Similarly, more junior managers, not directly involved in the planning process may misunderstand or resist the plans they are required to implement. Planners rarely have to implement the strategies they devise and feedback occurs too late or is badly filtered. Planners tend to assume that strategy can be divorced from operations and this is inappropriate. Second, there is an associated problem of detachment (Coff, 1999). In practice, strategic thinking tends to be iterative and even muddled, with the various processes and stages being undertaken on an ad hoc basis. This is dangerous because of the inherent unpredictability of the business environment today. However, although this approach has proved to be successful for some companies in the past, business leaders and managers deploying it today face a number of difficulties and their companies may cease to have sustainable competitive advantage over competitors.įirst, the formal approach encourages a sense of omniscience and control among planners (Lynch, 2009). PEST analysis), the use of other models such as Porter’s five forces and an analysis of the company’s mission and objectives (Porter, 2004 and Grant 2002).Īfter the analysis, a carefully evaluated and feasible strategy is selected from possible alternatives and then implemented. It also involves an external environment analysis of the organisation (i.e. This involves analysing the company’s Strengths, Weaknesses, Threats and opportunities also known as SWOT analysis. It begins with strategic analysis which is concerned with understanding the strategic position of the organisation in the widest terms. Through a sequence of logical steps, the model will allow the development, appraisal, choice, implementation and control of strategies that allow for both internal and external factors. In the context of management, ‘rational model’ usually means a comprehensive and systematic system of strategic planning (Habergberg and Rieple, 2008). Planned strategies (the theoretical rational model), have in past few decades and, are still widely used by business leaders today. This makes strategic formulation and management a very crucial stage in creating and sustaining competitive advantage. The structure of the organisation follows its strategy and systems support the organisational structure (Kay, 2000). Strategy is generally about the higher direction of an enterprise and it is normally the concern of top management. In this paper we discuss how strategic formulation and management has been affected by the rapid changes, how organisations ought to strategically think in the face of the shifting environment and an introduction to beyond strategy. This approach has proved to work in the past however it has ceased to be sustainable in the face of a changing environment. Managers placed more emphasis on following a clear strategic plan, they focused more on a formal structural design and they were more concerned about employee behaviour rather than with developing capabilities and broadening their perspectives. In the past few decades, business leaders relied on creating and committing to a clear strategy for a given period of time i.e. Due to these pressures, businesses today face a number of challenges ranging from keeping pace with the ever-advancing technology to dealing with the massive worldwide economic, political, and social shifts. The business environment has over the past years faced tremendous changes most of which are driven by rapid technological advances, globalisation, e-business and most recently the impact of emerging economies such as China which have led to a shift in the global ‘economic tectonic plates’. Change, by all means, simultaneously brings about both challenges and opportunities.
0 Comments
Leave a Reply. |
Details
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |