Strategic Vs. Operational Management (With Career Options)

Strategic and operational management are two business functions that improve efficiency and productivity. While strategic management involves deciding the overall business direction, processes and strategies, operational management includes executing those strategies to achieve results. Understanding how these two processes work with each other can help you understand their role in effective business management. In this article, we discuss the differences between strategic vs. operational management and share popular career options in both these domains, along with their salary information.

Differences Between Strategic Vs. Operational Management

These are some important differences between strategic vs. operational management:

Purpose

Strategic management decides the direction of a business. The goal of strategic management is to create a business plan that helps the organisation achieve its goals. Strategic management helps determine how teams can function differently to achieve better results. It shapes the long-term and short-term goals of an organisation. Operational management involves all activities that take place to fulfil the business objectives of the organisation. It is crucial for the day-to-day functioning of an organisation and results in the delivery of business objectives. Effective strategic planning is important to achieving operational efficiency in an organisation.

Related: What Is Corporate Strategy? (With Types And Importance)

Duration

Strategic management focuses on the future of the company, and the scope of a business plan is usually three to five years. In contrast, operational management focuses on short-term changes, implementation and processes. Leaders using operational management usually create plans for shorter periods. For example, an operational leader may create a schedule for production and shipping for the next month. It is important that operational management teams consider short-term functions because this makes alterations or complete changes easier to implement.

Leadership approach

In strategic management, business leaders typically use the company's mission statement, vision and goals to develop a business plan. Tools like data interpretation and economic analysis help leaders track performance and achieve business goals. These strategies impact everyone in the organisation, and the company's senior leadership usually decides the strategic direction. As a result, leaders effectively manage and lead the entire company and workforce when designing strategies and business plans.

In operational management, leaders manage smaller teams that mainly focus on implementing short-term goals or work plans. These activities align with strategic management plans and rely on them for direction and guidance. The scope of operational management usually gets limited to one or a few departments.

Related: What Is Strategic Planning And How To Do It In 6 Steps

Focus

The focus areas for strategic and operational management can vary significantly within a company. Strategic management usually focuses on external factors, such as increasing the market share and revenue. Alternatively, operational management focuses on the internal affairs of a business, with a focus on processes and collaboration amongst teams and departments. Typical activities in operational management include production, finance, logistics, hiring, information technology, service and sales. For example, while operational leaders tend to focus on production efficiency, strategic leaders can discuss larger business aspects like mergers and acquisitions.

Timeline and delivery

Strategic management usually requires entrepreneurs, leaders and managers to participate in monthly or quarterly meetings to track business progress and adjust future plans accordingly. During these meetings, the leaders may create company budgets, change processes or discuss the financial performance of the organisation.

In contrast, operational management involves daily supervision and surveillance of production processes and business deliveries. An example of operational management in a soft drink company can involve testing ingredients, overseeing and improving the recipe, bottling, reviewing logistics, managing marketing campaigns and handling shipments. In the same company, the senior leaders can decide on strategic goals like product line expansion or entering new markets.

Jobs In Strategic Management

Here are some common jobs in strategic management, along with their salary information and job duties:

1. Financial Analyst

National average salary: ₹35,765 per month

Primary duties: A financial analyst helps businesses identify investment opportunities, makes recommendations and evaluates the outcomes of various business decisions. These professionals analyse the company's financial data and use these findings to suggest effective business decisions to senior leaders. They also study company fundamentals along with microeconomic and macroeconomic conditions to make business and industry predictions.

2. Business Analyst

National average salary: ₹50,023 per month

Primary duties: Business analysts assist organisations in improving services, products, investments and processes with the help of data analysis. These professionals usually interact with leaders or board members to implement data-driven changes and strategies in various aspects of the business. They recommend decisions and ideas after determining their financial, functional and technological feasibility.

3. Chief Technology Officer

National average salary: ₹2,50,874 per month

Primary duties: A chief technology officer or CTO is a high-level executive role in the technology department of an organisation. They mostly work on assessing and optimising digital processes and policies that utilise technology to offer better services and products to customers. These executives may also work on strategies to align the company's products with its business vision and objectives. They may help envision the technical strategy for an organisation and help create digital systems within the company to automate processes.

4. Chief Operating Officer

National average salary: ₹2,23,046 per month

Primary duties: A chief operating officer or COO is another high-level executive title in the company. This executive mainly oversees business operations such as human resources, sales, marketing, production and research and development. Working alongside other C-suite executives, the chief operating officer helps implement the mission set by the chief executive officer to achieve results. These leaders usually look after the daily administrative operations, critical projects and oversee different business functions.

5. Chief Executive Officer

National average salary: ₹2,46,003 per month

Primary duties: The role of the chief executive officer is the highest C-suite position in a company. These executives lead the organisation, maximise business value, set long-term goals, create a common vision and design the overall structure of the organisation. They help develop long-term strategies for the company and make key business decisions. They play a direct role in deciding the progress and direction of a company.

Jobs In Operational Management

These are some common jobs in operational management:

1. Accounts Manager

National average salary: ₹48,646 per month

Primary duties: Accounts managers help maintain a company's relationship with its clients. They work to address customer issues quickly to ensure high satisfaction. Accounts managers are business representatives that interact with the customer on behalf of the organisation. These leaders may also manage teams and interact with project leaders regularly to ensure timely deliveries to clients.

2. Logistics Manager

National average salary: ₹50,201 per month

Primary duties: Logistics managers manage the purchasing and distribution processes in a supply chain and ensure that it operates with maximum efficiency. Their duties include storing, organising and monitoring goods distribution and making sure that these goods reach their correct destination without delay. These executives negotiate and liaise with manufacturers, suppliers, consumers, contractors, vendors and retailers.

Related: Jobs In Supply Chain Management (With Salaries And Skills)

3. Operations Manager

National average salary: ₹64,209 per month

Primary duties: Operations managers oversee high-level responsibilities, such as monitoring training standards, accounts, hiring processes and IT processes. They may also work on analysing and improving organisational processes to improve productivity, quality and efficiency in the workplace. Operations managers usually focus on maintaining and implementing organisational processes, resolving issues faced by HR personnel, managing inventories and coordinating with different teams.

4. Warehouse Manager

National average salary: ₹42,093 per month

Primary duties: Warehouse managers are responsible for receiving, storing and dispatching goods in warehouses. These executives manage vehicles, warehouse personnel and equipment in the warehouse. Warehouse managers are also responsible for overseeing sanitation, safety, security, administrative functions and processes at storage facilities. They work on maintaining detailed documentation of various warehouse activities on a daily basis. These managers require strong people skills, leadership, problem-solving and organisational abilities.

5. Process Manager

National average salary: ₹67,983 per month

Primary duties: These executives help assess, implement and improve processes within a business and can be a part of different departments in an organisation. They are mostly a part of the manufacturing and production department. Process managers improve operational efficiency through analysing existing processes and recommending changes and adjustments. They help implement standard processes, train team members and ensure comprehensive documentation.

Salary figures reflect data listed on Indeed Salaries at time of writing. Salaries may vary depending on the hiring organisation and a candidate's experience, academic background and location.