Strategic is something that is important, critical, central and long-for future direction. Management gets the jobs done by working through people to achieve objective efficiently. Strategic management refers to strategic decisions and actions of top management. It is concerned with implementation of strategy to achieve long term objectives. It involves decisions about allocation of significant resources which impact the long term performance of the organization. Resources can be people, money, technology, time and information.(1) Wheelen and hunger defines strategic management as a set of managerial decisions and actions which determines the long term performances of an organization. Strategic management provides guidance and future direction to organization. It makes strategic decisions and facilitates coordinated allocation of resources
Process of strategic management
The process of strategic management consists of the following steps:
Understanding the strategic position
Environmental dynamics, organizational capabilities and stakeholder expectations provide a basis understanding the strategic position of an organization. Environmental scanning serves as the basis for understanding the strategic position. It monitors and evaluates the changes and developments in the external and internal environment. External environment provides opportunities and threats.
Get your grade
or your money back
using our Essay Writing Service!
Making strategic choices
The strategic management involves making strategic choices from among alternatives. They serve as the basis for formulating the following strategies:
Corporate level strategy
Business level strategy
Strategic management is concerned about for turning strategies into action. It involves:
Evaluation and control
This aspect of strategic management is concerned with monitoring of performance results. Corrective actions are taken to resolve performance problems. It takes steps to make strategy work.
Strategic planning is a road map for the future of the organization. It is a long term planning ;ike five years or more.it is an organization's process of defining its strategy, or direction, and making decisions on allocating its resources to pursue this strategy, including its capital and people. Various business analysis techniques can be used in strategic planning, including SWOT analysis (Strengths, Weaknesses, Opportunities, and Threats ), PEST analysis (Political, Economic, Social, and Technological), STEER analysis (Socio-cultural, Technological, Economic, Ecological, and Regulatory factors), and EPISTEL (Environment, Political, Informatic, Social, Technological, Economic and Legal). Strategic planning is the formal consideration of an organization's future course.
In many organizations, this is viewed as a process for determining where an organization is going over the next year or more -typically 3 to 5 years, although some extend their vision to 20 years.
In order to determine where it is going, the organization needs to know exactly where it stands, then determine where it wants to go and how it will get there. The resulting document is called the "strategic plan."
It is also true that strategic planning may be a tool for effectively plotting the direction of a company; however, strategic planning itself cannot foretell exactly how the market will evolve and what issues will surface in the coming days in order to plan your organizational strategy. Therefore, strategic innovation and tinkering with the 'strategic plan' have to be a cornerstone strategy for an organization to survive the turbulent business climate
Strategic planning is an instrument for establishing the existent on the origin of the forecasts or projection of the anticipated prospect. In order to speak about Quality in Advanced Learning, Teaching, Training, Education and Strategic Planning In this day and age advanced learning wide-reaching appearances conflicting interpretations as well as assessments associated to advanced learning: in cooperation to very optimistic and completely dire. According to Brent P. Ruben, "Advanced learning is a dynamic and obligatory segment surrounded by humanity in addition to those of us who work as professors; lectures in academies and institution of higher education ought to be a number of utmost main professions everywhere "Chan, S.S., (1993)". The conservatory funds in necessary, universal and long-term techniques to the private and proficient in this world of the extra millions of students (undergraduates level, post-graduates level, PhDs,.) registered and enrolled yearly in gradation granting programs, besides further in general to the ethnic and traditional, rational, as well as financial strength of our societies and communities as well as our the social order." In order to progress a wide-ranging strategy for any section or division which would consist of in cooperation with long- series and intentional features, so here I presenting some approaches and tools defined in this manual which is used for many companies "Guth, W.D., (2001)". It is moreover factual that strategic planning might be an implement for effectually plotting the way of an establishment; conversely, strategic development itself cannot predict accurately how the market will grow then what disputes will surface in the upcoming existences in direction to plot administrative stratagem. Consequently, strategic revolution and interfering using the 'strategic plan' ought to be a keystone or basics scheme for an association or organization to endure the tempestuous professional and...
Steps in Strategic Planning Process
Always on Time
Marked to Standard
Strategic planning is a systemic approach to analyze the opportunities and threats in the environment, assessing organization's strengths and weaknesses, identifying opportunities of competitive advantage, and matching them with organization's resources in a long term perspective. It aims to develop a fit between organization's resources and activities with changing opportunities in the environment. It makes strategic choices.
The steps involved in strategic planning are as follows:
Define organization's vision, mission, objectives, strategies:
Vision; it states where the organization wants to be in a long term perspective. It is also known as strategic intent. It is the aspiration of the organization.
Mission: it states the reason for existence of the organization. It defines the nature and competitive scope of the organization. It provides direction to the organization for the long term.
Objectives : They are desired outcomes. They are end results to be achieved in the long term.
Strategies: they are broad action plans for achieving objectives. They identify sustainable competitive advantages. They provide direction and scope.
Analyze external environment: external environmental analysis is done to detect trends and create scenarios. It consists of political, economic, socio-cultural, and technological forces. It provides opportunities and threats to the organization.
Identify opportunities of competitive advantage: such opportunities provide positon of superiority in relation to competitors. They can be in terms of superior skills, technology, resources, and customer value.
Analyze internal environment: This focuses on resources and competency analysis. Resources can be human, financial, physical, and informational. Organization's resource capability is analyzed. Resource availability is determined.
Identify strengths and weaknesses: internal environment of the organization provides strengths and weaknesses. Assessment of these factors is done to identify core competencies. Core competency is strengths that provide competitive edge to the organization.
Match strength with opportunities: Based on SWOT analysis, organization's strengths are matched with opportunities of competitive advantage to formulate strategic plan.
Significance of strategic management
Strategic management is important due to following reasons:
Participative management: strategic management involves interactions at all levels of organization. It promotes participative management. It empowers employees.
Problem prevention: strategic management enhances problem prevention capabilities of the organization. Problems are anticipated and addressed during strategy formulation stage. This facilitates problem prevention during strategy implementation.
Better options: group interactions generate better strategic options as alternatives for strategic choices.
Motivation: employees are motivated by performance reward relationships. This improves productivity and goal-directed behaviour.
Reduced gaps and overlaps: strategic management takes an integrated approach to resource allocation. This reduces gaps and overlaps in activities. Roles and responsibilities are clearly specified. Strategic fit facilitates effective resource utilization.
Change management: strategic management reduces resistance to change. The participative approach promotes participation and communication. Uncertainty is reduced. Strategic change is facilitated.
Financial benefits: strategic management leads to higher profitability.
Nature of strategy formulation
Strategy is broad game plan to achieve objectives. It provides direction and scope to the organization over the long term. The process or strategy formulation consists of the following steps:
Review Strategic elements: strategy formulation starts with a review of strategic elements, they are vision, mission, objectives and strategies.
Vision is where the organization aspires to be. It is re-examined in the context of likely future changes in the environment. It is restated, if necessary.
Mission is the reason for the existence of the organization. It should follow from the vision. It is re-examined to ensure that it serves as a unifying theme. It is restated, if necessary.
Objectives are long term desired outcomes. They should follow from mission. They are reviewed. They are reformulated if necessary.
Strategies should follow from objectives. They are means to achieve objectives. They are reviewed. They are reformulated if necessary.
Conduct swot analysis: it is done to analyse the external and internal environment of the organization. External environment consists of political-legal, economic, socio cultural and technological forces. Its scanning is done to detect trends and create scenarios. It provides opportunities and threats to the organization.
Internal environment consists of resources and competencies internal to the organization. It provides strengths and weaknesses to the organization. Strategies should be bassed on opportunities of competitive advantage and internal strengths.
This Essay is
a Student's Work
This essay has been submitted by a student. This is not an example of the work written by our professional essay writers.Examples of our work
Identify strategic options: strategic options are strategic alternatives. They are carefully identified. They can be for
Strategic options are carefully reviewed. Relevant options of strategic advantage are earmarked for evaluation.
Evaluate strategic options: the evaluation of strategic options is based on
The option should be suitable to the environmental circumstances of the organization. That should be acceptable in terms of risk, return and shareholder expectations. And finally it should be feasible in terms of resources and competencies of the organization.
Make strategic choice: one or more best strategic optioins are chosen as strategy.
They result in corporae, business and functional strategies
Strategy implementation is translating strategy into action. Strategy formulation is followed by implementation. A strategy becomes meaningful when it is implemented and working in practice. Objectives can be achieved only when strategies are implemented. The process of strategy implementation consists of the following steps:
Preparing resource plans
Establishing management systems
Exercising strategic control
Designing structures: structure is a means to implement strategy. It defines activities, levels, roles and reporting relationships. It facilitates resource allocation. Dimension of structure are job design, job grouping and relationships.
Preparing resource plans: resources are important for strategy implementation. Resource plans are prepared to predetermine future resource needs. They serve as a framework for mobilizing and allocating resources to activities. Resource plans are prepared for corporate level, business level and functional level. They identify resource gap indicated by difference between needed resources and available resources. They select sources for resource mobilization in future. Action plans for resources are also prepared.
Establishing management process: a management system is established for strategy implementation. A strong management team is put together. Team members can come from within the organization or they can be outsiders. The team should have the right mix of skills with potential to develop. The management team performs the following functions: i. Human resource management, ii. Information management and leadership.
Exercising strategic control strategic control ensures right things in right manner at right time it continually assesses the changes in the environment. It provides feedback and early warning about the events that affect the course of strategy implementation.
Role of strategic management, planning and implementation
strategic planning is the master of other planning
Strategy plays the vital role on the development of an organization whether it is non profit organization or profit making organization. Strategic planning is not only the planning it is concerned with the long term developments of an organization. In the era of 21st century every organization wants to be stronger than other competitor. Strategic planning is not concerned with day to day operations. It is forward looking. It is an action plan to aim at objective achievement. Strategic plan is a road map for the future of the organization. It is long range plan five years and more. Strategic plan establishes mission, objectives and strategies for and organization. It makes strategic choice about future courses of action from among the relevant strategic options. Strategic planning is a systematic approach to analyse the opportunities and threats in the environment, assessing organization's strengths and weaknesses, identifying opportunities of competitive advantage, and matching them with organization's resources in a long term perspective.
"Failing to plan is planning to fail". This often-heard quote from Alan Lakein, the popular author on time management, is a reminder that many of the day-to-day operational struggles we face in organisational life had their seeds sown in the past, when we failed to think ahead.
You cannot predict the future.
True, you cannot predict the future. No manager has a crystal ball in his or her brief case. Every day has its own "we couldn't see it coming". Nevertheless, many severe day-to-day operating problems have, as their origin, a failure from months or years earlier- a failure in strategic planning. Simply, absence of strategic planning, or poor strategic plans, usually lead to tactical "days you'd rather forget" of operating nightmares, some of which can last months.
The importance of strategic planning in reducing these "days you would rather forget" cannot be overemphasized. My definition of strategic planning is "A systematic, formally documented process for deciding the handful of key decisions that an organisation, viewed as a corporate whole, must get right in order to thrive over the next few years."
Note that in this definition it speaks of the strategic plan being for the organization 'viewed as a corporate whole'. The kind of strategic planning we are talking about used to be called 'corporate planning'. In a sense this makes the importance of strategic planning blindingly obvious. Get it right and the whole organization is impacted, and strengthened towards better long term performance, get it wrong and ... !
Strategic planning gives overall direction
Strategic planning can provide an overall strategic direction to the management of the organization and gives a specific direction to areas like financial strategy, marketing strategy, organizational development strategy and human resources strategy, to achieve success. These other kinds of planning, some of which are confused with strategic planning are intended for parts of the organization, or specific functions or processes within the organization. All of these other types of planning should be guided and informed by the strategic plan.
Strategic planning is planning for the organization as a whole
To repeat strategic planning involves planning for an organization as a whole - as a corporate whole. So corporate strategic planning is not product planning, production planning, cash flow planning, workforce planning or any of the many of other sorts of planning conducted in today's organizations. All these are designed to plan parts or sections or departments of organizations. Most companies, even quite small ones, already employ product development managers, marketing directors, production planners and finance controllers to look after the planning of these various parts, and when you do strategic planning you certainly do not want to do all these again under a fancy new name.
As soon as a strategic plan starts to spell out detailed production plans, workforce plans, finance plans, and so on, it is going to overreach and become a initiative-sapping set of edicts from Head Office. The importance of strategic planning comes not from the degree of control or supervision, and the level of detailed instruction it includes, but for the scale, time horizon, and importance of the decisions it embodies.
Strategic planning is corporate. You can only have a strategic plan for an autonomous or quasi-autonomous organization; you should not have one for any section, part or fragment of an organization unless it is quasi-autonomous, like a profit centre, or a wholly owned subsidiary.
Simply put, strategic planning determines where an organization is going over the next year or more, how it's going to get there and how it'll know if it got there or not. The focus of a strategic plan is usually on the entire organization, while the focus of a business plan is usually on a particular product, service or program.
There are a variety of perspectives, models and approaches used in strategic planning. The way that a strategic plan is developed depends on the nature of the organization's leadership, culture of the organization, complexity of the organization's environment, size of the organization, expertise of planners, etc. For example, there are a variety of strategic planning models, including goals-based, issues-based, organic, scenario (some would assert that scenario planning is more of a technique than model), etc. Goals-based planning is probably the most common and starts with focus on the organization's mission (and vision and/or values), goals to work toward the mission, strategies to achieve the goals, and action planning (who will do what and by when). Issues-based strategic planning often starts by examining issues facing the organization, strategies to address those issues and action plans. Organic strategic planning might start by articulating the organization's vision and values, and then action plans to achieve the vision while adhering to those values. Some planners prefer a particular approach to planning, eg, appreciative inquiry. Some plans are scoped to one year, many to three years, and some to five to ten years into the future. Some plans include only top-level information and no action plans. Some plans are five to eight pages long, while others can be considerably longer.
Quite often, an organization's strategic planners already know much of what will go into a strategic plan (this is true for business planning, too). However, development of the strategic plan greatly helps to clarify the organization's plans and ensure that key leaders are all "on the same script". Far more important than the strategic plan document, is the strategic planning process itself
A Final Word
It is important to understand the limitations as well as the possibilities of strategic planning. A strategic plan is not a wish list, a report card or a marketing tool. It is certainly not a magic bullet or a quick cure for everything that ails an organization - especially if the plan winds up on the shelf. What a strategic plan can do is shed light on an organization's unique strengths and relevant weaknesses, enabling it to pinpoint new opportunities or the causes of current or projected problems. If board and staff are committed to its implementation, a strategic plan can provide an invaluable blueprint for growth and revitalization, enabling an organization to take stock of where it is, determine where it wants to go and chart a course to get there.