Book Of Strategic Management

Nature and Scope of Strategic ManagementStrategic management is well-organized approach that is based on effective principles and process of management to recognize the corporate objective or mission of business. It establishes suitable target to assure the objective, identify existing opportunities and restraints in the environment, and develop a logical realistic process to accomplish company objective. Strategic management is both the process and beliefs to determine and control the organizational affiliation in its vibrant environment. It is a process to describe approaches and procedures to help management become accustomed to the current business environment through the use of objectives and strategies. As a philosophy, it changes the viewpoint of manager to deal with competitors, customers, markets and even the organization itself. Its purpose is to motivate management's wakefulness of the strategic implication of environmental events and internal decision.

Theoretical review: Strategic management in literature is thoroughly described by several theorists. In the beginning of 1980, Glueck (1984) explained Strategic Management as 'a stream of decisions and actions, which leads to the development of an effective strategy or strategies to help achieve corporate objectives'. Another group of theorists like Hofer and others (1984) stated that strategic management is 'the process which deals with the fundamental organizational renewal and growth with the development of strategies, structures, and systems necessary to achieve such renewal and growth, and with the organizational systems needed to effectively manage the strategy formulation and implementation processes'.

Strategic intent in earlier literature: Features of Strategic Intent: Attributes of Strategic Intent:There are three major attributes of Strategic Intent:. Sense of Direction,. Sense of Discovery. Sense of Destiny.Sense of Direction is described as the 'Long-Term Market or Competitive Position.The Sense of Discovery denotes to 'the competitively unique point of view about future. It states that Strategic Intent is differentiated because here in this case the employees are allied and they are convinced about the concept of Strategic Intent'.Sense of Destiny refers to the emotional edge that is involved with the Strategic Intent. This takes Strategic Intent to an all-together new level by including the employee's emotions with the organization aspirations. This leads to an all over harmonic progress for everyone.Hamel & Prahalad stressed that strategic intent is more than simply unfettered ambition.

It encompasses the active management process which include focusing on organization's attention on the essence of winning, motivating people by communicating the value of target, leaving room for individual and team contributions, sustaining the enthusiasm by providing new operational definitions as circumstances change and using intent consistently to guide resource allocation. Therefore underlying concept of strategic intent is that strategic planning should be based on setting an ambitious vision and goals that stretch a company and then explore ways to build resources and capabilities necessary to accomplish vision and goals.

Strategic intent is more internally focused (Charles Hill, 2008).Vision: Aspirations expressed as strategic intent should lead to an end. That end is vision of an organization. A vision is more dreamt of than it is articulated. Vision has been described in different manner. Kotter defined vision as description of something such as an organization, corporate culture, a business, a technology, an activity in future (1990).

EL Namaki considers it as a mental perception of the kind of environment of an individual, organization aspires to create with in a broad time horizon and underlying conditions for the acquisition of this perception (1992). Miller and Dess visualized vision as category of intentions that are broad, all inclusive and forward thinking. Major benefits of having vision are designated by Parikh and Neubauer (1993). Good visions are inspiring and exhilarating. Vision represents a discontinuity, a step function and jump ahead so that company knows what is to be done.

Good vision assists to create common identity and a shared sense of purpose. Good vision is competitive, original and unique.

They make sense in the marketplace as they are practical. Good vision foster risk taking and experimentation. It also promotes long term thinking. Visions represent integrity (Azhar Kozami, 2002).Objectives: Objectives are described as specific results that an organization gets to accomplish for its basic mission. Long term means more than one year. Objectives state direction, aid in evaluation, create synergy, reveal priorities, focus synchronization, and provide a basis for effective planning, organizing, motivating and controlling activities. Objectives should be challenging, assessable, reliable, reasonable, and apparent.

Objectives plays vital role in strategic management. Objectives define organizational relationships with its environment. By stating its objective, an organization commits itself to what it has to achieve for its employees, customers and society at large.

Objectives help organization to pursue mission and vision. By defining long term position that organization wishes to attain and the short term targets to be achieved, organization help an organization to pursue its mission and vision. Objectives provide the basis for strategic decision making.

By directing attention of strategists to those areas where strategic decisions need to be taken, objectives lead to desirable standard of behaviour and this way help to coordinate decision making. Objectives provide the standards for performance appraisal. By stating the target to be achieved in a given period of time, and the measures to be adopted to attain them, objectives lay down the standards against which organizational as well as individual performance could be judged. In the absence of objectives, an organization would have no clear and definite basis for evaluating its performance (Azhar Kozami, 2002).Features of objectives: Objectives have certain characteristics to get success in business (Azhar Kozami, 2002). Objectives must be understandable. Objectives has vital role in strategic management therefore these should be comprehensive to accomplish them.

Objectives should be concrete and specific. Objectives should be related to a time frame. Objectives should be measurable and controllable. Objectives should be challenging. Different objectives should correlate with each other. Objectives should be set with in constraints.Objective setting is complex process.

There are numerous issues associated with Objective setting. Specificity: Objectives may be stated at different level of specificity.

Many organizations state corporate as well as general, specific, functional and operational objectives. The issue of specificity is resolved through stating objectives at different level and prefixing terms.

Multiplicity: Since objectives deal with numerous performance areas, a variety of them to be formulated to include all aspect of functioning of an organization. No organization operates on the basis of single objective. Other issue of Multiplicity is number and type of objectives to be set. Organizations need to set adequate and appropriate objective to cover all performance areas.

Periodicity: Objectives are devised for different time periods. It is possible to establish long term, medium term and shot term objectives. Generally, companies set long and short term objectives.

When they do so, objectives for different time periods must have to be integrated with each other. Long term objectives are less certain and short term objectives are certain, specific and comprehensive.

Verifiability: Each objective is to be tested on the basis of its Verifiability. Only Verifiable objectives can be meaningfully used in strategic management. Verifiability is also related quantification. Reality: Generally, organizations have two sets of objectives- official and operative.

Official objectives are those which organization professes to attain while operative objectives are those which seek to attain in reality. Quality: Objectives may be good or bad. The quality of the objectives can be judged on the basis of its ability to give specific direction and tangible basis for evaluating the performance.It is assesses that Strategic objectives are used to operationalize the mission statement.

They help to provide supervision for the organization to fulfil or move toward the high goals in the goal hierarchy of the mission and vision. Consequently, they tend to be more particular and cover a more well-defined time frame. Most of strategic objectives are directed toward generating more profits and returns for the owners of the business, others are directed at customers or society at large. It can be established that objectives are set in all those performance areas which have strategic importance to organization. Drucker stated that objectives are established in areas of market standing, innovation, productivity, physical and financial resources, profitability, manager performance and development, worker performance and attitude and public responsibility (Azhar Kozami, 2002). Major factors in Formulating Strategic ObjectivesThe first factor when Formulating Strategic Objectives is the mission of the organization.Formulating Strategic Objectives depends on the environment in which the organization operates i.e.

The influence of external factors such as market conditions legislation, political and economic trends have an influence on the desired end result.Formulating Strategic Objectives also depends on the values held by the management. Management values have an important influence on the formulation of target. They may value from ethical standards to the position held on social welfare.The management experience is also an important factor in Formulating Strategic Objectives. This relates to the management experience of a specific market.The strong and weak points of the business is where the organization plans should not be made to expose the weak points of the business but instead exploit on the strength of the business. The cost of each alternative should be considered against the benefits offered.There are many benefits for the organization. They facilitate to channel employees throughout the organization toward common goals.

This helps to focus and conserve valuable resources in the organization and to work jointly in a timelier manner. Challenging objectives can help to encourage workers throughout the organization to higher levels of commitment and effort. Meaningful objectives help to resolve conflicts when they arise. Appropriate objectives provide a standard for rewards and incentives.Policies: Policies are the devices by which annual objectives will be attained.

Strategic Management: A Competitive Advantage Approach, Concepts And Cases

Policies include guidelines, rules, and procedures established to support efforts to achieve stated objectives. Policies are most often stated in terms of management, marketing, finance/accounting, production/operations, research and development, and computer information systems activities. Business policies are concerned with developing the general management point of view with demands that the manager sublimates his departmental, functional or specialist perspective in order to take balanced companywide look. The process of strategic planning encompasses the formation of specific polices.

Book Of Strategic Management Pdf

Policies help to ensure that all units of organization operate under the same ground rules. They also facilitate coordination and communication between various organizational units. Policies of competitors also influence organizational policies. According to Terry George, a business policy is an implied over all guide setting up boundaries that supply the general limits and directions in which managerial actions will take place (Satya Sekhar, 2009).