What is Strategic Management?
Strategic management is the process of setting objectives and analysing the environment. It ensures new strategies and their implementation. It monitors the effectiveness of new strategies and helps identify the goals. So, It is a continuous process that develops action plans and resources. The core goal is to ensure the long-term success of an organisation.
Why is Strategic Management Important in an Organisation?
Strategic management is important and provides direction for all employees. It aligns the organisation’s goals and objectives with the industry and provides a framework for decisions and setting priorities. It allows the organisation to estimate progress and identify gaps and opportunities. So, It also ensures and adjusts the potential strategy. Strategic management allows the organisation to expect changes in the external environment. For example, changes in customer needs and market competition. It ensures all efficient resources and desired outcomes.
What are the Steps of the Strategic Management Process?
The following five steps are involved;
- Establish a mission and objectives: This step considers the company’s direction and purpose. The identification of the company’s goal is crucial.
- Create a positive environment: This step assesses the current situation of a company. The strengths and weaknesses help to create a positive impact. Identify opportunities and risks in the external environment.
- Develop a potential strategy: This step involves a plan of action. The organisation’s mission and long-term objectives are important to create an effective strategy.
- Application of strategy: This step applies a strategy in action and executes all available resources.
- Check strategy performance: This step involves progress and regulation of the strategy.
What is the goal of Strategic Management?
The goal is to establish a long-term direction for an organisation. It aligns mission, vision, and values of a company. It includes strategy formulation, objectives set and plans development. Strategic management appraises progress, assesses all risks, and adjusts proper plans.
Why is Strategic Management an Important Example?
It helps the organisation achieve long-term objectives. The objectives must complete with sustainable competition. It enables an organisation to make informed decisions about investment and resources. It focuses efforts on potential areas and creates an effective organisation. For example, strategic management develops a competitive strategy. Its main purpose is the efficient use of resources. It helps to establish potential growth parameters. It develops a long-term vision and strong mission statement. So, It identifies goals and makes useful objectives. This strategy ensures the organisation stays in a competitive market. It makes profitable values and longer growth.
What are the Characteristics of Strategic Management?
- Proper goals: Strategic management focuses on long-term objectives. The organisation must follow steps to achieve.
- Wide discipline: This management involves many disciplines like economics, finance, and marketing. It involves the behaviour of an organisation and operated management.
- Use of analytical tools: It is the use of analytical tools such as SWOT and PEST analysis. Also, test Porter’s Five Forces model to determine the best course of action.
- Systematic approach: Strategic management follows a systematic method. It helps and identifies problems and analyses data and solutions.
- Proactive: Its focus is to identify steps and capitalise on opportunities. It must reduce and mitigate risks.
- Easy adaptation: It is flexible and can adapt easily. Its approach must be dynamic and allows organisations to adjust strategies as needed. It should be responsive in response to changing conditions.
What is Strategic Management Case Study?
A case study is the examination of a particular company and its initial strategies. This study ensures all objectives recently made and decisions. It assesses the company’s performance and competitive position. It ensures the effectiveness of strategies. So, It also investigates the environment of a company and its relationship with competitors. Customers dealing with suppliers and stakeholders must consider. The study assesses the company’s resources, strengths and weaknesses, and strategic capabilities. It explores the company’s vision, mission, and objectives and how to achieve them. Finally, a strategic management case study evaluates the organisation’s strategies and its competitive environment. It describes goals and recommends strategies for better performance.
How do you write a case study in strategic management?
- Identify Company policies: Start research on the company and provide context for the case study.
- Strategic problem outline: Identify the strategic problem and explain its significance.
- Company‘s environment: Examine the internal and external factors. These factors impact the company’s competitive position and the industry’s dynamics.
- Define approach: Propose a strategy to address the problem.
- Execute strategy: The strategy must follow and consider ways to test.
- Achievements: Discuss the expected outcomes and provide an assessment for success and failure.
Let’s understand Strategic Management with a case study (The Perfecto Group). The solution is present at the end;
Case: The Perfecto Group
The Perfecto Group is a medium-sized company that manufactures and distributes consumer electronics. Its products are sold in major retail stores and online. The company has been in business for more than 20 years and has grown over the years. Now the company is facing many challenges. There is a decline in sales and a loss in the competition.
Problem:
The Perfecto Group needs to develop and devise a strategic plan. This plan must address current challenges and ensure continued growth.
Solution:
- Market Analysis: The Perfecto Group should conduct a comprehensive market analysis. It helps to better understand the current market environment. Also, the company will be able to identify growth opportunities. It analyses the competition of market products, customer needs, and market trends.
- Strategy Plan: The Perfecto Group should develop a useful plan. This plan fulfils all information of market competitors and risk values. It outlines the goals, objectives and strategies of the company. This plan is to increase sales and improve quality. It must follow a new market policy.
- Product Development: The Perfecto Group should focus on developing innovative and high-quality products. It ensures customer needs and high competition. This should include the new products and enhancement of existing products.
- Marketing Strategy: The Perfecto Group must develop a comprehensive strategy and ensure sales. This should include old and digital marketing schemes. Marketing strategy includes advertisements, public relations, and social media.
- Distribution Strategy: The Perfecto Group consider the best distribution strategy for its products. A strategy must depict availability at the right place in the right location. It includes both online and offline distribution channels.
- Organisational Structure: The Perfecto Group must review and update its organisational structure. This policy will ensure alignment with the company’s strategic goal. This should include a talent management system to recruit, train, and keep the best employees.
- Finance Model: The Perfecto Group should develop a financial model. This model must ensure management and measure the success ratio. This should include a budget, financial projections, and performance metrics.
- Implementation Plan: The Perfecto Group must develop a plan and ensure implementation. A company should confirm and execute the strategic plan. This should include a timeline, resources, and accountabilities.
Conclusion:
The Perfecto Group must develop and appliance a comprehensive strategic management plan. The company should address its current challenges and ensure growth. This can be achieved through market analysis and a strategic plan. A marketing strategy ensures product development, followed by a distribution strategy. It creates an organisational structure and implements the best service plan. After implementing the strategy, the Perfecto Group will be able and position itself for success. The company gets back success in the competitive consumer marketplace.
About Author
Isobel Taylor is an experienced Content Specialist from Birmingham. She has completed her Marketing (BS Honors) from the University of Kent. Isobel is currently living in the UK and working as a Content Creator at a UK based firm known for its best coursework writing services. She also has expertise in Google Ads and runs marketing campaigns for local and international retail chains. She loves to travel and go on hiking trips in her free time.