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An Overview of Strategic Management Practices

Published By : Austin Publishing Group


Introduction of Strategic Management
The Term of strategy originated from a Greek word “strategos”, meaning army guidance from the position
of Commander General. There is no single definitions of strategic management, which is generally
acceptable. Despite all that we present here some of the definitions found in the extant literatures. It is a
top management activity , which deals with decisions making in, regards to the purpose of organizational
mission , vision , philosophies , objectives , strategies and well-designed policies. Strategic Management
involves a combination of decisions and actions that guide toward the formulation and implementation of
plans intended to achieve organizational objectives. Strategic Management process entails understanding
the strategic situation of an organization , making strategic options for the future and turning strategy into
action.

Strategic Planning
Strategic planning as “an effort to produce fundamental decisions and action that shape and guide what an
organizations is , what it does , and why it does . It much wider than program , project , budget , or operations
planning’s, strategic planning is a big picture approaches that solve the most serious issues facing an
organization’s long term efficiency and effectiveness.
Stages in strategic planning
1. Environmental analysis
2. Resources analysis
3. Determination of the extent of the required strategy
4. Decision making
5. Implementation
6. Control for efficiency and effective the implementation

Strategy of Formulation
Strategy of Formulation as a phase of sub-process of strategic management in which a firm creates its
directions, defines it objectives and set a course for the organization to follow. In addition , that there are
two main approaches for strategy formulation
1. Plan or delibrate ( design )
2. Process ( emergent )

Strategy of Implementation
Numerous Studies confirmed that the type of strategy that is developed and the actual method of strategy
formulation that is , how strategy is , developed will certainly influence the result of its implementations. For
example , Good execution naturally start with good strategic input : the soup is only as good as the
ingredients.
There are 7 factors that affecting to strategy of implementations
1. Namely strategy context
2. Structure
3. System
4. Style
5. Staff
6. Skills
7. And subordinates as a key of implementations driver
Strategy execution and implementations are sometimes interchangeably used in the literature of strategic
management.
Strategic evaluation is an important tool for assessing how well your business has performed, relative to its goals.
It's an important way to reflect on achievements and shortcomings, and is also useful for reexamining the goals
themselves, which may have been set at a different time, under different circumstances.

Deciding the Destination

Although the actual evaluation step takes place at the end of the process, after goals have been reached or not,
the process of strategic evaluation starts at the beginning of the process, with the step of setting the goals
themselves. Goals are important because they give your company direction, and a way to measure success.

Effective goals should be tangible steps that move your company toward achieving its longer term mission and
vision, such as improving the environment, alleviating suffering or simply making money. Unlike your company's
mission and vision, its goals should be specific and quantifiable, such as increasing sales by a certain
percentage during a specific period of time.

Benchmarking your Performance

Your goals provide you with criteria and benchmarks, and the process of measuring your performance involves
taking a step back and assessing how effectively your company has achieved its goals. Measuring performance
is an important step in the strategic evaluation process because it provides a snapshot of the outcomes you
have achieved relative to the milestones you created. When you've set clear and quantifiable goals at the outset,
its easy to see and measure how well you have performed relative to these objectives.

Succeeding or Falling Short?

Although goals are milestones, the process of reaching them isn't an all or nothing endeavor. In addition to
simply measuring your outcomes relative to your goals, it's important as part of the strategic evaluation process
to analyze how close you've come. It's unlikely that you will achieve a preset goal precisely – and if you're one
percent short – you've clearly been more successful than if you'd only made it half-way.

Similarly, you may exceed your goal by just a fraction of a percent, or you can succeed so wildly that your goal
seems irrelevant. It's important to analyze variance both quantitatively and qualitatively. Calculate the degree of
variance, and also look at why you've exceeded your goals or have fallen short.

Steering a Better Course

If your business falls far short of meeting its goals, the strategic evaluation process is an opportunity to reflect on
why this has occurred and to then take corrective action. If your company has blown its goals out of the water,
the strategic evaluation process is an important opportunity for you to create a new set of goals that will reflect
your progress and challenge you in new ways.