructive competition”.
It is when companies and managers try to outshine other companies through cut throat competition and instead of trying to increase the performance and better functioning standards of their firm they instead work on putting other companies down. This is because such managers believe that there is only one best company amongst several. But as porter has pointed out that there is no one best company. It depends on people s perspectives, choices, different situations, budgets, and needs. Therefore he says concentrating on strategies that increase the performance and output and organisational integrity of a firm may actually help instead of opting for the former.
Although for this sort of strategizing. Managers have to look into their own firms and their own human resources and the strengths and weaknesses of the “‘Strategy is a word that gets used in so many ways with so many meanings that it can end up being meaningless. Often corporate executives will confuse strategy with aspiration.” (Porter ,2006). He also says that managers and firms confuse their strategies with the firm’s visions and firm’s missions, which quite frankly is the wrong approach to motivating their workers. When you confuse the company’s visions and strategies you are bound to end up no where. Because Strategising necessarily doesn’t involve motivationg and envisioning. It simply just helps the firm find a pathway to success if anything.
Product, pricing and geographical focus
It is also said that strategies should help a firm decide on what products and services its going to sell in the market, what pricing its going to adopt, who it is going to compete with and most importantly its geographical area of focus for business is to be determined. All these minor details play a major role in organisational success. The art of doing all this together is what porter says, leads to successful strategizing. Doing several of these key functions simultaneously is very important to larger firms.(Porter,2006)
Bad strategies and its problems
“Bad strategy abounds”, says UCLA management professor Richard Rumelt. “Senior executives who can spot it stand a much better chance of creating good strategies.”
Bad strategies are something that are very common. Managers think they have a strategy that will succeed but infact they don’t. They just make functioning a very difficult task for the firms due to listing down of some very demanding strategies that take more from the firm than they give. These strategies create a negative effect on the functioning of the firm. Because the goals seem very demanding and the managers and workforce are too stressed out to carry out the tasks asked of them.These strategies fail to solve the problem that the firms are actually facing. It is not based on realistic problems but based more on forecasted problems which could be wrong. A firm,s strategies should always be such that it helps solve the problems of the present as well as the future. Assuring an overall smooth ride. But not all strategies are like this. The one’s that fail miserably are coined as a bad strategy. These bad strategies can be a big negative effect on the firm.
There are strategies that mistake goals for strategies whereas the strategies themselves are only a means of achieving those very goals. Some strategies also have an absence of thought. They put in very sophisticated fancy words but lack any sense of thought or motive for the strategy basically making those strategies soul less. These are all bad strategies. While this may sound bad enough, there are strategies with no clear objectives or mission. These strategies as mentioned before have their priorites wrong. They are unsuccessful strategies from the very beginning.
Conclusion
Strategy as practice is a fairly new practice. Hence organisations and managers still don’t trust this method of strategising all that much. Many organisations still use the conventional method of goal-setting strategizing. Which basically is a prescribed way of going about various functions in order to reach its goals. While this may still be in fashion in most parts of the world and most of the organisations. The ever changing conditions of the market environments are asking for a change in the way organisations do business. For now it may be called the unconventional method of strategizing. But in a few years on, when its success catches on, businesses will see this as an option they may most certainly have to choose. This is because this method is a very flexible one, it keeps in mind both macro and micro influencing factors, It is also adaptive in nature and adapts to every situation that the organisation may be put in. As this strategy is not only set but is practised at the same time, it is easy for managers to make corrections along the way and not have problems in the strategy being too rigid and unchangeable.
Even if the organisations are choosing the conventional methods of strategising, they must always keep in mind the objectives and goals set for the firm which must be achieved through its strategies and also to make sure that they keep the strategies simple and easy to understand and not to confuse it with its goals and visions. When the strategies are void of any of these commonalities is when we can say that we have a near perfect strategy.
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Strategic and Organisational Learning. (2019, Apr 07). Retrieved from https://phdessay.com/strategic-and-organisational-learning/
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