The role of strategic management - Essay Example

Orgniztions operte in rpidly chnging environment, nd for this reson it is vitl step to stipulte minor detils nd predict ll chnges needed for strtegy implementtion. BMW is Europen utomotive leder operting on the mrket since 1922. t the beginning of the 21st century, BMW is influenced by interntionl economic integrtion, removl of brriers to business nd trde nd incresed competition (BWM Home Pge. 2007). Following Hill & Jones (2004) strtegic mngement is importnt for successful orgniztionl performnce becuse it involves pre-determined course of ction which helps to provide purpose nd direction for members of n enterprise.

The plnning process is ided by working in n environment which is conducive to it. Strtegic mngement influences its orgniztionl structure, processes nd reltions. BMW orgniztionl structure cn be identified s mtrix structure. Within the compny, the performnce of ll deprtments is closely relted to delegtion of uthority, but it includes ll res of mngement nd requires gret del more thn hnding uthority to subordintes (Hill & Jones 2004). The dvntge is tht it is esy to control ll ctivities nd implement generl nd unified policy.

The disdvntge is complicted "bureucrtic" structure which slows decision-mking nd chnge processes. Production nd sles re the first functions to be decentrlized nd finnce nd humn resources the lst. The degree of centrliztion is not esy to determine. Some decisions must be tken loclly nd mngement must decide wht re vitl decisions nd keep these, then delegte the rest. High degree of decentrliztion tkes plce in some production res where less checking is needed on decision, especilly if few people need be consulted on decision, or if the greter the number of functions ffected by decisions mde t lower levels (Hill & Jones 2004).

Following Ry Zimmermn, Executive Director of BMW:The nine person Board of Directors establishes policy and overseas the overall operations of the BMW Motorcycle Owners of America. The Board holds the Executive Director responsible for the execution of the policies and daily operation of the club. there is also a "dotted line" relationship between some of the staff members and the different members of the Board. For example, our Treasurer and the Accountant work hand-in-hand on a number of projects related to financial reporting".

This type of orgniztionl structure benefit overll well-being of business becuse it determines the nture of reltions, mkes possible the ppliction of the process of mngement nd cretes frmework of order nd commnd through which the ctivities of the orgniztion cn be plnned, orgnized, directed nd controlled (Hitt et l 2006). For instnce, size, geogrphicl seprtion of the deprtments or extended ctivities of BMW require decentrlized structure. Thus, BMW needs centrliztion to estblish common policies, but when employees know ll trditions they cn ct more independently (BWM Home Pge 2007, See ppendix Chrt 1).

In this cse, strtegic mngement nd plnning gives the compny only sense of direction for the ctivities. Strtegic plns give brod guidelines towrds which more detiled nd specific plns re directed. The greter the time spn, the greter the number of mistkes. Present conditions re usully dominnt in the plnner's mind when the orgniztion initites pln nd these my be overstressed. lso, mny events re obviously unforeseen, but plnning cn be ided by techniques