Sin título

DEFINITIONS

- Strategic management is the process of management of strategic decision-making, implementation and control.

- Strategic management is concerned with deciding on strategy and planning how that strategy is to be put into effect. Strategic analysis seeks to understand the strategic position of the firm. Strategic choice is to do with the formulation of possible course of action. Strategic implementation is concerned with planning how che choice of strategy can be implemented.

- Strategic management is a continuous, interactive, cross-functional process aimed at keeping an organisation as a whole appropriately matched to its environment.

- Strategic management is a continuous, interactive, cross-functional process aimed at keeping an organisation as a whole appropriately matched to its environment.

STRATEGIC MANAGEMENT

Part II

ANALYSIS OF THE DEFINITIONS

Strategic Management:

- Is a continuous process but that does not mean that the organisation never finishes its strategic work.

- Consists of a series of steps repeated cyclically.

- Integrales human resources with marketing, production/operations and finance, the cross-functional team members work together and the organisation will enjoy the benefits of synergy.

- Identifies its purpose as ensuring that an organisation as a whole appropriately matches its changing environment.

HISTORICAL DEVELOPMENT

Phase 1: Basic Financial Planning: The main concern during this phase is simply meeting annual budget requirement. operational functions like production. marketing, finance and human resources and emphasising on the operational control.

Phase 2: Forecast-Based Planning: The concern is mainly on effective plans, environmental scanning, plan for the future and allocation oí resources.

Phase 3: Externally-oriented Planning: increasing response to markets and competition, complete situational analysis and assessment of competitive strength, evaLuation of strategic alternatives and allocation of resources Based en changing needs fmm time to time.

Phase 4: Strategic Management: The focus shifts over time from meeting the budget to planning for the future, to thinking abstractly, to working te create desired future.

NEED FOR STRATEGIC MANAGEMENT

- Due to change: encourages the top executives to forecast change and provides direction and control.

- Provide guidelines: it provides incentive for employer and helps the organisation in achieving its objectives.

- Developed Field or Study by Research: More systematic knowledge in this arca is available al present

- Probability for better performance: businesses which plan strategically have a higher probability of success than those which do not have.

- Systematise Business Decisions: Strategic management provides data and information about different business transactions to managers and helps them to make decisions systematically

- Improves Communication: effective communication of information from lower level managers to middle level managers and to top level managers.

- Improves Coordination: improves coordination not only among the functional arcas of management but also among individual projects.

- Improves Allocation of Resources: helps in deciding upon most feasible and viable projects and thereby improves the allocation of resources to the viable projects.

- Helps the Managers to have a Holistic Approach.

BENEFITS

- Proactiviness

- Initiate and influence its environment

- More systematic, logical and rational approach

- Managers and employers become creative and

- Innovative

- Decentralisation

- Boost profits

- Order

- Discipline

- Minimise the effect of changing

- Cooperative, integrated and enthusiastic approach

VISION AND MISSION STATEMENTS

Vision statements visualise the future of the company. An organisation's vision statement answers the question: "What do we want to become?" or "What can we become?" Normally, mission statements are defined based on vision statements. Vision statement of a life insurance company is "To take your life's primary goal".

External Environment Analysis: consists of social, technical, economic, political, legal and government factors. These factors provide opportunities to certain business organisations while they pose threats to some other organisations

Internal Environment Analysis: consists of structures, resources, values, competencies, cultures, and systems of a company. It helps to identify company's strengths and weaknesses in relation to the market and customer needs.

STRATEGIC FIT vs. STRATEGIC INTENT

Companies used to bring the fit between their current strengths and opportunities and formulate strategies in those areas where there is a fit between strengths and opportunities.

Strategic intent process formulate challenging/ambitious goals, focus all organisational resources on winning acquiring additional competencies. motivate and inspire employees towards the targets. sustain enthusiasm by providing new operational definitions based on perceived círcumstances and towards the organisational transformation.

BEYOND FIT AND INTENT

Corporate level strategies: link the opportunities, strengths, competencies to the company's overall objective and goal.

Global strategies: include a decision to enter foreign markets.

Business level strategy: encompasses two or more functional units in crafting and implementing a strategy.

Functional level strategy: related to each function like production/ operations, marketing, finance. human resource. information management, research and development.

Strategic evaluation and control: focuses on monitoring and evaluating the strategic management process in order to improve it and ensure that it functions properly.

CHALLENGES

- Technological Advancements and Strategic Management

- Product/Service Innovation and Development and Strategic Management

- Global Issues and Strategic Management

- Quality Issues and Strategic Management

- Economic Boom and Recession

- Social Issues and Strategic Management

SWOT ANALYSIS AND STRATEGY FORMULATION

This process helps the organisation to make use of the opportunities To the full extent by aligning its strengths to the opportunities. This alignment further enables the company to formulate appropriate corporate strategies. The companies also strive to modify its products and/or correct their weaknesses in order to fit them with the opportunities and then formulate strategies