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Strategies for Business Management

Introduction

Many approaches have been used to describe various strategies for business management. Strategic management is mainly focused on the achievement and maintenance of high competitive advantage. It is important to describe what strategy is, in order to understand the management strategy. Strategic management involves the application of organizational corporate strategies in all the facet of the organization in question. Strategic management was established between 1970 and 1979; however, it has undergone many changes due to transformation in the structures of organizations and corporate culture (Ansoff, 2007). Strategic management has advanced to become the concern of both the executive directors and employees alike. All corporate organization must come up with well designed strategies of management in order to efficiently manage their affairs and advance toward achieving their goals and objectives. These strategies can be seen as the road maps that direct how the activities of an organization should be carried out in order to compete favorably with other similar organizations. The process of strategic management includes the analysis of both internal and external environments in order to come up with very comprehensive plans of actions that will enable the organization to achieve its long term goals and objectives. Today, there are about nine approaches that can be adopted as business strategies. They include planning, positioning and design schools of thought which can be classified as perspective while learning, political, cognitive, environmental, cultural, and entrepreneurial schools have a descriptive nature (Ansoff, 2007).

For every successful company there is a properly formulated strategy. Some of these strategies are either formulated through the process of trial and error, analytical process or even intuition. At this point strategy can therefore be described as a long term planning process that takes a hierarchical system structure with well formulated goals and objectives; this also involves a critically selected way of establishing a relatively perfect fit between resources that emanates both internally and externally. In a firm or company there are strategy stakeholders who are concerned with the successful management of the firm so that it can achieve both its long term and short term goals and objectives. These stakeholders include customers, employees, external, the community who form the external environment, and the owners who established the business.

Use of strategic management

Strategic management has been used by both profit oriented and non-profit corporations and organizations. It has ensured that organizational structures enhance operations, present sufficient and efficient channels for decision making and also motivate the delegation of tasks or responsibilities. The strategic management has also made it possible to hire personnel who are committed to the objectives of the organization of corporation, ensured the work force has high competence at all levels of operations through appropriate training and also, it has ensured that there are ready relevant and competent managers who are able to run the organizations. To understand strategic management and its relevance to organizations, it is important to discuss the prescriptive and the descriptive approaches to strategic management designs and how they are used.

Prescriptive approaches

The main objectives and elements of this strategy are always proposed prior to the commencement of the actual application of the strategies. Design school of thought is one of the prescriptive approaches that views the structure of strategy from conception to match for the inside circumstances of an organization and those in the outside or the external conditions of the surrounding or the environment. This approach therefore is developed to designate the finest possible fit within a corporate organization. Here the strategy is very informal and maintained in the simplest way possible but explicit in nature. Some thinkers of this school have further argued that the achievement of the correct match linking both the weak and strong points within a corporate organization and then between threats and opportunities that have external origin. Through a deliberate thinking the executive managers describe strategies that are vivid, simplistic, and unique. The deliberate thinking is usually not formally analytical and also not informally intuitive (Davenport, 2006). This means that everybody from top management level to low level can easily implement this type of strategy. Planning school has a strategy formed in a more formal process that is controlled and conscious where a thorough set of steps from the inception and breakdown of the condition to development and examination of other substitute scenarios. The idea of planning school saw organizations in the 70s and 80s build departments for staff to analyze and plan for the organization’s way forward. The third prescriptive strategy is the positioning school which has been greatly influenced by the works of somebody named Michael Porter’s (Davenport, 2006). Here strategy formation is an analytical exercise where business is placed in the industrial context considering options that the organization can adopt in order to compete and improve its position in the industry. This strategy is usually based on economics and external factors like the market situation tend to usually influence the strategy to a great extent. The fourth is cognitive which actually denotes a mental process. It is argued that studies have undergone a gradual change to cognitive facet of strategy. There are branches of this thought assumed more interpretative, subjective and constructivist apparition over the process of strategy whereby cognition is widely used to build the strategies as inventive explanation not with a view to identify reality in a manner that is more or less subjective, the fifth school is learning which has established big problems at the expense of prescriptive schools of thought. Power forms the sixth school in this strategy. It basically denotes a process of negotiation. This school takes two different departures; these are at the level of micro where the negotiation views the development from within the organization as being in the nature of a profound political phenomenon. This process actually implies the act of bargaining, confrontation persuasion that involves the actors who separate the power amongst them (Davenport, 2006). Then at a macro level the power views the corporate organization as an independent entity that uses its influence over other partners, the joint ventures and other networks relations so that they may all together bargain for a collective strategy that serve the interest of every one of them. The seventh is cultural; cultural school is mainly the social processes that take place within the corporate organizations. In this school the social practices are formulated with its deep roots in the culture of the society in question. Here specific literature is centered on the power of the culture in depressing the noteworthy strategic changes. The eighth school is environmental; this represents the process of reactions embodied in the contingency theory. This school focuses on the expected responses from the environmental situations. More to this is the institutional theory which has its aim on the pressure emanating from the organization; this pressure is referred to as institutional pressure. The last school is configurative. This school is characterized by the process of transformation. Just as its name suggests, it views a corporate organization as a configuration which is a collection of behavior and attributes. This school incorporates the attributes of other schools and each of these configurations has a fine place determined for it (Davenport, 2006).

Prescriptive approaches usually starts with the process of analyzing the available resources of a corporate organization and its external environment. From these analyses the organization’s objectives are established. The next activity is to come up with strategic options that able to facilitate the achievement of the company goals and objective (David, 2006). From these options the best and appropriate one is selected and implemented to actualize the achievement of goals and objective. There are theories linked to prescriptive approach. These include competition based theory, game-theory, cooperation and network and resource based theories. An example where prescriptive approach has been used is where different nations rely on permit. These permits include certain machineries like management systems for clean environment and the assessments of the impacts different projects have on the environment (David, 2006). These machineries are the basis or regulations on which the processes of regulation are formed by most countries.

Prescriptive approaches, unlike the descriptive approach, aim at rectifying the prejudices with a view to enhancing decisions and judgments in line with the normative standards. This means that the prescriptive approach is anchored on the advice that gives the direction on how to undertake the principle that may be proposed by the normative views (Baird, 1989). It is a method that is adopted when the management is not having any form of clue on what is actually going on or should be going on within an organization. It never tries to find the fundamental foundation of something. It simply proposes a question and examines whether the outcome is either positive or negative (Baird, 1989).

Descriptive Approaches

Entrepreneurial school of thought considers the plan or strategy to exist in the leaders mind mainly. The strategy usually has a long term vision and mostly exists in organizations that are owned by an individual or those that are run by just one person. Basically it is based on an idea in an individuals mind. This type of strategy is based on the past. For instance, an organization makes decisions based on the past experiences of successes or failures. It will most probably choose making decisions that contributed to its achievement of goals and objectives and avoid making decisions that made it to fail (Doherty et al, 2002).

Cognitive approach is based on the brain functions of the person strategizing and he outputs the strategy in the form of frames, maps, concepts among others. It is like an analysis of people’s perception of patterns and how they process information. This information is given by the person strategizing or rather the person in whose mind the strategy exists as a prescription to the people intending to start an organization. The ideas are then adopted and changed into an investment. However, it should be noted that getting a cognitive plan can be difficult especially finding someone with ideas. It is also difficult to change the strategy if it is not considered viable. The learning school is also based on psychology and describes systems of strategy acquired through learning over some period of time over which the formulation and execution of ideas is entangled and impossible to distinguish in nature. Usually this is due to the complexity and random nature of these enterprises and their corresponding environments. Intentional control is barred owing to the process of knowledge diffusion which is essential for enterprise strategy. All the people intending to operate or work in the system are usually required to learn or sometimes just the leader is the main learner (Baird, 1989). This therefore means at any point and time there are usually many strategies that can be potentially adopted by the enterprises (Feyerabend et al, 1966). The descriptive approach does not rely on an open function of social welfare neither does it rely on wholesome preference of time rate implanted on the functions of social welfare. It assumes that intergenerational returns through debt and tax policies of an economy. An example of a case where descriptive approach is used can be found in the practices of system engineering in an engineering corporate organization. In this case, system engineering functions may be subjected to software activities while in some cases the functions may be treated differently. However, under the descriptive approach would not relate the functions in terms of what is wrong or which one is wrong, but they are related according to particular processes that are actually used in the organization. In this approach the conducts of decision makers are described by the descriptive approaches.

Descriptive strategy has three facets: the first one is intelligence, which was actually derived from and is actually based on its reference to the military activities. This facet includes the identification of the decision needs. After the need has been identified the second facet comes in. The second facet is design; in this facet the investigation and development of the challenge domain and course of alternatives are developed. Choice becomes the third and final facet; this involves the activities of choosing the most suitable course of actions from the already generated alternatives (Sutherland, 1989). The process of going through each face is never smooth. Each face has its own complexity and may some times involve the application of intelligence. In moving through each face new challenges can be generated which may need to be resolved before moving to another face. One of the focal subjects of descriptive strategic managements is the idea of restricted rationality. This implies that all rational behaviors including those of cognitions are constrained.

Similarities between descriptive and prescriptive strategies

Both descriptive and prescriptive strategies actually have lots of differences. However, they have some similarities. The two strategies are actually some of the available approaches for the managing of both small scale and large scale corporations. They may have different approaches and views of how an organization should be managed, but it is worth noting that they are both meant to achieve similar goals and objective of a corporate organization. They are both means to an ends used by business entities. The two have similar focus and that is the future. Either of them can be used to come up with both short and long term goals and objectives of an organization and how to achieve them. In this case there is no superior strategy to the other because they are merely alternatives whose choice is at the discretion of the management of an organization. These two strategies are also similar in terms of their applications. Both prescriptive and descriptive do not need special or organization structures unique to either of them. They can be applied to all organizational structures including corporate, social, and governmental institutions. Another similarity is that both do not need different expertise, any expert who is knowledgeable in designing management strategies is able to use either speculative or descriptive strategy in his or her design so long as he or she understands.

Conclusions

Strategic management involves the application of organizational corporate strategies in all the facet of the organization in question. Strategic management was established between 1970 and 1979. Strategic management has undergone many changes due to transformation in the structures of organizations and corporate culture. Strategic management has advanced to become the concern of both the executive directors and employees alike. These strategies can be seen as the road maps that direct how the activities of an organization should be carried out in order to compete favorably with other similar organizations (Ansoff, 2007). The process of strategic management includes the analysis of both internal and external environments in order to come up with very comprehensive plans of actions that will enable the organization to achieve its long goals and objectives. Today, there are about nine approaches that can be adopted as business strategies. They include; planning, positioning and design schools of thought which can be classified as perspective while learning, political, cognitive, environmental, cultural and entrepreneurial schools have a descriptive nature. The main objectives and elements of prescriptive strategy are always proposed prior to the commencement of the actual application of the strategies. Here, strategy formation is an analytical exercise where business is placed in the industrial context considering options that the organization can adopt in order to compete and improve its position in the industry. In Prescriptive strategy, the deliberate thinking is usually not formally analytical and also not informally intuitive. This means that everybody from top management level to low level can easily implement this type of strategy. Prescriptive approaches usually starts with the process of analyzing the available resources of a corporate organization and its external environment. From these analyses the organization’s objectives are established. The next activity is to come up with strategic options that are able to facilitate the achievement of the company goals and objective. From these options the best and appropriate one is selected and implemented to actualize the achievement of goals and objective.

Descriptive type of strategy is based on the past. For instance, an organization makes decisions based on the past experiences of successes or failures. It will most probably choose making decisions that contributed to its achievement of goals and objectives and avoid making decisions that made it to fail. Descriptive strategy has three facets: the first one is intelligence, which was actually derived from and is actually based on its reference to the military activities. This facet includes the identification of the decision needs. After the need has been identified the second facet comes in. The second facet is design; in this facet the investigation and development of the challenge domain and course of alternatives are developed. Choice becomes the third and final facet; this involves the activities of choosing the most suitable course of actions from the already generated alternatives. The process of going through each face is never smooth. Each face has its own complexity and may some times involve the application of intelligence. In moving through each face new challenges can be generated which may need to be resolved before moving to another (Doherty et al, 2002).

The two strategies are actually some of the available approaches for the managing both small scale and large scale corporations. They may have different approaches and views on how an organization should be managed, but it is worth noting that they are both meant to achieve similar goals and objective of a corporate organization. They are both means to an ends used by business entities, therefore, they have some similarities.

Reference

Ansoff, H. 2007. Strategic management. New York, Palgrave Macmillan.

Baird, B. 1989. Managerial decisions under uncertainty: an introduction to the analysis of decision making. New York, Wiley-Interscience.

Davenport, T. 2006. Strategic management in the innovation economy: strategy approaches and tools for dynamic innovation capabilities. New York, Wiley-VCH.

David, F. 2006. Strategic management: concepts and cases, / tenth edition. New York, Pearson Educational Publishers.

Doherty et al. 2002. Managing public services-implementing changes: a thoughtful approach to the practice of management. New York: Routledge.

Feyerabend et al. 1966. Mind, matter, and method. Minnesota, U of Minnesota Press.

Sutherland, J. 1989. Towards a strategic management and decision technology: modern approaches to organizational planning and positioning. Kluwer Academic Publishers.

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