Introduction

The more specific and tangible aspects of enterprise-wide strategic management (ESM) involve the strategic management systems (SMSs) of business units. The strategic business units (SBUs) translate the vision and strategic direction of the company/corporation into executable missions, business strategies, action plans, and operating results. They focus on the market spaces, competitive landscapes, and specific business/product portfolios. Whereas corporate strategic leaders focus on crafting and implementing high-level, future-oriented grand strategies, SBU leaders manage the SMSs and concentrate on developing the game plans providing means and mechanisms necessary to take advantage of business opportunities and deal with challenges. They concentrate on achieving balanced and broad-based, near-term objectives and long-term sustainable success. SBU leaders play more specific roles in managing the affairs of the business units than corporate executives. They are responsibile for formulating and implementing business strategies and ensuring that functional and operational management performs in accordance with the strategic direction of the company and overall objectives.

For some companies, especially small and medium-sized enterprises (SMEs), the corporate level management system and the SMS are merged into a single, embedded system. Here, corporate executives also function in the roles of SBU leaders with narrower perspectives, well-targeted market spaces, and definitive product portfolios. In such cases, there may still be distinctions between corporate roles and responsibilities and those of the SBU leaders as articulated in this chapter. It is imperative that business leaders understand the differences and act accordingly.