Strategic Management

Many times, strategic planning fails because even though the actual plan is complete, there's little or no follow up to ensure that the plan is executed. Executives get the plan created and in a notebook, but they put it on the shelf and let it gather dust. The plan never gets integrated throughout the organisation.

What is Strategic Management?

Strategic management is definitely not an event. It's a continuous process that evaluates and controls the business and the industries in which an organisation is involved; evaluates its competitors and sets goals and strategies to meet all existing and potential competitors; and then re-evaluates strategies on a regular basis to determine how they have been implemented and whether they were successful or do they need changing.

Strategic management gives a broader perspective to the employees of an organisation and they can better understand how their job fits into the entire organisational plan and how it is co-related to other organisational members. It is nothing but the art of managing employees in a manner which maximises the ability of achieving business objectives.

Most importantly, strategic management has to incorporate various functional areas of the organisation completely, as well as, ensure these functional areas harmonise and get together well. Its key role is to keep a continuous eye on the goals and objectives of the organisation.

Strategic Management Process

Strategic Management is all about specifying an organisation’s vision, mission and objectives, environment scanning, crafting strategies, evaluation and control. 

More Than Giving Advice

These components are steps that are carried, in a chronological order, when creating a new strategic management plan. Present businesses that have already created a strategic management plan will revert to these steps as per the situation’s requirement, so as to make essential changes.

1. Defining the levels of strategic intent of the business

This is a process of collecting, scrutinising and providing information for strategic purposes. It helps in analysing the internal and external factors influencing an organisation. After executing the environmental analysis process, management should evaluate it on a continuous basis and strive to improve it.

Key focus areas:

• Establishing vision
• Designing mission
• Setting objectives

2. Formulation of strategy

This is the process of deciding best course of action for accomplishing organisational objectives and hence achieving organisational purpose. After conducting environment scanning, managers formulate corporate, business and functional strategies.

Key focus areas:

• Performing environmental and organisational appraisal
• Considering strategies
• Carrying out strategic analysis
• Making strategies
• Preparing strategic plan

3. Implementation of strategy

This implies making the strategy work as intended or putting the organisation’s chosen strategy into action. Strategy implementation includes designing the organisation’s structure, distributing resources, developing decision making process, and managing human resources.

Key focus areas:

• Putting strategies into practice
• Developing structures and systems
• Managing behavioural and functional implementation

4. Strategic evaluation and control

The key strategy evaluation activities are: appraising internal and external factors that are the root of present strategies, measuring performance, and taking remedial / corrective actions. Evaluation makes sure that the organisational strategy as well as its implementation meets the organisational objectives.

Key focus areas:

• Performing evaluation
• Exercising control
• Recreating strategies

In a nutshell, the basic purpose of strategic management is to gain sustained-strategic competitiveness of the organisation. It is possible by developing and implementing such strategies that create value for the organisation. It focuses on assessing the opportunities and threats, keeping in mind the organisation’s strengths and weaknesses and developing strategies for its survival, growth and expansion.

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