Strategic Planning in the Small Business

Unit 1

HO 1-5 (continued)

Chapter 1 The

Strategic Management

Process 9

dealing

with changing conditions,

and to steer the

organization into doing

the right

things at

the right time.

The

enterprising quality

of strategy formation

extends to all managers.

not

just senior

executives. Entrepreneurship

isinvolved

when a sales manager

crafts a

narroiw'

strategy to boost sales

by equipping sales

reps' cars with

mobile tele­

phones. And

entrepreneurship is

involved when senior

executives devise

a broad

companywide

strategy to become

the low-cost producer

in the industry and

then

use the cost advantage

to undercut rivals'

prices, grab some

of their customers.

and gain market share.

Hence, entrepreneurial

strateg. -making

falls on the shoul­

ders

of managers up and

down the organizational

hierarchy, in functional

depart­

ments and in remote

operating units

(plants and district

offices) as well as at

the

top of the

organizational pyramid.

Strategy-making

is not something

just top

managers

do: it is something

all managers do-ever.

manager needs

an en­

trepreneurial

game plan for the area

he/she is in charge

of.

From the perspective

of the whole organization,

the task of "strategizing"

is

an ongoing exercise.

I While "the whats"

of an organization's

mission and long­

term objectives,

once chosen.

may remain unaltered

for several

years. "the

hows"

of strategy are always

evolving, partly

to respond to an

ever-changing

external environment,

partly from the proactive

efforts of managers

to create new

windows of opportunity.

and partly

from fresh ideas

about how to make

the

strategy work better.

On occasion, major

changes emerge when

a new strategic

move is put

to the test in the real

world or when a

crisis strikes and managers

see

that the

organization's strategy

needs radical

reorientation. As a consequence.

refinements

and additions

to tMe strategic plan.

interspersed with

periodic quan­

tum ieaps,

are a normal part

of managerial "strategizing."

The

ongoing stream of strategic

moves and approaches

means that

an organi­

zation's

strategy forms over

a period of time and

then reforms, always

consisting

of some mix

of holdover approaches

and freshly planned

moves. Aside

from crisis

situations (where

many strategic

moves may have to

be made 

very quickly.

producing a substantially

new strategy

almost overnight

and neV company start­

ups (where strategy

exists more in the

form of plans and

intended actions).

a

company's

strategy is formed

in bits and pieces,

as events unfold

and as manage­

rial experience

with the situation

accumulates. Everything

cannot be planned

out

in advance,

and even the best-laid

plans must be

responsive to changing

condi­

tions.

Strategy-making

thus proceeds on two

fronts-one proactively

thought

through in advance,

the other conceived

in respoase to new

developments, special

opportunities, and experience

with the

successes and failures

of prior strategic

moves,

approaches, and actions.

Figure 1-2 indicates

the different

moves and

approaches

that delincate a

company's strategy.

The three

tasks of defining

the business. setting

objectives, and forming

a

strategy

all involve direction-setfing.

Together,

they specify where

the organiza­

' Henry Mintzberg.

"Crafting Strategy."

l rvard B1Itsin.%

Ret''ivi 65. no 4 (July-Augui

1987). pp

66-75: and Jame,.B Quinn.

Strategt vfor Chattng'

Loga

ol Int ret'g'nimh.wm

(Home­

wood. I!1.:

Richard D. Irwin, :91'0).

Chap. 2. especially pp 58-59

84