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Financial analysis and investment assessment of the enterprise. Cognitive school

25.09.2019

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Introduction

For the first time, the term strategic management was introduced into use at the turn of 1960-70. to denote the difference between current management at the production level and management carried out at the highest level. The leading idea, reflecting the essence of the transition from operational to strategic management, was the idea of shifting the focus of top management's attention to the environment in order to respond to changes in an appropriate and timely manner.

Strategic planning is one of the management functions, which is the process of choosing the goals of the organization and ways to achieve them.

Strategic planning provides a framework for everyone management decisions. The functions of organization, motivation and control are focused on the development of strategic plans. Without taking advantage of strategic planning, organizations as a whole and individuals will be deprived of a clear way of assessing the purpose and direction of the corporate enterprise. The strategic planning process provides the framework for managing organizational members.

Strategic planning allows shareholders and company management to determine the direction and pace of business development, outline global market trends, understand what organizational and structural changes need to happen in the company for it to become competitive, what its advantage is, what tools it needs for successful development .

Until recently, strategic planning was the prerogative of large international concerns. However, the situation began to change, and, as surveys show, more and more more companies representing medium-sized businesses are beginning to engage in strategic planning issues.

The strategic planning process in a company consists of several stages:

Defining the mission and goals of the organization.

Environmental analysis, which includes collecting information, analyzing the strengths and weaknesses of the company, as well as its potential capabilities based on available external and internal information.

Choice of strategy.

Implementation of strategy.

Evaluation and control of implementation.

Defining the mission and goals of the organization. The target function begins with establishing the mission of the enterprise, expressing the philosophy and meaning of its existence.

In the process of development of strategic thought, a number of directions (schools) were formed. There are ten main schools involved in strategy formation. The first three describe how strategy should be formed, while the next six attempt to describe how it is formed in practice. The last school actually incorporates all other approaches. The school, which is called the “configuration school” by G. Mintzberg and others, is an approach that seeks to combine disparate elements - the process of creating a strategy, the content of the strategy, the organizational structure and its environment - into separate sequential stages of the organization's life cycle, for example growth or stable maturity.

Schools:

School of Design;

School of Planning;

School of Positioning;

School of Entrepreneurship;

Cognitive School;

School of Training;

School of Power;

School of Culture;

School of Environment;

School of Configuration.

The emergence of schools of strategies is largely associated with various stages of development of strategic management. Some have experienced their heyday and are in decline, others are only “gaining momentum”, others are “making their way to the surface” in the form of thin but important “trickles” of publications and reports about practical application proposed concepts.

The modern significance of these schools varies. Some of them have proven themselves well and hold a reliable position for analyzing the activities of companies belonging to “traditional” industries, others demonstrate the effectiveness of their methodology in newly developing, innovative business sectors, others are more suitable for designing strategic changes in non-profit organizations or municipal government organizations and etc. Therefore, it would hardly be productive to try to rank schools and areas of strategic management in terms of importance or effectiveness in isolation from the real context of organizational problems in which they arose and which influences their development. It is more important to learn how to apply the necessary and effective methods from the entire arsenal of methods provided by schools for solving strategic management problems that arise in specific organizations and at a certain point in time.

1. Brief characteristics of schools

School Ddesign

The most common view of the strategy process, not only because it is included in many MBA business courses, but also because it is given a lot of space in strategy textbooks and other materials on the subject.

Very important for the formation of strategy are organizational values, or management values (beliefs and preferences of individuals who formally head the organization), social responsibility, in particular the moral principles of the society in which the organization operates.

Following the identification of alternative strategies in the model under consideration, the stage of their comprehensive assessment and selection of the optimal strategy follows. It is assumed that the company's management has previously developed several alternative strategies, from which, after appropriate assessment, it is necessary to select one. Strategy approval is followed by its implementation. The implementation of the strategy in the figure is presented as the unfolding of its formulation. This means that after narrowing down the choice of strategy, the evaluation process expands again, since its implementation requires the active participation of all levels of the organization.

The Design School ideas are based on a number of premises. Seven of them are represented by the Mintzberg School of Strategy.

Model School

“Grand strategy” comes from a conscious and careful thought process. Current goals and objectives are reviewed in the light of a SWOT (Strengths, Weaknesses, Opportunities and Threats) analysis, after which strategic alternatives are identified. These alternatives are then evaluated, taking into account the values of top management and the need for social responsibility, and the single “best” strategy is selected. The CEO not only controls the process, he or she “builds” the strategy. In this model, the end product is unique to a specific organization and appears in the form of a detailed “complete” strategy just waiting to be put into practice.

School Pplanning

The founder of this school is considered to be one of the most famous economists in the field of strategic management and planning - Igor Ansoff. The main ideas of the planning school were published in Ansoff's "Planning for Top Management" in 1969.

The motto of the planning school is to anticipate and prepare. According to representatives of this school, “all the company’s actions are based on an inherently mechanical assumption: work as prescribed with each of the component parts, then assemble them according to the instructions - and this is the result - a corporate strategy.”

For followers of this school, strategy formation is an integral part of the planning process. Therefore, it is a very formalized, rational process, usually divided into specific steps, each of which is accompanied by analytical work and the search for answers to a number of questions.

School Ppositioning

There are a limited number of strategies available for each industry. Strategies, in turn, are formed on the basis of analytical calculations, by taking a certain position in relation to other market participants.

School Pentrepreneurship

Strategy exists in the mind of a leader as a vision. Thus, this school believed that the choice of strategy is based on intuition, and the success of the choice depends on entrepreneurial talent.

Cognitive Shcola

Representatives of this school viewed strategy development as a mental process. The inclusion of this proposed school on the list is rather a call to work more in this direction.

School Oordeals

The formation of a strategy was considered by representatives of this school as a developmental process. The school offers a solution: learn over time. Managing the strategic learning process.

School Blusty

Formation of strategy, from the point of view of school representatives, was a process of negotiation.

Considers politics as separate from strategy, where companies use political influence over external organizations to achieve their goals. Such "macro politics" occur, for example, when a large organization faces bankruptcy and persuades the national government to throw it a lifeline.

Strategy Development:

Almost every organization has three legitimate ones, i.e. officially recognized systems: formal leadership, ingrained culture and certified expertise. But in certain situations, the means they use are aimed at achieving illegitimate goals. At the same time, the fourth system - politics, the means of which cannot be called fully legitimate, can be used to implement clearly legitimate tasks. Let's look at four specific points.

1. Politics as a system of influence can act in the manner of Darwinian selection, ensuring that the strongest members of the organization occupy leadership positions. Official leadership favors a single chain of command, which allows weak leaders to suppress strong subordinates. As effective leaders strive for power, they have the opportunity to demonstrate their potential in the “game.”

2. When using political methods, as a rule, all significant aspects of the problem are discussed, while other systems of influence can provide support only to one of the parties.

3. Political methods make it possible to stimulate urgent changes that may be blocked by legitimate systems of influence.

4. Political methods can facilitate change.

The following political methods for adopting strategies exist:

1. identify political realities and manage them. The formation of coalitions is a natural and spontaneous result of competitive demands regarding the distribution of resources, coming both from outside and from within the system;

2. be able to assess the significance of support from middle managers. Top management depends to varying degrees on middle managers for their technical knowledge and functional skills. If the management of the organization makes a decision and carries it out steadily, without paying attention to the relations of middle managers, resistance from the coalitions formed by the latter can very significantly reduce the effectiveness of such actions, or even completely nullify them;

3. we must learn to use political means:

Equifinality - approximately the same results can be obtained using different methods. Management needs to realize that the result achieved is more important than the methods by which it is achieved;

Feasibility - it is much better to agree to satisfactory results than to fail in trying to achieve

Optimal" results based on an unpopular strategy;

Generalization - switching attention from specific issues to more general ones helps to free up the hands of the company's management in the search for a strategy and corresponding political methods that are sufficiently effective and at the same time contribute to the staff's understanding of the organization's tasks;

Concentrating attention on primary issues allows you to distract from current needs in favor of long-term, and therefore more fundamental, interests of the organization;

Forecasting the behavior of coalitions - company management should pay more attention to the analysis of current issues, identifying potential participants in coalitions that are formed around current organizational problems;

4) manage the behavior of coalitions:

Learn to manage the coalition structure of the organization in order to limit the influence of the opposition;

Review the strategy and/or related policies in such a way as to de-escalate the confrontation;

5) take direct action against the opposition coalition:

Create proactive coalitions - the company’s management itself can organize a “support group” for its strategy from middle managers, having previously disseminated the relevant information throughout the organization;

Create a counter-coalition if an opposition coalition has already been formed;

Change the position of the leaders of the opposition coalition in the organization - moving or even demoting the leader of the opposition coalition can have a significant impact on his potential effectiveness;

Appoint coalition members to boards of directors, committees or working groups, which will bring them closer to new information about the situation, and new schemes of social influence may ultimately lead to a revision of the views that brought them into the opposition camp;

Strengthening explanatory work with coalition members is effective in those organizations whose management does not maintain close ties with staff, but communicates primarily with individual, key figures from among subordinates, who may not be very effective in informing employees about the strategy proposed by management;

Get rid of coalition leaders - eliminating coalition leaders is often effective way fight her.

In certain situations, it is advisable to admit defeat and change strategy.

School Kculture

Representatives of this school presented the strategy formation process as the result of the efforts of a large number of company employees, i.e. as a collective process.

Despite the fact that culture became unexpectedly important in the management literature in the 1980s, very little work has yet emerged that directly links culture and strategy. The exception is the Swedish school, especially the active one. According to supporters of this school, generally accepted beliefs, traditions and history or culture create expectations. Expectations then shape behavior. This results in a specific set of attitudes and intentions that shape active strategies. The advantage of such a cultural or ideological strategy is that the consensus and common interests make it very integrated and durable. The danger is that the stronger and richer the culture, the more difficult it will be to change the existing strategy in the future.

Culture is the mirror image of power. The government “takes into its hands” an object called an organization and splits it into parts, while it is primarily interested in its own benefit. Culture binds a collection of individuals into a single entity called an “organization” and is interested in its overall benefit.

In management, the “discovery” of culture took place in the 1980s thanks to the success of Japanese corporations. Look at strategic management from a cultural standpoint, it was formed later.

Culture can be studied from the perspective of an outside observer, determining why people behave in certain ways, explaining their actions by the uniqueness of social and economic relations, or from the inside - from the perspective of its original representatives, considering culture to be a subjective process of interpretation that has nothing to do with abstract, universal logic. .

Culture is made up of interpretations of the world, human activities, and the artifacts that reflect them. For us, organizational culture is associated with collective cognition. It becomes the “opinion of the organization,” general beliefs that are reflected in traditions and habits, in the stories existing in the organization, its symbols, buildings and products. E. Pettigrew saw in organizational culture a “clearly expressed social fabric”, which, like the connective tissues in the human body, attaches the “bones” organizational structure to the “muscles” of organizational processes. In a sense, culture is vitality organization, the soul of its physical body.

The more closely related interpretations and actions are, the more deeply ingrained they become in the culture, with many obvious connections between them on the surface.

The power of a culture may be proportional to the degree to which it eludes conscious understanding. Jerry Johnson has noted that organizations with strong cultures are characterized by a set of "taken-for-granted assumptions" that are "protected by a network of cultural artifacts," including the behavior of people towards each other, the conversations they have, which "write the pages of the present into the history of the organization" that they use. language, etc.

To describe a strong culture of an organization, e.g. shared by all its members of strong convictions that distinguish this company from others, we will use the word “ideology”.

Each political system, as a rule, is characterized by a certain ideology (capitalism, socialism, etc.). Each society and ethnic group is characterized by a unique culture. It is obvious that all levels of culture and ideology (in society, industry and organization) mutually influence each other. The beginning of development lies in the 70s.

School Oenvironment

While most other schools view the external environment as something to consider when developing strategy, in the School of the Environment external circumstances dictate strategy. This school "grew out of contingency theory, which postulates that the environment imposes specific characteristics on an organization." This initial idea was then further developed by "population ecologists" who believed that the laws of biology (natural selection, selection) could and should be applied to organization.

School Kconfigurations (Structural school)

The structural school is conceptually different from all nine. Rather than looking at writers prescribing an ideal or researchers describing existing practices, the key here is perspective, looking at episodes in the history of organizations. As representatives of this school believed, strategy formation is a process of transformation.

Of all the schools listed above, in our opinion, the main contribution to the development of the theory of strategic planning was made by the planning school and its founder I. Ansoff. Representatives of this school developed basic methods of strategic planning and recommendations for choosing strategies. In addition, unlike most other schools, in this teaching, the choice of strategy is a scientific process based on a competent and comprehensive study of the environment, conducting strategic analysis and the use of visual tools for choosing a strategy - strategic planning matrices.

Structural School

Views strategy formation as something determined by time or circumstances. Rather than emphasizing the best way to formulate a strategy, this approach considers that any or all methods may be appropriate in different circumstances. However, the nature and form of the organization, such as its size or maturity, combined with the specific environment in this moment time, mean that one path of strategy formation is more likely to be chosen rather than another. Different strategy formation processes thus occur in certain historical phases life cycle organizations. Whether formal planning or intuition dominates, whether politics or vision plays an important role, or any other strategy-making possibility comes into play depends on the timing and context. This approach means that the study focuses on specific periods in the history of organizations (growth, change, stability), stage of the life cycle (growth, maturity, decline), and the type and form of the organization to understand if there is a visible logic or system.

2 . Comparative analysis of the school of power and the school of culture

Research and Study Points

School of Power

School of Culture

1. Main characteristics

2. Strengths

3. Weaknesses

This school believes that a strategic goal is a matter of discussion, not agreement.

Forms a strategy through negotiations.

The school is dominant and studies trick or position strategies.

Several methods have been developed for developing and selecting a strategy.

Political demography for programming or strategy development, and considering strategy separately from politics.

Reflection of reality.

Does not give reliable way strategy formation.

Strategy formation is a collective process.

Formation of behavior and discipline.

A specific set of attitudes and intentions that shape active strategies.

Robust and integrated strategies.

There is no flexibility in changing the strategy (if the culture develops well, then the strategy is difficult to change. Why the stronger the more difficult)

Both schools practice using the developed strategy or strategies, improving over time for the best result. The School of Power and the School of Culture develop strategies different types and different directions.

The School of Power develops mainly strategies for the restoration of an enterprise or organization, and the School of Culture for the development or cohesion and organization of the team, i.e. the school of Power is more state and political, and the school of Culture is developing towards society. Again, society is one of the components of the totality of the world, and peace is basically the goal and politics itself.

3 . Developmunicipal formation

	Main characteristics, features, procedures
1. Development of a concept for the development of a municipal formation	The purpose of creating a development concept is to create management mechanisms that should respond flexibly to possible changes in the situation in society, that is, the strategy should adapt development to external changes. Internal processes should be focused on the goals of the concept, and not on solving current local problems. To implement the concept, certain stages of development and specific tasks are identified in terms of creating the necessary prerequisites for further development. The concept should be focused not only on simply increasing resource consumption, but also on increasing the efficiency of using existing potential.	Problem analysis: Identification of systemic imbalances and the factors causing them; Analysis of the mechanisms of occurrence and reproduction of imbalances; Establishing connections and interdependencies between the problems of the territory; Identification of key problems, dividing problems into external ones, characteristic of the entire country, and internal ones, inherent only in this particular territory; Formulate the boundaries of possible intervention by authorities at a given level of government to solve problems that have arisen; Identify factors that can be used to resolve problems; Set the time required to solve a particular problem; If, as a result of the analysis, problems are identified that have arisen due to imbalances in mechanisms external to a given territorial level, then they are recorded and, with a brief analysis, transferred to higher levels, along with their vision of optimal resolution.
2. Analysis current situation. (identification of competitive development opportunities)	It is necessary to modernize the education system, which is the basis for dynamic economic growth and social development of society, a factor in the well-being of citizens and the security of the country. Competition between different education systems has become a key element of global competition, requiring constant updating of technologies, accelerated development of innovations, and rapid adaptation to the needs and requirements of a dynamically changing world. The formation of a system of continuous education based on the introduction of a national qualification framework, a qualification certification system, and modular programs will make it possible to make the most effective use of human potential and create conditions for self-realization of citizens throughout their lives. Involvement of students and teachers in fundamental and applied research.	Formulation of goals and strategies: Based on the analysis of internal problems, a variety of development goals are formed; The formulated goals are checked for consistency with each other, as well as with the development goals of higher levels; The maximum number of areas in which it is possible to achieve the set goals is being developed; An analysis is carried out of alternative sources of resources, economic levers, structural changes, economic and other incentives, etc., their possible combination and sequence of use to achieve goals. Thus, simultaneously with the development possible directions In order to achieve each goal, the requirements for its implementation mechanisms are formed and justified. The general goal of this stage is to highlight the most significant measures and ensure sufficient concentration of resources in priority areas, preventing their dispersion.
3. Establishing the main strategic directions for the development of the municipality (the strategic plan itself)	Implementation as a priority national project“Education”, as the openness of education to external demands, application design methods, competitive identification and support of leaders who successfully implement new approaches in practice, targeting of resource support tools and the comprehensive nature of decisions made. Increasing the flexibility and diversity of forms of provision of preschool education services will ensure support and more complete use of the educational potential of families.	strategies are analyzed from the perspective of: Achieving previously formulated goals; Changes in the state of solved problems of the territory; Possible emergence of new problems and aggravation of existing ones.
4. Formation of a mechanism for implementing the strategic plan	Formation of a development management system, development of comprehensive programs and sectoral development strategies, development of programs for interregional and international, as well as intermunicipal cooperation, creating conditions for the participation of business and the public in the development and implementation of the Strategy to align it with the interests of the main “stakeholders”.	A comparative analysis of all selected feasible strategies is performed. The choice is made using a system of criteria reflecting: Efficiency of resource use; The versatility of the strategy, i.e. the ability to adapt to changes in the external environment; Complexity of development; Realizability of the main functions of this level.

Conclusion

The adopted strategy should serve as the basis for the development of both long-term and operational decisions to manage the development of the territory. Therefore, the timing of the stages of its implementation and the main parameters that need to be achieved at each stage must be formulated.

Increased competitiveness Russian education will become a criterion of its high quality, and will also ensure the positioning of Russia as one of the leaders in the field of export of educational services.

As the Concept is implemented, institutional changes are carried out to ensure increased efficiency of spending budget funds in the education sector, current expenditure on education will increase. This will require ensuring an increase in the share of education expenditures in the gross domestic product.

The implementation of an innovative option for economic development involves an increase in total spending on education from 4.8 percent of gross domestic product (in 2007-2008) to 7 percent in 2020, including an increase in budget system spending - from 4.1 percent to 5.5 - 6 percent of gross domestic product.

Bibliography

1.4873_Koncepciya_dolgostrochnogo_socialnoekonomicheskogo_razvitiya_RF_do_2020

2. 4876_Uchebnoe_posobie_-_Akmaeva_M.I.

3. 6971_1._Uchebno-metodicheskii_kompleks

4. Ш 17 strategic planning economic science: textbook. - Ekaterinburg: Publishing house Ural.gos. econ. Univ., 2006. 172 p.

5. Home library and notes

2.1. Review of Strategic Management Schools

The first three schools have prescriptive(answer the question: how should strategies be formed):

Modeling based on comprehension and elaboration (design);

A relatively isolated formal planning process (planning school);

Selection of strategic market positions of the organization - positioning (examples of typical positioning strategies are given in Appendix 1 and 2).

The following six schools focus on specific aspects formation strategies (the main thing is a description of the actual processes of strategy development):

Penetration into the future through the insight of a manager (school of entrepreneurship);

Based on the logic of cognitive psychology, penetration into the consciousness of a strategist (cognitive school);

Developing a strategy step by step as the organization learns (learning school);

Strategy is the process of negotiations between conflicting parties outside and inside the organization (school of power);

The principles of strategy formation are determined by culture (school of culture);

The strategy is formed under external influence (the school of external environment).

Knowledge of various areas is useful when developing strategies:

Biology (disequilibrium and adaptation of species);

History (stages of evolution and revolution);

Mathematics (chaos theory);

Psychology (cognitive process and leadership in organizations);

Anthropology (cultural diversity);

Economics (knowledge of industrial organizations, planning processes);

Policies (principles of public policy);

Military history (strategy in conflict conditions).

2.2. Strategy as a phenomenon

What does the word "strategy" mean? Strategy is:

A plan, or something like that - a guide, a guideline or direction of development, a road from the present to the future;

The principle of behavior or following a certain model of behavior;

Position, namely the location of certain products in specific markets (creating a unique and price position through a variety of actions);

Perspective, i.e. the main way of action of the organization (this is the theory of business of this organization);

A deft technique, a special maneuver undertaken with the aim of outwitting an opponent or competitor.

Strategy affects the organization and its environment. It is never simple. It's content and process. It is impossible to think it through completely. It involves a variety of thought processes. The well-being of the organization depends on the strategy. The pros and cons of the strategy are given in table. 2.2.1.

Table 2. 2. 1

Advantages and disadvantages of strategy as a phenomenon

2.3. Strategic management as a scientific discipline

Strategic management is cyclical process consisting of procedures for formulation, implementation and control.

Strategic failures of modern Russian organizations largely due to superficial knowledge their leaders in the field of strategic management and lack of experience in carrying out strategic changes in the organization.

However, as G. Mintzberg notes, the latest information about the success of organizations in modern conditions don't fit into the frame any one school of strategic management. Moreover, to some extent the lack of strategy can be considered as some kind of benefit in for several reasons: firstly, thoughtful actions of the manager contribute to increasing the strategic flexibility of the organization (even without developing a strategy); secondly, rigid adherence to the strategic course leads to a loss of the ability to innovate (the “dogma” strategy kills the ability to learn and adapt); thirdly, the absence of formal elements of strategy ensures freedom from bureaucracy.

Theorists, those involved in management are more interested in processes and stages strategic development organizations, while for practitioners procedures for strategic change are important, as well as the macro approach of the school of power (the study of alliances, collective strategy) and the research of the cognitive school. IN last years The popularity of training school approaches is increasing in terms of so-called self-learning organizations and key success factors (core competencies).

The main issues are determining the content of the strategy and the degree of control over the process of its creation. There are eight main issues to consider here. The first three address the problems of the content of the strategy, the rest are related to the process of its formation.

1. The problem of complexity lies in the answer to the question: how complex should a good strategy be? On the one hand, it must reflect the diversity of the reality around us, and on the other, like everything ideal, it must be simple. Truth is where the optimal degree of generalization is ensured.

2. Integration problem strategy lies in the fact that the school of positioning and planning basically contains a set of loosely interconnected components. Proponents of other schools of thought see strategy as a single, fully integrated perspective. Integration of strategies is carried out either formally (integrated plans), or mentally (imaginary vision), or normatively (cultural norms), or through mutual adaptation (team cohesion), etc.

3. The problem of strategy standardization touches on aspects of the novelty and uniqueness of the strategy: the strategies of the school of entrepreneurship and culture are unique and express the specific position of a person; all school learning strategies are products of individual adaptive processes; design strategies are unique because they are created during the personal process of their development, etc.

According to experts, new strategies are more complex than standard ones, more integrated and therefore less flexible. Obtaining new strategies requires managers to focus their attention on the unique properties of the organization.

Standard strategies are simpler in content (they are easier to formulate, the content becomes the center) and are more flexible and universal.

4. Control problem behind the process of creating an effective strategy (in terms of the degree of its thoughtfulness or the formation of the organization’s activities). It is important to imagine how planned, thoughtful, intelligent, centralized and controllable this process is. For example, all prescriptive schools and the school of entrepreneurship promote the idea of predestination, thoughtful strategies, while the school of instruction gives preference to the formation of strategy “as you go.”

5. The problem of collective interaction reflects the interaction of the leader (strategist), the team and the external environment of the organization.

According to representatives of the school of design and entrepreneurship, the strategist is one person, and representatives of the school of learning, political forces and culture view the creation of strategy as a collective process. Representatives of other schools believe that strategy is formed by the forces of the external environment (the school of external environment), methodology (the school of planning), analysis (the school of positioning) or the mind as a biological phenomenon (the school of cognition).

That is, it is important to determine: is strategy formation an individual, technical, physiological or collective process, and is it a process at all?

6. The Problem of Change is divided into three parts (Table 2.3.1.): the problem of the source of changes, the presence of these changes in the organization and the problem of determining the nature of the changes (under what conditions they occur).

These problems are caused by the fact that organizations must simultaneously develop and remain stable. Therefore, it is important to determine how organizations provide a combination of order and adaptation to changes in the external environment, the effectiveness of the organizational structure and the internal innovation of employees. The driving force for developing a strategy (model of organizational change) is the desire of employees to ensure the stability and sustainability of the organization, which is also a contradiction.

Table 2.3.1 Distribution of strategic change issues

Obviously, due to the differences in organizations, the strategic changes carried out in them are always varied, as are the conditions for implementing such changes, which makes it difficult to determine the content of the changes themselves.

In the process of developing strategic decisions and implementing changes, not only the form, but also the content of the organization changes as a self-learning system in the process of activity (as the school of training claims); thinking (design school); standardization of activities (school of planning); analysis of the external and internal environment (positioning school) or discussion of problems (power school). However, the ability of systems to self-learn is a specific property and is not inherent in all organizations at the same time.

7. Problem of choice consists in the presence not only of choice as such, but also of the number of alternative options for the strategic development of the organization. At the heart of the choice problem is the human factor: the power of proactive leadership, individual intuition, collective learning.

8. Problem of thinking due to the fact that, carried away by the process of strategy formation, organizations lose control over it (forgetting about the urgent need for strategic thinking in the first place, and secondly in specific actions that ensure the development of organizations not so much in plans, but in reality).

Considering Strategy as a system It should be noted that the diversity of approaches and schools indicates the period of formation of strategic management as an independent scientific discipline and type of activity of practical workers. To move forward, we need new generalizing hypotheses and development of problems of strategic management of organizations.

Structural focus of schools strategic management (Fig. 2.3.1) is determined by the structure of schools of strategies, consisting of three subsystems: a group of prescriptive strategies, a group of research into the process of strategy formation, and a group of combinations of these approaches.

Each of the named subsystems can be represented detailed subsystems(for example, prescriptive strategies consist of strategies based on the principles of planning, or regulation, standardization, and planning, in turn, can be represented by planning components based on a predetermined algorithm or the results of an analysis of the external and internal situation for a specific organization).

The main features of strategic management schools, reflected in table. 2.3.2, indicate that schools arose at different times (the interval is limited to only 40 years) and differ in approaches to the identification of the main persons receiving strategic decisions; the main content, features and strategic image of the organization itself.

Rice. 2.3.1. Structural diagram of the focus of strategic management schools

Table 2.3.2

Main features of strategic management schools

Strategy building as a mental process

If we really want to understand what a strategic vision is, how strategy is formed under the influence of various circumstances, we will have to make an attempt to penetrate the mind of the strategist. This is what the cognitive school insists on (it is also the school of cognition), whose supporters, relying on cognitive psychology, analyze the strategic process from the point of view of human cognitive abilities.

In the last ten to fifteen years, this school has attracted the attention of a number of well-known researchers, collaborating with representatives of other areas (for example, with the school of positioning on issues of cognition in strategic groups and business sales strategies of companies (divestments)). M. Lyles' review notes that this area of strategic management research gained particular popularity in the 1980s. (Lyles, 1990).

The works that we will turn to form not so much a single scientific school as a collection of unrelated studies, which does not prevent, however, from combining them into one direction. If their authors successfully cope with this task, it is quite possible that both the teaching and practice of strategic management will soon change.

Only God knows what was going on in the minds of managers before the appearance of these works - a whole wave at the same time. Researchers were more interested in the requirements for thinking and the conditions for its implementation (for example, what does a strategist need to know?) than in the thought process itself. And despite all the efforts of the school of knowledge, we are still far from understanding those complex and creative acts that result in strategies.

This is why strategists are mostly self-taught: they build, largely through acquired experience, their own knowledge structures and mental processes. Experience forms the circle of their knowledge, which in turn determines the actions of individuals, which enriches them with new experience. The research of the cognitive school is based on this dualism, and it becomes the starting point for its two completely different branches.

The first, more positivist, interprets the processing and structuring of knowledge as an attempt to create some kind of objective (film) picture of the world, when cognitive abilities are considered as a kind of movie camera. Peering into the world, at the will of the operator, she enlarges or reduces images, which, according to cognitive scientists, do not completely convey objective reality.

Another branch insists on the subjectivity of knowledge, considering strategy as an interpretation of the world. The mental gaze rushes inward to understand how the mind forms opinions regarding what it sees - events, symbols, customer behavior, etc. Thus, if the first branch perceives cognition as the reconstruction of the world, then the second, removing this prefix, believes that knowledge creates the world.

Notice how this chapter fits into the book: it bridges the gap between the objectivist schools of design, planning, and positioning and the subjectivist schools of learning, culture, power, environment, and configuration. In accordance with this division, we begin our consideration of the cognitive school with its objectivist branch, namely with research on (1) the bias of knowledge or the limits of the cognitive abilities of a strategist, (2) strategic cognition from the point of view of information processing and (3) the structuring of knowledge by the mind. Then we will turn to the subjectivist branch, to the interpretation of strategic cognition as a design process, and finally we will talk about the shortcomings of the cognitive approach as a system of views on strategic thinking.

Confusion in the process of cognition
Scientists have long been fascinated by the quirkiness of information processing and decision-making and, above all, by the biases individuals exhibit in it. Management scholars are particularly inspired by the brilliant work of Herbert Simon (1947, 1957; March and Simon, 1958), a political scientist long years who worked at the business school and then at the psychology department of Carnegie University, laureate Nobel Prize in economics in 1978, G. Simon promoted the idea of the greatness and complexity of the world, in comparison with which human brain and his information processing abilities appear negligible. Decision making is thus not a rational process, but a futile attempt at rationality.

Influenced by the work of G. Simon, numerous studies appeared on the dominant tendencies in human thinking (see in particular, Tversky and Khaneman, 1974), the results of which are summarized in the work of S. Makridakis (1990) and are briefly presented in table. 6.1. All these studies are of undoubted importance for understanding the strategic process, because they are focused on finding answers to questions about why, for example, human consciousness first of all “snatches” and “assimilates” facts that confirm (but do not deny) the already established belief system, why our mind prefers to “use” recently received rather than long ago received information, why we so easily accept wishful thinking, etc. In his review, S. Makridakis pays considerable attention to what he calls “unfounded opinions or truisms." For example, he writes:

We are raised in a culture in which the truth of certain statements is never questioned, even though it should be. For example, we believe that the more information we have, the more informed decisions we will make. Empirical evidence does not support this conventional wisdom. In fact, an increase in the amount of information simply increases our conviction that we are right, without in any way affecting the correctness of the decision itself... Very often, huge amounts of information are redundant and do not have the slightest value for the decision-making process (38).

Table 6.1. Trends in decision making
Source: Makridakis, 1990:36–37

Trend type	Description of the trend
Finding supporting data	Willingness to collect facts in favor of certain conclusions and neglect of other facts that threaten these conclusions
Inconsistency	Failure to apply the same criteria in similar situations
Conservatism	Inability to change (or gradually change) one's own opinion when new information/facts appear
Novelty	The most recent events dominate over older ones that are no longer of interest or are ignored
Availability	Tendency to rely on isolated events that are easily recalled in memory to the detriment of other relevant information
Binding	Forecasts are overly influenced by initial information, which is considered the most significant
Deceptive Relationships	Belief in the obviousness of certain patterns and/or a causal relationship between two variables that are not actually related to each other
Selective perception	People tend to see problems through the lens of their own position or experience
Regression dependence	The sustained growth [observed in some phenomena] may be explained by randomly selected causes which, if the explanation turns out to be correct, increase the likelihood of a subsequent decline. Conversely, a prolonged downturn may [increase] the chances of [subsequent] growth
Explaining success and failure	Success is attributed to skill, and failure is attributed to bad luck or someone else's (not your) mistake. This prevents a person from learning from failures and realizing their own mistakes.
Optimism, wishful thinking	A person’s desired outcome influences his or her prediction of that outcome.
Underestimating the unknown	Excessive optimism, misleading correlations, and the need to reduce anxiety lead to an underestimation of future uncertainty.

Analogies and metaphors, which, as we saw in the previous chapter, can enrich thinking, often have the opposite effect, simplifying and narrowing the scope of the search for solutions (Schwenk, 1988; Steinbruner, 1974). A. Duhaime and K. Schwenk (1985) tried to answer the question of how these and other distortions affect decisions about the acquisition of companies and divestments (sale of a business):

Thinking by analogies. The authors give an example when “company management plans to acquire a company that, “like the fourth leg of a stool,” will maintain a high level of profit. This image, or analogy, tells managers that the business of the takeover candidate has nothing in common... with the current activities of the company..." (289).
The illusion of power. “Decision makers often overestimate their own influence over the consequences of the purchase and may believe that under their leadership the firm will successfully cope with problems should they arise” (289). This approach, although it reduces concerns about the decision being made, is fraught with problems.
Escalation of participation. Escalation of involvement “involves a sustained increase in capital investment under pressure from unsatisfactory performance” (291). B. Staw (1976) develops this approach in the article “Knee-deep in troubled waters Missouri, which tells the story of how, despite repeated setbacks, the US government became increasingly drawn into the Vietnam War.
Consider one possible outcome. “There is evidence that if divestment is considered as one of the possible outcomes of the “fate” of an unprofitable business, then this option may soon turn into the only alternative considered... Thus, decision makers reject in advance alternative options that are undesirable for them, which is significant relieves the pressure that is inevitable in a poorly structured decision-making process” (292).

There are many facts known that confirm the hypothesis according to which organizations that are locked into a certain pattern of behavior based on a certain vision of the situation act less and less effectively. In other words, the motto of the cognitive school (both of its branches, as we will see later) can be the words: “I will see it when I believe in it.”

Indeed, activity can also influence understanding. Recall Kiesler's (1971) insight that the very act of defining a precise approach to a problem generates resistance to changing it (see Chapter 2). Compare this behavior with the behavior of people who do not discuss their upcoming actions. In other words, a person who has clearly formulated a strategy is psychologically opposed to changing it. K. Kiesler's experiments concerned one person, a single mind; Imagine what will happen in the multitude of consciousnesses that make up the organization. Hence the popular term “groupthink” (Janis, 1972). “Often the strongest resistance to beneficial change comes from the most loyal, well-meaning members of an organization” (Reger et al., 1994:567).

Of course, every strategist has his own individual cognitive style, so psychologists who study such characteristics of human behavior as “cognitive complexity” and “openness to new ideas” make significant contributions to our understanding of the process of creating strategies. Perhaps the most famous method is the personal classification method of I. Myers-K. Briggs (Myers, 1962) based on the typology of Carl Jung. The authors formulate four pairs of opposing dimensions:

Extroversion (a person is prompted to action by the external world) - Introversion (actions are taken under the influence inner world individual).

Sensing (consciously perceived and rationally processed information) - Intuitive (INtuition) (information as a result of an attempt to comprehend the most important principles).

Thinking (decisions are based on an analysis of the situation) - Feeling (decisions are made based on individual feelings).

Rational (Judgement) (pre-planned, orderly, controlled lifestyle) - Irrational (Perception) (spontaneity, flexible lifestyle).

Combining the characteristics, we get sixteen cognitive types or styles. For example, the ESTJ (Extroverted Thinking and Understanding) type includes people with a logical, analytical, objective, critical mindset; those who can be convinced solely with the help of reasonable arguments... They like to systematize facts... But at the same time, “when making decisions, they often take risks without burdening themselves with a thorough analysis of the situation” (10). In contrast, ESFP (extroverted sensing and sensing) individuals are “friendly, adaptable realists... trusting only what they see with their own eyes, hear with their own ears, know first-hand... Their flexibility helps them solve problems... [but ] they don’t always follow standard procedures or take the easy route…” (19). If these two definitions resemble the strategists of the schools of positioning and training, respectively, then individual style strategist can help us better understand different approaches to strategy building.

Cognition as information processing

In addition to tendencies, or inclinations, significant influence Individual cognition is influenced by a collective information processing system called an organization. Managers are information workers. They obtain information for themselves, their colleagues and higher managers, which creates all sorts of problems in organizations, especially large ones. Top managers do not have enough time to personally deal with all issues, so they are forced to generalize and group the information they receive as much as possible, which can lead to distortions (especially since the original data is not entirely reliable anyway). If the initial information was influenced by all the trends mentioned above, then one can only guess how objective it will appear before the “boss”. It is not surprising that senior managers often become hostages to the organization's dominant information processing system.

In accordance with the model of “parallel” information processing by P. Corner, A. Kinicki and B. Keats, people and organizations process information using the same principles (Corner, Kinicki, Keats, 1994). Information processing begins with concentration of attention, then it is encoded, memorized, and information search occurs; the culmination of the process is the selection of information and completion - the evaluation of the result obtained (see Fig. 6.1).

ATTENTION. At the attention stage, the data that will be processed is determined (a kind of secretary who selects incoming correspondence in order of urgency, delaying some messages and immediately delivering others).

CODING. Coding gives meaning to data because it is a search for matches between information and existing categories, for example, that someone is a “customer” rather than just a “visitor.” Of course, such categories are often a source of bias, since they do not take into account nuances, and any of them risks becoming a stereotype. The main thing for the entire process of information processing is the structure of general knowledge, thanks to which a single frame (scheme) of interpretation becomes dominant. P. Korner and his co-authors distinguish two types of “agreement frames”: newly emerging and entrenched. “Emerging frames are arranged in such a special way that it is possible to decide new problem or a question." Forming them takes time and takes up cognitive energy, but once frames are built, a person receives a strong incentive to continue using them. Thus, the emerging frame gradually turns into an established one. Later, it can be used “automatically when interpreting strategic information, regardless of its relevance. In this case, before building a new frame, the top management team will have to somehow get rid of the old one” (300).

STORE/SEARCH. The cognitive process begins with the work of memory. If we talk about an individual person, then his memory is a network of associative connections between various units of information. In organizations, these connections are connected to patterns of behavior, rules, procedures, regulations and technologies. A person and an organization are connected by socialization, when a company voluntarily and forcibly encourages an individual to accept its existing practices. Later, this practice becomes part of the person’s own memory and his cognitive abilities are “tuned to the organizational wave.”

CHOICE. Choice is a complex process of moving forward and retreating, moving from one stage to another, until a firm decision is made. Often it seems as if a decision has been “made”, but in reality it always arises unexpectedly. A category such as “decision” helps to determine further actions, and continue to collect information, but it cannot be considered in isolation (see “How is a decision made?”).

RESULT. Receiving the results of information processing means the beginning of the feedback process. Individuals and organizations recognize the value of their choices and connect this understanding to ongoing information processing—namely, the attention, encoding, storage, and retrieval associated with the next choice.

Rice. 6.1. Model of parallel information processing when making strategic decisions

Any strategy is always associated with the creation and implementation of changes and implies an unconditional focus on the future, and not on the past or present. Focusing on the future means understanding how the economy in the future will differ from the present, what new products may appear in the future, what new technologies may be introduced, and how competitors will act differently in the market. The strategy must reflect how the organization can identify competitors, that is, how to act faster, bigger and wiser than them.

There are five “P” strategies:

1. Strategy is a plan or guideline for development, or a road from the present to the future.

2. Strategy is a principle of behavior or following a certain model of behavior.

3. Strategy is the position, the placement of certain products in competitive markets.

4. Strategy is a perspective, the main way of action of an organization.

5. Strategy is a clever technique, a special “maneuver” with the goal of outwitting an opponent or competitor.

The evolution of strategy schools unites ten well-known schools: the design school, the planning school, the positioning school, the entrepreneurship school, the cognitive school, the learning school, the power school, the cultural school, the external environment school, and the configuration school.

1.Design school. The main idea of the design school is the consistency of the internal and external capabilities of the organization, its use competitive advantages, SWOT analysis (organizational strengths, weaknesses, opportunities and threats). The motto of this school is “establishing conformity.” Strategy is viewed by representatives of this school as a deliberate process of conscious thinking.

2. School of planning. Views strategy formation as a formal process. The greatest influence on the formation and development of this school was exerted by Igor Ansoff, outlining its main provisions in the book “Corporate Strategy”, published in 1965.

3.Positioning school. This school argues that for each industry there are a limited number of strategies that can achieve desired results, that is, key strategies. A significant contribution to the development of this school was made by M.Porter with his book Competitive Strategy, published in 1980.

4.School of Entrepreneurship. Studies strategy as a process of foresight that arises in the mind of the head of an organization (the manager is perceived as a leader).

5.Cognitive school. Proponents of this school analyze the strategic process from the point of view of human cognitive abilities. According to representatives of this school, strategies originate as perspectives in the form of concepts, maps, and diagrams that involve obtaining information from the environment.

6. School of training. This school is based on descriptions of the external environment of the organization. The best “learner” in an organization should be its leader. The learning process must be evolving. Strategic initiatives are carried out by those who have the ability and resources to learn.

7. School of power. Interprets the process of strategy formation as an open struggle for influence, with special emphasis on the importance of using power and political methods. By the term power, representatives of this school designate influences that go beyond the boundaries of pure economics (including economic power).

8. School of culture. Considers the construction of strategy as a collective process, calling the source of strategy formation the social power of culture. Representatives of this school associate organizational culture with collective cognition.

9. School of external environment. Approaches strategy building as a reactive process. This school seeks to balance the general idea of strategy formation taking into account changes in the external environment, management opinions and the state of the organization itself.

10. School of configuration. This school is ready for the general reconciliation of all other schools, believing that configuration (change in the state of the organization) should be followed by transformation (transition of the organization to a new state).

The listed schools, in turn, can be divided into three groups (considering that all schools cover the same period of time - from 1960 to 1995). The first three schools are prescriptive in nature - their adherents are more interested in how strategies should be formed, rather than how they are actually developed.

Plan

Introduction

Schools of Strategic Management

School of culture and its features

Toyota's experience in applying the ideas of the school of culture

Conclusion

List of used literature

Introduction

Strategic management is a recent concept that has emerged in the practice of general management. One of the main problems that strategic management solves is the problems of growth and survival of enterprises and organizations of any size and form of ownership, and today, when small businesses play such a significant role, their need for strategic management cannot be neglected. In strategic management, the main task is characterized by two main principles: the formation of an enterprise development strategy and its application in real market conditions. As in every scientific discipline, in strategic management there are various directions that, although they share the general basic principles of the discipline given above, nevertheless, place research emphasis differently, highlighting certain methodological priorities. Such directions are called scientific schools, in the case of strategic management theory - schools of strategic management.

Schools of Strategic Management

Before focusing on any one school of strategic management, it is worth considering all existing ones.

Schools of strategic management, according to the classification proposed in the work of G. Mintzberg, with some degree of convention, can be combined into two groups:

attributing

describing

The main tasks of prescriptive schools are to substantiate methods for developing strategies that ensure an increase in the competitive status of the organization. Within the framework of these schools, strategies act as something logically explicable, dependent on the will of the leader and, if applied correctly, unambiguously guaranteeing the success of the organization.

Describing schools set as their main task the most reliable description of the process of developing and implementing strategy as it is. Any recommendatory conclusions can be made only on the basis of an analysis of actually existing models.

Let's look at the main features of each school.

PRESCRIBING SCHOOLS:

1. School of Design (Andrews, Chandler). In general terms, the design school proposes a model of strategy as an attempt to achieve a match or correspondence between internal and external opportunities, i.e., according to this school, economic strategy should be understood as a match between the characteristics of the company and those opportunities that determine its position in the external environment. A typical example of a tool used within a design school is the SWOT analysis.

2. School of Planning (Ansoff, Lorange). This school views strategy as a conscious planning process, formally reflected in appropriate diagrams, tables and supported by appropriate methods, which is developed by specially trained people. The school's approach is based on the methodology of using the “balanced scorecard” (BSC)

3. School of positioning (Porter). The basic position of this school is that strategies are generic, specifically general, market positions that are both economic and competitive. The main task of management is to correctly position the position of the company or business, which automatically leads to the emergence of a “ready-to-use strategy.” One of the main models of this school is Porter’s competition model, a typical tool is the BCG matrix (Boston Advisory Group).

DESCRIBING SCHOOLS:

1. School of Entrepreneurship (Schumpeter) - considers the process of developing and implementing strategy as a vision or vision that is forward-looking (future); back (past); into the internal environment of the organization; into the external environment, etc. Moreover, this vision is based on intuition, entrepreneurial ingenuity and is expressed in goals that are intuitive to the manager.

2. The cognitive school (Simon) considers the process of developing and implementing a strategy as a thinking process that takes place in the mind of the strategist, which means that strategies originate as perspectives and their basis is information that is appropriately encoded and circulates between team members according to certain laws

3. School of learning (Lindblom) - considers the strategic process as an adaptation to unpredictable changing environmental conditions. Ideas that contribute to this can arise from any individual, regardless of his place in the organizational hierarchy. Consequently, the manager’s task is to create an organizational culture that promotes the selection and promotion of ideas that contribute to the adaptation of the organization.

4. School of power (Kayert, March) - strategy is considered as the result of the interaction of people pursuing their own selfish interests. For this purpose, formal and informal alliances are created, groups seeking to gain control over as many resources as possible. Strategy in this case is the resultant between the interests and actions of various groups.

5. The school of external environment (Meskon) takes the ideas of the positioning school to logical absurdity, considering strategy as the resulting impact on the organization external forces. According to this theory, organizations exist in certain limited, relatively stable conditions - economic niches. When a niche ceases to exist, organizations die or are transformed beyond recognition.

6. School of configuration (Miller) - largely generalizes the developments of previous schools and considers organizations as objects in whose existence periods of stability are replaced by periods of major changes. This allows us to formulate a certain eco-cycle of the organization, at different stages of which different strategies are effective.

School of culture and its features

As part of this report, we will take a closer look at the school of culture (Pettigrew).

Each political system, as a rule, is characterized by a certain ideology (capitalism, socialism, etc.). Each society and ethnic group is characterized by a unique culture (Japanese, Californian, etc.). Thus, both industries and individual companies can have their own culture. Culture within an industry is the unique way in which organizations produce their products, what distinguishes one organization from another, one industry from another. It becomes, so to speak, the “opinion of the organization,” general beliefs that are reflected in traditions and habits, as well as, more tangibly, in the organization’s lore, its symbols, even its buildings and products. In a sense, culture represents the life force of an organization, the soul of its physical body. The pervasiveness and uniqueness of a given organization's culture can also be found in relation to its unique management strategy.

The main premises of the school of culture:

Strategy formation is a process of social interaction based on shared beliefs and understanding among organizational members.

An individual's beliefs are the result of processes of familiarization with a particular culture or socialization, usually not explicitly expressed and non-verbal, although sometimes reinforced by more formal education.

Consequently, organizational members are only able to partially characterize the beliefs on which their culture is based, while its sources and explanations may remain obscure to them.

As a consequence, strategy takes the form primarily of a perspective and only secondarily of a position, rooted in collective aspirations (not necessarily expressed) and reflected in models that protect the deep resources and capabilities of the organization that form the basis of its competitive advantage. Thus, the main characteristic of strategy is predestination (even if it is not fully conscious).

Culture and especially ideology contribute, rather, not to strategic changes, but to the preservation of the current strategy; V best case scenario they allow for adjustments within the overall strategic perspective of the organization.

Of course, the ability of corporate cultures to be a source of resistance to strategic change has long been known. Consequently, culture influences the choice of economic strategy of an enterprise. This demonstrates the connections between these concepts:

1. Decision-making style. Culture acts as an eternal filter, consistently filtering out premises for decision-making. In other words, organizations with different cultures, but operating in the same environment, perceive the external environment in their own way and see only what they want and are ready to see: the organization develops a “dominant logic” that acts as an information filter, which emphasizes in the process of creating strategy some data and ignores others.

2. Resistance to strategic change. General commitment to certain views promotes consistency in organizational behavior and, therefore, prevents changes in strategy. An organization's dominant deep beliefs and implicit assumptions (culture) are the most powerful internal barriers to fundamental change.

3. Overcoming resistance to strategic change. A radical change in strategy must be driven by fundamental changes in culture associated with the gap between the organization's belief system and the characteristics of the environment.

4. Dominant values. The central concepts of enterprise culture should be 7 core values: strategy, structure, system, style, employees and special knowledge/experience. According to scientists, the success of an organization is determined by the harmonious combination of all these values.

5. Cultural contradictions. The uniqueness of the culture of any and every organization makes it problematic to implement merger and acquisition strategies (“Merger Wave of the 1980s”).

Now let us turn to the material side of culture: its economic problems. The idea that production systems, rather than products, compete in the market is not new. Economists have long understood that the efficiency of the production system plays a major role in competition. But they never realized the importance of the characteristics of competitive advantage - that uniqueness becomes the defining aspect of strategic superiority. A unique product occurs when “man-made objects reflect, consciously and unconsciously, directly or indirectly, the beliefs of the people who order, make, buy or use those objects and, more generally, the beliefs of the communities to which those people belong.” Consequently, deep cultural differences among competitors may give one firm a competitive advantage based on the culture of that firm. For example: early automobile production. The car was invented by Europeans as a luxury item available only to the rich. They established almost serial production of cars, while depriving a large number of people of the opportunity to buy them. The Americans managed to standardize the car and make it available for mass production, i.e. made it accessible not only to rich people. Many European firms tried to get around the Americans by adopting their methods, but even after copying one or another fragment of the mosaic, they were unable to put them together into a “harmonious picture.” Thus, we can see that the concept of competitive advantage is to some extent based on essentially cultural concepts.

Based on the foregoing, it can be argued that a unique culture is an inimitable resource of an organization. There are two reasons why this resource is unique and makes it the most effective barrier to imitators. First, culture produces unique results. Second, culture is characterized by causal vagueness, which makes it difficult to understand, let alone reproduce—even by its representatives themselves. So, for example, it is far from a fact that a “child” who has left the bosom of organizational culture will be able to accurately copy some of its resources for a competitor, which makes culture a kind of guarantee of strategic superiority.

The school of culture offers a common, agreed-upon ideology. In contrast to the individualism of the schools of design, cognition, and entrepreneurship, it introduces an important collective dimension of social process, considering both individual and organizational styles and challenging the popular tendency to fragment everything into separate parts - "agents" as part of "portfolios" - in favor of building a common perspective.

It should be noted that the cultural school has a number of disadvantages:

1.Conceptual vagueness, i.e. the concepts and categories of a given school change with amazing speed, and they are not always significantly different from each other.

2. Denial of the need for change. Its representatives advocate constancy in management and sustainable movement along the planned course. Culture is strong, durable, formalized; resources are established and deep. By emphasizing the importance of tradition and unanimity, characterizing change as very difficult, the cultural school in a certain sense contributes to stagnation.

3. Strategic advantage is equated with organizational uniqueness. It's great to be different, but when being different becomes an end in itself, being different leads to overconfidence.

4. The problem of imbalance. The organization needs not just an adjustment, a calm that comes after an obsession with external competition and a shift in emphasis to internal resources, but a sense of balance between all the necessary factors.

Toyota's experience in applying the ideas of the school of culture

An example of the effective use of the school of culture is the Toyota company. Since the founding of Toyota, their core principle has been to benefit society by producing high quality products and services. Business practices based on this principle have shaped the values, beliefs, and practices that have enabled the firm to achieve competitive advantage. The combination of these working methods and value orientations of management represents the Toyota approach.

The conditions for Toyota's success in achieving its goals are management's commitment to certain principles that make up the Toyota approach, appropriate training and production culture. The principles can be grouped into four sections:

Section I: Long-Term Philosophy

Principle 1: Make management decisions with a long-term perspective, even if this is detrimental to short-term financial goals.

Section II. The right process produces the right results

Principle 2: A continuous flow process facilitates problem identification (for example, by creating a flow of products or information and creating connections between processes and people so that any problem is identified immediately).

Principle 3: Use a pull system to avoid overproduction. (a just-in-time system is used, inventory and work in progress are minimized).

Principle 4. Distribute the amount of work evenly: work like a tortoise, not like a hare. (eliminating overload of people and equipment and smoothing out uneven production schedules to avoid rush jobs and downtime).

Principle 5: Make stopping production to solve problems part of the production culture when quality requires it.

Principle 6. Standard tasks are the basis for continuous improvement and delegation of authority to employees (increases coherence of work, makes product output more uniform, accumulation of experience by employees).

Principle 7. Use visual inspection so that no problem goes unnoticed.

Principle 8: Use only reliable, proven technology (reject or change technology that goes against the culture and may undermine stability, reliability, or predictability).

Section III. Add value to the organization by developing your employees and partners

Principle 9. Develop leaders who thoroughly know their business, profess the company's philosophy and can teach it to others.

Principle 10: Develop exceptional people and teams that embrace the company philosophy (create a strong, sustainable culture with lasting values and beliefs that everyone shares and accepts).

Principle 11: Respect your partners and suppliers, challenge them and help them improve.

Section IV. Constantly solving fundamental problems stimulates lifelong learning

Principle 12. To understand the situation, you need to see everything with your own eyes (your thoughts and reasoning should be based on data that you have checked yourself).

Principle 13. Make a decision slowly, based on consensus, after weighing all possible options; when implementing it, do not hesitate.

Principle 14: Become a learning organization through relentless self-reflection and continuous improvement (protecting the knowledge base of your company's organization, preventing turnover, ensuring the gradual advancement of employees and preserving the accumulated experience).

A striking example of the effectiveness of Toyota principles is the history of the joint venture between Toyota and GM - the NUMMI company. This was Toyota's first plant abroad, and the company did not want to work without partners. Toyota agreed to teach GM the principles of its production system. Toyota proposed to organize production in accordance with the principles of the Toyota approach at the old GM plant. At first, local workers were hostile to the Japanese ideas. They believed that the company's ideology was to force them to work their butts off, and that Japanese managers did not expect anything from them other than increasing production. In addition, the plant where the production was located was famous for its militant union, which could easily stall the work of the joint venture between Toyota and GM. GM management offered to “put the union in its place.” However, contrary to expectations, Toyota management did not intend to suppress the activities of the union. On the contrary, they decided to instill in the leaders of the trade union movement the cultural values of Toyota, changing their opinion of the company from negative to favorable. GM was surprised by this. Some of those involved in union relations advised against this. But the Toyota team decided to take a risk. They understood that former GM workers needed leaders, and the shop committee was made up of natural leaders. Managers had to change their minds and their attitude. They sent a shop committee to Japan for three weeks. Union representatives saw with their own eyes what the Toyota Production System is. They returned converted and convinced skeptical workers that the Toyota production system was not so bad. This is how the trust of the workers was won. Over time, the old plant, which reopened in 1984, outperformed all GM plants in North America in productivity, quality, floor space and inventory turnover. In 1987 and 1988, GM had problems selling the Nova model and orders to the plant were cut. The company had to cut production and use only about 75% of capacity, but no one was laid off. Toyota created groups that focused on skill development and found other rewarding jobs for people to do. Of all the things they did at NUMMI, this was the most important step to build trust. As GM became more familiar with Toyota's principles, they began to treat NUMMI more like a training laboratory. Hundreds of General Motors executives, managers and engineers came here in order to get acquainted with them and return to GM as new people. Thus, GM's "global production system" is an exact replica of Toyota's production system.

Unfortunately, it took GM about 15 years to fully learn the lessons of NUMMI. And when GM finally took them seriously, it took another five years to figure out what it meant to improve efficiency and quality companywide.

The question may arise: “Why would Toyota teach the coveted lean manufacturing system to its main competitor, GM?” Toyota had enough reasons to create this joint venture. And one of them was that Toyota understood the difficulties that GM faced in the production process. By helping GM take production to the next level, Toyota was helping communities and people and helping to create good-paying jobs for Americans. Top Toyota executives say the United States helped Japan rebuild its industry after World War II and they want to return the favor. These are not empty words or naive idealism. They really mean it.

Is Toyota Conservative? Yes. Is it easy for her to make changes? Not always. Is her approach innovative? Undoubtedly. In this sense, Toyota itself operates on the principle of “ and wherein", which Suzuki spoke about: take your time, rely on the experience of the past, comprehensively weigh the consequences of your decisions and wherein act with energy and assertiveness to defeat competitors, offer the market exceptional products of the highest quality and break stereotypes. This is Toyota's approach. This is her culture.

Conclusion

From the point of view of the cultural school, strategy is the result of social interaction. It is based on shared principles among members of the organization, beliefs and "understandings". At the same time, in assessing development options and methods for achieving goals, it is not so much formal efficiency that is important as the often unconscious ideas of members and the team about the correct actions. The role of management in this case is predominantly passive; it does not consist in developing a strategy as such, but in creating a certain microclimate in the team, which, as a rule, contributes to the conservation of existing strategies. It is worth noting that the disadvantage of the school of culture, like all other schools of strategic management of the describing group, is the impossibility or difficulty of using the results and recommendations obtained as a result of research in management practice directly, as well as the excessive emphasis on a lot of attention intuition and chance.

All schools of strategic management have gone through their own original paths of development. Therefore, each of them offers its own unique approach to developing a company development strategy. To achieve the best result in this matter, it is necessary to use as many methods offered by schools as possible, without understating or exaggerating the importance of any one of them.

List of used literature

1. Jeffrey K. Liker “The Toyota Way: 14 Management Principles for the World’s Leading Company”

2. J. Barney (Barney, 1986) "Organizational culture: can it be a source of sustainable competitive advantage?"

3. Mintzberg G., Alstrand B “Schools of Strategy” St. Petersburg, 2001. 336 p.

Contents Introduction………………………………………………………………………………………. 3 Chapter I Concepts of strategic management in modern conditions Concept of strategic management…………………………………………………….. 3 Evolution of theories of strategic management…………………………………………………… ………………... 4 Advantages and limitations of strategic management in the context of small and medium-sized enterprises……………………………………………………………………………………………… ……...6 The process of strategic management in small and medium-sized enterprises…………………………………………………………………………………………………………..8 Dynamic model of strategic management for small and medium-sized enterprises…………………………………………………………………………………...9 Chapter II Strategic management of small and medium-sized enterprises 2.1 The process of developing strategy in small and medium-sized enterprises…….……………….12 2.2 Strategic planning and business plan development……………………………...15 2.3 Implementation of strategy in small and medium-sized enterprises……………………………….20 2.4 Strategic control in small enterprises………………………………………………………30 Chapter III Strategic problems of small enterprises 3.1 Ignoring strategic management managers……………………….33 3.2 Strategic change management………………………………………………………….34 3.3 Approaches to strategic change management…………………… …………….36 3.4 SMEs in the process of globalization……………………………………………………………38 Chapter IV Introduction. LLC "UralItnvestTrade"………………………………………………………..40 1. Organization strategy of LLC "UralInvestTrade"...................................44 2. Strategic management of small and medium-sized enterprises…………………………….49 References……………………………………………………………….63

Introduction

Strategic management is a concept that has recently appeared in management practice. Strategic management primarily addresses the problems of growth and survival of large organizations, but at the present time, when small businesses play such a significant role, their needs for strategic management can no longer be ignored. Small business plays a very important role in ensuring economic prosperity, creating jobs, and developing technological innovation. Therefore, it is difficult to overestimate the importance of strategic management for the small business sector. Only recently have they begun to pay due attention to the study and analysis of this area of strategic management. Nowadays, many experts devote their research to the problems of forming and implementing strategies in small enterprises. Despite strong government support, many small businesses fail every year. And one of the primary reasons underlying the failure of SMEs is the widespread lack of strategic management skills and competence among SME managers. This, in turn, causes the inability to develop adequate business control and management systems. CHAPTER I Concepts of strategic management in modern conditions 1.1 Concepts of strategic management “Management of an organization” Rumyantseva Z.P., Salomatin N.A., Akberdin R.Z. et al., M.: INFRA-M, 1995, 103 pp. "Strategic Management" F. Analoui, A. Karami, M.: "Unity", 2005, 7 pp. So what is strategic management? What are its main components and is it different from other types of management? To answer these questions, various definitions of strategic management should be considered. In strategic management, the dominant paradigm is characterized by two main principles: strategy formation and its application. The main contribution to the development of these approaches was made by such outstanding scientists as Ansoff, Andrews, Porter. In general, the essence of strategic management is how strategies are developed and implemented. On the other hand, strategy formation is determined by how a company chooses to define its strategy and how it implements it through strategic management. Ultimately, it is the approach to strategy formation that determines the potential management style. On the other hand, managerial style and degree of effectiveness senior management management can in turn influence the process of strategy formation in organizations. As a result, a specific approach to strategic management is adopted. Only after a company has determined how it intends to shape its strategy can the strategic management path be effectively pursued. Strategy development can be either formal or rational, emergent or sequentially developing along a logical trajectory. Strategic management is called upon to manage the strategy development process and how and where the external environment of the organization's activities is analyzed - this precedes the choice and implementation of strategy. Before considering the strategic management process, it is useful to give it a definition. What is strategic management? Thompson states that the area that strategic management addresses is "the management processes and decisions that determine the long-term structure and nature of the organization's activities." This definition includes five key concepts: management process, management decisions, time scale, structure of the organization, its business. Ansoff and McDonnel distinguish between goal setting (concerning ends) and strategy (concerning means). Within the subject of strategic management, they define the same process as a systematic approach to managing strategic change, including positioning the firm through strategy and planning for its capabilities, real-time strategic response through issue management, and systematically monitoring employee resistance as strategies are implemented. This definition rather reflects an adaptive approach to strategic management. According to Johnson and Scholes, it is not enough to simply say that strategic management is a strategic decision-making process because strategic management is fundamentally different in nature from other aspects of management. Of course, these tasks are vital for the effective implementation of strategy, but they cannot be identified with strategic management. Johnson and Scholes believe that strategic management is not limited to making decisions on the major problems facing the organization, but also ensures the implementation of the developed strategy. They identify three main elements of strategic management: strategic analysis, strategic selection and strategy implementation. In contrast to this view, Stacey defines strategic management as the process of setting the fundamental goals or objectives of an organization, directed by top management. Within the framework of strategic management, senior management develops a series of decisions that allow achieving goals or objectives in the long term, while at the same time providing responses to problems that arise in the short term. Goldsmith argues that a new emerging subfield (strategic management) is beginning to view the implementation and evaluation of strategies as critical components of organizational success rather than as an analysis of the firm, its operating environment, and strategy formation. These are the stages of action and their evaluation within the strategic management process. He further concedes that “strategic management as a whole is a broad field of activity that involves planning strategy, implementing it, and adjusting or applying strategy to achieve desired results.” It is believed that the essence of strategic management lies in the setting of the fundamental goals of the organization, the selection of tasks that most contribute to the achievement of these goals, and the constant implementation of both of these functions. David believes that strategic management can be defined as the art and science of developing, implementing and evaluating cross-functional solutions that enable an organization to achieve its goals. This definition implies that strategic management focuses attention on the integration of management capabilities and techniques such as marketing, financial accounting, human resource management, production management and R&D in order to achieve organizational success. Thus, strategic management is a set of management decisions and actions that determine the long-term functioning of a corporation. Wheelen and Hunger argue that strategic management includes "scanning" the operating environment (both internal and external), strategy formation (strategic or long-term planning), strategy implementation, evaluation and control. The study of strategic management places particular emphasis on monitoring and evaluating external opportunities and threats in light of the strengths and weaknesses of the corporation. 1.2 Evolution of theories of strategic management “Strategic management” F. Analoui, A. Karami, M.: “Unity”, 2005, 57 pp. “Organization management” Rumyantseva Z. P., Salomatin N.A., Akberdin R.Z. et al., M.: INFRA-M, 1995, 19 pp. In order to understand strategic management, it is useful to briefly familiarize yourself with its history and consider key ideas. Strategic management developed from the teaching and study of business administration (business management). The roots of teaching strategic management can be traced to business policy, or general management, which by the 1960s had become a required course in business schools capping off business studies. Business policy educators were faced with the need to systematically understand the strategies used by companies, which ultimately led to self-study strategic management. From a research and analytical perspective, four periods of evolution of strategic management theories can be distinguished (Fig. 1). From a theoretical perspective, recent theories of strategic management (such as the resource-based view of the firm) have shifted the focus toward the internal aspects of the firm, whose characteristics constituted a major area of research in the early stages of strategic management development. The very first strategy researchers, Andrews and Ansoff, paid more attention to the content of the concept of “best business practices” that ensure the success of the company. Adherents of this trend were mainly interested in understanding the internal mechanism of development of the company, the so-called “black box”, and argued that the constant success of the company is a function of its internal and unique competitive resources. External Economics of organization industrial factors Focus on Organizational economics of organizational factors Internal Early period Resource approach factors Earlier hour Time Last time Fig. 1. Evolution of theories of strategic management During the next period of development of strategic management, both theoretically and methodologically moved away from the features of the early stage and switched attention to the economics of the industry organization. Beginning in the 1970s, research focused on the economics of industry organization, the theoretical foundations of which were laid by the works of Mason (1939) and Bain (1968). Hoskisson (1999) argues that this very transition to a new object of study from factors internal to factors external to the firm, namely the structure of the industry and the maintenance of competitive positions within it. The economics of industry organization examines the structural aspects of an industry, while work on strategic groups focuses primarily on the grouping of firms within an industry. In modern strategic management, strategic groups and competitive dynamics are very popular areas of study. At the third stage of the evolutionary development of theories of strategic management, a return to the company as an object of study is clearly visible. The renewed interest in the internal characteristics of the firm is evident in the emphasis placed on competitive dynamics and the firm's boundary relations with the environment. Strategic management has moved significantly closer to the firm and direct competitive rivalry between competitive companies within a competitive external environment. Finally, in recent times, the popularity of the resource-based approach has brought renewed attention to the internal domain of the firm. From a theoretical perspective, the resource-based approach centers on fundamental questions about the reasons for differences between companies and how they achieve and maintain competitive advantage. 1.3 Advantages and limitations of strategic management in small and medium-sized enterprises "Strategic management" F. Analoui, A. Karami, M.: "Unity", 2005, 14 pp. According to experts (Goldsmith? 1995; Bowman and Kakabadse, 1997) , the doctrine of strategic management contains the following main elements. · Look into the future. You should be aware of which markets you are currently operating in and which ones you want to enter in the future. · Pay unflagging attention to external factors - technological, economic, political and social. A balance should be established and maintained between these external factors and internal indicators of the organization. · It should always be remembered that strategic management is an interactive process. This is not something that can be done at the very beginning of work and then abandoned; strategic management involves feedback and constant accumulation of knowledge. These guidelines may seem like common sense, but that doesn't mean they're easy to follow. Strategy management is not a single event, but a process, and the successful implementation of this task requires actions with additional accompanying activities and subsequent refinement. Therefore, strategic management is concerned with those decisions that are related to the selection of a suitable market or product. It helps the firm's strategists better understand the current situation and develop the firm's goals and objectives. The question first becomes what the firm's current position is. The second question is what is her desired position. For example, in what market and within what characteristics of the external environment does the company operate? Then it is necessary to determine what its position will be after a certain period of time, for example, in a year, three years or five years. Finally, a set of tools should be prepared to carry out the intended tasks and achieve the goals of the organization. To be effective, especially in SMEs, the strategic management process does not always have to adhere to a strictly formal order. Research shows that firms that frequently use strategic management tend to be more successful than those that do not. Strategic management allows an organization to take preventative action, not limited to just reactive steps, and increases its preparedness to confidently face both controllable and uncontrollable situations. Strategic management provides a clear strategic vision and gives meaning to the firm's mission. Having a clear vision creates synergy and brings all the energy of the organization into one flow. This helps to effectively communicate the organization's plans to all employees, thereby ensuring that they are prepared to solve organizational problems. Strategic management allows you to assess the strengths and weaknesses of an organization and focus on strategically important areas. By assessing the effectiveness of strategy implementation, the organization receives the necessary information about how well the strategy corresponds to external environmental conditions; this allows us to understand the nature of changes occurring in the external business environment and introduce ethical aspects and corporate social responsibility into the strategic process. As already noted, despite the many benefits of using strategic management in SMEs, there are still managers who, for one reason or another, avoid its use. These reasons are as follows. Some SME managers may simply not understand the importance of strategic management to their business. They may lack the necessary knowledge in this area and information about the strategic process and its benefits for them and their companies. Some of them are simply not familiar with strategic management techniques. They may believe that it is only useful for large organizations, or they may not believe in long-term planning. Some SME managers may not have the management skills needed to initiate and maintain the strategic process while running a business. They may understand the benefits of long-term planning, but not know how to start the process. Finally, and quite importantly, many SME managers can be extremely busy with day-to-day activities. These routine duties can take up the hour needed for strategic long-term planning. A manager may be reluctant to spend time and money on strategic planning because he understands that it is still unknown what future developments will be. 1.4 The process of strategic management in small and medium-sized enterprises "Strategic management" F. Analoui, A. Karami, M.: "Unity", 2005, 57 pages. Does the process of strategic management in small and medium-sized enterprises differ from a similar process in large companies? What, in essence, is the process of forming and implementing strategy within a small business? According to Wheelen and Hunger, this same process does not fit into the framework of small business and new entrepreneurial ventures. Companies of this type must have a new mission, new tasks, new strategies and new policy , which should be the result of correlating external opportunities and threats with internal advantages and disadvantages. Therefore, these authors proposed a modified version of the strategic management model, which is more suitable for new entrepreneurial businesses. In Fig. 2 presents a strategic management model suitable for small businesses; it consists of the following interconnected steps (stages). · Development of the main business idea - a product and/or services that have a target consumer and/or target markets. Such a thought may arise from the experience of an entrepreneur or be the result of a creative insight. · Careful study and assessment of the external environment to identify factors in the social environment and the activity environment; this allows you to identify opportunities and threats. Market potential and resource availability should be at the center of the scanning process. · Thorough study and assessment of the internal factors of the new business. An entrepreneur should objectively evaluate personal assets, areas in which he is particularly competent, personal abilities and experience - all from the point of view of the organizational needs of the new business. · Analysis of strategic factors in light of the current situation using SWOT analysis. The potential strengths and weaknesses of an enterprise should be assessed in light of the opportunities and threats in the external environment. · Deciding whether or not to commit. If it seems that the main idea of a business can be implemented, you should continue to do it. Otherwise, it is necessary to abandon further development of the idea until the strategic factors change. No, return to stage 1 Yes Fig. 2 Strategic decision-making process in SMEs (new enterprises) · Creation of a business plan containing practical measures to turn the idea into reality. · Implementation of the business plan using action plans and practical measures. · Evaluation of the implemented business plan - comparison of actual performance results with planned ones. To the extent that actual results differ in one way or another from those planned, the entrepreneur should review the firm's mission, objectives, strategies, policies and programs and, if possible, incorporate changes into the original business plan. 1.5 Dynamic model of strategic management for small and medium-sized enterprises "Strategic management" F. Analoui, A. Karami, M.: "Unity", 2005, 78 pages. According to some experts, a number of models were specifically developed for strategic management in small businesses (Linneman, 1990; Green and Jones, 1982; Shuman and Seeger; 1986; Aram and Cowan; 1990; Foster, 1993; Berry, 1998, Beal, 2000). Strictly speaking, there is no fundamental difference between the models of strategic management for small businesses proposed by these authors. Everyone uses similar concepts as a basis. Many of the concepts and techniques related to strategic management have been developed and successfully applied in enterprises. As managers strive to adapt as best they can to the ever-changing conditions of the business world, their firms typically go through four stages of strategic management development, namely: financial planning, forecast-based planning, to the external environment (strategic planning) and, finally, strategic management. At its core, strategic management consists of four main elements: thorough research (scanning) of the environment, strategy formulation, strategy implementation, evaluation and control. Environmental scanning is a kind of monitoring, evaluation and dissemination of information obtained in the external and internal environment among key figures of the corporation. The purpose of this process is to identify strategic factors, those elements of the external and internal environment that determine the future of the corporation. The easiest way to scan a business environment is to apply a SWOT analysis. Strategy formation is the development of long-term plans for effectively managing the opportunities and threats of the external environment based on corporate advantages and disadvantages. Strategy formulation includes defining the corporate mission, setting achievable goals, developing strategy, and developing policy guidelines. Strategy implementation is the process by which strategies are put into action through program development, budget preparation and operating procedures. This process may involve changes in the overall culture, structure and leadership of the organization. Finally, evaluation and control is the process by which a corporation's performance and results are monitored to compare actual performance with desired performance. Although evaluation and control are the final elements of strategic management, they can also help identify weaknesses in already implemented strategic plans and encourage repetition of the entire process. The conceptual basis for developing a strategic management model for SMEs was the research of specialists in the field, the authors' own observations, as well as the results of the first empirical survey of the UK electronics industry. According to the authors of the book, this provided a completely realistic and structured format that determined the direction of the study of SME strategies in successive stages, starting with obtaining a complete picture of the general situation (awareness), then moving on to strategy formation and its implementation, and ending with control and improvement of the strategy. Traditionally, all strategic management process models seek to answer six basic questions: What would we like to do? What is our situation at the moment? What would we like to achieve? How do we intend to do this? Which way will be the best? And finally, should we bother with this at all? Most models of the strategic management process are based on a broad interpretation of the concept of "stakeholders, beneficiaries" and are driven by competitive considerations rather than customer-oriented. Dynamic strategic management for SMEs, as a variation of the more general model of basic strategic management, is represented by a model of strategic management based on customer value (Fig. 3). The dynamic model of strategic management of SMEs includes four stages: 1. awareness - understanding the strategic situation; 2. strategy formulation - developing suitable strategies; 3. strategy implementation - turning selected strategies into reality; 4. control and improvement of the strategy - review of results and conclusions for subsequent improvement of the strategy. The dynamic strategic management model for SMEs describes the process by which SMEs define their intentions, goals and desired level of achievement; decide what actions should be taken to achieve goals in a timely manner, often in a changing external environment; take these actions and evaluate the rate of progress by evaluating the results. This creates a basis for learning from experience for further improvement. In accordance with the model, it can be assumed that the process of strategic management in SMEs is a dynamic sequence: analysis current situation SMEs in the context of their products, markets, distinctive competitive advantages, personal goals of the owner-manager and therefore defining the mission, goals and values to satisfy customers; · analysis of the external environment - assessment of the opportunities and threats posed by competitors, suppliers, the socio-political influence of the economy, as well as the influence of technology, which will increase the value of SME products for consumers; · analysis of the internal environment - assessment of internal capabilities, advantages and weaknesses; Fig. 3 Dynamic model of strategic management for SMEs · identification of key factors contributing to increased efficiency and strategic issues of the company that may influence the direction of its future movement; · identification of strategic alternatives to goals and primary strategies; · implementing changes to improve the process (products and services) of increasing human capabilities; · monitoring improvements in customer value and business performance; · analyzing the results of applied strategies and drawing lessons in order to improve strategic management (i.e. the quality of decision making) in the future. The eight basic steps we just covered really help to prioritize the actions of a firm that wants to succeed by developing and executing a competitive strategy that consistently carries out the processes of forming, implementing and evaluating strategies - this will not only ensure customer satisfaction, but will also allow learning from its previous actions and will provide the basis for subsequent improvements in the firm's strategic capabilities. CHAPTER II Strategic management of small and medium-sized enterprises 2.1 The process of developing a strategy for SMEs "Organization Management" Rumyantseva Z.P., Salomatin N.A., Akberdin R.Z. et al., M.: INFRA-M, 1995, 114 pages "Strategic Management" F. Analoui, A. Karami, M.: "Unity", 2005, 146 pp. Development and formation of strategy, of course, is one of the main tasks of managers. This is especially true in relation to small businesses, where the manager. or the owner-manager are initially responsible for developing business strategies: they are the ones involved in making strategic decisions. Thus, it is necessary to study how SME managers develop and implement business strategies. As a stage of strategic management, strategy development is often called strategic planning or planning for the long term. ; this stage is associated with the development of mission, goals and strategies. A number of researchers suggest that the process of strategy formation in an organization includes three main elements: developing the strategic vision and mission of the business, developing the organization's strategic goals, and developing business strategies (Figure 4). Mission Goals Strategy formulation Strategy development Fig. 4 Strategy formation At the first stage of strategy development, the corporate mission is determined. A clearly stated mission promotes a sense of shared expectations among employees and serves to shape and disseminate the firm's image in the minds of important stakeholders who may influence the firm's goals in one way or another. Thompson believes that a strategic vision defines what a company should become in the future, while a mission reflects its main intention in the present and explains the reasons for its existence, the nature of the business in which it operates, and also indicates what kind of customers it seeks to attract. to serve and satisfy. Adopting this view, Scandura et al. argue that a mission is nothing more than a generalized statement of a firm's main purpose or intention, the fundamental reasons for its presence in a given business. The mission statement reveals the reasons for the organization's current existence, so it is not surprising that it is developed by senior management based on a common strategic vision shared by the entire management team. The mission must be comprehensive and clearly stated so that it is understandable to stakeholder groups both inside and outside the firm. Scandura and his colleagues argue that, from an external perspective, the mission should reflect a unifying principle, an inspiring idea for all stakeholders. These include the firm's shareholders, employees, suppliers and customers. From an internal, organizational point of view, the mission is very important because it helps employees understand and comprehend the intentions and goals of the company. Finally, an effective, successful mission serves to align strategy with the organization's established culture—a process Campbell and his colleagues describe as instilling a "spirit of mission" in the minds and hearts of employees, i.e. feeling that their whole business is of essential importance to society. Thus. An effective mission statement should clarify the firm's intentions and clearly define the business it intends to enter into. The mission statement should provide compelling, credible answers to the question of why the company exists at all. The mission should differentiate the company, indicate its personal characteristics that distinguish it from all existing and potential competitors. Mission statements should give the firm the ability to articulate its goals, including long-term ones. It is even more important that the mission has an inspiring, stimulating effect on all its employees and generates motivation and healthy business activity. Increasing employee motivation, participation and personal contribution to decision making can help improve overall organizational effectiveness. It is believed that a well-defined mission statement usually contains and reflects a unique and lasting cause that inspires all stakeholders to achieve common goals. A good mission statement is also expected to promote a more focused allocation of organizational resources. Based on the research results of F. Analoui and A. Karami, I can conclude that a typical SME mission statement contains components such as long-term profit, survival and growth; customer satisfaction; key technologies; market, philosophy and company values; quality of products and services; image, geographical area, the company's image of itself, as well as care of suppliers - these are also the main concerns of the manager, ranked in order of importance. At the second stage of strategy formation, achievable goals are determined. The owner-manager of a small business is expected to set his firm's goals based on current and projected capabilities (Shuman and Seeger; Hodgetts and Kuratko). These goals should provide SMEs with direction for future activities and investments. These researchers also argue that strategies should be formulated, procedures should be defined, and budgets should be established, all of which should be aimed at supporting the achievement of the firm's stated goals. Without established goals, SME strategists will be unable to steer themselves in the right direction. In this sense, goals can be considered as the end result of planned activities. It is the business goals that bring the mission statement into the plane of specific tasks that determine the direction and essence of the company’s activities. In almost all cases, goals turn commonplace mission statements into specific commitments of the company. In general, business goals can be achieved both in the long term and in the medium and short term. Goals include profitability, employee job satisfaction, labor productivity, organizational effectiveness, customer satisfaction, social responsibility, and technology development. Some focus on creating a list of quantitative and measurable goals, while others prefer to record a combination of quantitative and qualitative indicators. It should be emphasized that there are currently some goals that are difficult to quantify; These include employee job satisfaction and organizational effectiveness. However, regardless of the nature of the goals, it is very important for SMEs to develop a mission statement and define a list of goals in accordance with it. The company's goals should reflect its mission. The mission and strategic vision must take into account the firm's strengths, weaknesses, opportunities, and actual or potential threats it faces. A firm's strategic goals must include answers to four basic questions: what? Who? When? And how much exactly? In other words, goals must include outputs and results (what?), clearly indicate target groups or markets (who?), meet conditions and time constraints (when?) and, finally, establish standards and criteria for assessing the effectiveness of actions (how many? ). Let's look at an example of an SME's goal. Let's say we run a restaurant business in West Yorkshire. Our stated problem might look like this: Customers (who?) have a positive restaurant food and service experience (what?) every time (when?) they visit our restaurant (how?). The goal must be appropriate for the SME, it must be measurable, achievable, realistic, clearly expressed, internally consistent and logical among other goals, and it must be easy to communicate to others. In an SME, the owner-manager must develop goals that meet SMART requirements. Thus, effective goals must contain a number of relevant characteristics: · Specificity; · Measurable; · Achievable; · Realistic; · Time bound. In a small business, goals should be focused on business priorities (Fig. 5) So, the third period of the strategy formulation process is the development of the strategy itself. Once a firm's strategists have been able to develop a mission statement and set strategic goals in light of their analysis of the business environment, they can begin to develop business strategies. Strategy development typically involves determining how a company fits into its business environment. This process is contained in determining the capabilities of the company and at the same time the needs of the industry, so that the company can satisfy them, fitting well into business environment . Developing a strategy is quite a difficult task. Its solution requires awareness and comprehension of the business environment and a detailed analysis of the current state of the business environment and a detailed analysis of the current state of the company itself, especially by the manager (manager); although, in general, like all other management skills, this one develops with the acquisition of practical experience. For SMEs, the final decision on strategies rests with the owner-manager or manager. It has been found that SME managers' strategic thinking about the business environment can be essential to the development of a successful strategy. Researchers found that when SME leaders lacked the ability to think strategically about the business environment, their company tended to perform poorly. Figure 5 Developing Objectives To develop an effective strategy, a strategist must answer a number of basic questions. Roth and Washburn argue that the strategy development process involves answering ten basic questions that go beyond a SWOT analysis: 1) What product does your firm offer to sell? 2) What consumers and what market are your products intended for? 3) Why do customers need the service you offer? 4) Who are your main competitors? What is their market share? 5) What are the main strengths of your competitors? 6) What are the main weaknesses of your competitors? 7) What are the technical alternatives to your product (service)? 8) What is the strength of your company? 9) What is her weakness? 10) In light of the answers to the previous questions, what strategies should you employ to make the most of your strengths and take advantage of your competitors' weaknesses? So, in order to develop an adequate strategy, the SME strategist must find answers to these questions, taking into account the results of industry analysis, the firm's resources, and also taking into account the strategic goals of the SME. Roth and Washburn add that the answers to these questions can provide strategists with guidance to aid their practice. 2.2 Strategic planning and development of a business plan “Fundamentals of Management” M. Mescon, M. Albert, F. Khedouri, M.: “Delo”, 2004, 281 pp. “Strategic Management” F. Analoui, A. Karami, M. : "Unity", 2005, 199 pp. Strategic planning is essential for the long-term growth of small high-tech companies. Firms that use formal and informal strategic planning processes experience improvements in key performance indicators compared to firms that do not engage in strategic planning. This includes turnover, growth rate, progress towards profit targets and corporate goals. Planning helps the SME strategist identify strengths and competencies and create a competitive advantage for the firm. Identifying the strengths and weaknesses of a business helps the owner-manager develop alternative strategies to compete within his industry. In addition, planning also creates operational tools designed to achieve the organizational and financial goals of a small business. For example, using one of the planning tools, you can predict the future of a small business based on sales or production volume. Another example of a planning tool is forecasting through scenario development, which involves considering a set of possible future development plans designed for different forecast situations. The business planning process determines how business owners and managers transform their personal goals into business goals and then try to achieve them, following a logically consistent process. Figure 6 shows a typical business planning process for SMEs. The first step of business planning shows how the personal goals of the owner-manager or manager of the SME, along with corporate goals, are identified through a process of discussion and assessment. Small business managers then analyze the external and internal environment of the firm's activities to identify the firm's strengths, weaknesses, opportunities and threats in the external environment (i.e., conduct a SWOT analysis). Its results help determine the company's place in the market, as well as the strengths and weaknesses of its competitors. In light of the findings, SME strategists can identify the competencies and competitive advantages of their businesses. The next step is a consumer analysis to determine the company's target markets and target consumer groups. In accordance with this, the company must develop its marketing strategy and draw up a set of marketing activities. The marketing mix shows what a firm's product and/or service is. What are the pricing methods and promotion tactics? Where does the company intend to transact and how does it intend to sell its products and services? The next step is to develop an operational marketing plan and finally defining the operational needs, a business plan is like a road map and a tool, it shows the path from the starting point to the destination. Thus, Burns believes that the process of business planning can be likened to reading a map: first determine your coordinates, then the place where you want to be, and then start plotting a route. The business planning process is associated with solving three main problems: · Understand where you are at the moment (i.e., what is the current position of the company); · Decide where to be (i.e., what position it is desirable for the company to occupy in the future); · Plan how to get to your destination (i.e., draw up a plan of activities aimed at achieving the desired position). Whenever we refer to long-term business planning, it means that we are engaged in strategic planning. Strategic planning is the ongoing process through which small business leaders develop business strategies and maintain their firm's competitiveness in the marketplace. According to Kuratko and Hodgetts, strategic management in entrepreneurial firms is the development of long-term plans for effectively using the opportunities of the external business environment and avoiding the threats arising from it based on taking into account the strengths and weaknesses of the company. In principle, the use of strategic planning in small businesses is more or less limited. Despite this, a number of experts argue that small business leaders and managers have a responsibility to carry out the strategic planning process. One important reason for this is that, as a rule, the owner-manager of an SME is considered the chief strategist of his company and has the final say in decisions important decisions . Although many employees at different levels of the company should be involved in the process of preparing a business plan, only the owner-manager of the SME clearly understands the prospects of his business, is responsible for setting goals, has complete information from external and internal sources, and finally, it is the same person makes the final selection of the company's business strategy. Feedback cycle Fig. 6 Business plan development process The application of strategic management in small businesses can be determined by the influence of both organizational factors and factors of the external business environment. Kuratko and Hodgetts argue that the strategic management of a developing firm is determined by the influence of five main factors: · The time that a strategic manager can devote to this process; · Decision making needs; · Directions of the company's internal policy; · Uncertainties in the external business environment; · Visions of the entrepreneur-manager of the company. Some scientists even suggest that it is careful consideration of these factors that ensures the effectiveness of strategic management in small businesses. In general, despite criticism by a number of specialists of this approach, all strategic planning models intended for small businesses can be divided into two main theoretical directions: rational models and models of intuitive strategy development. Let us consider the theoretical foundations of both directions. The rational strategy model views the strategy development process as a formal activity that focuses on the relationship between the external environment of the business and the organization. This model considers achieving the so-called “strategic fit” (conditions of the external and internal business environment) as one of the important tasks that the strategist is called upon to solve. The second model is the intuitive strategy development model. It is best examined in the work of McCarthy and Leavy, who compared both models (Table 1). The intuitive strategy development model focuses on the internal parameters of the organization, such as culture, leadership style, and human resource policies. According to this model, formal strategic planning loses its importance over time, mainly due to the dynamism of the external environment, when the ability to be innovative and flexible becomes key conditions for the survival of the company. Table 1 Comparison of rational planning and intuitive strategy development models

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