Briefly, here are some ways in which the strategic planning process differs from the management control process. A strategic plan usually relates to some part of the organization lather than to the totality; the concept of a master planner who constantly helps all part of the organization at some coordinated optimum is a nice concept an unrealistic one. Strategic planning is essentially irregular problems, opportunities, and bright ideas do not arise according to some- set timetable; rather, they are dealt with whenever they happen to be; perceived. The appropriate analytical techniques depend on the nature of the problem being analyzed, and no over all approach (such as a mathematical model) has been developed that is of much help in analyzing all types of strategic, problems emphasis on a systematic approach is quite likely to stifle the essential element of creativity. In strategic planning, management, works, now on one problem, then Continue reading
Strategic Management Concepts
Organisation Structure – Meaning and Types
An organisation structure is a set of planned relationships between groups of related functions and between physical factors and personnel required for the performance of the functions. The organisation structure is generally shown on the organisation chart. It shows authority and responsibility between various positions in the enterprises by showing who reports to whom. Organisation structure lays down the pattern of communication and coordination in the enterprises. Though organisation structure is very important, it is not an end in itself. According to Peter F. Drucker, “Organisation is not an end itself, but a means to end of business performances and business results. Organisation structure is an indispensable means; and the wrong structure will seriously impair business performance and may even destroy it. Organisation structure must be designed so as to make possible the attainment of the objectives of the business for five, ten, fifteen years hence.” Process of Organizing Organisation Continue reading
Strategic Management Process – Stages of the Strategic Management Process
The strategic management process aims at delineating the organization’s strategy. It is defined as the process by which managers make a choice of a set of strategies for the organization to achieve efficient functioning and higher accomplishments. It is a continuous process that appraises the business and industries where organization is involved, evaluates its competitors, defines targets to meet all the present and future challenges and finally assesses each strategy periodically. Strategic management is a particular course of action that is meant to achieve a corporate goal. By and large, the owners, founders of the company take the first step of the process. They lay down the structure responsible for carrying out several functions such as providing direction and guidance to the employees, setting up measurable goals with defined time spans and designated duties. Planning, budgeting, acquiring resources, maintaining resources and using follow-up techniques to resolve key issues are key Continue reading
Organizational Downsizing – Definition and Reasons
Organizational downsizing is the conscious use of permanent personnel reductions in an attempt to improve efficiency and/or effectiveness. Downsizing is being regarded by management as one of the preferred routes to turning around declining organizations, cutting cost and improving organizational performance most often as a cost-cutting measure. Main Reasons for Organizational Downsizing Corporate downsizing has been the biggest fallout of the troubled times, the world is witnessing. As we continue our efforts to fight the global downturn, downsizing has become a stark reality. There are a number of reasons why a company downsizes its employee base. Merging of two or more firms: When a certain firm combines its operations with another firm and operates as a single entity, in order to stay in profit or expand the market reach, it is called a merger. In case of a merger, certain positions become redundant. The same work is done by two Continue reading
Steps implemented by Companies Act with regard to Corporate Governance
The Ministry of Company Affairs appointed various committees on the subject of corporate governance which lead to the amendment of the companies Act in 2000. These amendments aimed at increasing transparency and accountabilities of the Board of Directors in the management of the company, thereby ensuring good corporate governance. The dealt with the following: 1. COMPLIANCE WITH ACCOUNTING STANDARDS — SECTION 210A As per this subsection inserted by the Companies Act, every profit and loss account and balance sheet of the company shall comply with the accounting standards. The compliance of Indian Accounting standards was made mandatory and the provisions for setting up of National Committee on accounting standards were incorporated in the Act. 2. INVESTORS EDUCATION AND PROTECTION FUND — SECTION 205C This section was inserted by the Companies Act 1999which provides that the central government shall establish a fund called the Investor Education and protection Continue reading
Business Excellence Implementation in Organizations
For business to be successful, organizations need to realize that business excellence is a tool which helps them translate their plan into action and is a way of executing strategy. The best way to implement ‘business excellence’ practices in any organization is to balance the differential elements or variables of ‘business excellence’ models in such a way that development is strongly aligned to organizational imperatives. The successful implementation of ‘business excellence’ practices requires focused leadership whose concern for improvement (excellence) or financial necessity outweighs their attachment to traditional norms. One of the major issues faced by organizations implementing business excellence or quality management practices is the change in the culture of organizations as ‘business excellence’ implementation process may need to change the current work practices. Implementation Process The three aspects which should form an essential ingredient of the business excellence system are program design, leadership support and effective execution. Apart Continue reading