Defining Conceptual Thinking
Conceptual skills represent one of the three skill sets identified by Robert Katz as critical to managerial success in an organization; the other two include technical skills and human skills. While each skill set is useful in different circumstances, conceptual skills tend to be most relevant in upper-level thinking and broad strategic situations (as opposed to lower-level and line management). As a result, conceptual skills are often viewed as critical success factors for upper managerial functions.
Conceptual thinking is difficult to define but could generally be considered as the ability to formulate ideas or mental abstractions in the mind. Conceptual skills primarily revolve around generating ideas, utilizing a combination of creative intuitions and a comprehensive understanding of a given context (i.e., incumbent's industry, organizational mission and objectives, competitive dynamics, etc.). When combined with a variety of information, as well as a degree of creativity, conceptual thinking can result in new ideas, unique strategies, and differentiation.
Conceptual Skills in Upper Management
While all levels of management benefit from conceptual thinking, upper management spends the most time within this frame of mind (as opposed to thinking more technically—looking at and working with the detailed elements of a given operation or business process). Upper management is largely tasked with identifying and drafting a strategy for the broader operational and competitive approach of an organization.
This strategic planning includes generating organizational values, policies, mission statements, ethics, procedures, and objectives. Creating this complex mix of concepts to use as an organizational foundation requires a great number of conceptual skills—formulating concepts and predicting their effects in an organizational setting.
Conceptual Skills in Lower and Middle Management
While upper management may use the conceptual skill set most, middle managers and lower managers must also both understand and participate in the generation of company objectives and values. Of particular importance are the ability to communicate these critical concepts to subordinates and the ability to gather useful information to convey to upper management so that the concepts can evolve.
Collecting the results of conceptual thinking represent a feedback loop. Conceptual skills are important in empowering managers in all levels of an organization to observe the operations of an organization and frame them conceptually as an aspect of that organization's strategy, objectives, and policies. Conceptual thinking allows for accurate and timely feedback and organizational adaptability.