Perspectives on Corporate Strategy

Towards an enhanced model of strategic thought

Two schools of thought, the design (intended) school and the emergent (learning) school (Grant, 2005), dominate the strategy field. The design school views strategy making as a process of formal strategic planning (e.g. the creation of a strategic direction, usually top-down) (Prahalad & Hammel, 1990). This contrasts with the emergent school (Mintzberg, 1978) where strategy is seen as emerging from the pattern in the stream of decisions and actions taken in organizations as managers at several levels interpret intended strategies and other contextual factors. Mintzberg sees strategy as emerging from organizational actions rather then something that is planned in advance (Mintzberg, 1987)

Bower & Gilbert’s (B&G) view of strategy, the Bower-Burgelman explanation (Johnson et al., 2005) or Resource Allocation Process (RAP), is that it is driven and crafted, step by step, by patterns of resource allocations and commitments that are the outcomes of organizational decision making processes at multiple levels which develop over time as events and circumstances unfold. This is clearly an emergent view of strategy, in which RAP shapes strategic outcomes and strategy and one in which, importantly, the realized strategy is developed by many managers and not just a single individual such as a CEO.

Other strategic lenses such as the resource based view (RBV) (Barney, 1991; Peterav, 1993; Maritan, 2001; Wernerfelt, 1984) and the strategic positioning (SP) school (Porter, 1979; 1996) can enrich and supplement the RAP viewpoint. The RAP recognizes the importance of organizational resources in the strategy making process. There are clear synergies between the RBV and RAP because both are concerned with resources and capabilities internal to the firm and their importance and connection to strategic decision making. As Peterav (2005, p.411) notes the RBV adds to the RAP by directing attention towards competitive processes...