In this article, we will talk briefly about strategic management process and its role in business development and achieving the success for every organization.
Definition of Strategic Management
Strategic management refers to a management branch that deals with an organization’s strategic objectives including the development of the organization’s vision, outlining its operational objectives and coming up with and implementing the organization’s strategies.
The formulation and application of deviation corrective measures where necessary is also included in organization’s strategic objectives.
There is a big difference between the two processes of strategic management and strategic planning, which are a related but completely different branch of management. This article seeks to answer the question “what is a strategic management process” Before delving deeper, let us first define a strategic management process.
Strategic Management Process philosophy
If we want to put a definition for the strategic management process, we should look at it as a philosophical approach to doing business. This is an umbrella term that refers to a process by which managers develop and implement an operational strategy that gives an organization a competitive advantage.
An organization’s top management must first use data analytics to think strategically, and after that use the strategic management process to put those ideas into action.
What is strategic management process?
The strategic management process is a continuous evaluation culture that the company adopts to outperform the competitors. As simple as it may sound, this is a complex process that also covers the formulation of the organization’s overall vision for current and future goals.
The way different organizations set up and perceive their management strategies varies. As a result, there are different models of strategic management process that an organization can adopt. The right form depends on various factors including:-
- The existing culture of the organization.
- The dominance of the organization over the market.
- Leadership style.
- The Organization experience in creating and implementing strategic management processes.
- Industry and competition.
Why is Strategic Management Process Important?
The primary purpose of the strategic management process is its ability to assist the organization in order to achieve sustainable strategic competition in the market among the existence of many competitors.
SMP creates great value for an organization when it is properly designed and implemented by focusing on and evaluating opportunities and threats, followed by taking advantage of strengths and weaknesses to maintain it survive, grow and expand.
The strategic management process can help a company achieve this by:
- Being a reference for any major decisions of any institution.
- Directing the business to chart its future and move in this direction. Strategic Management Process involves formulating the organization’s goals, as well setting realistic and achievable goals, and ensuring that they all fit into the company’s vision.
- Helping the business become proactive rather than reactive. With SMP, business can analyze competitor actions in facing market trends and come up with steps to take to compete and succeed in the market.
- Prepare the organization well for both potential challenges and vigilance to explore potential opportunities that the company should be a leader in. SMP steps can also determining the best ways to overcome challenges and exploit new opportunities.
- Ensure that institutions deal with competition in a dynamic environment and live in an uncertain market.
- Assist in identifying and maximizing the organization’s core competencies and competitive advantages. These are responsible for business survival and future growth.
Strategic Management Process steps
The strategic management process has 5 steps that must be followed in chronological order.
- Setting goals
This includes clarifying the vision of the organization and defining the long and short term goals, the processes by which they can be achieved, and the persons responsible for carrying out each task within the set goals agenda.
Analysis includes gathering the data & information relevant to achieve the set goals, and understanding the needs of the business in the market, as well as examining any internal and external data that may affect the objectives of the organization.
- Formulating the strategy
The business will only be successful if it has the resources to reach the goals set in the first step. The process of formulating the strategy in order to achieve this may include determining the external resources that the business needs to succeed, and the priority objectives for setting them.
- Strategy Implementation
Since the main purpose of the strategic management process is to put the organization on the right path towards its goals, a robust execution plan must be in place before the process is considered viable. Everyone in the organization must understand the process and know their duties and responsibilities in order to align with the overall objective of the organization.
- Evaluation and Control
The evaluation and control procedures for the strategic management process include the performance appraisal process in addition to the continuous review process for internal and external issues. The organization’s management can also implement corrective actions when needed to ensure the success of the Strategic Management Process.
In order to maximize work efforts and Making the greatest impact on the bottom line of the business, the strategic management process must be used. This will also go a long way in helping the business survive the tough competition in the market.
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