Strategic thinking in business organizations

¶ … strategy that Johnson lays out for Heinz revolves around the four strategic imperatives that he has mentioned: driving profitable growth, removing the clutter, squeezing out costs and measuring and recognizing performance.

These four strategic imperatives had already been defined two years previously and Johnson uses the 2004 Fiscal Report in order to evaluate and present the actual situation to the shareholders. Additionally, Johnson finds the means to develop and present the tactical means by which these strategic imperatives can be reached. For example, one of the tactical components of the profitable growth is innovation: Heinze believes that new products and a constant improvement and enrichment of its portfolio of products will eventually bring about a profitable and sustainable growth.

Removing the clutter implies significant financial moves, specifically, for example, improvements in working capital. Additionally, the company has decided to control its costs so as to bring maximum profitability.

However, one of the most important points to be made out of Johnson's letter is the fact that he points out towards the importance human resources play in the development of the company. Without the actual people working for the company, all the strategic imperatives would have probably been useless. It is important to see that a CEO's job also relies on properly evaluating and correctly determining what the performance of each employee is, being careful to award the adequate prices when this is necessary.

A final goal: "to pursue opportunities." This is certainly a generous theme, which may include more than one strategic expression, and shows the company's and the management's determination to follow on any new path that may occur some time in the future.

2) The strategy making and the strategy executing process are, in my opinion, the two basic requirements that should compose a CEO's assignments within a company.

First of all, a CEO is a leader and, as any leader, he needs to provide the appropriate vision for the company, the shareholders and the employees. A good CEO needs to be a visionary mind that can set trends and determine what the future evolution of the company should be.

In this sense, comprising the visionary aspect, the CEO needs to provide a strategy for the company. The company's strategy, as provided by the CEO, will represent the directions in which the company will be developing in the next period of time. Usually, this is a long-term strategy, which means that it covers a period of time between 5 and 10 years.