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(SM) - CH - 1 (Nature & Value For Strategic Management)
(SM) - CH - 1 (Nature & Value For Strategic Management)
(SM) - CH - 1 (Nature & Value For Strategic Management)
M.Com II (S.M)
Chapter 1
Nature & Value for Strategic Management
Q. 1 : What are the benefits & risk of strategic management ?
OR
Give the Advantages & Limitation of Strategic Management ?
(Guj. 2001, 2003, 2004, 2005)
Ans.:
Introduction :
The concept of strategic management became well accepted in the field of business
& that proves it utility. In modern time stability in organization. Control & also for the
development, Strategic management is considered necessary. To face the future
uncertainty, the concept of strategic management become more useful. Strategic process
ins not a short term process. For this the officers & employees have to sacrifice for a long
time. At the view point of management, strategies are economically advantageous but even
employees considered themselves responsible for the profit.
Thus, strategic management has both advantages & as well as limitations. So let us
discuss them in brief as under.
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M.Com II (S.M)
interprocess is done with them & for the success of the strategy, the necessary
training is also given to them. By this these is a notable increase in efficiency of
employees & they get inspiration to work more.
(5)
Prevention of overlapping work :
When the same activity is done by more than one employee. At that time
there is a wastage of time & materials. The problem of co-ordination also arises with
the help of strategic process. The managers can prevent the overlapping of work.
(6)
Prevention of organizational gap :
Out of departmental activities of organization, if any activity is not allotted to
any employee, that activity is known as organizational gap. If allotment of any
activity is left out by mistake then none of the employees can be help responsible for
it. In strategic management process, because of the interacting process being done
with each employee, all the employees are given equal works & so these does not
arise a question of organizational gaps.
Limitations :
The limitations of strategic management are as under.
(1)
Time consuming :
For taking strategic decisions, the managers make a study of internal &
external environment. For this the process of forecasting is being used.
Besides this, interacting process is being done with various officers &
employees. For all these work, a lots of time is being consumed.
(2)
Ignorance of other managerial functions :
The responsibility of chief officer is more who are connected with framing &
implementation of strategy & due to continuously following the work of strategies
they are unable to concentrate on other managerial works.
(3)
Depression due to failure in target :
Many times during the framing of strategy. High targets are being fixed & if
these targets are not achieved then dissatisfaction takes place among employees.
(4)
Demand for more rewards & facilities :
The extent to which strategies depend on financial resources. To that extent,
employees also demand more remuneration & facilities. If their demands are not
fulfilled, then industrial disputes & unrest are created.
(5)
Dependability :
If the employees are continuously demanded for co-operation for the
training & implementation of strategy then they also feel dependability of managers
over them. In these circumstances, the demand of employees go on increasing.
Q.2
Ans.
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For this, it is necessary to take proper decision at corporate level, for increase in
production & control on cost, keeping mission of unit. Business unit, operating level
in to account companys internal & external environmental factors are affecting
decision making at all level & therefore management should examine
inter-relationship of factors, by making its proper analysis. Strategic decisions are
related with activities at all level & therefore proper study of it, has primary
importance.
Corporate
Strategy
CORPORATE LEVEL
BUSINESS
LEVEL
SBU 1
Strategy
SBU 2
Strategy
SBU 3
Strategy
FUNCTIONAL LEVEL
Marketing
Strategy
(1)
Production
Operation
Management
Strategy
Financial
Strategy
Personnel
Labour
Relation
Strategy
Accounting
Strategy
R&D
Strategy
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(2)
(3)
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