## Levels of Management in Strategic Management
Strategic management is carried out at three hierarchical levels, each with distinct roles and strategic focus.
### 1. Corporate Level
- Composed of the CEO and top-level executives at the apex of organisational decision-making.
- Responsible for strategy for the whole organisation.
- Key responsibilities:
- Defining the mission and goals
- Deciding what businesses the firm should be in
- Allocating resources across different businesses
- Providing organisational leadership
### 2. Business Level
- Comprises general managers of individual Strategic Business Units (SBUs).
- Each SBU is a self-contained division with its own functions (finance, production, marketing).
- Key role: Translate corporate-level direction into concrete strategies for the specific business.
### 3. Functional Level
- Comprises functional managers responsible for specific operations (HR, purchasing, product development, customer service).
- Scope is confined to one organisational activity.
- Contrast with general managers who oversee an entire division or company.
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### Primary Tasks of a Strategic Manager
1. Define mission and goals of the organisation
2. Determine what businesses to be in
3. Allocate resources among businesses
4. Formulate strategies
5. Implement strategies
6. Provide leadership for the organisation
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### Strategies Formulated at Each Level
| Level | Strategy Type | Key Examples |
|---|
| Corporate | Overall direction and scope | Stability, Growth, Retrenchment, Combination |
| Business | Competitive advantage in specific markets | Cost Leadership, Differentiation, Focus |
| Functional | Achieving functional objectives | Marketing, Financial, Operations, R&D, HR strategies |
> All three levels of management — corporate, business, and functional — participate in formulating and implementing strategies, though with different scope and focus.
### Example 1
Q: Enumerate the tasks to be performed as a strategic manager of a company.
A strategic manager's primary role is to conceptualise, design, and execute company strategies. The specific tasks include:
1. Defining the mission and goals of the organisation — establishes the fundamental purpose and direction.
2. Determining what businesses the organisation should be in — shapes the portfolio and competitive scope.
3. Allocating resources among the different businesses — ensures each SBU has the capital, people, and assets it needs.
4. Formulating strategies — crafting plans at corporate, business, and functional levels.
5. Implementing strategies — translating plans into action through structure, systems, and processes.
6. Providing leadership — aligning the organisation culturally and motivationally toward strategic goals.
Memory aid: Mission → Businesses → Resources → Formulate → Implement → Lead (MBRFIL)
### Example 2
Q: 'Management at all levels develops strategies.' Explain the different strategies formulated at different levels of management.
Corporate-Level Strategies (formulated by top management):
- Focus on the overall direction and scope of the entire organisation.
- Major types: Stability (maintain current position), Growth (expand), Retrenchment (cut back), Combination (mix of the above).
Business-Level Strategies (formulated by middle management / SBU heads):
- Focus on achieving competitive advantage within specific markets.
- Major types: Cost Leadership (lowest cost), Differentiation (unique offering), Focus (narrow segment).
Functional-Level Strategies (formulated by functional/department heads):
- Align with business-level strategies; focus on achieving functional objectives.
- Types: Marketing strategies, Financial strategies, Operations strategies, R&D strategies, Human Resource strategies.
Conclusion: Corporate strategies set overall direction; business strategies compete within markets; functional strategies support both through specialised execution.