Introduction
Strategic management is the process of analyzing both internal and external factors that contribute to the success of the business. analyzing these factors is essential in determining the course of action for addressing the various issues that affect the progress of the business. The strategic management process is the procedure for developing and executing policies based on the data analyzed (Adoli & Kilika, 2020). Effective analysis of data enables the organization to make favorable decisions that give it a competitive advantage. Additionally, the strategic management process involves designing the organization’s vision and objectives.
Model for strategic management process
The strategic analysis involves the organization’s mission and vision statements and the objectives to be achieved. It forms the basis of the strategic management process. The environmental analysis involves the assessment of the internal and external environmental factors affecting the business to identify the opportunities that may propagate the business forward and the challenges that may threaten the progress of the business. Strategic choice provides the organization with the options necessary of handling the challenges facing the organization and gives a sense of direction to the progress of the business. An effective strategic choice must conform to the structure and policies of the organization for easier implementation.
Strategic implementation enables the organization to adopt suitable structure and resources necessary for implementing strategic decisions. Lastly, strategic evaluation and control enable the organization to track its progress and evaluate its performance.
Other Models for strategic management process
The David model of strategic management process involves strategic formulation, strategic implementation, and strategic evaluation as the main elements of the strategic process. Implementing this model requires several steps. Firstly, the management should develop the vision and mission statements (Saadatmand et al., 2018). Secondly, conduct external and internal audits to understand the performance of the organization. Thirdly, the organization should establish short-term and long-term goals. Fourthly, the organization should identify and select the best strategy that can be used to achieve the set objectives. Fifthly, the chosen strategy should be implemented and its performance measured and evaluated.
Thompson and Martin’s model of strategic management process requires the organization to understand its position in the industry and evaluate its performance compared to its competitors. The organization then needs to develop goals and objectives based on its position in the market (Saadatmand et al., 2018). It is necessary to set realistic goals within a favorable timeframe. It is then essential for the organization to analyze the necessary strategies that can be implemented to achieve the set objectives. Lastly, the organization should measure the effectiveness of the implemented strategies by evaluating the performance of the organization. If the performance of the organization does not meet the expectations of the management, it is necessary to adopt different strategies.
Management Strategies
Strategic management strategies have evolved from focusing on the management of the workforce to enabling organizations to focus on achieving market expectations. Most of the recent strategies are designed to enable the organization to focus on both the internal and external environment (Fuertes et al., 2020). Balancing between internal and external environments has enabled organizations to develop and implement practical strategies that are successful in improving the performance of the business. Effective strategies adopted in strategic management create a competitive advantage for the organization.
Types of management strategies
SWOT analysis framework has been used in many organizations to identify their competitive advantage and address the various challenges that may hinder the progress of companies. This strategy has been essential in implementing various strategic management process models. It is data-driven and aims to present realistic recommendations for the development of the company (Benzaghta, 2021). The four major elements of SWOT analysis aim to address the performance of the company, analyze the level of competition in the market and identify the avenues that can be explored to design effective recommendations for addressing challenges facing the organization.
A balanced scorecard obtains information from the organizational growth by analyzing the training of the employees and how they use their training to improve their performance in business. This strategy obtains data from the business processes by analyzing the quality of the products produced and identifying the areas of improvement that can make the products meet the market expectations (Bochenek, 2019). Another vital element of the balanced scorecard is customer perception. The balanced scorecard uses customer perception to develop a strategic mechanism to improve the performance of the business. Most of the data about customers’ perceptions are often obtained through customer feedback about their experience with the company’s products. Lastly, a balanced scorecard relies on financial data obtained from the revenue and expenditure of the company to formulate to provide essential information for the design and implementation of effective policies that are aimed at improving the financial position of the company.
Role of organizational culture in the strategic management process
A strategy must align with the organizational culture to increase its effectiveness and ensure it succeeds. When the strategy and the organizational culture do not conform, it becomes difficult to implement a strategy and succeed. The culture of an organization defines the code of conduct of the employees and management which is necessary for understanding what motivates the workforce to perform better. Good organizational culture creates a conducive environment for the employees and the management to work collaboratively toward achieving the objectives of the organization. The cohesion between the management and the workforce makes the implementation of strategies easier and more effective. Additionally, culture enables the organization to identify the right resources necessary for organizing and executing tasks for the strategy to succeed.
Importance of Strategic Management Process
Through the strategic management process, organizations improve their decision-making process by reducing the hurdles and obstacles of slowing down the decision-making process. The strategic management process improves employee performance by motivating them towards achieving the set objectives (Demir, 2018). The process improves hiring by ensuring that the organization eliminates the elements that contribute to poor hiring. An effective decision-making process improves the image of the organization and brands it positively in the market thus attracting investors. Effective management through a strategic management process creates a culture of innovation and technology in the organization thus improving the quality of products and services delivered. The overall benefit of the strategic management process is the ease with which the organization can achieve its objectives thus improving its financial performance.
Limitations of Strategic Management Process
The strategic management process is a complex procedure that requires careful planning and accurate analysis of data. Wrong data and analysis may result in a wrong strategy which can be detrimental to the organization. The complexity of analysis makes the strategic management process lengthy and difficult to implement. It is therefore a time-consuming process that may not be ideal for resolving emergencies. Some of the strategies may take time to be effective thus giving room for challenges to continue affecting the organization. Lastly, the process requires skills to be effectively implemented. A lack of skills that are essential in the planning and execution of strategies may make it difficult to implement the strategic management process.
Trends in the strategic management process
The advancement in technology has significantly changed the approach to the strategic management process by making it easier to analyze data and identify patterns necessary for the development of strategies. Corporate governance has redefined the role of management in making strategies (Barczak et al., 2021). Through corporate governance, the various management positions have clear roles in ensuring the success of the strategy. The business environment has increased competition especially in the global market thus creating the need for more strategies.
References
Bochenek, M. (2019). Balanced scorecard in strategic management process. Modern Management Review, 24(26), 7-16.
Benzaghta, M. A., Elwalda, A., Mousa, M. M., Erkan, I., & Rahman, M. (2021). SWOT analysis applications: An integrative literature review. Journal of Global Business Insights, 6(1), 55-73.
Barczak, B., Kafel, T., & Magliocca, P. (2021). A network approach in strategic management: Emerging trends and research concepts.
Demir, F. (2018). A strategic management maturity model for innovation. Technology innovation management review, 8(11).
Fuertes, G., Alfaro, M., Vargas, M., Gutierrez, S., Ternero, R., & Sabattin, J. (2020). Conceptual framework for the strategic management: a literature review—descriptive. Journal of Engineering, 2020.
Saadatmand, M., Dabab, M., & Weber, C. (2018). Dynamics of competition and strategy: A literature review of strategic management models and frameworks. In 2018 Portland international conference on management of engineering and technology (PICMET) (pp. 1-14). IEEE.
Adoli, H. L., & Kilika, J. M. (2020). Conceptualizing the role of leadership strategy in the context of strategic management process: A review of literature. Journal of Economics and Business, 3(4).
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