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What is Strategic Management? Meaning.
Strategic management is the field within business administration and Management concerned with the way organizations can determine and execute their strategy to realize their long-term goals effectively and efficiently.
Strategic management does not focus on one functional area of business, like Finance, HRM, or Marketing, but concerns the entire corporation, business unit or organization as a whole. It is a holistic approach to the big picture of how the organization should be run.
Strategic management involves the formulation (formation) and execution (implementation) of the Strategic Vision, major goals and strategic initiatives by a company's top management in order to create value for the owners (Shareholders) and Stakeholders, based on consideration of the Resources, Strengths and Weaknesses of the organization, the Industry Structure and Macro Environment in which the organization operates and competes.
Strategy formulation (formation) involves analyzing the environment in which the organization operates (Strategic Analysis), then making strategic decisions about how the organization will compete (Strategic Decision-making). Formulation ends with a series of goals or objectives and measures for the organization to pursue (CSFs and KPIs).
Note that instead of this such Deliberate Strategy formulation (also called Formal Planning), strategy is increasingly viewed as an ongoing process of constant learning, experimentation and risk-taking; an adaptive, incremental and complex learning process (Emergent Strategy).
Strategy execution (implementation) involves decisions regarding how the organization's Resources (e.g., people, processes and systems) will be aligned and mobilized towards the objectives. Implementation results in the Organizational Structure, Leadership arrangements, Control Systems, Strategic Communication, Executive Compensation, Incentives, and Performance Management to track progress towards objectives, among others.
Note that while the two processes (formulation and execution) above are described sequentially, they are nowadays typically iterative and each provides input for the other.
Schools of Thought on Strategic Management
In his book "Strategy Safari", Henry Mintzberg gives an excellent overview of the entire field of strategic management by describing "Ten Schools of Thought".
Concepts and Methods used in Strategic Management
Go here for an extensive list of business and corporate Strategy Models and Methods.
Compare with: Strategic Analysis | Strategic Planning | Strategy Execution
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