Definition: Strategic thinking allows a manager to see the business as a whole and to take the broad, long-term view.
As a senior manager in a workplace, how would you promote the importance of strategic thinking to other managers:
- Strategic thinking is a key skill for managers to make their business more successful. The business should be creating a strategic plan process at least once a year for the management team to use the document as a guide book for the year. Companies should also be making strategic thinking an ongoing process throughout the year to achieve the best out of their management team
- Strategic thinking for managers must go through many issues to make the business successful like:
1. Resource limitations
2. Changing environments
3. Matching competitor’s strengths
4. Need to grow
5. Improved decision making
- Resource limitations refers to resources such as money, people and time. Strategic thinking can help business determine how to uses these resources in the most effective way and this will advance the company towards it objectives. Strategic thinking can help company’s avid mistakes such as opening a new retail locations before the customer population is large enough to support it.
- Changing environments is an issue that every business goes through. This changing environment created disadvantages like:
1. New competitive threats arising
2. Change in national and local economy
3. The prices of materials rise unexpectedly
Changing environments advantages as well like:
1. New markets open
2. Competitors that falter can create an opportunity to take market share from them
- Matching competitor’s strengths is a very hard because companies are always evaluating their strengths and weaknesses. You have to watch the businesses every move or figure out their strengths or weakness based on research that the management team has done.
- Need to grow is an issue that is faced by every business because there is always a constant pressure for business to grow. Growth generally means higher profitability and greater returns for the owners of the companies. It also means that the company is succeeding in the competitive struggle. In order for the business to grow they must be innovative in all aspects of the operation of the business. Companies that do the same thing year after year tend to lose market share to companies that are not afraid of change.
Improved decision making is where business owners make strategic thinking a central element of their management philosophy. With business owners doing this they often become strategic thinkers themselves which makes them learn to recognise suitable changes in the business environment. This will have a direct impact on the business revenues. The business will become more adapt at predicting how competitors are likely to react to the new strategies that they implement. They must make logical and confident decisions to help their business achieve high goals.