Strategic management is a relatively youthful discipline that has steadily matured over the past sixty years. Prior to 1960, the term "strategy" was primarily used regarding war and politics, not business. The purpose of this essay is to track the historical development of strategic management as a business discipline or explain the origins of strategic management. It explores the different views of strategy that have developed from research and also provides a general overview of the evolving nature of the strategy discipline. This paper will explore the contributions of different authors towards the historical development of strategic discipline such as Frederick W. Taylor who talks about scientific management, Chandler who talks about the …show more content…
Strategic management is a concept that has evolved over time and will continue to evolve. Strategic management is relatively recent hence developments in industrial organization theory stress the importance of strategic behaviour by firms.
1.1 Management
The classical approach to management are a set of ideas on management of organisations which developed in the late 19th century and early 20th century. This idea came from industrial revolution and focuses on efficiency. Towards the end of the 19th century, when factory production had spread and large organisations grew, many organisation started to look for ways to improve productivity and inspire (motivate) their employees. George (1984) states that a need for management ideas came to pass which directed to classical contributors such as Frederick Taylor Henri Fayol and Max Weber generating management theories such as Taylor‟ Scientific Management, Fayol’s administrative management and Weber’s Bureaucratic management. As a reaction to approaches of classical theory which over-emphasized the mechanical and physiological characters of management, came up the schools of neoclassical theory with a more human-oriented approach and emphasis on time needs, drives, behaviours and attitudes of individuals
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It explores how a task situation is structured to get the highest production from employees. Taylor states that the primary goal of management must be to maintain the maximum well-being of the employees while realising the maximum welfare of the employer. He came up with four principles of management which helps both managers and employees to be more productive at work. The first principle looks at coming up with different ways to replace the ‘rule of thumb’ practices of management. He proposed that the different way is to be scientific whereby the managers will be in a position to analyse the problems which the management encounter during the production process within the organisation. The second principle entails offering training sessions, selecting and giving work development to every worker. This was different from earlier methods which involved poor management, where workers could train and rule themselves on different tasks in the factories. By using this principle, he discovered that the person who is highly qualified will take the top position within the organisation and lead others in an efficient and systematic manner. Also, systematic management led to the development of a payment method where the amount of output the worker did was compared to the workers efficiency in production of quality goods and services. This improved the way the management managed work and
Dess, G. G., Lumpkin, G. T., Eisner, A. B., & McNamara, G. (2012). Strategic Management: Text & Cases (6th Ed.). New York, NY: McGraw-Hill.
An organization’s structure can affect its efficiency and productivity. The two main management theories are the Classic Theory and Theory X. Classical theory is defined as a management theory of a large organization in which management is led by intuition to motivate and control employees (Hamilton, 2008 p. 41). The Classic Theory can be divided into two large subgroups, scientific managers and bureaucratic theorists. Scientific manager’s focus is on reducing production costs while bureaucratic theorists focus is on administrative efficiency (Hamilton, 2008 p. 43). Although Theory X is not a large subgroup of the Classical Theory, it is under the classical theory and its crucial point is that workers are assumed lazy; therefore managers punish them to motivate them. Managers of Theory X believe that the average person; will avoid work because they do not like work, will not strive to achieve objectives, will avoid responsibilit...
The classical approach to management was the result of an effort to develop a body of management thinking, and the management theorists who participated in this effort are considered the pioneers of management study. The classical viewpoint emphasises efficiency in managing work and organisations in order to increase production (S. C. Certo & S. T. Certo, 2006).... ... middle of paper ... ...
The scope of this essay is to address coherently with examples a number of key areas of strategy; strategy and its importance, challenges in relation to development and implementation of strategies, and a discussion of the relevance of strategy in the modern
Strategic management is the ongoing process of ensuring a competitively superior fit between the organization and its ever-changing environment (Kreitner, G13). Strategic management serves as the competitive edge for the entire management process. It effectively blends strategic planning, implementation, and control. Organizations that are guided by a coherent strategic framework tend to execute even the smallest details of their mission in a coordinated fashion. The strategic management process includes the formulation of a strategy/strategic plans, implementation of the strategy, and strategic control. A clear statement of the organizational mission serves as the focal point for the entire planning process. People inside and outside the organization are given a general idea of why the organization exists and where it is headed. Working from the mission statement, management formulates the organization's strategy, a general explanation of how the organization's mission is to be accomplished. Then general intentions are translated into more concrete and measurable plans, policies, and budget allocations. Implementation is the most important part of the strategy. Strategic plans must be filtered down to lower levels to be success. Strategic plans can go astray, but a formal control system helps keep strategic plans on track. In the strategic management process general managers who adopt a strategic management perspective appreciate that strategic plans require updating and fine-tuning as conditions change. Given today's competitive pressures, management cannot afford to let strategic plans sit as is. A strategic orientation encourages farsightedness. Sun Microsystems Inc. is one company that developed a strategy to become the competitive leader and become the most reliable in the net business. I will explain how Sun's strategy integrates their marketing, management, technology, and service functions into one effective strategy. First I'll discuss who Sun is and what encouraged them to develop their strategy.
Mason Carpenter, G. S. (2013). Strategic Management: Concepts and Cases Second Edition. Harlow: South-Western Pub.
If asked what strategic planning is one could interpret it as simply a road map that can guide the organization in the right direction. It is very unlikely that an organization would know which direction to take without a sense of direction. Managers are faced every day with decisions that have a major impact on the direction the organization must take, therefore, strategic planning can play an important role in guiding managers in the right direction. In other words strategic planning is a tool that management can use to give them a sense of direction that will guide them in doing a better job and to ensure that all the members of the organization are working toward the same goals
Strategic management is a disciplined effort or control to make necessary decisions that have an effect on a business or an organization; the aim of strategic management is mainly to develop new, innovative or diverse ideas and opportunities for potential or development, and facilitates or assists an organization to achieve its goals (SM, 2010). In reality, strategic management not only can be used or applied to determine mission, vision and values or objectives, but it also establishes roles and responsibilities or timelines in a business (David, 2009). In the following sections, this study will focus on and examine the nature of strategy formulation, implementation, and evaluation activities, and analyze the potential pitfalls or risks in using a strategic-management approach to decision making.
There are several theories that examine an organization and it’s approach to managing work in an effort to develop efficiency and increase production. Two classical approaches to management are Taylor’s scientific management theory and Weber's bureaucratic management theory. Both men are considered pioneers of in the study of management.
What I benefit from this course strategy management class is knowing. The strategic management is consisting of the analysis, decisions, and actions an organization undertakes to create and sustain competitive advantages. strategic management analyses. concern with overall objectives, involves multiple stakeholders, incorporates short and long term perspectives, recognizes tradeoffs between effectiveness and efficiency. The strategic management analysis, formulation, and implementation the challenge managers face of both aligning resources to take advantage of existing product markets as well as proactively exploring new opportunities.
Witcher, B., and Chau, S. V., 2010. Strategic Management: Principles and Practice. Cengage Learning EMEA.
There are three well-established theories of classical management: Taylor?s Theory of Scientific Management, Fayol?s Administrative Theory, Weber?s Theory of Bureaucracy. Although these schools, or theories, developed historical sequence, later ideas have not replaced earlier ones. Instead, each new school has tended to complement or coexist with previous ones.
Hitt, M., Ireland, and Hoskisson, R. (2009).Strategic management: Competitive and Globalization, Concepts and Cases. In M.Staudt & Stranz (Ed).
Scientific Management also has a relationship with today’s environment because it has two advantages. Firstly, compare to the past, management is getting more scientific. How to improve production efficiency is the starting point of Scientific Management, and also is the final destination. It aims to unearth and cultivate workmen’s endowment, let them have the best performance in their work ---to obtain the highest efficiency farthest. Taylor said that the enormous increasing in production efficiency was the evident distinction to differentiate which a nation was civilized one or not. Moreover, it is the huge progressive emblem of human’s community. To change the production efficiency, he focused on management and labor. It based on “co-operation between the management and workers” (4) close together. The most quick and effective way is to import scientific analyses and knowledge into management practice, using scientific method instead of experienced way in various categories of work. “Bring everyone’s production efficiency into full play to accomplish maximum profit.”(5)For example, nowadays in the situation of teem of two workers in the factories, the fact is clearly identical. To understand that a worker and his helper, their workmanship become a extraordinary skill .The worker and his helper can produce two TV sets in one day, meanwhile, their competitor and helper can only produce one. After selling, the worker and helper can earn more money; the management can make more profits. In the same way, two competitive companies, different areas in a country, even between two nations, they will have the same situation while they in the same competitive market.
As the popularity of systematic management rose, there were many organizations that were implementing its main features such as employment of more unskilled workers and work standardization methods (Thompson and Mchugh, 2009, p.28 a). It had several features, a few of which included focusing on the manner in which production took place, being precise about how the activities were going about and to ensure that productivity and overall efficiency improved. Thus, the primary focus was on methods of production as compared to the end result of the production activity. This is when the role of Taylorism came about. Frederick Winslow Taylor, a name that transformed the management scheme forever. Also known as the Father of scientific management, Taylor was the brain behind recognizing the need for efficiency in the workplace. He first started off with his research at Midvale Steel Works, where he meticulously observed the workers and in order to develop his principles and theories with the prime focus of constructing a way to have full control over the activities taking place (Thompson and Mchugh, 2009, p.28 a).