He must ensure that the organisation is managed well. The CEO balance conflicting interests of stakeholders by negotiating disputes. The CEO makes strategic decisions related to strategy formulation. CEO ensures the acceptability to strategy by stakeholders. The roles of CEO in strategy formulation are: The CEO plays the role of the chief architect in defining the vision, mission, and objective of the organization. Competency – Phase 2 (Environmental Assessment) Able to lead a cross functional team of leaders to build a strategic planning & management system. The strategic management is a general management function. Major strategic policies flow from this source. Implementation is putting strategy into action. (c) CEO is primarily responsible for strategic management of an enterprise. The role of CEO can be summed up as follows: (a) He is the top most person in an organisation who is responsible for formulation and evaluation of strategy. Image Guidelines 5. Important Role of CEO in Strategic Management 1. Such plans can be organization-wide or related to the strategic business unit for function. Resources can be people, money, technology, time and information. According to Peters and Waterman, “Associated with almost every excellent company was a strong leader (or two) who seemed to have had a lot to do with making the company excellent in the first place.”, “The CEO is a reflective thinker who maps out strategy, designs an organisation to implement the plan and guides troops through the necessary maneuvers to accomplish objectives using vast experience and insight.”. In this approach the different roles played by the CEO are considered. He not only takes strategic decisions but also puts into practice such policies to achieve the corporate objectives. Chief executive officer is the most important figure in strategic managementprocess. The chief executive ensures that strategies are operationalized in practice. (f) CEO is supposed to devote most of his time to policy formulation. 2. He has ultimate responsibility for its success. The chief executive officer is the most important strategist who is responsible for all aspects of strategic management viz., strategy formulation, implementation analysis and evaluation. Report a Violation, Notes on the Importance of Executive Summary in a Business Plan, Chief Minister: Method of Appointment, Functions and Position, Top 6 Functions Performed by Human Resource Management. 3. The CEO looks forward based on his past experience and ability to understand the future changes. Let’s start with some basics of the CEO and the role of CEO in Strategic Management. The CEO assumes overall leadership for the implementation of the strategy. However he must see that the major policies are within the framework outlined by Board of directors. He provides the observations of strategy evaluation to the board and advises it either to continue the present strategy or to reformulate it or formulate a new strategy. 4. 9. Save my name, email, and website in this browser for the next time I comment. This role of CEO involves the coordinated allocation of significant resources to plans. He foresees the external environmental factors and their impact on the business. He formulates new objectives, policies and strategies as and when grand changes takes place in the environment like economic liberalization and technological advancement. Before publishing your articles on this site, please read the following pages: 1. TOS 7. His/her main duty is to define the long term direction and scope of the … (e) The environment created by CEO in the organization. (d) A CEO is both a specialist as well as a generalist. Prohibited Content 3. Guidelines for better and effective Delegation, Weaknesses of Trade Union Movement in India and Suggestion to Strengthen, Audit Planning & Developing an Active Audit Plan – Considerations, Advantages, Good and evil effects of Inflation on Economy, Vouching of Cash Receipts | General Guidelines to Auditors, Audit of Clubs, Hotels & Cinemas in India | Guidelines to Auditors, Depreciation – Meaning, Characteristics, Causes, Objectives, Factors Affecting Depreciation Calculation, Inequality of Income – Causes, Evils or Consequences. (b) He plays a pivotal role in setting the mission of the organisation, setting the goals and targets. Content Guidelines 2. As a top executive his role is very vital and significant in strategic decision making. (b) Leader and builder of an organisation. The role of CEO is basically to manage the external environment and relationships in order to create conditions for growth, fie may also look after the internal organisation. Able to communicate the need for change. He organizes the whole data, ideas and information and conceptualizes them.