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Rami Magharbeh

Strategic Management Theory

Culture and Organization

Introduction

Introduction

The strategic management discipline originated in the 1950s and 1960s. Among the numerous early contributors, the most influential were Peter Drucker, Philip Selznick, Alfred Chandler, Igor Ansoff, and Bruce Henderson.

Strategy is the determination of the basic long-term goals of an enterprise, and the adoption of courses of action and the allocation of resources necessary for carrying out these goals. (Chandler, Alfred Strategy and Structure: Chapters in the history of industrial enterprise, Doubleday, New York, 1962)

Strategy is about “purposes, directions, choices, changes, governance, organization, and performance of organizations in their industry, market and social, economic, and political contexts” (Pettigrew et al., 2002, p. 3).

Theory

Strategic Management Theory

Strategic management involves understanding the strategic position of an organisation, strategic choices for the future and managing strategy in action. Strategic management involves exploring and management of an organizational corporate strategy. It also involves modeling and analysing the overall corporate strategy of the system to include the strategic position of the organisation, strategic choices by the organisation and strategy in action within and around the organisation.

Strategic Management

A strategic management theory may be said to be a supposition, proposition or a system of ideas intended to explain the origin, evolution, principles and applications of strategic management. Strategic management theories actually stem mainly from the systems perspective, contingency approach and information technology approach to corporate management.

Strategic management is the process and approach of specifying an organization’s objectives, developing policies and plans to achieve and attain these objectives, and allocating resources so as to implement the policies and plans. In other words, strategic management can be seen as a combination of strategy formulation, implementation and evaluation (David, 2005; Haim Hilman Abdullah, 2005; Mohd Khairuddin Hashim, 2005; Zainal Abidin Mohamed, 2005).

Strategic Management Theoris

Common strategic management theories

  • Profit-maximizing and competition-based theory.
  • Resource-based theory.
  • Survival-based theory.
  • Human resource-based theory.
  • Agency theory.
  • Contingency theory.

Strategic Management

Framework

Strategic Management Framework

Art

Organizations

Why then is the strategic management and planning process particularly important to the running of arts organisations?

  • Enable to benefit from heightened organisational and managerial efficiency.
  • Help to secure vital funding and support.
  • Encourage staff to work together to tackle important issues and take the organisation forward.

O’Connell notes that "Arts organisations operate in an increasingly competive market for audiences and consumers, and in the context of limited financial resources are coming under increasing pressure to be more innovative in their art or artform and more professional in terms of the way in which they are organised and managed".

Critiques against strategic management

Critiques

Mintzberg identifies three fundamental “fallacies” of strategic management

  • ‘Predetermination’, which puts the strategic planning process at risk of being irrelevant to the organisation. As strategic planning employs a “predict and prepare” methodology, the process is not so much in control of the environment as may be assumed since that environment needs to be predicted during the planning process.
  • ‘Detachment’, many planners tend to be restricted largely to hard data — market research figures, analyses of competitors, statistics on economic cycles, performance reports etc….the process becomes detached from reality.
  • ‘Formalization’, the strategic planning process risks the art organisation becoming over-formalised to the point where the art comes second to administrative acuteness and the creative heart and soul of the organisation is sidelined.

Resources

  • Omalaja, M.A., Strategic management Theory, Economic Analysis (2011, Vol. 44, No. 1‐2, 59‐77).
  • Management, Strategic Management Theories and the Linkage with Organizational Competitive Advantage from the Resource-Based View, European Journal of Social Sciences – Volume 11, Number 3 (2009).
  • Bennie, L. (2021, February 9). The Role of Strategic Planning In Arts Organisations. Medium. Retrieved November 6, 2022, from https://lbennie.medium.com/the-role-of-strategic-planning-in-arts-organisations-4e2fdc90c746
  • Muogbo U .S, The Impact of Strategic Management on Organisational Growth and Development (A Study of Selected Manufacturing Firms in Anambra State), IOSR Journal of Business and Management (IOSR-JBM) ISSN: 2278-487X. Volume 7, Issue 1 (Jan. - Feb. 2013), PP 24-32 www.iosrjournals.org.
  • Kees van der Pijl and Harry Sminia, Strategic Management of Public Interest Organizations, InternationalJournalofVoluntaryandNonprofitOrganizations Vol. 15, No. 2, June 2004.

Resources

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