The Configuration School of Strategy Formation
The Configuration School of Strategy Formation is one of the ten schools of thought on strategy formation proposed by Henry Mintzberg, Bruce Ahlstrand, and Joseph Lampel in their book "Strategy Safari." This school focuses on the idea that organizations go through distinct stages or configurations, each requiring a different approach to strategy formation. According to the Configuration School, the process of strategy formation depends on the specific characteristics and context of an organization at a given point in time.
Purpose: The main purpose of the Configuration School of Strategy Formation is to emphasize the importance of understanding an organization's specific context, characteristics, and stage of development when formulating a strategy. This school recognizes that there is no "one size fits all" approach to strategy formation and that different organizational configurations require different strategies.
Role: The role of the Configuration School is to provide a perspective on strategy formation that considers the organization's specific context and characteristics. It offers a contrasting view to other schools of thought, which may focus on a more generalized approach to strategy development. The Configuration School emphasizes that organizations must adapt their strategies to their unique circumstances and stages of development.
Components: The Configuration School of Strategy Formation comprises several key components:
- Organizational configurations: Distinct stages or patterns of organizational characteristics, such as structure, culture, and leadership style, that influence the approach to strategy formation.
- Strategy formation as a context-dependent process: The development of strategy as a process influenced by the organization's specific characteristics and context, requiring a tailored approach.
- Adaptation and transformation: The need for organizations to adapt their strategies and structures as they move through different configurations, recognizing that change is a natural part of organizational development.
Importance: The Configuration School of Strategy Formation is important because it acknowledges the need for organizations to adapt their strategies to their specific circumstances and stages of development. By emphasizing the influence of context and characteristics on strategy formation, the Configuration School helps organizations recognize the need for flexibility and adaptability in their strategic planning processes.
History: The Configuration School of Strategy Formation emerged in the 1980s and 1990s as researchers and practitioners explored the relationship between an organization's specific characteristics, context, and strategy. It was later proposed as one of the ten schools of thought on strategy formation by Mintzberg, Ahlstrand, and Lampel in their book "Strategy Safari," published in 1998.
Benefits:
- Context-awareness: The Configuration School encourages organizations to consider their specific context and characteristics when formulating a strategy, resulting in more relevant and effective strategic initiatives.
- Flexibility and adaptability: By recognizing the need for organizations to adapt their strategies as they move through different configurations, the Configuration School promotes flexibility and adaptability in strategic planning.
- Holistic view: The Configuration School provides a more comprehensive view of strategy formation, considering not only the organization's internal and external environment but also its unique characteristics and stage of development.
Pros and cons:
Pros:
- Encourages organizations to consider their specific context and characteristics when formulating a strategy.
- Promotes flexibility and adaptability in strategic planning.
- Provides a more comprehensive view of strategy formation.
Cons:
- May be challenging for organizations to identify their current configuration or predict future configurations accurately.
- Can be complex and difficult to apply in practice, given the multiple factors that influence an organization's configuration and strategy.
Examples to illustrate key concepts:
- A start-up company in its early growth stage focuses on a strategy that emphasizes rapid market expansion, innovation, and customer acquisition. As the company matures and enters a more stable configuration, it may need to shift its strategy to improve operational efficiency, cost reduction, and customer retention. In this example, the Configuration School of Strategy Formation highlights the importance of adapting the organization's strategy to its specific stage of development and characteristics.
- A multinational corporation with a highly diversified portfolio of businesses adopts a strategy formation approach that considers the different configurations of each business unit. By recognizing the unique characteristics and contexts of each unit, the Configuration School of Strategy Formation emphasizes the need for a tailored approach to strategy development, ensuring that each unit's strategy aligns with its specific needs and circumstances.
- A nonprofit organization undergoes a significant transformation, shifting from a centralized structure to a more decentralized model, with increased autonomy for regional offices. As the organization moves through this configuration change, it needs to adapt its strategy to reflect the new context, focusing on empowering regional offices and promoting collaboration. In this case, the Configuration School of Strategy Formation highlights the need for organizations to adapt their strategies as they move through different configurations.
In conclusion, the Configuration School of Strategy Formation is a perspective that emphasizes the importance of understanding an organization's specific context, characteristics, and stage of development when formulating a strategy. By recognizing the need for flexibility and adaptability in strategic planning, the Configuration School provides a contrasting view to other schools of thought that may prioritize a more generalized approach to strategy development. While the Configuration School has limitations, such as the complexity of accurately identifying and predicting organizational configurations, it remains an important perspective for understanding the influence of context and characteristics on strategy formation.
See Also