Of the schools, the design, planning and positioning schools are prescriptivein nature. The remaining schools are descriptive and are all mainly based on thebehavioural sciences; the cognitive and learning schools are based on psychology;the power school is based on political science; the environment school is based onpopulation ecology; the culture school is based on anthropology (Volberda andElfring, 2001).
Strategy as a focus on internal, external or both?
Is the elephant a function of its internal organs or does it respond to itsenvironment?
Hoskisson et al. chronicle strategic management evolution as a series of swings of the pendulum from focus on the internal aspects of firm to focus onexternal aspects (1999) (Appendix 2). The classical strategy schools of Chandler(1962) Ansoff (1965) and Learned et al. (1965/1969) were focused internally. Theseschools stated
that the success of a firm is a function of “its internal and uniquecompetitive resources”
where the “black box” or internal growth engines of the firm
were scrutinized as drivers of success (Hoskisson et al., 1999:419).As will be discussed, the need for more scientific evidence of strategychanged the direction of strategy research. However, fundamentally, as scientificinformation gave more empirical evidence of strategy, it also instigated a majordebate that is one of the deepest roots in the fragmentation in strategic managementtoday; should strategy be shaped by the internal nature of the firm, or the externalenvironment?Porter (1980) and Bain (1956, 1968) primarily focused on how the externalenvironment shapes strategy in producing their famous models, the structure conductperformance paradigm and five forces model respectively. These IO models suggestthat industry structure shapes performance (Teece et al., 1997). Similarly, researchon strategic groups did not examine firm performance but rather the performance of groups within an industry (Hoskisson et al., 1999). The sociological view of strategyas population ecology also examines how firms of similar types grow and stabilizewithin an industry (Swedberg, 2003). In these cases, the primary focus is theindustry and competitive position within that industry (Hoskisson et al., 1999).However, the rise of the resource based view, transaction cost economics andagency theory of the firm firmly reverts back to the firm performance aspect of