 Art and science of formulating,

implementing, and evaluating cross-

functional decisions that enable an
organization to achieve its objectives
 Also refers to strategic planning
 Strategic management refers strategy
formulation, implementation, and evaluation;
strategic planning may refer only to strategy
formulation
1. Strategy Formulation
2. Strategy Implementation
3. Strategy Evaluation
 Development of MVG
 Identification of the external opportunities
and threats
 Determination of internal strengths and
weaknesses
 Establishment of long-term objectives
 Generation of strategies
 Choice of particular strategies to pursue
 Establishment of annual objectives
 Formulation of policies
 Motivation of employees
 Allocation of resources
 Review of external and internal factors that
are bases of current strategies
 Measurement of performance
 Corrective actions
 Strategic Management

Vision
Where would
we want to be?

Analysis of Current
Circumstance:
Where are we now?

Mission: Why do we exist?

Company Name
 ? QUESTIONS ?

Strategic Management seeks the answer for four basic

questions:

 WHERE ARE WE? SITUATION

ANALYSIS

 WHERE WOULD WE WANT TO VISION,MISSION,

BE? STRATEGIC GOALS

 HOW WOULD WE REACH STRATEGY &

WHERE WE WANT TO BE? ACTIVITIES

 HOW WOULD WE FOLLOW PERFORMANCE

AND EVALUATE OUR SUCCESS EVALUATION
 Allows organization to be more proactive
than reactive in shaping its own future
 Allows organization to initiate and influence
(rather than just respond) to activities
 Exerts control over its own destiny
1. Enhanced communication – dialogue,
participation
2. Deeper/ improved understanding – of
other’s views; of what the firm is doing/
planning and why
3. Greater commitment – to achieve objectives;
to implement strategies; to work hard
4. All managers and employees on a mission
to help the firm succeed – THE RESULT
 Research indicates that organizations using
SM concepts are more profitable and
successful than those that do not.
1. It allows the prioritization and exploitation of
opportunities.
2. It provides an objective view of management
problems.
3. It represents a framework for improved
coordination and control of activities
4. It minimizes the effects of adverse
conditions and changes.
5. It allows major decisions to better support
established objectives
6. It allows more effective allocation of time
and resources to identified opportunities
7. It allows fewer resources and less time to be
devoted to correcting erroneous or ad hoc
decisions
8. It creates a framework for internal
communication among personnel.
9. It helps integrate the behavior of individuals
into a total effort
10. It provides a basis for clarifying individual
responsibilities.
11. It encourages forward thinking.
12. It provides a cooperative, integrated. And
enthusiastic approach to tackling problems
and opportunities.
13. It encourages a favorable attitude toward
change.
14. It gives a degree of discipline and formality
to the management of a business.
1. Lack of knowledge or experience in
strategic planning
2. Poor reward structures
3. Firefighting
4. Waste of time
5. Too expensive
6. Laziness
7. Content with success
8. Fear of failure
9. Overconfidence
10. Prior bad experience
11. Self-interest
12. Fear of the unknown
13. Honest difference of opinion
14. Suspicion
1. Using strategic planning to gain control over
decisions and resources
2. Doing strategic planning only to satisfy
accreditation or regulatory requirements
3. Too hastily moving from mission
development to strategy formulation
4. Failing to accomplish the plan to employees,
who continue working in the dark
5. Top managers making many intuitive
decisions that conflict with the formal plan
6. Top managers not actively supporting the
strategic planning process
7. Failing to use plans as a standard for
measuring performance
8. Delegating planning to a “planner” rather
than involving all managers
8. Failing to involve key employees to all
phases of planning
9. Failing to create a collaborative climate
supportive of change
10. Viewing planning as unnecessary or
unimportant
11. Becoming so engrossed in current
problems that insufficient or no planning is
done
12. Being so formal in planning that flexibility
and creativity are stifled
1.It should be a people process more than a
paper process.
2. It should be a learning process for all
managers and employees.
3. It should be words supported by numbers
rather than numbers supported by words.
4. It should be simple and non-routine.
5. It should vary assignments, team
memberships, meeting formats, and even the
planning calendar.
6. It should challenge the assumptions
underlying the current corporate strategy.
7. It should welcome bad news.
8. It should welcome open-mindness and a
spirit of inquiry and learning.
9. It should not be a bureaucratic mechanism.
10. It should not become ritualistic, stifled, or
orchestrated.
11. It should not be too formal, predictable, or
rigid.
12. It should not contain jargon or arcane
planning language.
13. It should not be a formal system for
control.
14. It should not disregard qualitative
information.
15. It should not be controlled by “technician”.
16. Do not pursue too many strategies at once.
17. Continually strengthen the “good ethics is
good business” policy.