Difference Between Strategic Planning and Management Control

Briefly, here are some ways in which the strategic planning process differs from the management control process.

A strategic plan usually relates to some part of the organization lather than to the totality; the concept of a master planner who constantly helps all part of the organization at some coordinated optimum is a nice concept an unrealistic one. Strategic planning is essentially irregular problems, opportunities, and bright ideas do not arise according to some- set timetable; rather, they are dealt with whenever they happen to be; perceived. The appropriate analytical techniques depend on the nature of the; problem being analyzed, and no over all approach (such as a mathematical model) has been developed that is of much help in analyzing all types of strategic, problems emphasis on a systematic approach is quite likely to stifle the essential element of creativity. In strategic planning, management, works, now on one problem, then on another, according to the needs and opportunities, of the moment.

The estimates used in strategic planning are intended to show the expected results of the plan. They are neutral and impersonal. By contrast, the management control process and the, data used ins it are; intended to influence managers to take actions that will lead to desired results. Thus, in connection with management control it is appropriate, to discuss how tight an operating budget should be. Should the goals be set? So high that only an outstanding manager can achieve them, or should they be set so that they are attainable by the average manager? At what level; does frustration inhibit a manager’s best efforts? Does an easily attainable budget lead to complacency? And so on. In strategic planning, the question to about figures is simple this the most reasonable estimate that can, most reasonable estimate that can be made.

Strategic planning relies heavily on external information that is, on data received from outside the company, such as market analysis, estimates of and other factors   involved in building a plant in a new   locality technological developments, and so on. When does from the normal information are used, they usually must be recast : fit the needs of the specified problem being analyzed. For example, current operating costs that are collected for measuring pricing and other operating decisions must be restructured before they are useful in deciding whether to close the plant. Another characteristic of the relevant information is that much precise. The strategic planner estimates what will probably happen of over a rather long time period. These estimates are likely to have a high degree of uncertainty, and they must be treated accordingly.

In the management control process, the communication of objectives, polices guidelines, decisions and results throughout the organization is extremely important. In the strategic planning process, communication is much relatively few persons; indeed, the need for secrecy often communication. Wide communication of the decisions that result from strategic planning is obviously important; this is part of the management control process.

Both management control and strategic planning involve top management but middle managers (i.e. operating management) typically have a much more important role in management content than in strategic planning. Middle managers usually are not major participants in the strategic planning process and sometimes are not even aware that is being considered. Many operating executives are by temperament not good at strategic planning. Also the pressures of current activities usually do not allow them to devote the necessary time to such work. Currently, there is tendency in companies to set up separate to gather the facts and make the analysis that provide the background material for strategic decisions.

Strategic planning and management control activities tend to conflict with one another in some respects. The time that management spends in thinking about the future is taken form time that could otherwise be used in controlling current operations, so in this indirect way strategic planning can hurt current performance. And of course the reverse also is true. More directly, many actions that are taken for long-run specific reasons make current profits smaller than they, otherwise would be. Research and some advertising expenditures are obvious examples. The problem of strong the right balance between strategic and operating considerations is one in the same problems in the whole management process.

Credit: Strategic Management-KU

About Abey Francis

Abey Francis is the founder of MBAKnol - A Blog about Management Theories and Practices - and he's always happy to share his passion for innovative management practices. You can found him on Google+ and Facebook. If you’d like to reach him, send him an email to: [email protected]
Bookmark the permalink.

Leave a Reply

Your email address will not be published. Required fields are marked *


*

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>