Structure & Process of Organizational Strategy

Save

Perhaps the most important aspect of business strategy is the way a company formulates and implements its commercial outline to outflank rivals and stay profitable. Given the importance of strategy formulation in modern-day business management, top leadership sets effective policies to foster a sound structure and process in strategic decision-making.

Organizational Strategy

  • A company's strategy represents its way of telling the world it doesn't like uncertainty, and therefore wants to set sound procedures to ensure long-term profitability. The organization draws up a commercial outline to clearly identify factors that could throw its operations off kilter, as well as to put on paper how it intends to dodge rivals' strategic bullets. Strategy implementation calls for a plan of action aimed at reaching a goal, along with clear ways to prevent factors that could halt operational momentum. All organizations -- including nonprofits, such as government agencies and charities -- implement strategies to improve efficiency and productivity in their operations.

Structure

  • When economists talk about strategic structure, they refer to the way an organization tailors its strategy to suit its existing structure. Organizational structure touches on how a company makes decisions, the hierarchical lines it goes through to seek consensus, and whether it relies on a centralized or decentralized format to monitor operating activities. In a centralized format, top management doesn't delegate much decision-making to department heads and business-unit chiefs. The structure of a company's strategy also enables the business to be nimble and change the elements of the outline if conditions on the competitive ground call for it.

Process

  • One operational strategies that often stands out is the "plan, do, check, act" (PDCA) cycle. Also known as Deming wheel or Shewhart cycle, the PDCA cycle helps a company come up with adequate ways to improve its operating processes and change the way it does business in nonperforming units. The planning phase calls for a clear collaboration among personnel across the hierarchical spectrum. Department heads work in tandem with rank-and-file employees to identify what doesn't work and relay the message to top leadership. To adequately execute senior executives' strategic vision, personnel must watch out for risks that could derail internal mechanisms. Checking strategy formulation enables company principals to compare what they set out to do with what they actually did. By so doing, they set what didn't work apart from what worked. After remedying the internal weaknesses that created problems, top management tells subordinates to give strategy execution another shot.

Occupational Impact

  • To make sure strategy execution is a success, organizations often create work groups in which employees can operate, depending on their functions. These "occupational silos" may be effective, especially if a company has several operations in far-flung locations, and management wants to find a better way to coordinate strategy implementation at the country or regional level.

References

Promoted By Zergnet

Comments

You May Also Like

Related Searches

Check It Out

Are You Really Getting A Deal From Discount Stores?

M
Is DIY in your DNA? Become part of our maker community.
Submit Your Work!