Aug 21, 2019 15:10

Strategic Management Process

Vision

010

Mission

009

Goals And
Objectives Strategic
008 Intent
Vision ,
Mission & 011
Goals
Strategic
Decision
Making
012

Strategic
Managemen
t Process
Strategic
001
Manageme
nt Model
007

Stages In
Stategic Stage-3
Manageme Formulation
of Strategy
002

Stage-4
Implementa
tion
003
Stage-5
Stage-1 Evaluation
Determining & Control
Stage-2
Objectives Analysis 004
006
005
NOTES
001 Strategic Management Process
ȴStrategic Planning- It is determining
the objectives of the firm resources
required and formulation of policies to
attain objectives it includes the
overlapping decesions so the
organization gets a effective strategy . It
means where the firm sees itself in next
year.
ȴStrategic uncertainty - it is a key for
constructing strategies a typical analysis 004
can result in many strategic
uncertainties such uncertainties shall be
grouped in a logical cluster or theme
then the importance of each cluster be
assessed in order to set priorities
ȴ Each uncertainty involves potential
trends or events that could have impact
on present proposed or even the
potential business.
002 Stage-3 Formulation of
ȴThe first step in this stage is to gather
all the alternative in the light of strength
weakness of organisation and OT in
external enviroment. The second step is
to choose mist appropriate alternative as
a strategy of firm.
ȴThere can be the following alternatives
$Should company continue the same
business
$If it should continue then shall it
expand units or aquire new units
$If it diversify then shall it diversify in
related area or unrelated areas
$Should it get out of existing business
fully or partially
ȴThe company may also use the
combination of alternatives known as
combination strategy
003 Stage-4 Implementation
ȴImplementation is operation oriented
it is the most demanding and time
consuming part of the SM process . To
ensure the results a manager must be
able to motivate people build and
strengthen companies competencies and
meet or beat performance targets
ȴPrincipal aspects
$Developing Budget
$Staffing Organisation
$Ensuring that the policies falicitates
effective execution
$Using best known business practices
for continuous improvement
$Installing information and operative
systems
$Motivating People
$Creating a culture and work climate
$Exerting the internal leadership and
keep Improving the execution process.
Stage-5 Evaluation & Control
ȴThe final stage is to evaluate the
companies performance and accessing
new external developments and making
corrective adjustments it is the stage
where the company has to decide
whether to continue or change
companies vision objectives strategy or
strategy execution process . But untill
the targets are being acheived the
company continues the course . Fine
tuning and efforts of improving strategy
execution are sufficient
005 Stage-2 Analysis
007
ȴThis Includes 2 types of analysis
$Environmental scanning
$ Organisational Analysis
ȴExternal enviroment consists of
economic social technological and
market. The external enviroment is
Dynamic the management should
systematically analyse each element to
determine opportunity and threats of for
firm in future.
ȴOrganisation analysis involves review
of financial resources productive capacity
marketing and distribution effectiveness
and so on. This helps in obtaining
strengths and weaknesses of entity
which can be matched with opportunity
and threats of external enviroment in
form of table of SWOT analysis.

006 Stage-1 Determining Objectives
ȴFirst the company shall determine a
path that would lead to acheivement of
goal and improve the present market
position for current and future
prospectus the top management decision 008
about the company's direction
constitutes to the vision of the company.
ȴManagers must be clear about role of
organisation this is important for both
external stake holders and the other
managers . at this level strategy does not
mean about SBU or other competitive
advantage but overall strategic
directions.
ȴcorporate goals and objectives flow
from the mission of corporation the
managerial purpose of setting objective is
to convert strategic vision into Specefic
targets which management wants to
acheived and use these targets as
yardsticks for tracking company's
performance
ȴThe managers use the objective
setting as a tool for stretching
organisation to its full potential
challenging the personell to go all out
and deliver big gains pushes company to
be more inventive.
ȴObjectives are not restricted to too
management only. It is needed at all
organizational levels the objectives shall
be broken down into separate targets for
every level department SBU etc.
Strategic Management Model
ȴevery organisation has a mission vision
and a goal though it may not be written
designed or communicated. The answer
where organisation is going to be can be
determined by where the organization
has been
ȴStrategic Managemt process is
Dynamic and continuous. A change in
one of the factor may require the change
in any or all other factors.
ȴTherefore the strategic management
process shall be on continuous and not
at the end of a year actually this process
never ends.
ȴGenerally the strategic management
process isnot cleanly and neatly
performed as per the model . But there is
a give and take among different level of
organisation. Creative ideas are
encouraged at the meeting .
Communication and feedback is required
throughout the SM process
Goals And Objectives
ȴ Objectives are organisations
performance targets they function as
yardsticks for tracking an organization
performance and progress
NOTES
ȴCharacteristics of objectives
$Should define relationship with
external environment
$Should be facilitative towards mission
$Should provide basis for strategic
decesions making
$Should provide standards for
performance appraisal
$They should be concrete and Specefic
$Should be related to time frame
$Should be challenging
$Different objectives shall corelate
among themselves
ȴA company shall have both short-term
and long term objectives short term
objectives are quarterly targets which
helps the management to indicate the
performance efficiency and long term
objectives are what the company wants
after a particular long period day 5 years
For eg if the company wants to double it's
sales in 5 years it can begin in 3rd or 4th
year it has to acheived it's short term
targets to acheived the long term
objectives.
ȴAreas of Long term objectives
$Profitablity
$ Productivity
$Employee development
$Employee relations
$Competitive position etc.
ȴLong term objectives are the results
obtained from certain strategies the time
frame for strategies and objectives shall
be consistent
ȴobjectives should be measurable
realistic challenging obtainable and
congurant among the divisions of
organisation. All objectives shall be linked
with a timeline. The objectives are often
stated in terms of Profitablity productivity
market share etc. Clearly stated
objectives provide many benefits.

vision at corporate level and business
009 Mission
ȴA company's mission statement is
typically focused on present business
scope Mission statement bradlly describe
an organizations present capabilities and
business makeup etc
ȴNeed of Having A Mission
$To ensure unamity of purpose in
company
$To develop basis for allocation of
resource
$To provide basis for motivating use of
organisational resources
$To establish a general tone or
organisational climate
$To specify the purposes and
translating these purposes into goals in
such a way that the cost time and
perfoance can be assessed
ȴThe following points to be kept in mind
while drafting mission statement
$The mission statement shall give the
organization it's own identity emphasis
and path of development mission
statement shall set apart the
organization from other similar
companies
$A comoanies business is defined by
what needs it satisfies which customers
it targets and the techniques used etc.
$Good mission staements are unique
for the organization for which they are
developed
ȴExample(ICAI)(Pg3.9)
ȴAs per the management experts peter
drucker and Theodore levitt in the
mission statement some questions shall
be raised and answered by the firm such
as
$What is our Mission?
$What is our ultimate purpose ?
$What do we want to become ?
$What kind of growth do we seek?
$What business are we In?
$In what business we would like to be
in future
ȴAs per peter drucker the organization
must ask the question "Which business
we are in?" And the answer to this shall
be marketing oriented and not
production oriented . For Eg
Revlon- In factory we make cosmetics
.(This is production oriented)In retail
store we sell Hope(This is Marketing
Oriented).
ȴDifference Between Mission&Purpose
$Mission is a statement which defines
role of organisation in the society while
purpose is anything for which the
organization strives for
$Mission strictly focuses on the needs
of society while purpose relates to what
organization strives to acheived for
accomplishing it's mission
$For example both book publisher and
magazine editor extinguish the
information need but a publisher aims to
produce better reading material while a
editor strives to present better newas
analysis

010 Vision
ȴA strategic vision is a road map which
provides specefics for the technology
customer focus product markets to be
persued the capabilities it plans to
develop and a company that
management is trying to create
ȴElements of strategic vision
$Coming up with a mission statement
which convays rthe essense that--" who
we are and where are we now"
$Using the mission statement to decide
long term course making choices about "
where we are going?"
$Communicating the strategic vision in
clear and extiting manner
ȴExamples of Vision
$ICAI: To become world's leading
accounting body a regulator and
developer of trusted professionals with
world class competencies in accounting
assurance taxation finance and business
advisory services
$Tata Motors- to be a world class
corporate furthering the interest of the
stakeholders
ȴEssentials of vision
$A challenge in developing the vision is
how to prepare company for the future
$Forming strategic vision is a exersice in
intelligent entrepreneurship
$A well articulated vision creates
enthusiasm among members
$The best worded vision statement
illuminates the direction in which the
company is to be headed
011 Strategic Intent
ȴStrategic management provides a
framework which guides the firm in one
way to acheived sttategic objectives This
intent can be in form of Mission and
model or business definition at business
level.
ȴElements of strategic Intent
$Vision - it is a blueprint of firms future
position it provides a glimpse that what
the form wants to become every sub
division in form shall follow the vision
$A mission defines the business of the
company it's goals and ways to reach
them helps the investors and
shareholders to understand the business
of firm it also defines present capabilities
and role in society of firm
NOTES

$ Business Definition explains the

business of firm WRT customer needs
target markets with business definitions
one can acertain strategic business
choices . Strategic restructuring depends
on business definition.
$Business model- it is strategy for
effective operation of business
acetaining desires customer base rival
forms operating in same industries rely
on different business models due to their
diffrent choices .
$Goals and objectives- Goals are the
end result that the organization
attempts to acheived . Objectives are the
measureable targets help in
accomplishment of goals . These are the
end Results achieved after the overall
planning during the particular period
It may be noted that in real life there is
no distinction between the goals and
objectives

012 Strategic Decision Making

ȴDecisions making is a process of

selecting best course of action from all
the available alternatives for the
accomplishment of organisational
objectives. Such decesions making can be
at operational level as well as strategic
level.

ȴDimensions of strategic DM
$It requires top management
involvement this means every problem
relating to Decesions making shall be
discussed with top management
$It requires commitment of resources
to action
$It Requires orienting organisations
internal environment to the changes in
external environment
$They have significant impact on
long-term prospertiy of the firm
$These decesions are future oriented
$These decisions generally have multi
functional or multibusiness
consequences