Rational Perspective And Approaches To Strategic Management

keen Perspective And Approaches To strategical ManagementThe word dodge mainly takes for give the historical and geo policy-making conditions chthonian which management precedences atomic scrap 18 determined and executed. Strategic Management is not fairish restricted to the commerce human being kind of it can be bring inn in the ever widening circle of paradoxs which ar suitable for its application- from public sector and NGOs to regional economic development.In this strive we try to explore the acuteities to help managers improve organizational effectiveness and corporeal profitability. The active come out seeks to explore the genius of strategic management as an organizational process. The quick-scented fire exposes the contradictions between the idealised myth of immaculate competition and the to a greater extent realistic ramifications of commercialize place forefinger as explored by business school strategists (Porter, 1980). But at the end of the day, for both approaches, it has been seen that managers are the just now players within the organisational structure of the market who discombobulate some(prenominal) power in the real strategic process. This eventuality has been criticised by such lofty scholars as W ravishertington (1993), who proposes mechanisms to ensure that the strategy process remains objective instead than being captured by a particular management faction muchover, he suggests that managers can draw from broader, less visible sources of power, such as the political resources of the state, the network resources of ethnicity, or, if male, the patriarchal resources of masculinity (1993 38).Moving a port from managersOne terminus ad quem of the dearth of literature available on the analysis of strategic formulation is an account of how a faction of global managerial staff came to tire and maintain a stronghold on the strategic processes in the bigger scheme of the market. on that point, however, buzz o ff been individuals who have addressed this issue, notably among them Shrivastava, who, in a landmark critique in 1986, sought for emancipation in the accomplishment of communicative competence by allsubjects that allows them to participate in deal aimed at liberation from constraints on interaction (1986 373). He also called on researchers to generate less ideologically value-laden and much universal knowledge intimately strategic management of organisations (1986 374).Post modern critiques, such as that by Knights and Morgan (1991), take a leaf out of Shrivastavas book and similarly herald a to a greater extent(prenominal) constitutive and inclusive approach to strategic planning. They see corporate strategy as a install of discourses and practices which transform managers and employees alike(predicate) into subjects who secure their sense of purpose (1991252). So they are saying that managers cannot accept at a passive distance from ideology and impose their ain ration ales on an unaware workforce. But for all practical purposes, that is what takes place in the actual workplace a core group of elite members, lots known as the executive board, are the only participants of strategic discourse, with more actual manual labour deployed on workers as we go bring forward down the line. This norm looks like it is here to stay, at least for a slice. This is because even in the contemporary business scenario, mid0level managers, even if they assume any strategic responsibility, are perhaps living an illusion if they feel that they have any decisive say in the actual decision-making process. If we draw from lie Tzus seminal work on military strategy, The Art of War (1983), we maintain echoes of this theory, where, as in a military structure, it is the field marshall who is croup the drawing board and the foot soldier who is out there on the ground fighting. The captain, or the mid-level manager, does have a say on the surgical process of the troops on the ground. But in actual effect, all he is doing is relaying the strategy of those above him, or the executive board members.The rational and combat-ready approachesBefore we move on further and investigate the pros and cons of the two approaches chthonian discussion rational and propelling let us start by taking a brief look at both.The rational approachThis is concerned with an organisations ability to achieve the goals that it has set for itself. For this, the organisation must original identify a goal for itself, and so define a set of means or objectives that can be employed to achieve this goal, and because set in place a list of activities that help assemble the objectives in action. An evaluation of the organisation is then based on the number of objectives it achieves in comparison to the number it had planned.The primary motivating factor in this model is profits for the caller-out. As such, the top echelon of decision making under such a system can tend to b e more autocratic in nature than in other models. Managers who are godlike by fiscal program lines alone in turn tend to go steady their workforce uninspired. In a critical aim for his PhD, C.P. Washburn says, What we found is that executives accent rationality in their decision making are less in all likelihood to be seen as visionary by their subordinates and more likely to be seen as autocratic. But the more holistic executives are seen as more visionary and less autocratic.But as things stand today, despite the non-holistic nature of a rational approach (Washburn, 2006), it still predominates in the global workplace. This is by chance because of the logical framework that defines a rationale approach. Managers who follow it believe that a precise end to an objective should be sought through equally precise and calculated means, and that focusing their energies on quantifiable activities that can be observed and measured is the best way forward. Even if not quite, in a se nse, the rational approach can be summarised in the famed sentence from the 1987 movie protect route, Greed, for the want of a better word, is good.The self-propelling approachThe dynamic approach to strategic planning is aimed more at smaller businesses that lack the necessary tax revenue to implement all the heterogeneous strategies that a great(p)r organisation can. It was conceived by Edward Pierce, who was at the School of telephone line and Entrepreneurship at Nova Southeastern University until he retired in the early 2000s.The need for a new approach that moved away from the traditional rational approach was instigated primarily for the benefit for smaller firms. Apart from a basic strategy that is absolutely essential for a line of sustained credit, anything else is a luxury, not least because strategic managers are usually prohibitively expensive for such firms to hire. Moreover, it is not within the financial realm of these smaller organisations to develop a compli cated strategy (which in all possibility only a handful of commonwealth in the organisation are competent copious to fully comprehend) and then let it gather dust. Unlike the larger organisations that have the means and the resources to leave strategic planning to the hands of a a few(prenominal) select individuals in the executive board, these smaller organisations have a more hands-on approach crossways all levels of management, with even mid-level managers sometimes given a free hand to take decisions.The common necessity for a vision and agencyWhether it be a large scale MNC or a small-scale non profit organisation, each must have a vision for the smart set. Essentially, the vision of an organisation is the single statement that will be able to guide the enterprise across its several strategic business units (SBUs) (Whats In a Vision Statement, 2003). Talk of SBUs brings us to the consideration of another(prenominal) critically important component of strategic planning a mission. There has been much debate over whether vision is more important that mission and it is not our prerogative to enter further debate here. Instead, we can evidently define vision as an enterprise view and mission as an SBU view (Whats In a Vision Statement, 2003).Of course, the vision and mission of a particular company are determined by its positioning in the market context. The larger a company, the more complicated is its vision statement and more tedious is the process of achieving its mission. For instance, if we take LG as an example, the parent company has one single vision, exclusively it is modified to suit the needs of its dissimilar SBUs such as those for phones, wireless equipment and other electronic appliances. It would not be feasible to assume that this vision statement would apply equally across all the different SBUs within the company. The same would hold full-strength even in the case of a small company, say one that specialises only in making carpet s. The vision statement would remain fundamentally the same, but would be applied in different avatars across the different departments that the company might have, such as carpet-manufacturing, the gross revenue division, the training department and so on.Basic differences between the two approachesAs we have seen so far, a maximisation of profits is the founding principle behind an organisations rational approach. It is the more traditional way of functioning, and due to its emphasis on increasing revenues as the most important objective, it finds support and has for a long time in Wall Street. But given the vagaries of the market situation not just right now post the financial crisis, but for a bandage now, there had been the need for a more theoretical approach to strategic planning than simply a total profit = total revenue total cost way of thinking. This is where, apart from the previously discussed need for a holistic approach, Edward Pierce stepped in with his dynamic a pproach. The rational approach was an across-the-board one that looked at business through a one-light prism of profit. The dynamic approach, at least according to me, represents a better view of the complex market scenario that is prevalent at present. Large businesses have taken the biggest hit in 60-odd years. Small businesses on the other hand are proceed to face the future with a bright prospect. In such a situation, a low-cost, direct-result-oriented approach to strategic planning suits the needs of a market that is thriving more for smaller businesses than for large conglomerates.But even while saying this, the benefits of a rational approach despite its disadvantages are there for all to see, and have been for many years now. The main amongst these benefits are an value in sales and profitability. It should follow then that productivity would see a similar surge through the rational model. This might have held true earlier more than it does now. Right now, it is possibly the inclusive nature of the dynamic approach that can be best utilised to increase productivity. And this increase productivity today apart from a more harmonious works relationship between the different levels of management would lead to more sales and profitability later down the line.The problem that I have with the rational model is that to an extent, it is behind the credit crisis that we faced as a world a couple of years ago. The greed that operated in Wall Street the same greed that is the basis of the rational approach filtered down to Wall Street. The world at large lost its humane characteristic to a degree and hankered after immediate financial returns and benefits, which is what led to the crisis that we faced.The other problem with the rational approach is its non-inclusive nature. If we take the example of any global financial institution that was affected in the crisis be it Lehman Brothers or the Royal aver of Scotland how much of it was due to the middle-in come banker who sits at his terminal in Canary dock for example? How much of an idea did he or she have as to what was afoot in the top rungs of the ladder? More significantly, if such people did indeed have an idea of how harmful the trend of borrowing from mortgage brokers was becoming and were not party to it and had feasible arguments to counter and tackle it were their voices hear? I am guessing not, because it takes a middle-income banker with tremendous guts to paseo through the door of, say, the vice-president and tell him or her that what he or she is doing possibly for greed if not on a personal level then on the companys behalf could later have ramifications that the entire world at large would reel under.Another advantage that the dynamic approach has over the rational approach is that because it is more human-oriented than the rational approach, which is more finance-oriented, there is a bring down resistance to change. This is of critical importance since in the rapidly evolving global market scenario, continually changing to adapt to situations is the need of the hour.Moreover, since larger multinationals have been candid post the financial crisis (which is a necessary standpoint for any study of strategic planning in the present scenario) smaller organisations are eyesight the light of day more than in the recent past. This means that evolving approaches to strategic planning should be geared in such a way that it suits the needs of these lesser organisations so that they can play their inevitably essential role in getting the world back to where it was. That is possible more through a dynamic approach to the problem than a profit-oriented rational approach. In fact, the very word, dynamic, is a literary representation of the zeitgeist of our times.