Strategic Management can be broadly defined as the set of actions and decisions applied in the formulation and implementation of appropriate strategies. These strategies help in the provision of competitive advantage to the organization. Consequently, Strategic Management Plan refers to the main actions that an organization intends to attain in the long run. It entails three categories namely growth, stability and retrenchment. In a global perspective, it concentrates on the global business. Here, the three aspects involved are globalization, Multi domestic strategy and transnational strategy.
Strategic management process involves the use of management tools available in the organization to direct the available resources towards achieving the organization’s goal. The process involves the implementation of transformation on factors like leadership, information and control systems, human resource, cultural structure and the external environment.
The role of corporate governance in the strategic management process takes five different avenues. These include Policy setting where they set the codes and ethics guiding the workers in the organization. The other issue is the establishment of corporate strategy, which involves clear formulation of the mission and vision of the organization. It also ensures that the actions applied support the strategic position of the organization. It operates in the monitoring of the capital investments and decisions on the investments. Accountability of the stakeholders is a major concern in corporate governance.
Environmental analysis evaluates both the internal and the external environments of the business. This employs the SWOT analysis which focuses on the strengths and opportunities; and weaknesses and threats. The strengths and opportunities are considered internal environment while the threats and weaknesses are considered the external environment. It involves using the strengths and opportunities within the business to fight the threats and the weaknesses.
There are indeed around six major challenges to strategic implementation. These include the availability of an over contended upper management team, ineffective management programs, inadequate communication, lack of intermediate management techniques, poor coordination, conflicting priorities and unclear strategies. The key to solving these hic ups is based on the proper communication and training of workers. The different strategic alternatives to these situations are as illustrated below. The organization should engage all levels in the planning process. Communication becomes very important at this stage. Conduct proper training for the workers and finally implement new strategies with a lot of care.
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