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Strategic Management Process (3. Crafting a strategy (Business strategy…
Strategic Management Process
1. Developing a strategic vision
Where do we want to go?
Vision
Desired future state of the org
What is out business & what will it be?
To function as valauble managerial tool:
provide understanding of what business to look like
leaders intend to position company beyond where it is today
Mision
General expression of overall purpose & intends to reflect stakeholders' expectations
Who are we? What do we do? What do we stand for? Whare are we heading?
2. Setting objectives
Short term
what MG needs to work towards for the next yr/2
Long term
directs MG to consider what to do to boost performance
Objectives should be
SMART
SPECIFIC:
precise attribute of formulation sought
MEASURABLE:
index/measure for determining progress
ATTAINABLE:
objectives = realistic
RELEVANT:
appropriate to mission statement
TIME BOUND:
time frame to achieve
3. Crafting a strategy
Business strategy
responsibility of CEO & other executives
primarily concerned with strengthening company's market position + building competitive advantage
Functional area strategies:
concerned with actions related to particular functions/processes withing business
Operating activities:
concerned with relatively narrow strategic initiatives & approaches for managing:
key operating units
specific operating activities
Crafting business strategy that yields competitive advantage has several facets
deciding where firm has best chance to win competitive edge
develop product/service that appeals to buyers & set entity apart from rivals
countering competitive moves of rival companies
Where are we now?
4. implementing & executing chosen strategy
implementation involves application of MG process to obtain desired result
strategy implementation included:
designing entity's structure
Allocating resources
Developing info & decision proces
implementation = most complicated & time-consuming
How are we going to get there?
5. Evaluating performance & initiating corrective adjustments
trigger point for deciding whether to continue/change vision, objective, strategy, etc
involves monitoring actual performance against performance targets
strategy may need to be modified because:
new objective have been set
changing conditions