Strategic Planning and Strategic Management
Strategic management process entails the definition of an organization’s strategy. To be precise, it is described as a process that managers use to determine the set of strategies, which will allow an organization to perform better (Persaud, Woodhouse, & Scriven, p. 2). Furthermore, it is a continuous process, which evaluates the industries and business in which an organization is involved; assesses its rivals; adjusts goals to counter all the current and prospective competitors and eventually, reevaluates every strategy (Zafar, Babar & Abbas, p.15).
Components of Strategic Management
This process is made up of three primary components, namely: strategy formulation, strategy implementation and strategy evaluation (David, p. 6). Strategy formulation entails planning and is associated with five activities. First, this phase focuses on the conceptualization of the company’s mission and vision and forms the basis for the entire process. The subsequent two activities concentrate on the situational scrutiny of the existing environment to ascertain the organization’s weaknesses, strengths, threats, opportunities (Persaud, Woodhouse, & Scriven, p. 4). Such scrutiny is achieved through an internal and external analysis of the organization’s environment. An internal analysis focuses on examining the organization’s weaknesses and strengths trough assessing the business’s functional areas over which the organization has control. Conversely, an external analysis involves environmental scanning through the identification of threats and opportunities that could likely harm or help the company and which are mostly beyond its control. The fourth activity entails the formulation of the organization’s long-term objectives. Lastly, strategy formulation is concluded with the development, assessment, and choosing of strategies to be pursued by the organization.
The second component, strategy implementation, is widely regarded as the action stage. This is because it involves the translation of the firm’s strategy into reality through policies and procedures development and resource allocation for the execution of the strategy (Persaud, Woodhouse, & Scriven, p. 4). Besides, it involves the full mobilization of personnel and the creation of a favorable and supportive work environment. This is to encourage employees to maximize work performance for the achievement of the organization’s desired outcomes.
Last, is the strategic evaluation component, which is vital for company’s well-being. This phase in the strategic management process initiates an analysis of the of the strategies, values, and objectives. Therefore, under this phase, the ineffectiveness and inefficiencies of the company’s comprehensive plans are outlined, and the management is notified of the potential issues that could turn critical (David, p. 7).
Responsibilities and duties of the Strategic Manager
According to Zafar, Babar and Abbas (p. 23), the senior leadership of an organization have the responsibility of strategically managing it. As mentioned earlier, strategic management is not a onetime event, but instead, it is a process that is continuous. Therefore, a strategic manager is required to be not only a leader but also the strategic thinker of a company and its culture. To guarantee success, a strategic manager needs to be a coach, a facilitator, consensus builder and a consultant. The fulfillment of such duties requires dedication, hard work, willingness to face particular risks, and the internalization of the firm’s guiding principles and vision (Zafar, Babar & Abbas, p. 23).
The significance of strategic management planning
Persaud, Woodhouse, and Scriven (p. 3), state that the strategic management process embraces a framework that is logical, systematic and rational. Such a framework is essential as it allows the management of a company to control and guide its destiny proactively. In that case, companies that are profit-oriented or growth-oriented can use a well-designed strategic management process to achieve such financial objectives. Besides, proactive strategic management processes can enable organizations to evade financial demise. This is because such organizations become much more conscious of external threats or risks, and better comprehend their customer or market needs (Persaud, Woodhouse, and Scriven, p. 3). Precisely, companies that embrace strategic planning are more ready to challenge and manage the daily limitations that arise in both the external and internal environment and enjoy better financial rewards than their equals in the industry that do not embrace strategic planning.
Also, strategic management process is linked to non-pecuniary benefits. It nurtures a positive organizational environment or climate. For instance, it facilitates enhanced communication, deeper and improved understanding of the firm’s objectives, and lastly a greater commitment to implement strategies and achieve objectives (David, p.48). As a result, it aligns both the management and employees on a common mission of helping the organization to succeed.