by henry mintzberg

8
- by Henry Mintzberg Whenstrategic planning arrived on the scene in planning often spoils strategic thinking, causing the mid-1960s, corporate leaders embraced it as managers to confuse real vision with the manipula- "the one bestway" to devise and implement strate- tion of numbers. And this confusion lies at the gies that would enhance the competitiveness of heart of the issue: the most successful strategies are each business unit. True to the scientific manage- visions, not plans. mentpioneeredby FrederickTaylor, this one best Strategicplanning, as it has beenpracticed, has way involved separating thinking from doing and really beenstrategic programming, the articulation creating a new function staffed by specialists:stra- and elaboration of strategies, or visions, that al- tegicplanners. Plann,ing systemswere expected to ready exist. Whencompanies understand the differ- encebetween planning and strategic S ..., ..thinking, they can get back to what trategIc plannIng Isn t strategIc the strate~-making processshould h be: captunng what the manager t InkIng. One IS analysIs learns from all sources (both the soft d ...' insights from his or her personal ex- an the other IS synthesIs. periences and the experiences of others throughout the organization and the hard data from market re- ~rod1ice the best strategiesas well as step-by-step I search and the like! and then synthesizing that instructions for carrying out thosestrategies so that ' learning into a vision of the direction that the busi- the doers, the managers of businesses, could not get ness should pursue. them wrong.As we now know, planning has not ex- actly worked out that way. While certainly not dead,strategic planning has longsince fallen from its pedestal. But evennow, few people fully understand the reason: strategic planningis not strategicthinking. Indeed, strategic I Henry. Mintz berg is professor of management at McGill University in Montreal, Quebec, and visiting professor at INSEAD in Fontainebleau, France. This article, his fifth contribution to HER, is adapted from his latest book, The Rise and Fall of Strategic Planning (Free Press and Prentice Hall International, 1994). 107 IiARVARD BUSINESS REVIEW January-Februarv 1994

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Page 1: by Henry Mintzberg

-

by Henry Mintzberg

When strategic planning arrived on the scene in planning often spoils strategic thinking, causingthe mid-1960s, corporate leaders embraced it as managers to confuse real vision with the manipula-"the one best way" to devise and implement strate- tion of numbers. And this confusion lies at thegies that would enhance the competitiveness of heart of the issue: the most successful strategies areeach business unit. True to the scientific manage- visions, not plans.ment pioneered by Frederick Taylor, this one best Strategic planning, as it has been practiced, hasway involved separating thinking from doing and really been strategic programming, the articulationcreating a new function staffed by specialists:stra- and elaboration of strategies, or visions, that al-tegic planners. Plann,ing systems were expected to ready exist. When companies understand the differ-

ence between planning and strategicS ..., ..thinking, they can get back to what

trategIc plannIng Isn t strategIc the strate~-making process shouldh be: captunng what the manager

t InkIng. One IS analysIs learns from all sources (both the softd ...' insights from his or her personal ex-

an the other IS synthesIs. periences and the experiences ofothers throughout the organizationand the hard data from market re-

~rod1ice the best strategies as well as step-by-step I search and the like! and then synthesizing thatinstructions for carrying out those strategies so that ' learning into a vision of the direction that the busi-

the doers, the managers of businesses, could not get ness should pursue.

them wrong. As we now know, planning has not ex-actly worked out that way.

While certainly not dead, strategic planning haslong since fallen from its pedestal. But even now,few people fully understand the reason: strategicplanning is not strategic thinking. Indeed, strategic I

Henry. Mintz berg is professor of management at McGillUniversity in Montreal, Quebec, and visiting professorat INSEAD in Fontainebleau, France. This article, hisfifth contribution to HER, is adapted from his latestbook, The Rise and Fall of Strategic Planning (Free Pressand Prentice Hall International, 1994).

107IiARVARD BUSINESS REVIEW January-Februarv 1994

Page 2: by Henry Mintzberg

STRATEGIC PLANNING

Organizations disenchanted with strategi~ plan-ning should not get rid of their planners or concludethat there is no need for programming. Rather, orga-nizations should transform the conventional plan-

and,suIts of each step. "I ~ ~ -niques for developing strategy,/'. Michaelprobably the most widely read writer on

wrote in the Economist.!PI h Id k h .The label "strategic..1 'anners s ou .ma e t elr c

greatest contribution around thestrategy-making process ratherthan inside it.

-~ ,,' ~'I such as going off to'an.-~ treat in the mountains to

I strategy. But call that activityL -ning," let conventional, r~-- ':~' -~- ganize it, and watch ,how.

.the event becomes formalized---, 'I-: sion statements in the

sessment of corporatening job. Planners should make their c9ntribution I weaknesses in the afternoon, strategiesaround the strategy-making process rather than in- articulated by 5 P.M.).

side it. They should supply the formal analyses or I Strategic thinking, in contrast, is abouthard data that strategic thinking requires, as long as It involves intuition and creativity. Thethey do it to broaden the consideration of issues of strategic thinking is an integratedrather than to discover the one right answer. They I o~.ilie ent~rpri.se, a not-too-precisely

should act as catalysts who support strategy mak- VISIon of directIon, such as the

ing by aiding and encouraging managers to think the founder of Silicon Graphics, thatstrategically. And, finally, they can be programmers sional visual computing is the way to makeof a strategy, helping to specify the series of con- puters easier to use.crete steps needed to carry out the vision. I Such strategies oft~n cannot be '

By redefining the planner's job, companies will schedule and immacUlately conceived. Theyacknowledge the differenc.e between planning and be free to appear at any time and at ~ny ,

strateg.ic thinking. Planning has always been about organization, typically throughanalysis-about breaking down a goal or set of in- informal iearning that ~ust necessarily betentions into steps, formalizing those steps so that out by people at various levels who arethey can be implemented almost automatically, volved with the specific issues at hand.

Call an informal retreat "planning," let conventional planners organize it,and watch how quickly the event becomes formalized.

108 DRAWINGS BY GARISON

Page 3: by Henry Mintzberg

~~.-- Formal planning, by its very analytical nature,

has been and always will be dependent on thepreservation and rearrangement of established cate-gcries-the existing levels of strategy Icorporate,business, functional), the established tYI1es of prod-uctS Idefined as "strategic business units"), overlaidon the current units of structure ldivisions, depart-ments, etc.). But real strategic change requires notmerely rearranging the established categories, butinventing new ones.

Search all those strategic planning diagrams, allthose interconnected boxes that supposedly give

Planners would have people believe that planningfails when it does not receive the support it de-serves from top management or when it encountersresistance to change in the organization. But surelyno technique ever received more top managementsupport than strategic planning did in its heyday.Strategic planning itself has discouraged the com-mitment of top managers and has tended to createthe very climates its proponents have found so un-congenial to its practice.

The problem is that planning represents a calcu-lating style of management, not a committing

style. Managers with a committing...style engage people in a journey:

Real strategIc c.hange requIres They lead in such a way that every-..' one on the journey helps shape itsmventIng new categorIes not course. As a result, enthusiasm in-

.' evitably builds along the way. Those

rearrangIn g old ones. with a calculating style fix on a desti-

, natipn and calculate what the groupmust do to get there, with no con- i

cern for the members' preferences. But calculatedstrategies have no value in and of themselves) to ,paraphrase the words of sociologist Philip Selznick, !strategies take on value only as committed people iinfuse them with energy! I

No matter how much lip service has been paid tothe contrary, the very purpose of those who pro-'mote conventional strategic planning is to reducethe power of management over strategy making. IGeorge Steiner declared, "If an organizatiqn is man- Iaged by intuitive geniuses there is no need for for-mal strategic planning. But how many organiza-

you strategies, and nowhere will you find a singleone that explains the creative act of synthesizingexperiences into a novel strategy. Take the exampleof the Polaroid camera. One day in 1943, EdwinLand's three-year-old daughter asked why she couldnot immediately see the picture he had just takenof her. Within an hour, this scientist conceived thecamera that would transform his company. In otherwords, Land's vision was the synthesis of the in-sight evoked by his daughter's question and his vasttechnical knowledge.

Strategy making needs to function beyond theboxes, to encourage the informallearning that produces new perspec-tives and new combinations. As the The goal -of those who promotesaying goes, life is larger than our ..' d 'categories. Planning's failure to tran- planrnng IS to re liCe managerssccnd the categories explains why it k .h.as discouraged serious organiza- power over strategy ma Ing.~lonal change. This failure is whytormal planning has promoted strate-~es that are extrapolated from the past or copiedfrom others. Strategic plannirlg has not only nevera~ounted to strategic thinking but has, In fact,

i otten impeded it. Once I1':J.anagers understand this,I thl:\" can avoid other costly misadventures causedby applying formal technique, without judgmentand intuition, to problem solving.

tions are so blessed? And, if they are, how manytimes are intuitives correct in their judgments?1I3Peter Lorange, who is equally prominent in thefield, stated, liThe CEO should typically not be...deeplyinvolvedll in the process, but rather be lithedesigner of [it] in a general sense.1I4 How can weexpect top managers to be committed to a pro-cess that depicts them in this way, especially whenits fail~es to deliver on its promises have become

so evident?At lower levels in the hierarchy, the problem be-comes more severe because planning has often beenused to exercise blatant control over business man-

The Pitfalls of PlanningIf you ask conventional planners what went

,:,rong, they will inevitably point to a series of pit-taIls for which they, of course, are. not responsible.

109HARVARD BUSINESS REVIEW January-February 1994

Page 4: by Henry Mintzberg

STRATEGIC PLANNING

agers. No wonder so many middle mana,gers havewelcomed the overthrow of strategic planning. Allthey wanted was a commitment to their own busi-ness strategies without having to fight the plannersto get it!

their strategies in much more personalized

tuitive ways.

T~e Fallacy of Detachment. In her book

tionalizing Innovation, Mariann Jelinek -

the interesting point that strategic planning

the executive suite what'

ods were to the factory floor-a way to

vent human idiosyncrasies in.order to

behavior. ''It is through administrative

that planning and policy are made possible,

the systems capture knowledge about the

Thus I'true management by exception.

policy direction are now }?ossible, solely

management is no longer wholly immersed -details of the task itself. "6

According to this viewpoint; if the system

the thinking, then strategies must be _:

from operations (or "tactics"), formulation

implementation, .~-. J gists from the objects of their strategies.

The trick, of course, is to get the relevant -

mation up there, so that senior managers on

can be informed about the details down

without having to immerse themselves inPlanne'rs' favored solution has been II hard

quantitative aggregates of the detailed

about the organization and its context, -

aged and regularly delivered. With such

tion, senior managers need never leave

five suites. or planners their staff offices.

they can formulate -work with their heads-

the hands can get on with implementation.All of this is dangerously fallacious. ~

has never been institutionalized. Systems

The Fallacies of Strategic Planning

An expert has been defined as someone whoavoids the many pitfalls on his or her way to thegrand fallacy. For strategic planning, the grand fal-lacy is this: because analysis encompasses synthe-sis, strategic. planning is strategy making. This fal-lacy itself rests on three fallacious assumptio~s:that prediction is possible, that strategists can bedetached from the subjects of their strategies, and,above all, that the strategy-making process can beformalized.

The Fallacy of Prediction. According to thepremises of strategic planning, the world is sup-posed to hold still while a plan is being developedand then stay on the predicted course while thatplan is being implemented. How else to explainthose lockstep schedules that have strategies ap-pearing on the first of June, to be approved by theboard of directors on the fifteenth? One can just pic-ture competitors waiting for the board's approval,especially if they are Japanese and don't believe insuch planning to begin with.

In 1965, Igor Ansoff wrote in his influential bookCorporate Strategy, ",We shall refer to the period forwhich the firm is able to-construct forecasts withan accuracy of, say, plus or minus 20 percent as theplanning horizol1 of the firm."s What an extraordi-

Wh 8 h 1 8. 1 8 thesis created by the geniusere In t e p anmng Iterature preneur or even the ordinary

8

h h d f 8d petent strategist, and they ~--IS t ere a s re 0 eVI ence that never will. .

hb 8 .Ironically, strategic planninganyone as othered to fInd out I:1l\ssed one of Taylor's most'h 8 tant messages: work processes --

OW managers make strategIeS? be fully understood before theybe formally programmed. But ~

in the planning literature isshred of evidence th.at anyone hasfind out how it is that managers really donary statement! How ill the world can any compa-

ny know the period for which it can forecast with a

given accuracy?The evidence, in fact, points to the contrary.

While certain repetitive patterns, such as seasons,may be predictable, the forecastillg of discontjnu-ities, such as a technological innovation or a priceillcrease, is virtually impossible. Of course, somepeople sometimes "see" such thillgs coming. Thatis why we call them "visionaries." But they create

havetegic thinking, and strategy making aremous, at least in best practice.

The problem with ~- ,to inform the senior manager is they can have acidedly soft underbelly. Such data take.'harden, which often makes them late. They

HARVARD BUSINESS REVIEW January-February110

Page 5: by Henry Mintzberg

lack richness; for exam- Ie, they often exclude I VISIon IS unavaIlable

p 1., d to those who cannotthe qua Itatlve. An " ". h hh tend to be overly see WIt t eir ownt ~egated, missing im- I eyes. Real strategists

ag h get their hands dirtyportant nuances. T ese d' .f .d dare the reasons man- Iggmg or 1 eas, anagers who rely on for- reai strategies are built

1. d . f .from the occasionalroa lze In ormatIon,such as market-research .nuggets they uncover.

.These are not Peoplereports pr accountIng h b h. b .w 0 a stract t em-statemeThts I.n usmess 1 . f h d .1d ..'

1 .se ves rom teal yan OpInIOn po Is In. . d t .1 h h,- d b e al s; t ey are t egovernment, 'ten: to e h .h d .' ones w 0 Immerse.detac e m more ways th 1 . hemse ves In t emthan one. Study after

hil b . bl bw e ~mg a e to a -

study has shown thatstract th t t . .e s ra egIc mes-

the most effectIve man- sages from them. Theagers rely on some .of big picture is paintedthe soft~st fo:ms of .m- \ with little strokes.for~atlon, IncludIng I The Fallacy of For-gOSSIp, hearsay, and var- malization. The failureious othe! intang~ble I of strategic planning isscraps of mforI;natlon. the failure of systems to

My research and that Real strategists get their hands dirty d1ggmg for 1deas, and d b tt thI . b it t- th 0 e er an, or evenof many others demon- rea strategies are u t Hom e nuggets they uncover. nearly as well as, hu-

strates that strategy ma,king is an imm_ensely com- ; man beings. Formal systems, mechanical or other-plex process, which involves the most sophisticat-: ! wise, have offered no improved means of dealin~ed, subtle, and, at times, subconscious elements of : with the information overload of human brains; in-human thinking. \ deed, they have often made matters worse. All the

A strategy can be deliberate. It can realize the! promises about artificial intelligence, expert sys-specific intentions of senior management, for ex- : terns, and the like improving if not replacing hu-ample, to attack and conquer a new market. But a : man intuition never ma.terialized at the strategystrategy can als'o be emergent, me~ning that a con. ; level. Formal systems could certainly process morevergent pattern has formed among the different ac- i information, at least hard information. But theytions taken by the organization one at a time. i could never internalize it, comprehend it, synthe-

In other words, strategie:s can develop inadver- ! size it. In a literal sense, planning could not learn.tently, without the conscious: intention of senior! Formalization implies a rational sequence, frommanagement, often through a process of learning. A ! analysis throug? administrative procedure to even.-salesperson collvinces a different kind of customer I tual actiop. But strategy making as a learning pro-to try a product. Other salespeople follow up with I cess can proceed in the other direction too. Wetheir customers, and the next thing management think in order to act, to be sure, but we also act iriknows, its products have penetrated a new market. order to think. We try things, and those experi:.When it takes the form of fits and starts discoveries, ments that work converge gradually into viable

,\1ased on serendipitous events, and the recognition! patterns that becbme strategies. This is the very es-

~,.i unexpected patterns,learning inevitably plays a, i sence of strategymakin? as a learning proc~ss.111 not the, crucial role in the development of novel! Formal procedures will never be able to forecast

Strategies. i discontinuities, i?Iorm detached ~~agers, or ~re. I

Contrary to what traditional planning would i ate novel strategIes. Far ~om .proVlding .stra~egIes,have us belie~e, deliber.ate strategies are not neces- ! pl~g could not proceed WIthout th~l! pnor ~x-sarily good, nor are emergent strategies necessarily istenc,e. All this time, therefore, strategIc plannIngbad. I believe that all viable strategies have emer- has been misnamed. It should have been called stra-gent and deliberate qualities, since all must com- I tegic programming, distinguished from other use- .

bine some degree of flexible learning with some de- : ful things that planners can do, and promoted asgree of cerebral control. i a process to formalize, when necessary, the conse-

111,-1 ,,_L 100A~"n _.

Page 6: by Henry Mintzberg

STRATEGIC PLANNING

quences of strategies that have already been devel-oped. In short, we should drop the label "strategicplanning" altogether.

clean them up. Package them neatly so thattell everyone about them and get .~,more formal language, strategic , ~ ---volves three steps: codification, elaboration,conversion of strategies.

,

strategies in terms sufficiently clear to reI:!.derformally operational, so that theircan be worked out in detail; This requires adeal of interpretation and -~~ ~ -.

might be lost in articulation: nuance, .~qualification. A broad vision, like ~ -~market for a new technology, is one thing,

specific pl~T-'35% market share, focusing onhigh end-is quite another.

Elaboration means breaking down the

Planning, Plans, and Planners

Two important messages have been conveyed

through all the difficulties encountered by strategic

planning. But only one of them has been widely ac-

cepted in the planning community: business-unit

managers must take full and effective charge of the

strategy-making process. The lesson that has still

not been accepted is that managers will never be

able to take charge through a formal-

ized process. What then can be the

roles for planning, for plans, and for

planners in organizations?

Planners. and managers have dif-

ferent advantages. Planners lack

managers' authority to make com-

mitments, and, more important,

managers' access to soft information

critical to strategy making. But be-

cause of their time pressures, man-

agers tend to favor action over reflection and the

oral over the written, which can cause them to

overlook.important analytical information. Strate-

gies cannot be created by analysis, but their devel-

opmentcanbehelpedby.it. well is overall action plans specifying what

Planners, on the other hand, have the tiffie and, be done to realize each strategy: build four new

most important, the inclination to analyze. They tories and hire 200 new workers, for example.

have critical roles to play alongside line managers, And conversion means considering --

but not as conventionally conceived. They should the changes on the organization's ~ -' ~

work in the spirit of what I like to call a "soft ana- fects on budgets and perforII1;ance controls, for

lyst," whose intent is to pose the right questions ample. Here a kind of great divide must be

rather than to find the right answers. That way, from the nomoutine world of strategies and,

complex issues get opened up to thoughtful consid- .grams to the routine world of budgets and ~-

eration instead of being closed down prematurely I tives. Objectives have to be restated and by snap ~ecisions.. ..i reworked, and ~olicies and. ~ -" ',~, -

Plannmg as StrategIc Programmmg. PlannIng i cedures reconsIdered, to take mto account ~~ ~

cannot generate strategies. But given viable strate- sequences of the specific changes.

gies, it can program themj it can make them opera- One point must be ~mphasized. Strategic

tional. For one supermarket chain that a colleague gramming is not "the one best way" ~~

andlstudied,planni,ngwaSthearticulation,justifi- I sarilya good way. Managers don't always

cation, and elaboration of the strategic vision that I program their strategies formally. ~~_..

the company's leader already had. Planning was not, must leave their strategies flexible, as broad

deciding to expand into shopping centers, but expli-'! sions, to adapt to a changing environment;

cating to what extent and when, with how many I

stores, and on what schedule. iAn appropriate image for the planner might be :

that person left behind in a meeting, together with

the chief executive,. after everyone else has depart-

ed. All of the strategic decisions that were made are

symbolically strewn about the table. The CEO

turns to the planne;r and says, "There they all arej

ty of its environment and is in needordination of a -typically the case of airlines with their needscomplicated scheduling I, does such strategicgramming make sense.Plans as Tools to Communicate and -Why program strategy? ..

112 HARVARD BUSINESS REVIEW January-February

Page 7: by Henry Mintzberg

! newly uncovered markets and understanding their! implied new products. I

! Planners as Analysts. In-depth examinations of: what planners actually do suggests that the "effec- I

; tive ones spend a good deal of time not so much do- ,I ing or even encouraging planning as carrying out, analyses of specific issues. Planners are obvious

candidates for the job of studying the hard data andensuring that managers consider the results in thestrategy-making process. ,

'Much of this analysis will necessarily be quickand dirty, that is, in the time frame and on the adhoc basis required by managers. It may include in-dustry or competitive analyses as well as internalstudies,.. including the use of computer models to !

analyze trends in the organization.But some of the best models that planners can of-

fer managers are simply alternative conceptual in~terpretations of their world, such as a new way toview the organization's distribution system. AsArie de Geus, the one-time head of planning at Roy-al Dutch/Shell, wrote in his-HER article "Planningas Learning"IMarch-April 1988J, "The real purpose Iiof effective planning is not to make plans but to "'change the...mental models that...decision makers icarry in their heads! "

IPlanners as Catalysts. The planning literature I, has long pr-Omoted the role of catalyst for the plan- I '

ner,. but not as I will describe it here. It is not plan- Itling that planners should be urging on theirorgani-

1zations so much as any form of behavior that can .lead to effective performance in a given situation. i

for coordination,. to ensure that everyone in the or-ganization pulls in the same direction. Plans in theform of programs-schedules/ budgets/ and so on-can be prime media to communicate strategic in-tentions and to con,trot the individual pursuit of

f them, in so far/ of course/ as common direction is! considered to be more important than individual;

., discretIon.Plans can also be used, to gain the tangible as well

as moral support of :inf1uentia;i outsiders. Writtenplans inform financie,rs/ supp~ersj governmentagencies, and others about !he intentions of the or-ganizationso that these groups can help it achieve

, its plans.Planners as StrategyFi~ders. As noted/ some of

the most important strategies in organiz~tionsemerge without the intention or sometimes eventhe awareness of top II;lanagers. Fully exploitingthese strategies/ though/ often r~quires that they berecognized and then broadene~ in; t4eir impact/ liketaking a new use for a product 'atcidentally discov-

, ered by a salesperson and turning it into a majornew business. It is obviously the responsibility ofmanagers to discover and anoint these strategie'8.But planners can assist managers in finding thesefledgling strategies in theiI organizations/ activitiesor in those of competing organizations.

Planners can snoop aroUlid places they might notnormally visit to find patterns amid the noise offailed experiments; seemingly random activities/,and

messy learning. They can discover new ways ofdoing or perceiving things/ for example/ spotting

ifIt

An appropriate image for the planner is the person left behind in a meeting, together with the CEO,who helps package the strategic decisions that are symbolically strewn about the table.

113IiARVARD BUSINESS REVIEW January-February 1994

Page 8: by Henry Mintzberg

STRATEGIC PLANNING)!!fJ:

,;been forced to waste so much time doing ill-co~ceived strategic planning, may prefer to have vetifew of either! ,~

:~..J

Sometimes that may even mean criticizing fonnalplanning itself.

When they act as catalysts, planners do not enterthe black box of strategy making; they ensure thatthe box is occupied with active line managers. Inother words, they encourage managers to thinkabout the future in creative ways. .

Such planners see their job as getting others toquestion conventional wisdom and especially help-ing people out of conceptual ruts jwhich managerswith long experience in stable strategies are apt todig themselves into!. To do their jobs, they mayhave to use provocation or shock tactics like raisingdifficult questions and challenging conventionalassumptions. .

.left- and Right-Handed Planners

Two very different kinds of people populate the

planning function. One is an analytic thinkerl who

is closer to the conventional ima,ge of the planner.

He or she is dedicated to bringing order to the orga-

nization. Above alII this person programs intended

strategies and sees to it that they are communicat-

ed clearly. He or she also carries out analytic stud-

ies to ensure consideration 9f the necessary hard

data and carefully scrutinizes strategies intended

for implementation. We might label him or her the

right-handed planner.The second is less conventional but present

nonetheless in many organizations. This planner is

a creative thinker who seeks to open up the strate-gy- making process. As a II soft analystlll this plaimer

is prepared to conduct more quick and dirty studies.

-He or she likes to find strategies in strange placesand to encourage others to think strategically. This

person is somewhat more inclined toward the in"

tuitive processes identified with the brain'$ rightI hemisphere. We might call him or her the left-

I handed planner. Many organizations need both types, and it is top

J management's job to ensure that it has them in ap-

propriate proportions. Organizations need people to

bring order to the messy world of management .as

well as challenge the conventions that managersand especially their organizations develop. Some

'I! organizations !those big, machine-like bureaucra-

cies concerned with mass production) may favor

I the right-handed plannersl while others !the loose,

I flexible I'adhocracies," or project organizations)may favor the left-handed ones. But both kinds of

organization need both types of plannersl if only to

offset their natural tendencies. And, of course,

some organizations, lik~ those highly professional-ized hospitals and educational systems that have

The Formalization Edge

We human beings seem predisposed toour behavior. But we must be careful notthe formalization edge. No doubt we mustize to do many of the things we wish tosociety. That is why we have organizations. Butexperiences of what has been labeled strategicling teach us that there are limits. Thesemust be understood, especially for complexcreative activities like strategy making.

Strategy making is not an isolated process.not happen just becauselabel. To the contrary, strategy making is ainterwovennization. Sys~ems do not think, and when theyused for more than the facilitation of humaning, they can prevent thinking.

TJuee decades of experience with strategicnil'lghave taught us about the need to loosen upprocess ofit off by arbitrary formalization. Through allfalse starts and excessive rhetoric, we havewhat planning is not and what it cannot do.we have also learned what planning is andcan do, and perhaps of greater use, whatthemselves can do beyond planning. We havelearned how the literature of management can get'carried away and, more important, about the apprO;priate place for analysis in organizations. .:,

The story of strategic planning, in oth~r words,has tal,lght us not only about formal technique it-self but also about how organizations function ~dhow managers do and don't cope with that func:tioning. Most sigilificant, it has told us somethingabout how we think .as human beings, and that wesometimes stop thinking. :~-.--References1. Michael Porter, "The State of Strategic Thin~:' Economist. May1J.1987, p. 2,1. ,~:

2. Philip Selznick, Leadership in Administration: A Sociological Inler.

pretation (New York: Harper ~ Row, 1957). ~

3. George Steiner, Strategic Planning: What Every Manager Must KnO~:(New York: Free Press, 1979), p. 9. ;.;1,

4. Peter Lorange, "Roles of the CEO in Strategic Planning and Control ~cesses, " ina seminar on The Role of General Management in Strategy~Jmulation and Evaluatio~, cosponsored by E.S.S.E.C., E.I.A.S.M., ~~I.A.E.ICergy, France: April 28,-30, 19801, p. 2. ;~

5. H.igor Ansoff, Corporate Strategy: An AnalytiC Approach to Busin~.

Policy for Growth and Expansion {New York: McGraw.Hill, 19651, P',.i

6. Matiann J~linek, Institutionalizing Innovation: A Study of Orga11jtf;}~n~ LearnIng Systems (New York: Praeger, 1979), p. 139. -:..:fi

. 107 :-~ RepJ'lnt 94 !:i;

HARVARD BUSINESS REVIEW January-February xl~114