Question

2. Which strategic management theory do you think has the greatest value to the practising manager? You should discuss at least two theories in your answer before coming to a justified conclusion.

Answer 1

INTRODUCTION

Strategies are one of the most important part of the organization for the accomplishment of goals of the organization, management follow various strategies. Or we can say that formulation and execution of these strategies in the organization called strategic management.

STRATEGIC MANAGEMENT THEORIES

Two theories of the strategic management are given as follows -

1. INNOVATION THEORY

In the innovation theory of strategic management, organization develop strategies for the innovations in the company. In this theory of strategic management there is always new product and services designed by the organization. Or we can say that in this theory organization take huge risk because innovation for new product and services comes in this category. This theory is important for the organization because it creates good image of the company in the eyes of the customers.

2. VALUE CREATION STRATEGIC THEORY

Value creation theory deals with creating value of the organization in the existing market. In this theory, complete analysis of the environment is done and after that all those parameters that are related to the customers are analyzed. Needs and demands of the customers change every day so for creating value, organization should understand all the aspect of customer demand.

GREATEST VALUE THEORY FOR MANAGERS

Strategic management theories cannot be developed on the basis of any single criteria. Various parameters are there, in these theories. So before applying these theories in any organization, Deep analysis of the organization is necessary so the need of particular theory could be analyzed. And on the basis of this need, theories in the organization are applied. In my opinion, strategic management theory that have greatest value to the practicing manager is value creating strategic theory because it helps the organization in creating value in the minds of the customer and employees of the organization.