This term paper is to examine the following key arrears in relation to the topic above:
The evolution and the definition of Strategic management, the dimension and scope, various strategic decision making process, the strategic management process, stages of strategic management, various strategic management models, developing the strategic movement process, the tools and techniques used in strategic management, the advantages, values and disadvantages of strategic management.
THE ORIGIN OF STRATEGIC MANAGEMENT
Strategic management was discovered amid high optimism and industrial growth in the 1960’s and early 1970’s. In the beginning, organizations tried to cope with the new and rapidly-changing technological, economic and organizational developments by means of long-range planning. Long-range planning soon ran into numerous problems when it became clear that simply forecasting past events into the future could not always provide accurate results, nor achieve the organization’s desired objectives. There was need for Organizational transformation strategic planning into a vital management discipline. Long-range planning has been replaced by strategic management, which incorporates the possibility that changes and trends can and do occur and it is not based on the assumption that development can be assured (Burnes, 1992:91). Whereas long-range planning was essentially concerned with plotting trends and planning actions to achieve identified. Targets all aimed financial goals and budgetary control.
STRATEGIC MANAGEMENT DEFINITION
Strategic management is a management field focusing on long-term planning and the direction of the organization. Strategic management in an organization ensures that things do not happen randomly but according to pre-planned, long-term plans. It serves, on one hand, the transmission of the owners’ requirements to the management and on the other hand, the organizational management for the organization, unification and directing the behavior of all people in all parts of the organization.
Phases of strategic management
The whole process of strategic management takes place in four primary, recurrent phases (the so-called Strategic cycle):
• Strategy Formulation (organization mission, its vision and strategic objectives)
• Strategic Planning (establishment of a strategic plan and schedule implementation)
• Strategy Implementation (resource allocation, implementation of projects, activities and measures to meet strategic objectives)
• Strategic Control, status monitoring and strategy evaluation (strategy evaluation and possible update).
THE DIMENSION AND SCOPE OF STRATEGIC MANAGEMENT
Strategic management focuses on the total enterprise. It involves the planning, directing, organizing, and controlling of the strategy-related decisions and actions of the business.
The Scope of Strategic Management
This incorporates five key areas.
• Management process
. Management process as relate to how strategies are created and changed.
• Management decisions
. The decisions must relate clearly to a solution of perceived problems (how to avoid a threat; how to capitalize on an opportunity).
• Time scales
. The strategic time horizon is long. However, it for company in real trouble can be very short.
• Structure of the organization
. An organization is managed by people within a structure. The decisions which result from the way that managers work together within the structure can result in strategic change.
• Activities of the organization
. This is a potentially limitless area of study and we normally shall center upon all activities which affect the organization. These all five themes are fundamental to a study of the strategic management field and are discussed further in this chapter and other part of this thesis.