1. Explain the evolution, role and importance of business policy andstrategic management. What would be the role of manager in thisage?
Introduction: The term strategic management has been traditionally used. New titlesuch as business policy, corporate strategy and policy, corporate policies isessentially and extensively used which means more less the same concept.
Evolution of Strategic Management:
1)In early 1920\u2019s and 1930\u2019s the managers used day-to-day planning methods
to perform any task.
2)To anticipate the future, they tried using tools like preparation of budgets and
control systems like capital budgeting and management by objectives.
3)The techniques were unable to emphasize the future adequately.
4)The next step was they tried using long range planning which was replaced
by strategic planning and later by strategic management.
5)In mid 1930\u2019s, according to the nature of business the planning was done
during Adhoc policy making.
6)As many businesses had just started operations and were mostly in a single
product line, there arose a need for policy making.
7)As companies grew they expanded their products and they catered to more
customer and which in turn increased their geographical coverage.
8)The expansion brought in complexity and lot of changes in the external
environment. Hence there was a need to integrate functional areas.
9)This integration was brought about by framing policies to guide managerial
10)Policies helped to have pre-defined set of actions, which helped people to
11)Policymaking was the owner\u2019s prime responsibility.
12)Due to increase in the environment changes, in 1930\u2019s and 40\u2019s policy
formulation replaced ad-hoc policy making, which led to emphasis shifted to
the integration of functional areas in this rapidly changing environment.
13)Especially after II World War there was more complexity and significant
changes in the environment.
14)Competition increased with many companies entering into the market.
15)Policy making and functional area integration was not sufficient for the
complex needs of a business.
ROLE OF STRATEGIC MANAGEMENT: -
1)Due to increase in the competition, in 1960\u2019s there was a demand for critical
look at the bane corrupt of business.
2)The environment played an important role in the business.
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