(Source: Ybanez Jr., Antonio Errol B.

Applied Strategic Management and

Top management is comprised of the key officers who are responsible for formulating
and implementing the organization’s strategies. Top-level officers are also called strategic
managers because their insights play such a critical role toward achieving the firm’s strategies. It
is imperative that their Competency, Attitudes, Skills, and Habits (CASH) match with the firm’s
strategies. Being at the top, they should have a long term vision to set the overall direction of the
company although they are not involved in day-to-day tasks.

Management Composition

a. Chief Executive Officer (CEO)

Top managers must handle human and other capital for the effective and efficient execution of
various policies and objectives. The management of an enterprise is divided into various levels.
Top management is responsible for running the business as a whole and has specific executive
powers. They decide and implement the vision of the company. They are less involved in the
day-to-day running of the business.
The CEO can have autonomous power because of virtual supervision by the BOD especially
when the CEO is also serving as Chairman of the BOD. Hence, CEO’s long tenure of office can
also exercise considerable power. Kenneth R. Andrews (1971) describes the chief executive’s
role of the Chief Executive as an Architect of Purpose.
George Steiner (1997) summary of CEO’s role in strategic management:
1. Must understand that strategic management is his responsibility; parts of this task,
but certainly not all of it, can be delegated.
2. Responsible for establishing a climate in the organization that is congenial to strategic
management.
3. Responsible for ensuring that the design of the process is appropriate to the unique
characteristics of the company.
4. Responsible for determining whether there should be a corporate planner. If so, the
CEO generally should appoint the planner and see that the office is located as close to
that of the CEO as practical
5. Must get involved in doing planning
6. Should have face- to- face meetings with executives for making plans and should
ensure that there is a proper evaluation of the plans and feedback to those making
them
7. Responsible for reporting the results of the strategic management process to the board
of directors

The CEO makes the final decisions; his decisions are the culmination of ideas,
information, and analyses of others.

Top management consists of individuals who hold various positions and titles. The
CEO, the Chief Financial Officer (CFO), the chairman of the board, the vice
president, and the president of the company are all part of the executive decision
making management team.
An effective strategic leadership covers determining strategic decision, exploiting and
maintaining core competencies, developing human capital, sustaining an effective
organizational culture, emphasizing ethical practices, and establishing balanced
organizational controls.

The top level sets the broad objectives and policies of the business as a whole and
appoints middle management to see to its implementation. Further, they decide on the
long-term goals that the business will accomplish for the business while coming up
with effective strategies that can implemented for the achievement of the identified
objectives.

Four types of executives who use their time badly (McKinsey Global Survey)
1. Online junkies stick to the office and spend less time managing and motivating
employees. 38%of their time is spent using asynchronous messaging.
Communication is mostly done through e-mails and over the phone. The pain
point is the personal contact.
2. Schmoozers spend much time of their time outside the office and can be elusive
for direct reports. 29% of their time is spent on the phone. They are the CEOs and
sales directors. The communication channels are face-to-face and meetings with
clients. Pain points are strategy and thinking time.
3. Cheerleaders are good with employees but spend little time with outsiders
(including customers). 55% of the time spent is face-to-face. They are the C-suite
executives. The communication channels are face-to-face and internal meetings.
Pain point is external orientation.
4. Firefighters are invariably dealing with emergencies, micro-managing, and
operationally focused. 39% of their time is spent alone. They are the general
managers. Communication channel is through email. Pain points are direction
setting and meeting people.

In all these cases, the survey cites that too much focus on particular aspect of the
job means that other things get left behind. All these add up to the cost in
productivity and effectiveness. Four tips how the company can ensure that
executive time is used effectively:
1. Create a budget for leader’s time; think about how much attention each project
will require; figure out which ones are the priority; and delegate accordingly.
2. Strip out redundancy and extra layers in the decision-making process.
 3. Encourage executives to measure how they use their time, so they can align it
with their company’s priorities.
4. Use a calendar not only as scheduling tool, but also a tool to find and strip out
time- wasting meetings.

Strategic Leadership
“Good leaders are made not born.” If you have the desire and will power, you can
become an effective leader. Good leaders develop through a never-ending process of self-study,
education, training, and experience(Jago, 1982). Good leaders are continually working and
studying to improve their leadership skills; they are not resting on their laurels.
A genuine leader is a good steward of the organization and its resources. It is about
protecting the interest of the master or owner. He should posses the character of personal
sacrifice to achieve the common purpose or goal. Lao Tsu said, “A leader is best when people
hardly know he exists. Less good when they praise him and obey him. Worse when they fear
and despise him. But with a good leader, when his aim is met and his dreams fulfilled, they will
say: We did this ourselves.”
A strategy serves as a guide to achieve the desired goal set. It actually helps the mangers
organize the resources including, but not limited to, human resources. No greater strategy can be
formulated without able and visionary leaders. The effectiveness of the strategy relies on the
degree or level of influence applied by corporate leaders. Simply said, leadership is influence.
Strategic leadership involves the ability to anticipate, envision, maintain flexibility, and
empower others to create strategic change. It also involves working through and with others via
multi-functional work . An effective strategic leadership shapes the formulation of strategic
intent and corporate mission, which influences the strategic actions heading to achieve
competitiveness, and above average returns.
Decision-making is seemingly the most important task of a manager and one of the
easiest to get”wrong”. It is imperative in making a decision that is rational or a reasoned choice
among the alternatives. Decision-making is a process of selecting among the alternative courses
of action for the purpose of achieving the stated objective that will create value for stakeholders.
The role of a leader in the organization cannot be gainsaid. The success and failure of
every organization is fundamentally attributed to leadership. To be an effective one, a leader
possesses characteristics such as tolerance for ambiguity, commitment to the firm, good
interpersonal skills, high level of aspiration, and self confidence. However, the factors affecting a
managerial discretion are external environment vis-a-vis organizational characteristics. This
external environment refers to industry structure, arte of market growth, number and type of
competitors, political and legal constraints, and product differentiation. On the other hand
organizational characteristics pertain to size and age, culture, resource availability, and
employee interaction. Furthermore, these factors may lead to a failure in decision-making
because of the presence of these conditions:
1. Certainty. A situation in which a manager can make an accurate decision because the
outcome of every choice is known. In other words, all the information is readily and
sufficiently available.
2. Risk. A situation in which the manager is able to estimate the likelihood of outcomes that
result from the choice of particular alternative. Hence, it is subject to chance.
3. Uncertainty. Limited information prevents estimation of outcome probabilities for
alternatives associated with the problem and may force managers to rely on intuition; gut
feels following the experience, feelings and accumulated judgement. In short, the
information about alternatives and future events is incomplete.
4. Ambiguity. A situation where in the objective to be achieved or the problem to be solved
is unclear, such that, alternatives are difficult to define because information about the
anticipated outcomes is unavailable.