Today we talked about various strategic management tools that may help small and medium size companies with their strategic development.
I was thinking about the efficiency of applying such strategies. Most of these companies may be really small and not afford the time, energy and capital to invest in such techniques. As a matter of fact, as Mittelstand (Tabellenband, 2004) research shows, companies give up planning as years pass. His research showed that most planning is (if ever) done in the first years, after which a steady decline is noticed. Also, the smaller the company, the less planning is done.
Planning and applying strategic management tools may coagulate the various sectors of your company, binding them together (as McKinsey's 7S model does for example). The 7S model tries to analyze various parts of your company (Skills, Staff, Structure, Strategy, Structure, System) and bind them into one, Shared Value unit. My opinion is that by doing this the company's departments become more interrelated and dependable on one another. Also one change may have bigger repercussions in the other 6 sectors the company defines. There may also be the fear of implementing change due to the risk of uncertainty that will be created in other sectors of the SMEs.
Thus, I believe that for small and small to medium size enterprises, devising strategic management tools may have as a consequence the company's loss of flexibility and thus its main competitive advantage against big corporations.
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