Strategy is the action taken by strategists to achieve the goals of the organization.
It deals with long term development rather than routine operations like: new product development, capturing new customers , occupying new geographic location, adaptability of technology & focusing on creativity & innovativeness.
It ca be defined as a general direction set for the company & its various components to achieve a desirable state in future.
Strategy plays a significant role in forecasting future uncertainties by scanning the environment.
The main aim of Strategic Management (SM) is to help the organization to operate successfully in the dynamic environment which is complex by nature.
It helps the business to be less bureaucratic & more flexible.
It provides competitive advantage to the organization.
It demands that the company should be a learning organization which creates, acquires and transfers knowledge.
Strategic management process consists of four stages. These are
Environmental scanning
Formulation of Strategy
Implementation of the Strategy
Evaluation & Control of the Strategy.
Environmental scanning is the systematic process of monitoring, evaluating and disseminating information from the external & internal environments to key people within the organization.
The external environment consists of opportunities & threats that are outside of the organization whereas internal environment consists of strength & weakness that are within the organization itself.
The internal environment includes the management, employees, structure, culture and resource of the organization.
The environmental scanning is done through SWOT analysis.
Strategy Formulation is the development of long-range plans for the effective management of environmental opportunities & threats in light of corporate strength & weaknesses.
It includes defining the corporate mission, specifying achievable objectives, developing strategies & setting policy guidelines.
In this step the organization must practically fix the quantitative target values for some of the organizational objectives.
Strategy Implementation is the process by which strategies & policies are put into action through the development of programs, budgets & procedures.
This process might involve changes within the culture, structure, system of the organization.
Most of the times, strategy implementation is carried out by middle & lower level managers with the review by the top management.
Sometimes referred to as operational planning, strategy implementation often involves day-to-days in resource allocation.
It includes programs, budgets & procedures.
Evaluation of Strategy is the process in which corporate activities & performance are monitored so that the actual performance can be compared with desired performance.
Managers at all levels use the resulting information to take corrective action & resolve problems.
A critical evaluation must be done on the basis of the organization’s past performance.
2. STRATEGY
Strategy is the action taken by strategists to achieve the goals of the
organization.
It deals with long term development rather than routine operations like: new
product development, capturing new customers , occupying new geographic
location, adaptability of technology & focusing on creativity & innovativeness.
It ca be defined as a general direction set for the company & its various
components to achieve a desirable state in future.
Strategy plays a significant role in forecasting future uncertainties by
scanning the environment.
3. STRATEGIC MANAGEMENT
The main aim of Strategic Management (SM) is to help the organization to
operate successfully in the dynamic environment which is complex by nature.
It helps the business to be less bureaucratic & more flexible.
It provides competitive advantage to the organization.
It demands that the company should be a learning organization which creates,
acquires and transfers knowledge.
4. STRATEGIC MANAGEMENT PROESS
Strategic management process consists of four stages. These are
Environmental scanning
Formulation of Strategy
Implementation of the Strategy
Evaluation & Control of the Strategy
5. CONT… Environmental Scanning
Environmental scanning is the systematic process of monitoring, evaluating
and disseminating information from the external & internal environments to
key people within the organization.
The external environment consists of opportunities & threats that are outside
of the organization whereas internal environment consists of strength &
weakness that are within the organization itself.
The internal environment includes the management, employees, structure,
culture and resource of the organization.
The environmental scanning is done through SWOT analysis.
6. Strategy Formulation
It is the development of long-range plans for the effective management of
environmental opportunities & threats in light of corporate strength &
weaknesses.
It includes defining the corporate mission, specifying achievable objectives,
developing strategies & setting policy guidelines.
In this step the organization must practically fix the quantitative target
values for some of the organizational objectives.
7. Strategy Implementation
It is the process by which strategies & policies are put into action through the
development of programs, budgets & procedures.
This process might involve changes within the culture, structure, system of
the organization.
Most of the times, strategy implementation is carried out by middle & lower
level managers with the review by the top management.
Sometimes referred to as operational planning, strategy implementation
often involves day-to-days in resource allocation.
It includes programs, budgets & procedures.
8. Evaluation & Control of Strategy
It is the process in which corporate activities & performance are monitored so
that the actual performance can be compared with desired performance.
Managers at all levels use the resulting information to take corrective action
& resolve problems.
A critical evaluation must be done on the basis of the organization’s past
performance, present condition & desired future.
Although evaluation & control is the final major element of strategic
management, it also can pinpoint weakness in previously implemented
strategic plans & thus stimulate the entire process to begin again.
The best course of action is actually chosen after considering organization’s
potentiality and limitations.
9. STAKEHOLDERS IN BUSINESS
Stakeholders are the individuals & groups who have claims on firm’s
performance & they can be affected by the strategic outcomes. They support
the organization for its effective strategic management and achievement of
goals.
Stakeholders can be broadly categorized by two parts. Internal stake holders
& external stake holders.
Internal stakeholders are shareholders, employees, managers, directors.
External stakeholders are customers, creditors/banks, community, trade
unions, suppliers, media & Government.
10. ANALYSIS OF STAKEHOLDERS
Identify stakeholders
Identify their interests
Focus on claims they likely to make on the organization
Identify stakeholders who are the most important from the perspective of the
organization.
Forecast the strategic challenges involved in managing the stakeholder
relationship.
