Evolution of strategic management in a corporation

At the inception, there is strategic management as firms decide their areas of specialization and potential clients. However, it is never static in any case. As the market position gets established, the organization then settles in specific areas where it flourishes. It is at this point where there is a concentration of resources in the regions that pay best. Additionally, it will do away with some of the areas which seem not to be well paying. The last stage of the evolution includes the alignment of functions and activities where they all offer support towards realizing a particular strategy.

Influences on strategic management

Globalization- globalization has seen the reduction of trade barriers and an increase in competition amongst firms. As a result, firms have been forced to relocate to places where labor costs are lower and those with comparative advantages. Further, it forces firms to use their capabilities to increase market share by accessing new markets.

Social responsibility- firms increasingly need to play on the global platform of business as a strategic move. Social responsibility has proven to help businesses get orientation on the global front. It is also a critical ingredient in brand strengthening and market positioning.

Environmental Sustainability- The survival of businesses depends on a reliable supply chain, which is assured by a sustainable environment. Therefore, strategic management uses this not only as a public relations stunt but also as a way of ensuring survival. At the same time, the rising costs of energy demand that firms establish ways of generating green, which is cost-friendly.

Structure and Culture

organizational structure can help to make or unmake a business. More so, it is the type of system adopted by a company that shapes its culture. The size and nature of a business determine the type of structure to apply. It is also necessary to make changes when the business demands so. Radio Flyer, an American company that specializes in the making of toys, is such a company that has successfully used the organizational structure as strength. Further, the structure has helped create a culture of cohesiveness, and the employees relate like family. The functional structure has made it possible for the company to survive over a century through the changing times. It encourages a culture of innovation, and there is also a free flow of information.

Board of directors

At the initial stages, when companies form, they may be small. In many cases, they also have a lack of clear lines of specialization in addition to limited resources. The registration process may require that they have a board of directors. On many occasions, the owner and a few employees occupy this space. However, it is only to satisfy regulatory requirements. As they grow, the need for specialization and expert leadership becomes necessary. It is at the point of an expert needs that board of directors sets in. Many businesses in Saudi Arabia grew from family to become large conglomerates. At the point of inception, only a few family members served as both board members and employees. As they grow, they recruit board members from outside the family to tap their business operation expertise. For example, Almajdouie Group started as a family business in 1965. The founders had a big vision, but there was no formal board. The board came later when the business grew and required expertise in operations. It has now become an international entity with a presence in different places across the globe.