Strategic planning: systems thinking in practice
Strategic planning: systems thinking in practice

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Strategic planning: systems thinking in practice

3.1 Systems thinking

The chapter by Reynolds and Holwell describes four different attempts to group traditions of systems thinking according to the relative emphasis given to the situation, the users, and the ideas underpinning the approach.

Activity 7 Four perspectives on systems thinking

Read the section ‘Perspectives on systems thinking’ in Introducing systems approaches [Tip: hold Ctrl and click a link to open it in a new tab. (Hide tip)] (section 1.2.6). Draw up a table contrasting each of the four perspectives on systems thinking. For each perspective note the relative emphasis given to the:

  • a.situation of use
  • b.practitioner or user of particular systems approaches.

Discussion

The act of classifying ideas is itself dependent on the perspective of the person or people doing the classifying. Each of the four perspectives on the range of systems ideas provides an emphasis on either the situation in which the ideas were generated or on the individual practitioners or community of practitioners generating the ideas. Sometimes a classification of ideas may rely on more or less equal emphasis on both the situation and the practitioner. A similar distinction between situation and practitioner emphasis is found in classifying approaches towards strategy making, as you will discover when I introduce the ideas of Henry Mintzberg.

If systems thinking is about making complex situations manageable, how might you describe strategy making?

Making strategy, like systems thinking, involves dealing with situations often comprising many variables and with often contrasting perspectives held by different practitioners. In the late 1990s Henry Mintzberg, a well-known writer on management theory and strategic thinking, with his colleagues Bruce Ahlstrand and Joseph Lampel, attempted to make sense of the plethora of strategy-making approaches (Mintzberg et al., 1998). Firstly, using ideas from Chaffee, they identified seven common areas of agreement on strategy (Mintzberg et al., 1998, p. 16). These are listed below, where I have added in brackets an indication of whether the area emphasises attention to variables, which are associated with situations, or perspectives, which are associated with practitioners:

  1. strategy concerns both organisation and environment (perspectives)
  2. the substance of strategy is complex (variables)
  3. strategy affects overall welfare of the organisation (perspectives)
  4. strategy involves issues of both content and process (variables)
  5. strategies are not purely deliberate (perspectives)
  6. strategies exist on different levels (variables)
  7. strategy involves thought processes (perspectives).

The seven can therefore be divided between two groups. The first group, formed by the three areas 2, 4 and 6, relates more to engaging with multiple variables. The second group, formed by the four areas 1, 3, 5 and 7, relates to areas engaging with perspectives.

Next, Mintzberg and his colleagues classified all the approaches to strategy making they could find according to two sets of criteria:

  1. how each viewed the external world, ranging from being comprehensible and controllable to being unpredictable and confusing, with a focus on situations
  2. what internal process was proposed, ranging from the deliberate rational process to the less-deliberate natural process, with a focus on practitioners and their ideas.

Box 3 Schools of strategic management

The authors of Strategy Safari: A Guided Tour Through The Wilds Of Strategic Management (Mintzberg et al., 1998) identify ten schools of strategy making.

The first five are prescriptive schools with a practitioner focus on the process of strategy making:

  1. the design school, which sees strategic management as a process of attaining a fit between the internal capabilities and external possibilities of an organisation
  2. the planning school, which extols the virtues of formal strategic planning involving analyses and checklists
  3. the positioning school, which stresses the strategic need for positioning an organisation in the market and within its industry
  4. the entrepreneurial school, which emphasises the central role played by the leader
  5. the cognitive school, which looks inwards into the minds of strategists.

The last five schools are descriptive with a focus more on the situation in which strategies emerge:

  1. the learning school, which sees strategy as an emergent process – strategies emerge as people come to learn about a situation as well as their organisation's capability of dealing with it
  2. the power school, which views strategy emerging out of power games within the organisation and outside it
  3. the cultural school, which views strategy formation as a process rooted in the social force of culture
  4. the environmental school, which believes that a firm’s strategy depends on events in the environment and the company’s reaction to them
  5. the configuration school, which views strategy as a process of transforming the organisation – it describes the relative stability of strategy, interrupted by occasional and dramatic leaps to new ones.
(Source: adapted from Chakravarty, 2005)

A clue to the value of systems thinking is given by Mintzberg himself

We are all like the blind men and the strategy process is our elephant. Everyone has seized some part or other of the animal and ignored the rest. Consultants have generally gone for the tusks, while academics have preferred to take photo safaris, reducing the animal to a static two dimensions. As a consequence, managers have been encouraged to embrace one narrow perspective or another, like the glories of planning or the wonders of core competences. Unfortunately, the process will only work for them when they deal with the entire beast, as a living organism.

(Mintzberg, 2000, pp. 11–16)

Perspectives on making strategy clearly need a wider picture. It is not that particular perspectives are necessarily wrong but only that they are necessarily limited.

The relative focus of attention on situations and practitioners expressed by different schools of strategy-making approaches can be translated in relation to asking questions of ‘what’ and ‘how’ respectively. What is the purpose of the given strategic issue in any given situation, and how might it be achieved by practitioners? The framing of these questions is undoubtedly important, particularly with respect to situations where there are a multitude of variables and purposes for dealing with them.

But questions on strategy in the twenty-first century are also more concerned with questions of ‘why’. Why are there so many unintended consequences of human action? Why did the global financial crises of 2008–09 happen? Why the crises of confidence in societal and organisational governance? Why can societies, organisations and people not be more ecologically benign? In short, why can people not think systemically about alleviating the multitude of economic, social and ecological issues?

Monocausal explanations are sometimes favoured by managers and politicians either in order to mobilise action or as a way of demonstrating that a presumed single cause is being addressed. Making strategy requires looking at multiple causes through multiple lenses. It is this particular territory of complexity when navigating through multiple causation in messy contexts where strategic thinking of whatever school might be served through systems practice.

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