Strategic management is the process of strategic analysis of an organization, strategy-focused objective-setting, strategy formulation, strategy implementation, and strategic evaluation and control. It familiarises the student with the terms that are associated with strategic management and is used extensively in the post later. This post presents the context of longterm decisions, discusses, in brief, the changing nature of the external context and how organizations respond to the ever-changing external context by adopting strategic management. It involves large-scale mobilization of resources across the organization to develop competencies and capabilities for the future while taking care of the risk such long term decisions entail. The strategic management process is initiated to enable the organization’s top managers to make those decisions that affect the longterm profitability and sustainability of the organizations.
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What is Strategic Management and Strategic Management Process? In their book of 1980, Thompson and Strickland defined strategy as “the pattern of organizational moves and managerial approaches used to achieve organizational objectives and to pursue the organization’s mission. In his book, he defines competitive strategy as “a combination of the ends for which the firm is striving and how it is seeking to get there.” Strategy expresses the intention of Management about the way to achieve objectives of the organization.Īccording to Michael Porter, the undisputed guru of competitive strategy, “strategy is about the competitive position, about differentiating yourself in the eyes of the customer, about adding value through a mix of activities different from those used by competitors.” Here ‘means’ refer to ways or actions and ‘ends’ refer to objectives. When defined this way, objectives are considered as part of strategy formulation.Īccording to the definition provided by Thompson and Strickland, a strategy is the means used to achieve the ends. It also involves the allocation of resources necessary to achieve the objectives. It involves the determination of the long-term objectives of the organization and the adoption of courses of action. Business people deploy resources of various types to achieve objectives.Ī strategy is considered as a long-term plan that relates the strategic advantages of an organization to the challenges of the environment. business, we can substitute ‘resources’ for troops. In the military, most often strategy refers to ‘deployment’ of troops – that means maneuvering of troops into position before the enemy is engaged.
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The word ‘strategy’ is adopted from military administration. To comprehend what is strategic management, we need to know what Strategy means. It results in the articulation of the corporate strategy followed by competitive and functional strategy (what it is and outcomes).” What is Strategy? It can be regarded as the architecture of integrative decision making. It synergizes the strategic and operational orientation and provides an overall framework for resource allocation among different units and time horizons.