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Most, if not all, organizations believe in the value of strategic management in achieving success. Strategic management is often defined as the art and science of making, implementing, and assessing cross-functional decisions that help organizations achieve their long-term objectives. It involves defining the mission and vision of an organization, developing policies and plans that are often translated into projects and programs, and allotting resources needed in implementing these policies and plans - all of which are working together to achieve the objectives and goals of the organization.
It is vital to understand strategic management as a mixture of strategy formulation, strategy implementation, and strategy evaluation. Most managers follow a three-step process in strategy formulation. Performing a situation analysis, self evaluation, and competitor analysis is the first step. It is crucial to take into consideration both internal and external, and micro-environmental and macro-environmental factors in doing the analyses. Next is to set objectives based on the results of the analyses made. Vision and mission statements, overall corporate objectives, strategic business unit objectives, and tactical objectives are formulated in this stage. Objectives set should include both financial and strategic goals, and these should correspond to a timeline.
Strategy implementation covers the apportioning and management of sufficient resources - financial, human, time, and technology, setting up a chain of command and/or alternative structures, delegating responsibility based on specific tasks and processes to particular individuals or teams, monitoring results of the process, comparing results of the process to best practices, evaluating the effectiveness and efficiency of the process, exercising control for possible variations, and doing adjustments if necessary. This area of strategic management also involves procuring the needed resources, and improving the process, training, process testing, documentation, and integration with or conversion from legacy processes.
Evaluating the efficacy and efficiency of organizational strategy is as essential as the other facets of strategic management. In doing so, it is beneficial and imperative to do an analysis of the strengths and weaknesses of the organization, and the opportunities and threats presented by the internal and external environment to the organization. There are three critical questions that can serve as a guide in strategy evaluation: Would it work? Can it be made to work? Will they work on it?
It is not always that organizations succeed in accomplishing their goals. Failure comes to those who overlook certain factors that play important parts in successful strategy formulation, implementation, and evaluation. Oftentimes, these reasons include: failure to understand customers/clients, failure to foresee and calculate environmental reaction, too much confidence in resource competence that the organization fails to develop new management and employee skills, failure to coordinate, failure to attain commitment from senior management and employees, miscalculation of time requisites, failure to stick with the plan, and failure to manage change. In so many cases, these failures arise due to poor communication.
Strategic management indeed plays a significant role in the success of an organization. On the other hand, it can also cause organizations to suppress creativity. In this age where changes happen more rapidly than organizations can adapt, it can sometimes be an advantage to be more flexible than to adhere to a finely structured strategic plan. As strategy becomes too incorporated into an organization's culture, group think can arise. It can also cause marketing myopia when it triggers an organization to define itself narrowly.
It is vital to understand strategic management as a mixture of strategy formulation, strategy implementation, and strategy evaluation. Most managers follow a three-step process in strategy formulation. Performing a situation analysis, self evaluation, and competitor analysis is the first step. It is crucial to take into consideration both internal and external, and micro-environmental and macro-environmental factors in doing the analyses. Next is to set objectives based on the results of the analyses made. Vision and mission statements, overall corporate objectives, strategic business unit objectives, and tactical objectives are formulated in this stage. Objectives set should include both financial and strategic goals, and these should correspond to a timeline.
Strategy implementation covers the apportioning and management of sufficient resources - financial, human, time, and technology, setting up a chain of command and/or alternative structures, delegating responsibility based on specific tasks and processes to particular individuals or teams, monitoring results of the process, comparing results of the process to best practices, evaluating the effectiveness and efficiency of the process, exercising control for possible variations, and doing adjustments if necessary. This area of strategic management also involves procuring the needed resources, and improving the process, training, process testing, documentation, and integration with or conversion from legacy processes.
Evaluating the efficacy and efficiency of organizational strategy is as essential as the other facets of strategic management. In doing so, it is beneficial and imperative to do an analysis of the strengths and weaknesses of the organization, and the opportunities and threats presented by the internal and external environment to the organization. There are three critical questions that can serve as a guide in strategy evaluation: Would it work? Can it be made to work? Will they work on it?
It is not always that organizations succeed in accomplishing their goals. Failure comes to those who overlook certain factors that play important parts in successful strategy formulation, implementation, and evaluation. Oftentimes, these reasons include: failure to understand customers/clients, failure to foresee and calculate environmental reaction, too much confidence in resource competence that the organization fails to develop new management and employee skills, failure to coordinate, failure to attain commitment from senior management and employees, miscalculation of time requisites, failure to stick with the plan, and failure to manage change. In so many cases, these failures arise due to poor communication.
Strategic management indeed plays a significant role in the success of an organization. On the other hand, it can also cause organizations to suppress creativity. In this age where changes happen more rapidly than organizations can adapt, it can sometimes be an advantage to be more flexible than to adhere to a finely structured strategic plan. As strategy becomes too incorporated into an organization's culture, group think can arise. It can also cause marketing myopia when it triggers an organization to define itself narrowly.
About the Author:
CMOE has been helping companies with leadership development and team building since 1978. Through a leadership development course and other innovative business techniques CMOE has established themselves a leader in the business world. Visit www.cmoe.com for more information.
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