STRATEGIC MANAGEMENT ASSIGNMENT

Small companies Large Companies

Annual sales <100 million >100 million
Classification of Diversity of operation Single industries Two or more diversified
company and industries
c Organizational structure Functional Product based
Organisational
structure: Expertise of top executives Greater than functional Less than that of divisional
subordinates subordinates
Source: Harward business review

CEO Project Coordination

Based on the above
parameters, the Functional Functional Functional
company is Manager Manager Manager
differentiated as
small company. Staf Staf Staf

Staf Staf Staf

Staf Staf Staf

 communication of corporate performance
goals. 01

The goal-setting process.

02

Competition and industry analysis.

03

Managers role.
Strategic planning 04
process:
The corporate planner’s role.
05

Linkage of planning and budgeting.

06
 Unlike in the case of a large company where process starts at general manager level of a division, here
the process of strategic planning will start at president level and will involve functional managers .

Communication of The top level executives will only share thoughts about objectives & strategies and will leave the devising
Corporate Goals action programs & performance goals to functional managers in line with companies objectives.

Generally in case of small growing company ,goals and results of the plan aren’t fixed before
establishment of programs and plans. This helps companies to react to any stimulus quickly and reduce
losses.

In a sense then, functional goal setting is a top-down process. The functional managers propose action
programs, but the president with his business-wide perspective determines the programs and goals for
his functional subordinates.

Goal setting process As this company is technology based,the engineering team and marketing world drive the growth of the
company .

A joint communication strategy from these teams about the objectives and strategies that will drive the
company’s future goals.
 This forms the external environment analysis that the company requires to stay in-line with the volatile
environment. In this company this function will be performed by the functional managers and top-level
Competition and
executives since they will be more knowledgeable and will have more expertise in this area.
industry analysis
This will also help them take better decisions regarding courses of action to take and define function wise
goals.

Creating a functionally co-ordinated set of strategic planning in case of small company requires lot of
cross-functional communication between various teams.

Being small ,agile and functional organisation structure will help teams co-ordination and planning.
Manager’s role
Much of the managers task will be to prepare various courses of action to take the company on the path
to achieve its ultimate goals with the help of staf members in their own functional areas.
 Small companies usually have less flexibility in case of budget .Hence company will focus more on
narrowing down diferent strategies and choose only those that contribute majorly and directly to
companies main focus objectives.

Rapidly narrowing objectives will occur at objective setting stage unlike in large companies which occur at
planning and budgeting stage.
Budget and
Planning For example company’s last year customer acquisition and revenue should be chosen as the basis of next
linkage years operations goals.

Similarly every functional areas defining their performance criteria depending on their functions like
Technology department keeping goal of x no of new customers registered or increase of customer support
and satisfaction etc
In case of this company , the corporate planning is not a separate function like the big corporations have.

Instead it will be merely a person from a important department(technology in this case) working like an
Corporate Planner’s assistant co-ordinating with various functions and top level executive.
Role
The planner should also be a person with the same long term view as top management and will assist
them in analysing diferent action plans as suggested by functional managers.
 In all a rapidly growing small company, the planning system reflects focus on development
and review of innovative action programs.

In all the strategic planning would be such that:

• Goal setting will be top-down approach,
• Linkage to the budget will be tight,
Final conclusion: • Top level executives will only provide goal in the form of vision .The functional teams
according to their TOWS analysis detailed out courses of action and performance
paraments depending on their functions to those courses of action.
• The staf planning officer plays a major role as cross-functional program analyst.

This king of planning process will help most of the major contributors of the company’s growth to directly
influence the strategy of the company and will make people realise their fair share of responsibility,