Introduction to Strategic Management
The term "Strategic Management" has been used traditionally through new titles such as Business Policy, Business Policy & Strategic Management, Corporate Strategy and Policy Corporate Planning and Policy, and so on. Essentially all are now used extensively and mean more or less the same concepts and coverage. In the initial days typically in early 1920's till the 1930's, managers used to do day-to-day planning methods. Strategic management focus is towards two aspects - first on the strategic process of business and - second on the responsibilities of general management. Unlike earlier, in this phase the role of the senior management is vital and of utmost importance. Their role would be important in decisions like. • Whether a company either promotes a joint venture or a new division. • Or decides to exit or sell some of its business.
• Or decides to go on an expansion.
• Or takes other similar important actions.
All these actions and decisions have a long-term impact on its future operations and status of the company. They are a result of senior management decision-making. It is the senior management, which is primarily responsible for charting and deciding the future course of action. As per many eminent authors and management thinkers, Strategic Management/business policy is both about the present and about the future in respect of the following: • The study of the function and responsibilities of senior management. • The crucial problems that affect success in the total enterprise. • The decisions that determine the direction of the organization and shape its future. • The choice of purposes of the organization and the molding of its character and its identity. • The mobilization of resources and their allocation.
Strategic Management is wide and encompasses all functions and thus it seeks to integrate the knowledge and experience gained in various functional areas of management. It enables one to understand and make sense of the complex interaction that takes place between different functional areas. In real life there are constraints and complexities, which Strategic Management deals with. In order to develop a theoretical structure of its own, Strategic Management cuts across the narrow functional boundaries. This in turn helps to create an understanding of how policies are formulated and also in creating an appreciation of the complexities of the environment that the senior management faces in policy formulation. Characteristics that the Indian manager will require in the current scenario will be as follows 1. Managing and understanding Information Technology.
2. Managers need to be oriented towards shareholders value.
3. Need to acquire skills to maximize shareholder value.
4. To foresee the future and track changes in customer expectation thus 5. Take a Strategic perspective.
6. Intuitive and conceptual ways using sound reasoning and logic as well as instinct and perceptions in decision-making would be needed. 7. Increasingly the success of companies depends on its people, thus People management would be a requirement of Management. 8. They would have to create capability for initiating and managing change through leadership and personal qualities of patience commitment, and perseverance. 9. Managers would have to provide speedy responses to environmental changes through information systems and organizational processes. 10. Lateral thinking. Managers would have to learn to deal with chaotic situations and the complex relationship between decision variables. 11. Boundaries across business and countries are shrinking. Thus the need for global sensitivity and experience. Managers would have to develop the sensitivity to deal with global managers and cultural preferences, business protocols, and market conditions. 12. Managers would have to develop the courage to make unconventional decisions. 13. Social responsibility. Managers would have to...