Role of CEO in Strategic Management

Hello Friends, Today, we are going to discuss the role of the CEO in Strategic Management. Let’s start with some basics of the CEO and the role of the CEO in Strategic Management

Role of CEO in Strategic Management

The chief executive is the executive head of the organization. S/he represents the top management. His/her main duty is to define the long-term direction and scope of the organization.

He has ultimate responsibility for its success. S/he leads the formulation and implementation of the strategy. S/he is guided by the board of directors. Since strategic management involves the teamwork of multiple participants, the CEO plays the key role in:

  • Formulation of Strategy
  • Implementation of Strategy
Role of CEO in Strategic Management
Role of CEO in Strategic Management

The details role of the chief executive officer (CEO) in Strategic management describes below.

Formulation of strategy

Strategy Provides future direction and scope to the organization for gaining competitive advantage. The roles of the CEO in strategy formulation are:

Key Strategist Role

The CEO plays the role of the chief architect in defining the vision, mission, and objective of the organization. He conceptualizes and crafts strategies to achieve objectives.

Decision-making role

The CEO makes strategic decisions related to strategy formulation. CEO makes a strategic choice from among strategic options for achieving objectives. This role involves risk-taking.

Resource planning role

This role of the CEO involves the coordinated allocation of significant resources to plans. Such plans can be organization-wide or related to the strategic business unit for function. Resources can be people, money, technology, time, and information.

Negotiator role

The strategy must fulfill the expectations of various stakeholders of the organization. The CEO balance the conflicting interests of stakeholders by negotiating disputes. The stakeholders can be owners, customers, employees, suppliers, government, labor unions, and financial institutions. CEO ensures the acceptability to strategy by stakeholders.

Implementation of Strategy

Implementation is putting strategy into action. The chief executive ensures that strategies are operationalized in practice. His/her roles in strategy implementation are as follows:

Information Role

The CEO disseminates information about the strategy to the implementers within the organization. S/he serves as a spokesperson for strategy implementation. Effective communication serves as the key to the effective implementation of the strategy.

Leadership Role

The CEO assumes overall leadership for the implementation of the strategy. He/she inspires trust and self-confidence among implementers of strategy. CEO ensures the participation of those who involve in implementation. CEO motivates them for higher productivity and also provides direction for implementation.

Organizer Role

The CEO is an organization builder. S/he determines the structure for strategy implementation. S/he establishes reporting relationship and span of control and assigns authority and responsibility for positions and people in the organization for key result areas.

Resource manager Role

The CEO ensures efficient and effective mobilization, allocation, and utilization of resources for the implementation of strategies. Budgets are prepared for the management of resources.

Monitoring role

The CEO monitors and evaluates the performance results of the strategy implementation. S/he takes corrective action to resolve performance

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