The Crucial Insight For Business Management Strategy
One of the greatest tragedies of modern management is the belief that strategy is long-term and tactics are short-term. Truth is, strategy exists at ever level of the organization and must be considered with every action and option chosen by the company.
According to Goldratt and the Theory of Constraints (TOC), ‘strategy’ means: “an answer to the question ‘what for?’” (objective, purpose). This couples with the TOC explanation of ‘tactics’, which are: “an answer to the question ‘how?’” (process, actions).
This impacts on management in a big way. Mark Parker Follett (1868-1933) defined management as ‘the art of getting things done through people’. How succinct.
And since all people are involved with objectives, purpose, process and actions in some way, to achieve ongoing competitive advantage, strategic management must become more open to bottom-up innovation and a more open approach to engaging people throughout the entire organization.
This shift in approach (for strategic management to be involved in more than just long-term top-level stuff and for all staff to be more involved with it) will produce the much needed mature and natural progress of management for the future. Although much management stubbornly maintains their monopoly on company direction due to academic traditions or super sized egos.
Opportunistic managers seeking quick gains for their own honor can sink the long-term competitiveness of the company and stifle much needed disruptive innovations under the pretence of seeking efficiencies to save money.
But that old paradigm is losing it’s shine. Six years of research by Collins and Porras discovered the key principles behind 19 successful companies:
Each company encouraged and maintained an ideology that nurtures the organization. These core values support employees to build a long-lasting organization. In Built To Last (1994) they identified that: “short term profit goals, cost cutting, and restructuring will not stimulate dedicated employees to build a great company that will endure.”
The Theory of Constraints, through it’s definition of strategy and tactics, and its array of management tools, is providing the means to involve all staff in strategic management.
Continue with more on strategic business management and read the authors recommended top leadership book for learning modern strategy.