Strategic management refers to the initiatives, intended or emergent, that are normally taken by managers on behalf of owners of a company. It entails the utilization of resources with the intention of boosting the performance of the firm.
Strategic management is essentially about defining the organizations’ mission, vision and objectives, development of plans and policies which are in the form of programs and projects most of the time. It is good practice for managers to measure progress towards the organizations’ objectives or lack of it using a balanced yardstick.
It is fundamentally a type of management that is focused on overall goals of the organization in which the missions as well as planned achievements are explicitly defined and all management processes are structured and monitored in a bid to achieve the organization’s overall goal.
Strategic management is essentially about three processes which are analysis, decisions and actions. Strategic management entails the analysis of strategic vision, mission as well as the strategic objectives together with the external and the internal environment of an organization (Hitt et al, 101).
What follows thereafter is the decision making which is usually done by the leader since it is his responsibility. Decision making is basically made on two levels; which field should we compete in? How are we supposed to compete in that field?
Lastly, actions are taken based on the decisions that have been made. The necessary resources are utilized in a bid to bring the intended initiatives to reality. The other essence of strategic management is finding out why some firms post better results than others in the same line of business.
The manager should therefore be preoccupied by how he can compete so that his firm can compete so as to have a competitive edge over its rivals in the market. The competitive advantages should be sustainable over a long period of time in the sense that competitors can neither copy nor substitute them easily.
The chief goal of any organization is to register results while that of strategic management is to ensure that those results are in sync with the organization’s overall goal. It therefore implies that for an organization’s results to be in line with the organization’s goals, constant monitoring of every activity going on within the organization is necessary.
On several occasions after monitoring has been done, a manager will identify areas or processes which need to be altered in order to register results that are in line with the organization’s overall goals.
The necessary changes should be made as soon as possible under the leadership of the manager. This will only work if the strategic management processes were properly implemented meaning that there was flexibility (Liebeskind, 18).
Therefore strategic management essentially lays a lot of emphasis on the fact that managers should be on the lookout for external threats as well as opportunities while bearing the firm’s weaknesses and strengths in mind. Threats to a firm may be in the form of threat of new entrants into the market who threaten to eat into some of the firm’s market share.
Fierce rivalry among firms may also be perceived as a form of threat to any organization. Opportunities may come in the form of government subsidies or tax breaks. Strengths of any organization are internal, therefore highly skilled staff can be considered as strength to the firm while the use of outdated technology relative to competitors is regarded as a weakness.
Works Cited
Hitt, Michael, et al. Strategic Management: Concepts and Cases: Competitiveness and Globalisation. (9th ed). Sydney, Australia: Cengage Learning. 2011. Print.
Liebeskind. Knowledge, Strategy, and the Theory of the Firm. Strategic Management Journal. Vol: 17 1996. 18. Print.