53 Strategic Management: Concept, Process and Types

53.1 What is Strategy?

The word strategy comes from the Greek stratēgia — the art of the general. In business, strategy is the long-term direction and plan of action by which an organisation seeks to achieve its objectives in the face of competition and uncertainty. Strategic management is the broader managerial process — the formulation, implementation and evaluation of cross-functional decisions that enable an organisation to achieve its objectives (thompson2020?).

Three foundational definitions:

Three Working Definitions

Author	Definition	What it foregrounds
Alfred D. Chandler	“The determination of the basic long-term goals and objectives of an enterprise, and the adoption of courses of action and the allocation of resources necessary for carrying out these goals.”	Goals + actions + resources
Michael Porter	“Strategy is creating fit among a company’s activities — the success of a strategy depends on doing many things well, not just a few, and integrating them.”	Activity fit
Henry Mintzberg	Strategy is “a pattern in a stream of decisions” — and can be deliberate, emergent, or both.	Pattern (descriptive)

53.1.1 Mintzberg’s Five Ps for Strategy

Mintzberg famously argued that strategy is used in five different senses, each useful in its own way (mintzberg1987?):

Mintzberg’s Five Ps for Strategy

P	Sense
Plan	A consciously intended course of action
Ploy	A specific manoeuvre to outwit a competitor
Pattern	A pattern in a stream of decisions (deliberate or emergent)
Position	The firm’s place in its environment relative to others
Perspective	The firm’s ingrained way of seeing the world (its character)

53.2 Levels of Strategy

Three Levels of Strategy

Level	Question it answers	Decisions
Corporate	“What businesses should we be in?”	Diversification, M&A, divestiture, geographic spread
Business / SBU	“How do we compete in this business?”	Generic strategies (cost / differentiation / focus)
Functional	“How do the functions support the business?”	HR, marketing, finance, operations

flowchart TB
  C[Corporate Strategy<br/>Which businesses?] --> B[Business / SBU Strategy<br/>How to compete?]
  B --> F[Functional Strategy<br/>How functions support business]
  style C fill:#FCE4EC,stroke:#AD1457
  style B fill:#FFF3E0,stroke:#EF6C00
  style F fill:#E8F5E9,stroke:#2E7D32

53.3 The Strategic-Management Process

A standard six-step process used by Thompson, Strickland and Gamble (thompson2020?):

Six-Step Strategic-Management Process

#	Step	Activity
1	Develop strategic vision and mission	Where do we want to be? Why do we exist?
2	Set objectives	Translate vision into measurable targets (financial + strategic)
3	Craft a strategy	Choose how to compete and grow
4	Implement and execute the strategy	Build organisation, allocate resources, lead change
5	Monitor, evaluate and corrective action	Measure performance; adjust
6	Repeat	Continuous loop

The process is iterative — emergent strategies and environmental shifts feed back into the loop.

53.3.1 Vision vs Mission vs Objectives

Vision, Mission, Objectives

Term	Question it answers	Time horizon
Vision	What do we want to become?	Long-term, aspirational
Mission	Why do we exist? What do we do, for whom, how?	Continuing
Objectives	What measurable targets?	Annual / multi-year
Strategic vs Financial objectives	Strategic = market position; Financial = profit, ROI	Both required

53.4 Schools of Strategy — Mintzberg’s Ten

Henry Mintzberg, Bruce Ahlstrand and Joseph Lampel’s Strategy Safari (1998) identifies ten schools of strategy thought, grouped into three families (mintzberg1998?):

Mintzberg’s Ten Schools of Strategy

Family	School	View of strategy
Prescriptive (how strategy should be made)	Design school	Strategy as conception (Andrews; SWOT)
	Planning school	Strategy as a formal process (Ansoff)
	Positioning school	Strategy as analytical positioning (Porter)
Descriptive (how strategy is made)	Entrepreneurial school	Strategy as visionary process
	Cognitive school	Strategy as a mental process
	Learning school	Strategy as an emergent process
	Power school	Strategy as a political process
	Cultural school	Strategy as a collective process
	Environmental school	Strategy as a reactive process
Configuration	Configuration school	Strategy as transformation across configurations

The positioning school — Porter’s Competitive Strategy (1980) and Competitive Advantage (1985) — is the dominant lens for the remainder of this chapter (porter1980?; porter1985?).

53.5 Strategic Intent

Gary Hamel and C.K. Prahalad’s notion of strategic intent (1989) — “an ambitious and compelling dream that energises the organisation; provides the emotional and intellectual energy for the journey to the future” (hamelprahalad1989?). Strategic intent has three properties: clarity of direction, sense of discovery, and a sense of destiny. Examples — Komatsu’s “Encircle Caterpillar”; Nike’s “Crush Adidas”; Tata’s intent to create a ₹1-lakh car (the Nano).

53.6 Strategic Decisions vs Operational Decisions

Strategic vs Operational Decisions

Feature	Strategic Decisions	Operational Decisions
Time horizon	Long-term	Short-term
Reversibility	Hard to reverse	Easy to reverse
Scope	Whole organisation	Function or process
Information	Often incomplete	Usually complete
Decision-maker	Top management	Middle / lower management
Frequency	Infrequent	Frequent, routine

53.7 Deliberate vs Emergent Strategy

Mintzberg’s classic typology (mintzberg1985?):

Deliberate vs Emergent Strategies

Term	Definition
Intended strategy	What the firm plans to do
Realised strategy	What the firm actually does
Deliberate strategy	Intended and realised
Emergent strategy	Realised but not intended — patterns that emerge from action
Unrealised strategy	Intended but not realised

Most successful strategies are a blend of deliberate and emergent — an intended frame that adjusts to learning along the way.

53.8 Practice Questions

Q 01 Chandler Easy

"The determination of the basic long-term goals and the adoption of courses of action and the allocation of resources to carry them out" — this definition of strategy is from:

AMichael Porter
BAlfred Chandler
CHenry Mintzberg
DGary Hamel

View solution

Correct Option: B

Alfred Chandler's 1962 definition. Mintzberg gave the descriptive view (pattern); Porter the positioning view (fit).

Q 02 Five Ps Medium

Mintzberg's "Five Ps" of strategy include all of the following EXCEPT:

APlan
BPattern
CPerformance
DPosition

View solution

Correct Option: C

The Five Ps are Plan, Ploy, Pattern, Position, Perspective. Performance is not one of them.

Q 03 Levels Medium

"Which businesses should we be in?" is the central question of:

AFunctional strategy
BBusiness / SBU strategy
CCorporate strategy
DOperational strategy

View solution

Correct Option: C

Corporate strategy decides the portfolio. Business strategy answers "how do we compete in this business"; functional answers "how does each function support".

Q 04 Schools Medium

Mintzberg, Ahlstrand and Lampel's "Strategy Safari" identifies how many schools of strategy?

AThree
BFive
CSeven
DTen

View solution

Correct Option: D

Ten schools — three prescriptive (Design, Planning, Positioning), six descriptive, and one Configuration school.

Q 05 Strategic Intent Medium

The concept of "strategic intent" was introduced by:

APorter and Kramer
BHamel and Prahalad
CKaplan and Norton
DMintzberg and Ahlstrand

View solution

Correct Option: B

Gary Hamel and C.K. Prahalad's 1989 HBR article. Strategic intent = an ambitious dream with clarity, discovery and destiny.

Q 06 Mintzberg Typology Medium

In Mintzberg's typology, a strategy that is realised but not intended is called:

ADeliberate
BEmergent
CUnrealised
DIntended

View solution

Correct Option: B

Emergent strategy = realised but not deliberately planned. Deliberate = intended and realised; unrealised = intended but not realised.

Q 07 Vision-Mission Easy

A vision statement primarily answers the question:

AWhy do we exist?
BWhat do we want to become?
CHow do we compete?
DWhat is our annual revenue target?

View solution

Correct Option: B

Vision = aspiration about what to become. Mission = why we exist; Objectives = measurable targets; Strategy = how to compete.

Q 08 Strategic vs Operational Easy

Compared with operational decisions, strategic decisions are typically:

AShort-term, easily reversible, made by lower management
BLong-term, hard to reverse, made by top management, with incomplete information
CFrequent and routine
DLimited to a single function

View solution

Correct Option: B

Strategic decisions are long-term, irreversible, top-management led, taken under uncertainty.

Quick recall

Strategy = long-term direction. Chandler (goals + actions + resources); Porter (fit); Mintzberg (pattern in decisions).
Mintzberg’s Five Ps: Plan · Ploy · Pattern · Position · Perspective.
Three levels: Corporate (which businesses) · Business / SBU (how to compete) · Functional (how functions support).
Six-step process: Vision/Mission → Objectives → Strategy → Implement → Monitor → Iterate.
Vision (become), Mission (why exist), Objectives (measurable targets) — strategic + financial.
Mintzberg’s 10 schools in three families: prescriptive (Design, Planning, Positioning), descriptive (Entrepreneurial, Cognitive, Learning, Power, Cultural, Environmental), Configuration.
Hamel & Prahalad’s strategic intent — clarity of direction, discovery, destiny.
Mintzberg’s typology: Intended → Deliberate / Emergent → Realised. Most strategies blend deliberate and emergent.