Entrepreneurial School of Thought
This school sees strategy formation as a visionary process and is fell under the descriptive school of strategic management. The chief architect of the strategy is the CEO of a company. This school took formal leadership seriously and CEO is responsible for strategy formulation. It stressed on mental state and processes such as instinctive knowledge, belief, wisdom, experience and insight of a single leader. The leader should be visionary in formulating strategy. The entrepreneurial school promotes strategy as a process which has a clear image and sense of direction which can be termed as a vision. Entrepreneurial strategy often occurs in startup companies ...view middle of the document...
They are social innovators and change agents, seeing the big picture and thinking strategically.
A visionary leader is effective in manifesting his or her vision because she/he creates specific, achievable goals, initiates action and enlists the participation of others.
Entrepreneurship is more than the creation of business. It is the symbol of business tenacity and achievement. Entrepreneurs were the pioneers of today’s business successes. Their sense of opportunity, their drive to innovate and their capacity for accomplishment have become the standard by which free enterprise is now measured. This standard has taken hold throughout the entire world. For example starting with just 10 developed countries in 1999, the Global Entrepreneurship Monitor (GEM) has now grown to include over 80 economies by 2011. In 2010, people were surveyed in 59 economies which account for over 52 percent of the world’s population and 84 percent of the world’s GDP. The past 20 years have witnessed the powerful emergence of entrepreneurial activity in the United States. Successful multinational companies like General Electrics, General Motors, Apple, Microsoft, Dell, Google, Facebook, Intel and IBM have been using entrepreneurial school of thought in their strategic management processes.
Approach to Strategy Making
Strong leaders share the following approaches to strategy making.
* Strategy making is dominated by the active search of new opportunities.
* The power is centralized in the hands of the chief executive officer.
* Strategy moves forward by making large decisions in the face of uncertainty.
* Growth is the dominant goal.
Premises of Entrepreneurial School
* The strategy exists in the mind of a leader as a complete picture especially with a sound vision and long term direction of the organization’s future.
* The strategy formation process is partially conscious at best, based on the experience and knowledge of the leader. The leader conceives the strategy from others and then formulizes it in his way.
* Only the leader single mindedly promotes the vision and makes a close personal control of the implementation process so that he would be able to reformulate specific aspects as necessary.
* The strategic vision is very flexible, so entrepreneurial strategy tends to be deliberate and emergent. This means it fully considered the every aspect of a company and very prominent in how the details of the vision unfold.
* Under entrepreneurial school of thought, organization is like a metal which can easily be molded into any shape according to the vision and mission of the organization. The leader is free to do necessary changes and transformation as needed.
* Entrepreneurial strategy tends to take the form of a niche which is a specialized but profitable segment of the market. It protects the organization niche from the forces of open and direct competition.
* A sound vision and a visionary CEO can help...