Strategic Management and Strategy Lenses - Literature review Example

Top management does not really have control over strategic direction to the extent that the design lens suggest.” Introduction “In the business as well as in biological competition it follows the same pattern of gradual evolutionary change except the fact that business strategists can use their own imagination and ability to reason logically in order to accelerate the effects of the competition as well as the rate of change. This means that imagination as well as logic make the strategy possible and in addition to that, without them, behavior and tactics are either intuitive or result of conditioned reflexes. However imagination and logic are the factors which determine shifts in a competitive equilibrium. The ability to understand the complex web of natural competition is required in the strategy. According to David (1989), “strategic management is an art of formulating, implementing as well as evaluating cross-functional decisions that will enable the organization to achieve its objectives. It is the process of specifying the objectives of the organization, developing policies and plans in order to achieve the objectives as well as allocating resources to implement such policies and plans to achieve objectives of the organization. It is formulated by the Board of Directors and performed by Chief Executive Officers and the executive team. Overall direction to the enterprise is provided by the strategic management and it is closely related to the Organization Studies field.” Providing a clear direction and being responsible to new developments as well as changes in an organization is needed in strategic management. These changes that need to be addressed are the changes in available resources (human. Physical, and financial), changes in how the organization work (changes in working methods, style and services), changes in the demands and needs of the customer (will demand for service go up or down), changes in political or economic arena (impact of new regulations, changes in policy directions and the state of the economy), changes in the environment (competition with other agencies). The Strategy of an organization includes making decisions about priorities, linking current activities to future plans, setting direction or route for the organization, obtaining resources for new directions as well as managing change as well as setting objectives (“Strategic Management,” 2008b, p. 27). According to Scholes (2005), strategy lenses are concept of strategic management, and these are the three different ways of viewing the strategy development: As a design lens, it is logical analytical and planned. The assumptions of design lens are: 1) before doing actions one should think first; 2) the strategy making is deliberate; 3) the strategy is logical and clear; 4) the top managers are the decision makers as well as the directors of strategy; and 5) the organizations are mechanistic and hierarchical. Potential benefits of systematic thinking to handle complexity as well as the uncertainty, the need for planning and control and the benefits of analytic tools as well as techniques are the highlights of design lens. As an experience lens, it is the adaptation through cultural and political processes. The assumptions of the experience lens are as follows: 1) that individual a well as the collective experience is central; 2) that culture and history strongly influence strategic thinking and choices; 3) bargaining as well as negotiation influence strategic direction; and 4) the strategies are likely to develop incrementally. Links between assumptions which are taken for granted as well as ways of doing things, use of the analytic technique or planning technique to post rationalize and justify strategic decisions and risk of strategic drift are highlighted by the experience lens. As ideas lens, it is emergent from diversity and variety. The ideas lens assumptions include: 1) innovation resulted from variety and diversity; 2) what fosters innovation are changing and diverse environment; 3) ideas compete for adoption within and around organizations; and 4) organizations are complex systems, organism not mechanism. The conditions for innovation, the problem of too little or too much control, top managements as coaches as well as creators of context and the role of imperfection are highlighted by the ideas lens. This paper aims to assess the statement that “Top management does not really have control over strategic direction to the extent that the design lens suggest.” The purpose of this paper is to gather evidences that will prove or disprove this statement. Main Body Organizations are mostly designed wherein vertical systems of command and control are allowed. The ones who are involved in decision-making and planning are the people at the top positions. Managers as well as the supervisors are involved in transmitting decisions and plans down the organization and to the people who should carry them out. However, this level do not link well in many organizations and the people at the operations gets frustrated when new initiatives from the top management get in the way of the organization’s real work. As a result any sense of strategy that will link to the policy to daily work is not evident (“Strategic Management,” 2008b, p. 28). A good internal communication, good feedback as well as an ability to think about the whole organization and not just for specific departments, are required in order to have an effective strategic planning as well as management (“Strategic Management,” 2008b, p.28). In an organization it is important that those individuals closest to the problems are involve in making the decisions in order to effectively respond to change in the environment, which means that the responsibility as well as decision- making are push down in an organization This is because those individuals who are closest to the problem knows a lot of information on which an intelligent decision could be based. Through delegation, decision-making can be achieved more advantageously wherein it will allow the organization to be more responsive and more competitive than others. It increases motivation of the employee, the morale, as well as job performance of the employee when the team members participate in the decision making. Therefore, as the participation of the employee increases, the commitment of employee to the job and the organization increases as well. Hence, the flexibility of the operation also increases (“Strategic Management,” 2008a). Bower and Gilbert (2007), state that in an organization, leader can announce strategy to become global, change core technologies, or open new markets, however, the said strategy will only be realized only if it is in line with pattern of resource allocation decision which is made at every level of the organization. At each level, managers are likely to create an impact on strategy because knowledge and power span organizational level. In addition to that external forces such as company’s best customers as well as the capital markets can also create large effect on how resources are allocated as well as how strategy evolved. Senior corporate managers are not just among those who critically affect strategic decisions. The midlevel general managers, their teams as well as operating managers who report to them are also included. The fundamental processes that make multi-business, multinational companies feasible are managed by immediate-level general managers. They are responsible for reporting to other general mangers and translating broad corporate objectives which include earnings and growth into specifics which operating managers can understand and execute are involved in their jobs. By determining package of plans, programs, as well as activities which should drive the strategy for business, they provide corporate management with integrated picture of what their businesses can accomplish right now and what they might achieve in the future (Bower and Gilbert, 2007). In order to succeed in the business, aside from top management the following are also in control of decision making process: 1) The role of operating managers on the outcome of the strategy, are ignored by a lot of analysts, they assume that managers are too tried up to operational requirements of the business to think strategically. The senior executives overlook the real impact of operating managers at their risk; 2) In the formation of real strategy, decision of few very powerful customers, play an important role in the business. Those companies who stay close to their best customers give them virtual power to refuse on product development and distribution; 3) Capital markets, influenced management performance, they can dramatically reshape strategy, however it is less well documented but true. The pressure of earnings could be the reason for a company to exit a market too soon and a dip in stock price can also be the reason for a company to struggle to improve short-term performance (Bower and Gilbert, 2007). A lot of advocates of the view of strategy as experience including Henry Mitzberg, argue that design lens is often not accurate because top level executives are not close from day to day organization’s development. Mitzberg states that strategic development should be adaptive and divided into intended, realized and emergent strategy. This model of strategic development shows continuous adaptation of the past strategies based on experience, according to this, strategy is influenced by culture which is taken for granted assumption and it involves large level of bargaining as well as negotiations (“Strategic Lenses,” 2007). According to research, there are a lot of reasons why strategic plans do not succeed and these include: 1) failure to understand the customer’s needs and why do customers buy the product and inadequate marketing research; 2) inability to predict environmental reaction such as knowing what the competitors will do (fighting brands and prices wars), or will the government intervene; 3) Over-estimation of resource competence which includes knowing if the staff, equipment as well as processes handle the new strategy and failure to develop new employee and management skills; 4) failure to coordinate because reporting and control relationships is not adequate and organizational structure are not flexible enough; 5) failure to attain management commitment, wherein management are not involve right from the start, and they fail to obtain sufficient company resources to accomplish the task; 6) failure to obtain commitment of the employee because new strategy is not explained clearly to the employee and no incentive are given to workers to embrace the new strategy; 7) under-estimation of time requirements since there is no critical path analysis that were done; 8)Failure to follow the plan in addition to that there are no follow through after the initial planning, and no progress against the plan are not traced; 9) failure to manage change, understanding the internal resistance to change are inadequate, and vision of relationship of the processes, technology as well as organization is lacking; and 10) poor communications wherein there is insufficient sharing of information among the stakeholders and exclusion of stakeholders as well as delegates (Strategic Management, 2008c). Conclusion The study shows that indeed top management do not really have control over strategic directions because they have no control on resources, changes in the system as well as budget of the organization. In an organization it is not only managers who can participate in the decision making. It is also important that those individuals closest to the problems are involve in making the decisions since they can provide a lot of information on which an intelligent decision can be based in order to effectively respond to change in the environment, which means that the responsibility as well as decision- making are push down in an organization. Through delegation, decision-making can be achieved more advantageously wherein it will allow the organization to be more responsive and more competitive than others. It increases motivation of the employee, the morale, as well as job performance of the employee when the team members participate in the decision making. Therefore, as the participation of the employee increases, the commitment of employee to the job and the organization increases as well. Hence, the flexibility of the operation also increases (“Strategic Management,” 2008a). Bower and Gilbert (2007), states that in order to succeed in the business, aside from general managers, the role of operating managers, decision of the most powerful customers, capital markets are also in control of decision making process. There are a lot of reasons why strategic plans do not succeed and these include: 1) failure to understand the customer’s needs and why do customers buy the product and inadequate marketing research; 2) inability to predict environmental reaction such as knowing what the competitors will do (fighting brands and prices wars), or will the government intervene; 3) Over-estimation of resource competence which includes knowing if the staff, equipment as well as processes handle the new strategy and failure to develop new employee and management skills; 4) failure to coordinate because reporting and control relationships is not adequate and organizational structure are not flexible enough; 5) failure to attain management commitment, wherein management are not involve right from the start, and they fail to obtain sufficient company resources to accomplish the task; 6) failure to obtain commitment of the employee because new strategy is not explained clearly to the employee and no incentive are given to workers to embrace the new strategy; 7) under-estimation of time requirements since there is no critical path analysis that were done; 8)Failure to follow the plan in addition to that there are no follow through after the initial planning, and no progress against the plan are not traced; 9) failure to manage change, understanding the internal resistance to change are inadequate, and vision of relationship of the processes, technology as well as organization is lacking; and 10) poor communications wherein there is insufficient sharing of information among the stakeholders and exclusion of stakeholders as well as delegates (Strategic Management, 2008c). References David, F., 1989, Strategic Management, Columbus: Merrill Publishing Company. Scholes, K., 2005, Strategy: Looking Through the Lenses-resolving dilemmas in strategy, United Kingdom: Scholes Associates. “Strategic Lenses,’ 2007, Wikipedia: The Free Encyclopedia, US: Wikimedia Foundation Inc., last modified 13 June 2007. ‘Strategic Management,’ 2008a, Management FAQs, Downloaded 11 March. ‘Strategic Management,’ 2008b, Strategic Management Participant Manual, Uganda: UNASO Organizational Development Program, downloaded 11 March. ‘Strategic Management,’ 2008c, Wikipedia: The Free Encyclopedia, US: Wikimedia Foundation Inc., last modified 11 March 2008. Read More