Challenges firms face in Strategic Management
Strategic management refers to the ongoing planning, analyzing, assessing and monitoring the operations of organization that allow firms to meet their objectives. Globalization has led companies to face many challenging issues in strategically managing the firm’s goals. Some of the challenges include taking the strategic decision as science or art, the visibility or secrecy of strategies in front of stakeholders, technological advancement, right talent and the process structure in the firms. It has been observed that business world is widely competitive and there is no chance of error in strategic planning. Thus, one of the challenges that a firm face is to take the strategic approach as science or an art. However, the rational decision consists of systematically analyze the internal and external environment that is based on research, evaluation of pros and cons and taking the most optimal solution for the betterment of the organization. But the strategic decision that management considers also cannot be done without creativity, imagination and holistic thinking, which is, undoubtedlyan art. Thus taking the right approach becomes a great deal for many organizations (David&David, 2014).
The second challenge that companies face is to decide whether the decisions should be open or hidden as clear picture of firm’s decision can benefit the rivals. However, it has been noticed that hiding the required information from stakeholders or even with employees can lead to serious problems.It canprevent the effective communication, commitment and understanding between the employees, which is essential aspect in successful implementation and formulation of the strategies.Moreover,knowing the information, the stakeholders and employee sometime can contribute positively to the firm’s process by giving ideas and solutions. Thus, there should be balance between the visibility and confidentiality of strategic planning.
Another challenging issue that is faced by many firms these days regards to the structure of the firm. The top management is considered to be the most experience and responsible to make strategic decision, while the lower to middle level supervisors and managers are better aware of day to day operations. In addition, in order to support and be committed to the organizational goals, middle management is actively involved in formulating the effective strategies. Therefore, the rational approach is to educate and train all the level of diversified workforce to participate in the firm’s strategic planning.
In todays’ competitive market, the technological advancement and new systemsbecome the most important factor in the success of organizations.Setting up the system where organization can infiltrate new process and technologiesaccording to macro environmentis a great deal of challenge.Moreover, it needs huge cost to adapt the latest framework and structure. As a result, companies have to tradeoff between many available strategic options to implement the best technological alternative which can support the organization objectives. The last but not the least challenge is the hiring of talent management.The problem is that the strategies need to be revised according to changing environment. Also, operations in firms are now more knowledge based, complex and require global standards. As a result, the formulation and implementation of new strategies is not possible without the support of efficient workforce. While, it has been observed that due toglobalization, the workforce is diversified and belongs to different background and culture. Thus, in order to meet international standards;many times firms downsize the smart talent of the firm. Therefore, it becomes a great deal to access,recognize, hire and retain the efficient workforce which can best serve for the betterment of the organization.
Reference
David, F. R.,David, F. R. (2014).Strategic Management: A Competitive Advantage Approach, Concepts and Cases. Prentice Hall
