This document provides an introduction to business policy. It defines business policy as the study of senior management's functions and responsibilities in addressing problems that impact an organization's success. Business policy deals with determining an organization's future course of action, mobilizing resources to achieve goals, and choosing between alternatives. It discusses the importance of business policy for integrating knowledge across management functions, understanding real-world business complexities, and adapting to changing internal and external environments. The document also outlines different levels of strategic decision making within organizations.

1. Introduction to Business
Policy

2. Nature of Business Policy
• The study of the function and responsibilities of
senior management , the crucial problems that
effect success in the total enterprise and the
decisions that determine the directions of
organization and shape its future.
• Policy is the study of functions and
responsibilities of senior management related to
those organizational problems which effect the
success of total organization

3. • It deals with the future course of action
that an organization has to adopt.
• It is concerned with mobilization of
resources so the organization can achieve
its goals
• Choosing between different alternatives
available.

4. Who Comes Under Senior
Management ?

5. Importance of Business Policy

6. For Learning
• Integrate the knowledge and experience
gained in various functional areas of
management
• Deals with constraints and complexities of
real life business.
• Can be applied to various fields of
management

7. Understanding Business
Environment
• Internal Environment
• External Environment
• Adapting internally to external
environment

8. For understanding the organization
• Provides the basic framework for
understanding strategic decision making
• Understanding of business policy leads to
improvement of job performance

9. For Personal Development
• It is beneficial for an executive to
understand the impact of policy shifts on
the status of one department and on the
position one occupies
• Offers unique perspective to executives
for understanding the macro factors and
their impact on micro level
• Offers unique perspective to executives
for understand the senior management
view.

10. Different levels of Strategy

11. • Today the environment in which companies
operate is full of complexities. one strategy may
not work this situation .
• The need is for multiple strategy at different
levels .
• In order to segregate different segments, each
performing a common set of activities.
• Many companies are organized on the basis of
operating divisions or simply devisions

14. Corporate Level Strategy
• The overall corporate level strategy is concerned with
the broad scope of an organization’s strategic activities
and the matching of these to the organization’s
environment, its resources capabilities and the values
and expectations of its various stakeholders.
• It looks at the whole strategic scope of the enterprise.
• This is the “large picture” view of the organization and
includes deciding in which service or products markets to
compete and in which geographic regions to operate.

15. Business Level Strategy
• It is the comprehensive plan providing
objectives for SBU, allocation of resources
among functional areas and coordination
between them for optimal contribution to
the achievement of the corporate level
objectives.

16. What is SBU
• Operating Divisions are also known as
profit centers or strategic business units
(SBU)
• It may also be termed as any part of
business organization which is treated
separately for strategic Management
Process
• Generally SBU are involved in a single line
of business

17. Functional Strategies
• These strategies deal with relatively
restricted plan providing objectives for a
specific function, allocation of resources
among different operation and
coordination between them for optimal
contribution to SBU and corporate level
objectives

18. Other Strategies
• There are strategies which are at higher
level than corporate strategies. These are
known as societal strategies.
• Based on a mission vision statement a
societal strategy is the generalized view
of how the corporation relates itself to
society in terms of particular need or a set
of needs that it strive to fulfill

19. • Eg. Suppose a corporation decides to
provide alternative source of energy for
society at an optimum prices and based
on the latest technology. On the basis of
its societal strategy it has no of
alternatives it can be a manufacturer or
nuclear power reactor, a maker of
equipments used for tapping solar energy
etc

20. • One step down the functional level
strategies are operational level strategies
• Each functional area could have a number
of operational activities
• They deal with the highly narrow or
specific area

21. Centralization Vs Decentralization

22. Strategic Decision Making
• One of the most important function of
manager.
• It is the prominent task of senior
management also.
• The difference lies in the level at which
they operate

23. Conventional Decision making
• Objectives to be achieved are determined
• Alternatives ways of achieving the
objectives are identified
• Each alternative is evaluated in terms of
its objective-achieving capability
• The best alternative is chosen
• The case of Pantaloon white shirts

24. Issues in Decision Making
• Strategic decision-making is a complex
process .
• Decision makers are unable to describe
the exact manner in which the decision is
made.

25. Criteria for decision making
• It requires objective setting.
• Why we set objectives
• The first is the concept of maximization.
The behavior of organization is oriented
towards achieving these objectives and
maximizing returns
• Second view is based on the concept of
satisfying. This can be achieved by
optimization.

26. • Rationality in decision making
• Creativity in decision making
• Variability in decision-making
• Individual Vs group decision making