In this lesson you learned the three fundamental elements of strategic management. You learned that a company must understand it strategic position relative to its competitors in order to determine its strategic choices before turning its strategy into action.

1. Strategy and
Strategic
Management: An
overview
Global Business Consultants &
Partners Training Courses
Copyright 2020 Global Business Consultants

2. Chapter 2. Levels of Strategy
Lesson 3: Elements of Strategic Management

3. Elements
of Strategic
Management
 Understanding the strategic
position of an organisation.
 Making strategic choices for the
future.
 Turning strategy into action.

4. Elements
of Strategic
Management
Understanding the strategic position of an organisation.
 Strategic positioning of a company is concerned with the
way in which it, as a whole, distinguishes itself in a valuable
way from its competitors and delivers value to specific
customer segments.
 In order for a company to make strategic decisions, it must
first adequately determine the position it occupies in its
external environment.
 Strategic decisions includes:
 What products and services it should offer.
 What prices it should sell its products and services.

5. Elements
of Strategic
Management
Understanding the strategic position of an organisation continued....
 A company can use many methods to determine its strategic
position. Some methods include:
 Internet research on macro, market and industry trends;
 sending out customer and employee surveys; and
 acquiring information about its competitors through secret shopper, trade
shows, or industry reports.
 A company must understand its Strengths, Weaknesses,
Opportunity and Threats in determining its strategic position.
 A company must also understand its external environment.
 Essentially, those factors which it cannot control such as Political,
Environmental, Societal, Technological, Economic and Legal factors.

6. Elements
of Strategic
Management
Making strategic choices for the future.
 Strategic choices are the specific steps a company intends to
take in order to effectively deploy its resources.
 Every company has a certain amount of resources available
to it such as:
 financial resources,
 human resources,
 productive capacity, and
 distribution channels.

7. Elements
of Strategic
Management
Making strategic choices for the future continued...
 A company’s strategic choices could include:
 determining what products and services to sell,
 where to sell them,
 how to sell them, and
 what target markets to sell them to.
 A company’s strategic choice could be acquiring a competitor
if the objective is to gain market share.
 Another strategic choice might be to focus on selling at trade
shows rather than using advertising to reach potential
customers.

8. Elements
of Strategic
Management
Making strategic choices for the future continued...
 Whether a business succeeds or fails depends in large
measure on the strategic choices made by the owner.
 Spending large amounts of time and money introducing a product
that turns out to have a very limited market is an example of a bad
strategic choice.
 Anticipating a change in consumer tastes and introducing a service
to take advantage of that change before competitors do is an
example of a good strategic choice.

9. Elements
of Strategic
Management
Turning strategy into action.
 Turning strategy into action is concerned with executing the
strategic choices the company has determined in light of its
strategic position relative to its competitors.
 Turning strategy into action involves setting strategic
priorities that reinforce one another to ensure the different
parts of the company are moving in tandem.
 At a minimum, the priorities should not conflict with one another or
pull the organization in opposing directions.
 The best strategic priorities hang together and tell a coherent story
about how the company as a whole will create value in the future.

10. Elements
of Strategic
Management
Turning strategy into action.
 A company’s strategic priorities must provide guidance on
how to adjudicate the conflicts that will inevitably arise as
different parts of the organization try to execute the strategy
in the trenches.
 Strategic priorities should lay out what matters for the
company as a whole to win and should reflect the
interdependencies among the choices.
 If senior executives pursue goals that are not aligned with one
another, then the disagreements will filter down the silos, and the
various teams will work at cross-purposes.

11. “A winning strategy must fit the company’s
external and internal situation, build
sustainable competitive advantage, and
improve company performance and be
based on awareness of the lens through
which it is perceived.”
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12. Congratulations! You’ve completed lesson 3.
Recap: In this lesson you learned the three fundamental elements
of strategic management. You learned that a company must
understand it strategic position relative to its competitors in
order to determine its strategic choices before turning its strategy
into action.
Awesome work!
Now click Complete and then Next for Chapter 3.