Corporate strategy involves answering a key question from a portfolio perspective: ”What business should we be in?” Business strategy involves answering the question: ”How shall we compete in this business?”In management theory and practice, a further distinction is often made between strategic management and operational management. Operational management is concerned primarily with improving efficiency and controlling costs within the boundaries set by the organization’s strategy.
The second major process of strategic management is implementation, which involves decisions regarding how the organization’s resources (i.e., people, process and IT systems) will be aligned and mobilized towards the objectives. Implementation results in how the organization’s resources are structured (such as by product or service or geography), leadership arrangements, communication, incentives, and monitoring mechanisms to track progress towards objectives, among others.
Running the day-to-day operations of the business is often referred to as ”operations management” or specific terms for key departments or functions, such as ”logistics management” or ”marketing management,” which take over once strategic management decisions are implemented.