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Unit 3: Planning
4. Operational strategy: Operational strategy was encouraged by Peter Drucker in his theory Notes
of Management by Objectives (MBO). It is very narrow in focus and deals with day-to-day
operational activities such as scheduling criteria. It must operate within a budget but is
not at liberty to adjust or create that budget. Operational level strategies are informed by
business level strategies which, in turn, are informed by corporate level strategies.
Since the turn of the millennium, some firms have reverted to a simpler strategic structure
driven by advances in information technology. It is felt that knowledge management systems
should be used to share information and create common goals. Strategic divisions are thought
to hamper this process. This notion of strategy has been captured under the rubric of dynamic
strategy, popularized by Carpenter and Sanders’s textbook. This work builds on that of Brown
and Eisenhart as well as Christensen and portrays firm strategy, both business and corporate, as
necessarily embracing ongoing strategic change, and the seamless integration of strategy
formulation and implementation. Such change and implementation are usually built into the
strategy through the staging and pacing facets.
Figure 3.1: The Delta Model – Three Distinct Strategic Options
3.6.2 Elements of Strategic Management
Ellen-Earle Chaffee summarized what she thought were the main elements of strategic
management theory by the 1970s.
1. Strategic management involves adapting the organisation to its business environment.
2. Strategic management is fluid and complex. Change creates novel combinations of
circumstances requiring unstructured non-repetitive responses.
3. Strategic management affects the entire organisation by providing direction.
4. Strategic management involves both strategy formation (she called it content) and also
strategy implementation (she called it process).
5. Strategic management is partially planned and partially unplanned.
6. Strategic management is done at several levels: overall corporate strategy, and individual
business strategies.
7. Strategic management involves both conceptual and analytical thought processes.
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