What is the Configuration School of Strategy?

The Configuration schools view strategy formation (configuration) as a process of organizational transformation.  

Configuration refers to the organization and the context in which it operates. An organization can be defined in terms of the configuration of particular characteristics. This configuration affects or controls the manner in which it operates (the strategy it employs). A firm gravitates toward stability. 

Transformation is the development or strategy by reaction to the operational context. That is, an organization needs to transform to meet the needs of the environment. The transformation that takes place generally concerns the transition from a decision-making structure to another. 

As the organization transforms, it configures itself toward stability. 

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What are the Perspectives of the Configuration School of Strategy?

The Configuration School is based on the following premises:

• Usually, an organization can be described in terms of a particular state of stability regarding its configuration. Thus, in a particular moment the organization adopts a particular form and behavior that matches a particular situation. In such times, particular strategies will arise too.
• These periods of stability are occasionally interrupted by a process of transformation that eventually will move the organization to another state of configuration.
• The periods of stability and change alternate into consecutive successions, forming their own distinguishable patterns (e.g. life cycles of organizations).
• Therefore, the key to strategic management becomes the capability to sustain stability. This implies the need of periodic transformation without to destroy the organization in the process.
• Consequently, the strategy formation process in the Configuration School can take the form of a conceptual design or a formal plan, a systematic analysis or a vision of leadership, a cooperative learning or political gaming, either focusing on individual cognition, collective socialization, or becoming a simple response to forces of the environment.
• As a consequence, the resulting strategies can take the form of plans or patterns, positions or perspectives, or even ploys. Whatever the form, the strategy must be applied at its own time and in its own context.

What are the Organizational Stages?

• Stage of Development (e.g. establishing systems and consolidating strategic positions)
• Stage of Stability (refining strategies and structure)
• Stage of Adaptation (minor changes in the strategic positions and structure)
• Stage of Struggle (looking for a new sense of direction by any means)
• Stage of Revolution (rapid transformation of characteristics taking place simultaneously)

What are Organizational Patterns?

The sequence of stages can follow different patterns. 

• Periodic Bumps: Very common in conventional organizations and characterized by long periods of stability interrupted by short periods of revolution.
• Oscillating shifts: A period of adaptation towards stability is follow by a period of struggle
• Life cycles: A stage of development is follow by one stage (period) of stability
• Regular progress: Relatively sustained adaptation overtime

The Configuration school suggests a few strategies to achieve a comprehensive degree of organizational change:

• Evolutionary/ institution building: gradual reshaping of values, top-level (managerial) structures, and performance and control systems in order to allow managers to drive change
• Jolt and refocus: a change in the focus, attitude, and style of management to redefine a new direction
• Follow the leader: The leader initiates major changes from top to bottom in order to achieve immediate results
• Multi-front focus: Change is driven by dedicated task-teams with a wide focus
• Systematic redesign: In order to improve performance, task teams drive changes and plan the core process redesign in parallel
• Unit-level mobilizing: Change leaders designates task teams to induce change within a unit, focusing on middle managers and their subalterns

These strategies focus on changes at either the top or the bottom level of an organizational hierarchy. In some firms, such changes run along the hierarchy affecting the organization as a whole.

What are Examples of Top-Down Change?

An example of strategy aiming a successful transformation of a firm from a top-down perspective of change considers:

• Establishing a sense of urgency (identifying crisis and opportunities)
• Forming a powerful coalition (forming a group with power enough to drive the change)
• Creating a vision (establish a vision to be follow and the strategies to do it).
• Communicating the vision
• Empowering others to act on the vision (getting rid of any obstacles to change)
• Planning and creating short-term wins (plan, execution and reward of achievable performance and practice)
• Consolidating improvements and producing more changes (using achieved credibility to materialize the vision, and finding new ways to bring it further)
• Institutionalizing new approaches (making evident the links between success and the new vision and behavior, making them a tool of leadership and management)

What is Bottom-Up Change?

From a bottom-up perspective of change, there are at least six steps to effectiveness:

• Mobilize commitment to change through joint diagnosis of business problems (shared role in the problem and the solution)
• Develop a shared vision of how to organize and manage for competitiveness (share new roles and responsibilities)
• Promote consensus for the new vision, the necessary competence to attain it, and the cohesion (unity) to walk along the way (promote the shared benefit and the challenge)
• Spread revitalization to all departments without pushing it from the top (let them find the way and reorganize themselves)
• Institutionalize revitalization through formal policies, systems and structures
• Monitor and adjust strategies in response to problems in the revitalization process (share the responsibility to learn from the change)

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