Strategic Management

                                Strategic Management

In today's economic environment, where the market has become broad and aggressive, each company, organization, or enterprise has a certain objective to fulfil, and to do so, they must become more competent in today's economic environment.

What is the definition of strategic management?

Strategic management is identifying and describing the strategies that each company develops in order to perform successfully and earn more profit. The strategic management of a company entity provides guidance in the planning, creation, and implementation of specific goals.

The fundamental principles of strategy are outlined here.

1) In a competitive market, establishing a firm's market position

2) Identifying and attempting to prevent hurdles to the firm's growth and development.

3) Creating a complete procedure in a corporate organization and completing all tasks at once.

Benefits of strategic management:

Strategic management aids in the appropriate planning of an organization's efforts to attain a specified goal. Some of the advantages or benefits of strategic management are as follows:

Competition: Developing and implementing a proper plan allows a company to better understand its competition and stay one step ahead of them. Strategic management enables a business to think beyond its boundaries and always stand out from the crowd in today's competitive world when companies are modernising their ways of working and technology to meet their aims.

Set and attain objectives: Proper strategic management aids in the setting of a specific objective as well as the planning and execution of that aim.

Systematized organisation: a good system and strategy can help a company compete better in the market.

 Types of strategic management: 

There are many types of strategic management which vary from one organization to another. Following are some of the important types of strategic management:

1) SWOT Analysis (Strength, weakness, opportunities, and threats)

Every influence has strengths, weaknesses, opportunities, and threats. SWOT analysis is the examination of internal and external factors' strengths, weaknesses, opportunities, and threats to develop a cohesive plan. Within the firm, there are strengths and weaknesses. For example, educated and experienced personnel may be a strength, while inadequate technology may be a problem.

A favourable field for a company's activity in which it can gain a competitive edge is referred to as an opportunity. Environmental Threat is an insistence by an undesirable trend or development in the environment that, if not addressed, will result in the company's position eroding. For example, in today's pandemic scenario, where COVID 19 has spread around the world, it is an opportunity for some businesses, such as the internet food and retail industry, because everyone now wants to receive their goods at home. In contrast, for some corporates threat of loss has developed such as real estate business. It is seen that the real estate has recorded a decline in sale during the pandemic times. 

2) Balanced scorecard: Balanced scorecard helps to find the facet of the business and helps to understand the areas of improvement. There are four key area of balanced scorecard

• Learning and growth

• Business procedure

• Customer’s perspective

• Financial statistics

Steps involved in strategic management:

 Fundamentally, there are five steps involved in strategic management those are:

1) Identification: This refers to determining the existing work direction of a company. Then establishing essential and desired goals to be met, as well as a comprehensive strategic direction for the company.

2) Analysis: After determining the present work scenic, a thorough analysis is required. SWOT analysis can aid in the analysis of a company's strengths, weaknesses, opportunities, and threats.

3) Strategy formation: after analysing the firm's position, strategies must be properly formed. Managers of the organisation must develop a proper and clear strategy to meet a specific goal.

4) Execution: Now that you've developed a solid strategy, it's time to put it into action. The strategy should be implemented in a clear, goal-oriented manner, and it should be communicated clearly to all stakeholders.

5) Evaluation: Managers must assess the approach after it has been implemented. It entails determining if the evaluation is the examination of whether the process was followed by all in the organization.

Limitations of Strategic Management:

The strategic management process can take a long period at times. The strategic management process necessitates extensive planning, research, and communication. This becomes tough to adopt an ineffective plan. The implementation of a comprehensive strategic management approach might be difficult. External influences, such as economic developments, might have an impact on a company's internal operations. The strategic management process becomes challenging in these circumstances. An effective strategic management strategy necessitates deft planning after considering the long-term consequences. When planning a strategic management process, a manager must always consider the risks associated in the business.

Perspective and uses    

This topic is significant in the professional exams for both undergraduate and graduate courses, especially for  

B.B.A. 

M.B.A. 

B.Com