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Strategic or institutional management is the conduct of drafting, implementing and evaluating cross-functional decisions that will enable an organization to achieve its long-term objectives. It is the process of specifying the organization's mission, vision and objectives, developing policies and plans, often in terms of projects and programs, which are designed to achieve these objectives, and then allocating resources to implement the policies and plans, projects and programs. A balanced scorecard is often used to evaluate the overall performance of the business and its progress towards objectives.
Strategic management is a level of managerial activity under setting goals and over Tactics. Strategic management provides overall direction to the enterprise and is closely related to the field of Organization Studies. In the field of business administration it is useful to talk about "strategic alignment" between the organization and its environment or "strategic consistency". According to Arieu (2007), "there is strategic consistency when the actions of an organization are consistent with the expectations of management, and these in turn are with the market and the context."
"Strategic management is an ongoing process that evaluates and controls the business and the industries in which the company is involved; assesses its competitors and sets goals and strategies to meet all existing and potential competitors; and then reassesses each strategy annually or quarterly [i.e. regularly] to determine how it has been implemented and whether it has succeeded or needs replacement by a new strategy to meet changed circumstances, new technology, new competitors, a new economic environment., or a new social, financial, or political environment." (Lamb, 1984:ix)
Strategic formulation is a combination of three main processes which are as follows:
Performing a situation analysis, self-evaluation and competitor analysis: both internal and external; both micro-environmental and macro-environmental.
Concurrent with this assessment, objectives are set. These objectives should be parallel to a time-line; some are in the short-term and others on the long-term. This involves crafting vision statements (long term view of a possible future), mission statements (the role that the organization gives itself in society), overall corporate objectives (both financial and strategic), strategic business unit objectives (both financial and strategic), and tactical objectives.
These objectives should, in the light of the situation analysis, suggest a strategic plan. The plan provides the details of how to achieve these objectives.
Marketing action plan
Placement and execution of required resources are financial, manpower, operational support, time, technology support
Operating with a change in methods or with alteration in structure
Distributing the specific tasks with responsibility or moulding specific jobs to individuals or teams.
The process should be managed by a responsible team. This is to keep direct watch on result,comparison for betterment and best practices, cultivating the effectiveness of processes, calibrating and reducing the variations and setting the process as required.
Introducing certain programs involves acquiring the requisition of resources: a necessity for developing the process, training documentation,process testing, and imalgation with (and/or conversion from) difficult processes.
As and when the strategy implementation processes, there have been so many problems arising such as human relations, the employee-communication. Such a time , marketing strategy is the biggest implementation problem usually involves , with emphasis on the appropriate timing of new products. An organization, with an effective management, should try to implement its plans without signaling this fact to its competitors.
In order for a policy to work, there must be a level of consistency from every person in an organization, specially management. This is what needs to occur on both the tactical and strategic levels of management.
The organizational context
Conditions affecting scanning
Internal factors influencing the scanning activity were identified as being of an individual nature - information conciousness and individual exposure to information - and of an organizational nature - outwardness and information climate.
Information conciousness was assessed through the attitude of top managers towards environmental scanning and through the communication pattern established among managers within each organization. All the interviewees agreed about the vital role of information in business. Top managers of large and medium-size companies operating in different sub-sectors described their role, as far as environmental scanning is concerned, as a mix of personal monitoring and dissemination of information among direct collaborators. A significant difference was detected between managers of larger companies and managers of smaller companies. In larger companies, managers tend to minimize their role as monitors and emphasize their role as disseminators; dissemination of information becomes an important issue in larger organizations, where more complex structures and functional diversification are dominant features. On the other hand, managers of smaller companies assume environmental scanning as a personal responsibility and attribute great importance to that activity, while the dissemination factor is irrelevant, because in most of the cases there is nobody else to pass the information to.
Communication is generally intense between the top manager and the functional directors, and among functional directors. Communication among managers is made up of a mix of oral information and written information; the nature of this mix and the reasons that determine the choice of either of the forms of communication was not entirely clarified. However, some evidence associates the choice of oral communication with the generic scope of the information or its potential for starting action. Chief executives tend to use oral communication more than functional directors, while these apparently use both forms, without favouring clearly one or the other a priori. Sometimes both forms are used to convey the same information, the oral form being used for the first approach, followed by a memo or a report.
The information climate was assessed through the information infrastructure implemented, i.e., the processes, technologies and people used in information acquisition and handling. Most of the pharmaceutical companies had rich, centralized collections of scientific and technical information, managed by information professionals with different backgrounds, offered access to international on-line systems and provided selective dissemination of information and loan services. However, the other companies provided a consistent picture, characterized by loose, small collections made up mainly of specialized journals, market reports and product literature, lack of skilled staff to manage information, and the main service provided was the circulation of journals. This picture was shared by all the remaining companies, independently of sub-sector or size.
The pervasiveness of information was pointed out as one of the reasons why it is so difficult to account for the costs involved in environmental scanning, as it is always associated with the performance of specific roles. The data collected point to an average of 50% of staff involved in information handling in the medium to large pharmaceutical companies. Smaller companies have few resources to invest and different needs as well; an average of 9% of staff was found to be involved in information handling in smaller companies.
The outwardness of the organizations was assessed through their links with R&D organizations, the collaboration with regulatory agencies and participation in development programmes. Apart from two multinational pharmaceutical companies that developed fundamental research, the remaining companies either developed applied research, independently or in association with research organizations, or did not develop research at all. This was the case of large companies operating in declining industries and small companies in the plastics sub-sector, which used external laboratories for quality control only.
Large and medium size companies enjoying relative economic health engage in collaborative actions with a view to influencing legislative and other regulatory initiatives, usually through their sectoral associations, sometimes regional or international bodies. This collaboration, however, is generally passive, i.e., companies tend to act only under request. Companies of the same size going through a crisis tend to turn inwards for reorganization. Smaller companies, on the other hand, usually lack the resources needed to be able to provide collaboration to external bodies.