Strategic Planning as We Knew You, R.I.P

Article excerpt

McGill University Professor Henry Mintzberg, perhaps the world's premier management thinker, hammered the last nails in strategic planning's coffin in his just-released book, "The Rise and Fall of Strategic Planning."

Of course, our mindless love affair with planning effectively ended a dozen years ago, when then-neophyte GE Chairman Jack Welch nixed his corporation's hyper-formalized planning system and most of the planners along with it. Still, Mintzberg's latest is so encyclopedic, so damning . . . and so final. It closes a major act in the American management drama.

"A good deal of corporate planning . . . is like a ritual rain dance," wrote Dartmouth Professor Brian Quinn. "It has no effect on the weather that follows, but those who engage in it think it does."

Mintzberg hardly limits himself to reciting such gratuitous, if deadly accurate, barbs. In chapter after chapter he meticulously exposes planning's problems. Consider just three: Process strangles. Process was king for the champions of strategic planning. They are "more set on deciding rightly than upon right decisions," said one commentator. In the late 1970s, Mariann Jelinek gushed about Texas Instruments' rococo Objectives, Tactics and Strategies system, a scheme one TI exec later described as "a paperwork mill that makes it absolutely impossible to respond to anything that moves quickly." (TI, like GE, trashed its system following a long string of marketplace blunders.)

Mintzberg views Jelinek's belief in "institutionalizing innovation" as the final performance of a long-running play. "The revolution that (time-and-motion study pioneer Frederick) Taylor initiated in the factory," he wrote, "was (now) being repeated at the apex of the hierarchy, and the outcome would be fundamentally no different." Hard data ain't. Not surprisingly, process fanatics go gaga over factoids. Yet Mintzberg reveals the "soft underbelly of hard data," typified by the fallacy of "measuring what's measurable." The results are limiting, for example a pronounced tendency "to favor `cost leadership' strategies (emphasizing operating efficiencies, which are generally measurable) over product-leadership strategies (emphasizing innovative design or high quality, which tends to be less measurable)."

Overall, Mintzberg opined, "While hard data may inform the intellect, it is largely soft data that generate wisdom. They may be difficult to `analyze,' but they are indispensable for `synthesis' _ the key to strategy making." Detachment kills. Mintzberg next pounces on the "assumption of detachment," quantification's close kin. …