What is Strategic Management?

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What is Strategic Management?
Zedy Zaidy, Member
In the business environment people talk of strategic planning, strategic implementation, strategic direction, strategic fit, strategic flexibility, dynamic environment, turnaround strategy, downsizing, divergence and convergence and many more.

Economists, managers, exchangers, marketers, speculators, brokers and dealers, innovators and entrepreneurs, and broadcasting corporations all fuel us up of big words…

⇒ Now what exactly is this field of strategic management?
 

 
What Strategic Management is...
K.Narayana Moorthy, Member
Strategic management processes link and activate the following spheres of an enterprise towards effective performances: vision, mission and objectives; the general environment; the industry and international environment; enterprises' internal factors; general strategic and tactical alternatives; strategy variations; choosing appropriate strategy and tactics; resource and structure; policies-plans-procedures and administration and establishing an evaluation system.
Knotty problems arise in the field of strategic management like depletion of natural energy resources; relationship between political and business corporations; justice for the society in which business corporations exists. These are to be tackled by adopting a strategy which satisfies all.
 

 
What is Strategic Management?
Belay Gezahegn, Member
Let us take an example of a mountain climber who wanted his name recorded in history:
- This person has to design a strategy that will help him to succeed, without losing his life or succumb an injury. This may include selecting the easiest route to the top of the mountain, exercise to get his body fit to the task, obtaining tools, instruments, medicines, foods.
- Besides, he has to study the history of earlier mountain climbers and learn from their weaknesses and strengths, he has to be able to identify his own strengths and weaknesses, and he has to know risks like avalanche and the way to avoid them.
- In addition to the above, the climber has to have sufficient resources like finance, time and other things to get his strategy fulfilled.
- If he does not have adequate financial resources, he may not be able to pay for the needed tools.
- If he does not have enough time, he cannot exercise properly.
- If he does not have a strategic plan to get these resources his vision will remain a dream.
The same analogy applies to business firms.
 

 
Definition of the Field of Strategic Management
K.Narayana Moorthy, Member
A nice definition of strategic management is also: "A field that deals with major intended and emergent initiatives taken by general managers on behalf of the owners, involving utilization of resources, to enhance the performance of the firm in its external environment".
 

 
What is Strategic Management
Nay Min Aye, Member
Strategic management is the management process which would keep the organization from deviating from it's desired performance and result in a changing environment.
 

 
A Definition of Strategic Management
Alan Kennedy
The definition I offer for strategic management in my book, "The Alpha Strategies: Understanding Strategy, Risk, and Values in Any Organization", is: Strategic Management is managing the strategic thinking of individuals to produce superior organizational performance.
Managing strategy is achieved by managing the individuals responsible for strategy and its implementation. Those individuals are, of course, the employees of an organization. Each employee, from the CEO down, has a role to play in strategy and its implementation and therefore must be managed.
The most critical activity to be managed is managing the strategic thinking of those individuals; namely being the way they “think” about strategy. Managing how employees think about strategy is achieved by identifying, prioritizing, and communicating clear expectations for strategy implementation and making sure those expectations are met.
Everyone in the organization has a role to play in strategic management and driving better performance.
 

 
Strategic Management Defined
azeem, Member
SM can be defined as: "The art and science of formulating, implementing and evaluating cross-functional decisions that enable an organization to achieve its objectives".
 

 
What is Strategic Management
ismail Ahmed Al kamish, Member
Is the entire thinking of sustainability, innovation and responding to the challenges and threats facing an organization to provide satisfactory products and services.
 

 
Strategic Management is a Quest to Maximize Value
Beatrice Musiega, Member
I would sum up strategic management as "A quest to maximize the value of an enterprise by those charged with the responsibility of its management".
 

 
Strategic Management Comprises Strategic Planning and Strategic Implementation
Zedy Zaidy, Member
Strategic Management is divided into two expert-fields, to wit:
- Strategic Planning
- Strategy Implementation and Control.
I will briefly start with the description of Strategic Planning:
STRATEGIC PLANNING: This is a systematic process of envisioning a desired future, and translating this vision into broadly defined goals and sequence of steps to achieve them.
In contrast to long-term planning, which begins with the status quo and lays down the path to meet estimated future needs, strategic planning begins with the desired-end and works backward to the status quo. At every step of long-term planning, the manager asks: What has to be done to reach the next step? At every step of strategic planning, the manager asks: What has to be done at the previous step to reach here?
In contrast to tactical planning, which focuses at achieving narrowly defined interim objectives with predetermined means, strategic planning looks at the holistic picture and is flexible in choice of its own means.
 

 
Strategic Management Components
K.Narayana Moorthy, Member
@Zedy Zaidy: In my view, Strategic Management consists of:
a. Strategic Planning: covering environmental assessment, organizational directions, strategy formulations and preparing implementation plans;
b. Strategy Implementation: covering- top management commitment, involving middle managers, effective communication, clear assignment of responsibilities, preventive measures against change barriers, team work activities, respect for all, calculating buffer line;
c. Operation Management: involving strategic planning-portfolio management and project management process- all leading to operational excellence;
d. Strategic Direction: involving- principles, investment policies, financial discipline and dividend policies
e. Strategic Fit: covering technology fit-operating fits-managerial fits-distribution & customer relations fits;
f. Strategic Flexibility: involving market orientation, market focus environmental turbulence and sustainable competitive advantages and service performance.
 

 
Strategic Management
K.Narayana Moorthy, Member
I add further comments on strategic management as dealing with:
1. Organizational Environment: covering new situations;looking into unpredictable obstacles (problems); creating safe & healthy work places; facilitating work/life balance;
2. Turnaround Strategies: covering convert, change or transform loss making into profit making again; caring industrial sickness;
3. Downsizing: involving corporate re-organization; creating a leaner company; reducing layers of organization;
4. Divergence: creating a skill based progressive system; advance in trading systems; planning risk coverage;
5. Convergence: involving specialization of product and services;partnering systems realignment & synchronization technology and leadership.
 

 
Strategic Management Center and 10 Schools
Jaap de Jonge, Editor
We have now added a separate knowledge center on strategic management and moved this discussion over there. Have a look…
Or watch the 10 ways or "schools" in which you can perceive strategic management as described by Prof. Henry Mintzberg. Note the implicit point that since there are at least 10 (11, 12, 13) view points or schools about strategic management, it is impossible to agree with everybody about its exact meaning or scope.
 

 
The 'Ten Schools of Thought' Seems to Sum it Up Well
Ivan Kohlinsky, Member
I have tended to agree with the view, often put about, that strategy (determining it) is incredibly important, but that it doesn't require a department for it.
It only requires a couple of days of 'hard and deep thinking' using something like the '10' ways - maybe taking a stance of each of the ten in the style of 'de Bono's hats'/methods.
Maybe (dare I say it) some outside 'help' may be beneficial.
In a way to me it involves some deep reflective thinking. So to me, in a way THERE IS NO STRATEGIC MANAGEMENT - there is only strategic thinking/development/definition of a strategy and then there is strategic implementation.
 

 
The Purpose of Strategic Management
Javier Elenes, Member
Making a company ABLE TO COMPETE is the purpose of strategic management.
So the key question is: How shall we compete? How shall we be better in value/price delivery to the customer with less use of key resources, time and money?
 

 
Strategic Management
T V N Murthy, Member
Strategic management is a preconceived plan of action, for every stage of business transactions to ensure the designed results. A strategic management principle evolved with greater insights of business and on in depth deliberations about its operational methods to minimize the road blocks and maximizes the returns. This naturally involves a group of people with a visionary head, who set the ball rolling.
 

 
What’s Strategic Management
obialor okwudiri Oleka, Member
@Zedy Zaidy: Strategy take you to playing field, execution pay the bills.
 

 
What is Strategic Management?
James Graham, Member
Strategic management is the MANAGEMENT OF STRATEGY. There is far too much theorising and hot air in this area. Know where you are currently, know where you wish to be at the end of your horizon, identify the internal and external challenges that stand in your way, create policies to deal with the challenges and manage their execution. Strategic management may draw from several strategic schools of approach, as identified by Mintzberg et al in 'The Strategy Safari'.
 

 
Strategic Management
Luis Gyory, Member
Simple... The decisions you must have to take today to being able to exist in the future... Or to disappear. Must be very able and intelligent if you want your business to survive.
 

 
Strategic Management
Jayaram, Member
Strategies are always top down and is done in the board room. This is always done with the Vision of the company in mind. Once the strategy is formulated, the team management has to work on it and define the KPI to every employee of the organisation. It is normally done keeping long term plans.
In my experience, strategies are often mismanaged because the information flow to the bottom is seldom done correct. One has to understand that it's the people in the organisation who are responsible to focus and execute the strategy.
The second part of the failure comes from lack of expertise, no sufficient time is given to execute - called as green banana delivery, and market research is not done with clear focus. Companies can create an environment, only if the leadership is supportive of the strategy.
 

 
Strategy Not Always Top Down
James Graham, Member
@Jayaram: Although your description may still hold true in some cases, strategy is by no means always done by top down planning. In a world where fast moving developments and demanding consumers create severe disruption and turbulence in some industry sectors, such an approach can lead to rapid extinction.
 

 
Strategic Management
Michel Comet, Member
Translation by Editor:
If we take as definition of the strategy, the definition of Michael Porter: "allocation of human, financial, technological, production resources; who engage the company in the long term, in order to endow it with a sustainable, decisive and defensible competitive advantage"; in this case strategic management consists in finding, researching and selecting the women and men capable of carrying out the chosen strategy.
Original posting:
Si nous prenons comme definition de la stratégie, le definition de Michael Porter: "allocation des ressources humaines, financieres, technologiques, production..; qui engagent l'entreprise sur le long terme, afin de la doter d'un avantage concurrentiel durable, décisif et défendable"; dans ce cas le management stratégique consiste à trouver, rechercher et selectionner les femmes et hommes capables de mener à bien la stratégie retenue.
 

 
The Meaning of Strategic Management
Silvan Pillay, Member
In a simple sentence. Strategic Management is an evaluation of the options available, the choices you make to steer the organisation in the intended direction.
 

 
What is Strategic Management
Gavril, Member
Looking beyond the horizon, thinking ahead of time and acting immediately, measuring and correcting the route, tolerating the battle for winning the war, focusing on new horizon.
 

 
What Strategic Management is
Hoyeol Bang, Member
Strategic Management is a management based on the belief that a manager should not be humanistic.
A humanistic man makes a decision after considering so many things, sometime against his will or preference. He accepts a certain decision because he can not reject his mother's persistent request. He lend money to his close friend even he knows he will not be payed... Because he is so humanistic!
A manager armed with the strategic management concept only makes an optimal decision which leads to the achievement of mission, goals, or objectives, usually related with maximization of benefits or minimization of costs.
He is not humanistic! He is only obssesed with the goal and disregards anything unrelated with that. It is, therefore, extremly important what a manager wants to achieve, that is, mission, goals or objectives!
 

 
Definition Strategic Management
Jeroen Kraaijenbrink, Member
Strategic management is the generation and execution of an organization's unique and sustainable value creation.
 

 
My View on Strategic Management
Florence Ansu-Amponsah, Member
Strategic Management is an intentional decision which needs to be complex and uncertain but should be able to affect operational decisions and requires an integrated approach which can result to change within an organisation.
It can also be likened to corporate governance which involves a combination of policies, system, structures and operational framework that needs to be in place for the success of a company.
One should note that strategic management is dynamic. No single model is ideal but one should consider the situation, environment and many other factors.
 

 
'Strategy' a Referent
Maurice Hogarth, Member
The word strategy relates to "HOW" not "WHAT". It is about the overall approach, the backdrop or the over-arching framework for how the required outcome (aim/goal/objective) will be achieved.
It may be at an industrial, corporate, team or personal level.
The required outcome(s) (aims, goals, objectives) may be short, medium or long-term and can be stated from national, industrial, corporate to team levels.
But the overall approach as to HOW they will be achieved is the 'strategy'. This forms the framework for the tasks-activities that will be in the 'action plan' (i.e. the tactics).
So "Strategic Management", seems meaningless. "Management of Strategy", more meaningful.
Examples:
Aim: 'win the war'. Strategy: destroy the enemies command and control structure (first). How we carry out this strategy are our tactics: tasks & activities.
Aim: 'pass my exam'. Strategy: study up on previous questions to determine likely questions and learn exam technique.
Editor: Maurice et all, please note we are NOT discussing "What is Strategy" here! We are discussing "What is Strategic Management".
 

 
A Matter of Semantics?
James Graham, Member
Maurice, though I agree with your differentiation of Strategic Management and Management of Strategy, in my experience the term 'Strategic Management' is often used by firms to mean 'strategic management process' or what firms do produce a 'strategic' plan, rather than the choices (the how you mention) that are made during that process and reflect how they will achieve their objectives. It is the source of more than a little confusion.
 

 
What is Strategic Management
Luis Gyory, Member
Please look at the original question.
In my opinion it refers to making the management think strategic. That´s why I insist in the requirement of the management (from top to bottom) to think strategically, because if they are unable to take the correct decisions today about his business, soon they will find themselves with no future, no business to manage. (Thanks Javier Elenes and Hoyael Bang).
 

 
You Make my Point
James Graham, Member
@Luis Gyory: Luis, IMHO 'thinking strategically', if done in the conventional sense, follows a process with a series of steps that inform 'what' must be done (I teach it at a business school, so am clear on this).
@Maurice Hogarth's point is that strategy is about how a firm gains advantage in it's chosen market(s) and is the result of thinking, intuition, good fortune, opportunism and potentially a range of other factors - it is reasonable to argue that one cannot teach this, as it is the result of synthesis, not analysis and is not a completely deterministic process.
There are so many potential definitions of strategic management and yet little agreement on exactly what it is, thus Mintzberg et al's attempt to define the main schools of thought.
 

 
 

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