Business Policy

Origin:
• Can be traced back to 1911
• When Harvard Business School introduced an
integrative course in management aimed at
providing general management capability.
• This course was based on case studies which had
been in use at the school for instructional purposes
since 1908
 Business Policy
• The Gordon and Howell report sponsored by Ford
Foundation –gave students an opportunity to pull
together what they have learned in the separate
business fields and utilize this knowledge in the
analysis of complex business problems.
• The Pierson report sponsored by Carnegie
Foundation had made a similar recommendation.
 Business Policy-Indian scenario
• Formal management started in IIMs and
administrative staff college of India in early
sixties.
• AICTE prescribed business policy first in 1990
and again in 1995.
• AIMS(The association of Indian Management
Schools) included business policy and strategic
management as a compulsory course.
 Business Policy-Indian scenario
• AIMA(The All India Management
Association ),New Delhi ,which is a
national body for the promotion of scientific
management in India.
 Importance of Business Policy
• Business policy is important as a course in
the management curriculum and as a
component of executive development
programme for middle level managers to
move up to the senior management level
Four areas where B.P course proves to be
beneficial:
 Four Areas
(1)Learning the course
• B.P seeks to integrate the knowledge and
experience gained in various functional areas of
management ,enabling the learner to understand
and make sense of the complex interaction that
takes place between different functional areas .
• To deal with the constraints and complexities of
real life businesses.
 Four Areas
• B.P cuts across the narrow functional boundaries
and draws upon variety of sources and a wide
variety of disciplines like
economics,sociology,political science,psychology.
• B.P makes the study and practice of management
more meaningful as one can view business
decision making in its proper perspective.
 Four Areas
(2)For understanding the business environment
• B.P helps to create an understanding of how
policies are formulated ,understanding the
complexities of the environment that the senior
management faces in policy formulation.
• Managers become more receptive to the ideas and
suggestions of the senior management.
• Managers feel themselves to be a part of a greater
design and this helps to reduce their feeling of
isolation.
 Four Areas
(3)For understanding the organization
• B.P presents a basic framework for
understanding strategic decision making
while a person is at the middle level
management.
• B.P brings the benefit of years of distilled
experience in strategic decision making to
the organization and also to its mangers
 Four Areas
• An understanding of B.P may also lead to an
improvement in job performance
(4)For personal development
• It is beneficial for an executive to understand the
impact of policy shifts on the status of one’s
department and on the position one occupies.In
extreme cases, many positions may become
redundant due to policy shifts and retrenchment
is inevitable.
 Four Areas
• An understanding of B.P enables executives to
avail an opportunity or avoid a risk with regard to
career planning and development .
• Provides an adequate grounding for understanding
the macro factors and their impact at the micro
level
• Business policy offers a unique perspective to
executives to understand the senior management’s
viewpoint.
 Objectives Of Business Policy
• It has been defined in terms of knowledge , skills
and attitudes.
In terms of knowledge:
1.The learners of business policy understand the
various concepts like strategy ,policies,plans &
programmes.
2.A knowledge of the external and internal
environment and how it affects the functioning of
an organization is vital to understanding of business
policy.
 Objectives Of Business Policy
3.Information about the environment helps in the
determination of the mission ,objectives and
strategies of a firm.
4.The implementation of strategy is a complex issue
and is invariably the difficult part of strategic
management.
5.To learn that the problems in real life business are
unique and so are the solutions is an enlightening
experience for the learners.
 Objectives Of Business Policy
• To survey the literature and learn about the
research taking place in the field of business
policy is also an important knowledge
objective.
 Objectives Of Business Policy
In terms of skill
• The attainment of knowledge should lead to
the development of skills so as to be able to
apply that which has been learnt – through
cases and its interpretation & by analysis of
the business events.
• B.P. should enable a student to develop
analytical ability and use it to understand
the situation in a given case.
 Objectives Of Business Policy
• It should lead to the skill of identifying the
factors relevant to decision making (SWOT
analysis).
• BP will increase the mental ability of the
learners and enables them to link theory
with practice.
• BP leads to the development of oral and
written communication skills through case
analysis.
 Objectives Of Business Policy
In terms of attitude
1. The attainment of knowledge and skill
objectives should lead to the inculcation of an
appropriate attitude among the learners.
2. The most important attitude developed through
this course is that of a generalist
3. The generalist attitude enables the learners to
approach & access the situation from all possible
angles.
 Objectives Of Business Policy
• It is important to have the attitude to “go
beyond & think”when faced with a
problematic situation .
• Developing a creative and innovative
attitude is the hallmark of a general
manager who refuses to be bound by
precedents and stereotyped decisions.