Re: Strategic Planning Out-of-date? LO3602
Thu, 2 Nov 1995 12:13:15 -0500

Replying to LO3568 --

Hi Kurt,

About 10years ago I wrote an article called "Why Strategic Management is
Bankrupt" (Organizational Dynamics, Autumn 1986). By this I meant that the
claims for it (liablities) exceeded its assets and that although it had
great strengths it was fundamentally limited by the contexts in which it
was possible to practice it. I was attacking "management" rather than
"planning" because by then the original planning model had grown to become
a giant framework for the instrumentally rational management of

Since then much has happened: the smooth growth of the post WW II period
in the west gave us the unhealthy illusion that we knew what we were
doing. This has ended. From the success of the Japanese I think we have
learnt that the strategy model is as culture-bound as any other, and
reflects the weaknesses and strengths of the Western management culture.
Henry Mintzberg's "Rise and Fall of Strategic Planning" details much of
the history. But we cannot throw it away -- it is extraordinarily useful.
Rather we need to understand the contexts in which it is not useful. There
are three such contexts IMHO: 1. Early in the life of an enterprise,
during the entrepreneurial phase, when the issues are unanalyzable -- a
logic has not yet been developed and there are no markets "scan"
because we don't know "what business we are in". 2. Late in the life of an
organization when the logic is clear, but available to all and
organizations are constrained from acting on any analysis by systemic
constraints. 3. The period of renewal which follows the crises required to
break the systemic constraints and leads to the development of a new
social system and the formation of creative networks out of which
entrepreneurial activities emerge. This requires a values-based
rationality, not a means-end rationality of the kind offered by the
strategy model.

For further explanations see my book "Crisis & Renewal: Meeting the
Challenge of Organizational Change" (Harvard Business School Press, 1995)

David Hurst
Speaker, Consultant and Writer on Management