Power School (Strategy) - Explained
What is the Power School of Strategy?
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What is the Power School of Strategy?
This school, as the name implies, focuses on the effect or power and politics on strategy. That is, the school interprets how power and politics are used to negotiate strategies in pursuit of specific interests - a process of influence.
Because individuals work in groups at varying levels of the organization, the groups with the greatest power in a given situation is able to pursue their interests.
This also limits the ability for organizations to deliberately develop strategies; rather, strategy forms through deliberate decision making.
Back to: STRATEGY & PLANNING
What are the Premises of the Power School?
The premises of the Power School entail:
- Strategy formation is shaped by power and politics (as a process inside the organization or as the behavior of the organization in its surrounding environment).
- Strategies emerging from that process tend to evolve, and take the preferred form of position and ploy. Power as a game of influences, for strategic purposes, takes both a micro and a macro form.
- Micro power sees strategy as an interaction, through direct or indirect persuasion or bargaining between the interest of the firms and partners.
- Macro power instead, sees the strategy as the capability to promote the organization‘s own welfare, by controlling or cooperating with other organizations, and by conducting strategic maneuvering within networks and alliances.
How Does Politics Relate to Power in the Firm?
Politics in organizations consists of the actions taken by individuals or groups to improve their positions or remove differences through influence, social interaction, and bargaining.
This is often carried out through groups aggregated for a common interest but a unique objective (coalitions). The differences among members in terms of objectives and resources encourage the search for power within the group.
What are Some Political Games based upon Power?
Some common games include:
- Insurgence - Played to resist authority and exert power through unity, particularly those in the lower ranks of the organization
- Counterinsurgency - A retaliation game‖ played by the authority in order to achieve certain political gains.
- Sponsorship: Played to build up a power base by engaging into an ―alliance‖ with a superior in the hierarchy.
- Alliance-building - Played among peers, usually managers or experts, who negotiate supports contracts for each other, in order to build power bases and advance in the power line of the organization.
- Empire-building: Played by line managers in order o build power bases not with peers, but with subordinates.
- Budgeting Played with clear rules in order to build a power base, not in light of achieving a higher position but more resources (similar to the empire-building game).
- Expertise Played to build a power base in light of knowledge, by becoming the unique who knows or better does.
- “Lording” Played to create a power base by employing legitimate power in an illegitimate way against those with less or no power at all.
- Line versus staff - A game of rivalry commonly played by line managers against staff-advisors in order to gain power, and eliminate opposition.
- Rival camps Played to defeat an emergent rival power block. The blocks can emerge from other games such as ―alliance‖ or ―empire-building‖ (e.g. marketing v/s production).
- Strategic candidates - Played to promote change in the organization, by individual or groups with particular political interests.
- “Whistle-blowing” A brief and simple game played by an insider (with low rank) in the organization to induce change. The insider has privileged information to be use against the organization by any outsider with considerable influence and particular interest in the issue.
- “Young Turks” Played by groups of people close to, but not at, the centre of power. The objective is to reorient the organization‘s basic strategy by displacing somebody from power, replacing his/her prevailing culture, or getting rid of his/her leadership
How Can a Company Modify its Environment to Fit its Capabilities?
There are three basic strategies an organization can employ to modify its environment:
- Deal with each demand or problem as they arise
- Make a strategic use and selective disclosure of information
- Pit internal players against one another
What is Strategic Maneuvering?
Strategic maneuvering is a manner of controlling the power of external players or pressure groups by controlling their behavior through the use of politics (without the need of physical and destructive confrontation).
Five recognized competitive maneuverings (related to negotiation) include:
- Understand what you're what your competition has to gain/lose.
- Minimize your competitions knowledge of your capabilities and interests.
- Understand the character, motivations and behavior of your competitor
- Make subjective demands that are shows no particular emotions.
- Be focused and direct (less arbitrary)
While these maneuvers are considered competitive, organizations also can set collective and collaborative strategies through networks, collective strategizing, joint ventures, strategic alliances, and strategic sourcing.
What is Collaborative Advantage?
Recognized principles of collaborative advantage according include:
- Collaboration is competition in a different form
- Harmony is not the most important measure of success:
- Cooperation should be limited in terms of compromise.
- Learning from partners is fundamental:
What are Strategic Alliances?
Strategic alliances are agreements between competitors for the purpose of mutual advantage. Some examples of Strategic Alliances include:
- Collaborative advertising
- R&D Partnership
- Lease service agreement
- Shared distribution
- Technology transfer
- Cooperative bidding
- Government-Industry Partnership
- How Strategies Arise
- Intended, Deliberate, Realized, and Emergent Strategies
- Management and Strategic Planning
- Mintzberg's Schools of Strategic Development
- Design School
- Planning School
- Positioning School
- Entrepreneurial School
- Cognitive School
- Learning School
- Power School
- Culture School
- Environmental School
- Configuration School
- Mintzberg's 5Ps of Strategy
- McKinseys 7s Model
- ***Industry Analysis to Build a Strategy***
- Strategic Analysis
- SWOT Analysis
- SPACE Analysis
- Situational Analysis - 7C
- Competition Profile Matrix
- Stakeholder Analysis
- Stakeholder Mapping
- Resources and Capabilities
- Core Competency
- VRIO Analysis
- Value Chain Analysis
- Internal Factor Analysis
- Value Creation Index
- Minimum Efficient Scale
- PEST(LE) Analysis
- Industry Lifecycle Analysis
- Company Lifecycle - Definition
- Porter's Five Forces
- Modes of Management
- External Factor Evaluation
- Business Performance Measurement
- Balanced Scorecard
- Economic Value Added
- Activity-Based Management
- Quality Management
- Action Profit Linkage Model
- Business Activity Monitoring
- Gap Analysis
- Strategy Diamond
- BCG Growth-Share Matrix
- GE McKinsey Matrix
- Value Reporting Framework
- Pyrrhic Victory