The difference between operational and strategic management

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The difference between operational and strategic management
Managers at all levels are trying to improve the effectiveness of the organisation. (Jupiterimages/Comstock/Getty Images)

There are many different management skills that deal with a wide range of activities designed to improve the effectiveness of an organisation and promote its growth. Generally, however, they can be divided into two main types of management activity: strategic management and operational management. Strategic management is usually thought to be the preserve of senior managers in an organisation. Operational management, which includes making decisions about tactics, is the responsibility of mid-level and junior managers.

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Strategic management concentrates on the performance of the organisation as a whole. It is concerned with developing a vision and defining where the organisation is heading in the future. While strategic managers focus on the future, they need also to assess the current strengths and weaknesses of the organisation as well as to understand the threats and opportunities presented by the external environment. Operational management is concerned with ensuring that the day-to-day operations of the organisation are carried out effectively and efficiently. Operational managers are usually responsible only for a small part of the organisation, such as a single department or team.


Strategic management is about looking to the future and planning long-term. Strategic plans usually cover between three and five years. The long-term vision of an organisation may take 10 to 20 years to achieve. In operational management, typically the longest timescale you work to is a year -- to achieve your department's annual business plan.


Operational managers deal with routine tasks and certainty. They know what the department or team has to achieve, and they concentrate on achieving it. What they do is always measurable.

Strategic management is by definition non-routine and ambiguous. Because it is about thinking about what might happen in the future it is all about dealing with uncertainty. However, it is worth remembering that a form of strategic management happens at all levels in the organisation. The IT department has an IT strategy, for example. As a result, many junior managers combine their operational remit with a level of strategic management.


Harvard Business School's Professor Michael Porter distinguished between operational and strategic effectiveness. According to Porter, operational effectiveness is about doing the same things as your competitors, only better. For example, you produce things faster, more cheaply and with fewer defects. Strategic effectiveness is about doing the right things in the first place. You may decide that you should be doing the same things as your competitors, but in a different way, or doing entirely different things.

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