BU S IN E S S P O L IC Y A N D

S TR A T E G Y – W E E K 1
CEPT OF BUSINESS PO LICY
CILO 1 – EXPLAIN THE CON
LESSON OBJECTIVES
AT THE END OF THE LESSON, YOU WILL BE ABLE TO:

• EXPLAIN THE EVOLUTION OF BUSINESS POLICY AS A DISCIPLINE;

• DISCUSS THE EVOLUTION OF BUSINESS POLICY BASED ON MANAGERIAL PRACTICES.
• DISCUSS THE HISTORICAL PERSPECTIVE OF THE EVOLUTION OF BUSINESS POLICY;
• PREDICT THE FUTURE BUSINESS POLICY IN REGARD TO MANAGERIAL PRACTICES.
EVOLUTION OF BUSINESS POLICY AS A DISCIPLINE
• KAZMI (2006) STATED THAT ITS CAN BE TRACED BACK TO 1911, WHEN THE
HARVARD BUSINESS SCHOOL INTRODUCED AN INTEGRATIVE COURSE IN
MANAGEMENT AIMED PROVIDING GENERAL MANAGEMENT CAPABILITY.

• THIS COURSE WAS BASED ON CASE STUDIES WHICH HAD BEEN IN USE AT THE
SCHOOL FOR INSTRUCTIONAL PURPOSES SINCE 1908 (CHRISTENSEN, ET. AL.,
1982 CITED IN KAZMI, 2006).
EVOLUTION OF BUSINESS POLICY AS A DISCIPLINE
• THE REAL IMPETUS FOR INTRODUCING BUSINESS POLICY IN THE CURRICULUM OF
BUSINESS SCHOOLS (AS MANAGEMENT INSTITUTES OR DEPARTMENTS ARE KNOWN IN THE
UNITED STATES) CAME WITH THE PUBLICATION OF TWO REPORTS IN 1959. THE GORDON
AND HOWELL REPORT, SPONSORED BY THE FORD FOUNDATION, HAD RECOMMENDED A
CAPSTONE COURSE OF BUSINESS POLICY WHICH WOULD “…GIVE STUDENTS AN
OPPORTUNITY TO PULL TOGETHER WHAT THEY HAVE LEARNED IN THE SEPARATE
BUSINESS FIELDS AND UTILIZE THIS KNOWLEDGE IN ANALYSIS OF COMPLEX BUSINESS
PROBLEMS” (KAZMI, 2006). THE PIERSON REPORT, SPONSORED BY THE CARNEGIE
FOUNDATION, AND PUBLISHED SIMULTANEOUSLY, HAD MADE A SIMILAR
RECOMMENDATION.
EVOLUTION OF BUSINESS POLICY AS A DISCIPLINE
• IN 1969, THE AMERICAN ASSEMBLY OF COLLEGIATE SCHOOLS OF BUSINESS), A
REGULATORY BODY FOR BUSINESS SCHOOLS, MADE THE COURSE OF
BUSINESS POLICY A MANDATORY REQUIREMENT FOR THE PURPOSE OF
RECOGNITION.
EVOLUTION OF BUSINESS POLICY BASED ON
MANAGERIAL PRACTICES
• KAZMI, (2006) HAVE VIEWED THE DEVELOPMENT IN BUSINESS POLICY AS ARISING FROM
THE USE OF PLANNING TECHNIQUES BY MANAGERS.

• STARTINGFROM DAY-TO-DAY PLANNING IN EARLIER TIMES, MANAGERS, TILL RECENTLY,

TRIED TO ANTICIPATE THE FUTURE THROUGH THE PREPARATION OF BUDGETS AND BY
USING CONTROL SYSTEMS LIKE CAPITAL BUDGETING AND MANAGEMENT BY OBJECTIVES.

•BUT
EVOLUTION OF BUSINESS POLICY BASED ON
MANAGERIAL PRACTICES
• THE TECHNIQUES WERE UNABLE TO EMPHASISE THE ROLE OF THE FUTURE
ADEQUATELY, LONG-RANGE PLANNING CAME INTO USE.

• BUT, SOON, LONG-RANGE PLANNING WAS REPLACED BY STRATEGIC

PLANNING, AND LATER, BY STRATEGIC PLANNING – A TERM THAT IS
CURRENTLY BEING USED TO DESCRIBE “THE PROCESS OF STRATEGIC
DECISION MAKING”. STRATEGIC MANAGEMENT FORMS THE THEORETICAL
FRAMEWORK FOR BUSINESS POLICY COURSES TODAY
HISTORICAL PERSPECTIVE OF THE EVOLUTION OF
BUSINESS POLICY
• PARADIGM SHIFTS ACCORDING TO HOFER

FIRST PHASE: PARADIGM OF ADHOC POLICY (TILL MID 1930S): ADHOC POLICY
MAKING NECESSITATED BY THE EXPANSION OF AMERICAN FIRMS IN TERMS OF
PRODUCT MARKETS AND CUSTOMERS AND THE CONSEQUENT NEED TO
REPLACE INFORMAL CONTROLS AND COORDINATION BY FARMING FUNCTIONAL
POLICIES TO GUIDE MANAGERS.
 HISTORICAL PERSPECTIVE OF THE EVOLUTION OF
BUSINESS POLICY
• SECOND PHASE: PARADIGM OF PLANNED POLICY (1930S – 1940S): REPLACEMENT OF
ADHOC POLICY MAKING BY PLANNED POLICY FORMULATION AND SHIFTING ATTENTION
TOWARDS INTEGRATION OF FUNCTIONAL AREAS, IN LINE WITH ENVIRONMENTAL
REQUIREMENTS.

4 FUNCTION OF MANAGMENE
• PLANNING,- DAPAT SMART
• ORGANIZING,
• LEADING,
• CONTROLLING
ENVIRONMENTAL INFLUENCES

• PLITICAL
• ECONOMIC
• SOCIAL
• TECHNOLOGICAL
HISTORICAL PERSPECTIVE OF THE EVOLUTION OF
BUSINESS POLICY
• THIRD PHASE STRATEGY PARADIGM ( 1960S): RAPID FORCE OF
ENVIRONMENTAL CHANGES AND INCREASING COMPLEXITY OF MANAGERIAL
FUNCTIONS DEMANDING A CRITICAL LOOK AT THE CONCEPT OF BUSINESS IN
RELATION TO ITS ENVIRONMENT HENCE THE NEED FOR STRATEGIC
DECISIONS.
 HISTORICAL PERSPECTIVE OF THE EVOLUTION OF
BUSINESS POLICY
• FOURTH PHASE: PARADIGM OF STRATEGIC MANAGEMENT (1980S): SHIFTING OF
FOCUS TO THE STRATEGIC MANAGEMENT PROCESS AND THE RESPONSIBILITY OF
GENERAL MANAGEMENT IN RESOLVING STRATEGIC ISSUES.

• STRATEGIC PLANNING
• STRA IMPLEMENTATION
• STRA CONTROL
SUMMARY OF EVOLUTION F BUSINESS POLICY
o 1 PHASE- PARADIGM OF ADHOC POLICY 1930S
ST

o2 PHASE- PARADIGM OF PLANNEDPOLICY 30S-40S

ND

o3 PHASE- STRATEGY PARADIGM 60S

RD

o4RTH PHASE- PARADIGM OF STRATEGIC MANAGEMENT 80S

THE FUTURE OF BUSINESS POLICY
• THE RESOLUTION OF STRATEGIC ISSUES THAT AFFECT THE FUTURE OF A
BUSINESS FIRM HAS BEEN A CONTINUAL ENDEAVOUR IN THE SUBJECT OF
BUSINESS POLICY.

• AS WHITEFIELD SAYS “REALLY USEFUL TRAINING (IN STRATEGIC MANAGEMENT

SHOULD YIELD) …. A COMPREHENSION OF A FEW GENERAL PRINCIPLES WITH A
THOROUGH GROUNDING IN THE WAY THEY APPLY TO A VARIETY OF CONCRETE
DETAILS”.
THE FUTURE OF BUSINESS POLICY
• THEDIRECTION IN WHICH STRATEGIC MANAGEMENT IS MOVING CAN BE ANTICIPATED FROM
WHAT (ANSOFF, 1984) CALLS AN EMERGING COMPREHENSIVE APPROACH OF “MANAGEMENT OF
DISCONTINUOUS CHANGE, WHICH TAKES ACCOUNT OF PSYCHOLOGICAL, SOCIOLOGICAL,
POLITICAL, AND SYSTEMIC CHARACTERISTICS OF COMPLEX ORGANIZATIONS”.

• WITH THE EMERGENCE OF FUTURISTIC ORGANIZATIONS, WHICH, IN THE WORDS OF TOFFLER,

ARE NO LONGER RESPONSIBLE SIMPLY FOR MAKING A PROFIT OR PRODUCING GOODS BUT FOR
SIMULTANEOUSLY CONTRIBUTING TO THE SOLUTION OF EXTREMELY COMPLEX ECOLOGICAL,
MORAL, POLITICAL, RACIAL, SEXUAL, AND SOCIAL PROBLEMS,” (TOFFLER, 1980) THE DEMANDS
ON BUSINESS POLICY ARE EXPECTED TO RISE TREMENDOUSLY.
 THANK YOU FOR ACTIVELY
LISTENING AND PARTICIPATING!