1.1. Relation between strategic management and leadership
Strategic Management is one of the functions of management, subject to long-term goals and actions of the company. Strategy Formulation and its precise tools are the core of government and a major sign of good management of the company. Strategic Management has to develop and implement actions leading to long-term excess performance of the company above the competitors. Strategy ”“ is the image of organizational actions and management approaches used to achieve organizational goals and objectives of the organization.
The five elements of the strategy (H. Mintzberg): Strategy as Plan, Strategy as position, Strategy as a “trick”¯, Strategy as a behavioral patterns (sample model), and Strategy as perspective. Strategy of the organization ”“ is an interrelated set of long-term measures or approaches in order to strengthen the vitality and power of the organization relative to its competitors. Organization’s strategy – in essence – is a set of rules for decision making, which the organization is guided in its activities.
Strategic management is closely related to transformational leadership. The term transformational leadership refers to a management model in which those who are led to feel confidence, respect, loyalty and admiration for the leadership and thus provide outstanding performance. It should be noted that strategic Plan ”“ is a plan, developed at the company level or branch (the strategic business unit (SBU)) to determine the company’s mission, the main benchmark for long-term growth, creation of a basis for developing product lines and distribution of resources between divisions of the company. buy essay
Strategic Analysis (portfolio analysis) – is a key element of strategic planning. Strategic analysis serves as a strategic management tool by which management of the company identifies and evaluates its activities to investing in the most profitable and promising her direction. The main method of portfolio analysis is to construct the two-dimensional matrices. With the help of these matrices are compared productions units, processes, products of the relevant criteria.
Strategic management can be also defined as a sole management strategy in accordance with he developed a strategy for achieving the strategic goal. Strategist ”“ is a Head that has all the necessary powers and resources to implement its strategy. Strategic goal ”“ is a goal for achieving a strategist radically and irrevocably change the situation of competing in their favor. Strategy ”“ is the solution to the problem (not an order, a “response”¯) on how to achieve the strategic objective of the initial situation with the available resources and taking into account the possible actions of competitors. Strategic decisions are often based on intuition and experience in strategy, since logically calculate all the possibilities and options for development of the situation of competing even in a military confrontation is impossible. However, no responsibility and the initiative remains with the strategy (the role of leader of the organization) or “strategic planning process”¯ turns into a bureaucratic procedures, and loss of initiative to compete.
Goals and vision determined by strategic management have to be supported by the selection of proper leadership style and approach, in order to perform tactical realization of these goals. Strategic management and leadership are closely interconnected, since management without proper leadership represents mostly plans on paper, while leadership without strategic management does not cover long-term goals and might result in poor consequences for the company. The case of an under-performing pizza restaurant illustrates the situation where lack of strategic management is combined with moderate presence of leadership. Evidently, in order to reach best business results, it is necessary to combine both of them effectively.