The ideal, strategic management process is developed and governed by a strategic management team. The team consists principally of strategic decision makers at all three levels in the corporation, e.g., the chief executive officer (CEO), the product managers, and the heads of functional areas. The team also relies on inputs from two types of support personnel: company planning staffs, when they exist, and lower-level managers and supervisors who provide data for strategic decision making and who have responsibilities for implementing strategies. Because strategic decisions have such tremendous impact on a firm and because they require large commitments of company resources, they can 2 H. Mintzberg, “Strategy Making in Three Modes,” California Management.
The nature and value of strategic management.
Medium-sized firms frequently employ at least one full-time staff member to spearhead strategic data-collection efforts. Even in smaller or less progressive firms, an officer or group of officers designated as a planning committee is often given an assignment of spearheading the company’s strategic planning efforts. Precisely what are the responsibilities of strategic managers in the strategic planning process at the corporate and business levels? Figure 1-6 provides some answers. It shows that top management shoulders the responsibility for broadly approving each of the six major phases of planning which are listed. They are assisted in the execution of these responsibilities by the corporate planning department, staff or personnel, who actually prepare major components of the corporate plan. They also review, evaluate, and counsel on most major phases of the plan’s preparation.
One final, but perhaps overriding, point must be made on the topic of strategic decision makers: a company’s president or CEO characteristically plays the most dominant role in the process. In many ways this situation is desirable and reasonable. The principal duty of a CEO is often defined as that of giving long-term direction to the firm, the CEO is ultimately responsible for the success of the business and therefore of its strategy. Addi¬ tionally, CEO’s are typically strong-willed, company-oriented individuals with a high sense of self-esteem.
Their personalities often inhibit them from delegating substantiative authority to others in the formulation of approval of strategic decisions. However, when the dominance of the CEO approaches autocracy the effectiveness of the firm’s strategic planning and management processes are likely to be greatly diminished. The advantages of a team-oriented, participative strategic system are obviously related inversely to the propensity of the CEO to make major strategic decisions single-handedly. For these reasons, the establishment of a strategic management system carries with it an implicit promise by the CEO to provide managers at all levels with the opportunity to play a role in determining the strategic posture of their firm. The degree to which the CEO fulfills the promise is often synonymous with the degree of success enjoyed through the use of the strategic management process.