Strategic Management

Strategic management is the planned use of a company's resources to reach its goals and
objectives. Strategic management requires ongoing evaluation of internal processes and
external factors that may impact how a company functions. Companies of all sizes and in all
industries can benefit from the practice of strategic management.

The Importance of Strategic Management

 Identify Opportunities
Strategic management is necessary to identify opportunities. Tap into opportunities
and identify strengths and weaknesses by studying the internal structure of your
organization. Within every team, there’s unrealized potential that needs your
attention. You may even discover new ways to implement existing strategies.
 Prepare For The Future
Strategic management helps you prepare for the future. Organizations can benefit
from understanding the importance of strategic management because it can help
you prepare for contingencies. A business environment is dynamic and fast-paced.
Evolve and adapt your strategies to keep abreast of vital changes in the business
sphere.
 Be Action-Oriented
Don’t become complacent in your management style. If you’re driven by action and
purpose, you can easily alter policies and business plans to drive the organization
forward. A sound action plan is sustainable and important for the growth and
survival of your company.
 Achieving goals :
Strategic management helps keep goals achievable by using a clear and dynamic
process for formulating steps and implementation.
 Sustainable growth:
Strategic management has been shown to lead to more efficient organizational
performance, which leads to manageable growth.
 Cohesive organisation :
Strategic management necessitates communication and goal implementation
company-wide. An organization that is working in unison towards a goal is more
likely to achieve that goal.
 Increased managerial awareness:
Strategic management means looking toward the company's future. If managers do
this consistently, they will be more aware of industry trends and challenges. By
 implementing strategic planning and thinking, they will be better prepared to face
future challenges.
 Strengthen Organizational Structure
Working in a team is important to achieve shared goals. Each member is dependent
on another for guidance, especially in a stressful situation. This gives rise to the need
for strategic management. You can reflect on your organization’s internal structure
and make changes wherever you feel necessary. Only a strong organizational
structure can endure testing times.
 Sustained Competitive Advantage
It’s necessary to have a sustained competitive advantage in today’s market. Strategic
management gives businesses an advantage over competitors because its proactive
nature means your company will always be aware of the changing market. To do well
compared to other players in the market and avoid failure when faced with setbacks,
build a plan that’s viable and long-lasting. The importance of strategic management
lies at the intersection of your company’s internal and external environments.
Constructing a strategic vision with long-term objectives in mind is useful for
achieving organizational goals.
Every company needs a contingency plan to fall back on. If one have a
sound strategic plan ready and accessible to all the stakeholders, he can overcome
any hurdle. Team management doesn’t have to be a challenging task. You can turn it
into an opportunity for the greater good of your company. When you’re in a team,
you get to collaborate with motivated individuals who realign their personal goals to
attain larger organizational objectives.

Strategic Management Process - Steps and

The strategic management process means defining the organization’s strategy. It is also
defined as the process by which managers make a choice of a set of strategies for the
organization that will enable it to achieve better performance.
Strategic management is a continuous process that appraises the business and industries in
which the organization is involved; appraises it’s competitors; and fixes goals to meet all the
present and future competitor’s and then reassesses each strategy.
Strategic management process has following four steps:
Environmental Scanning- Environmental scanning refers to a process of collecting,
scrutinizing and providing information for strategic purposes. It helps in analyzing the
internal and external factors influencing an organization. After executing the environmental
analysis process, management should evaluate it on a continuous basis and strive to
improve it.
Strategy Formulation- Strategy formulation is the process of deciding best course of action
for accomplishing organizational objectives and hence achieving organizational purpose.
After conducting environment scanning, managers formulate corporate, business and
functional strategies.
Strategy Implementation- Strategy implementation implies making the strategy work as
intended or putting the organization’s chosen strategy into action. Strategy implementation
includes designing the organization’s structure, distributing resources, developing decision
making process, and managing human resources.
Strategy Evaluation- Strategy evaluation is the final step of strategy management process.
The key strategy evaluation activities are: appraising internal and external factors that are
the root of present strategies, measuring performance, and taking remedial / corrective
actions. Evaluation makes sure that the organizational strategy as well as it’s
implementation meets the organizational objectives.
These components are steps that are carried, in chronological order, when creating a new
strategic management plan. Present businesses that have already created a strategic
management plan will revert to these steps as per the situation’s requirement, so as to
make essential changes.

Components of Strategic Management Process