Strategic management is a combination of external and internal environmental analysis, strategic direction, business and corporate strategy formulation, strategic control and strategic restructuring. Strategic management is the ability to analysis and organizations strengths and weakness. The resource an organization has is as important as the operating capital of the organization. It is important that the organization is aware of all business opportunities and conditions for which an opportunity can be taken. Just because a organization has analyzed and hypnotized over the possible threats does not necessarily mean the organization will not incur financial damages, this merely gives an “educated view point” to what could or could not happen in the organization.
Strategic management is vital and important to all organizations, without stratgtic management and organization would have no foundation to build upon. With the ability to analyze and learn from the business environment stratgtic management serves as a key element for organizations to establish goals, execute goals and satisfy key organizational stakeholders. Strategic management includes having a direction to the types of objectives the organization will peruse, long term goals are important for the overall mission of the organization. A well established strategic direction will give an organization the leverage needed to provide guidance to managers and employees who are in the positions to carry out and perform the duties for organizational growth.
There are many processes to stratgtic management starting with external and internal analysis. The external environment focuses on socio-cutural, economic, technological and political forces. With these of focus an organization is able to better understand the needs to their external environment as well as set logical goals to improve on services of their external enviornment. The external environment is broad and must be properly evaluated by the organization; competitive markets may include suppliers and existing organizations with similar mission statements.
Internal analysis consists of organizational resources and competitive advantages. Organization must have a healthy understanding of their sustainable competitive advantage as well as resource interconnectedness. The organizations human resources department is a fragment of top management involvement that must be included in all operational decisions. Employee recruitment, training and rewards are all facets of keeping an organization competitive.
Overall, the stratgic management process is all about the stratgic thinking focus of an organization. Although stratgic managment is a learned skill, most organizations figure it is a part of a creative professional business process needed to ensure an organization is successful. The focus is simple, to include long term growth, keeping external and internal points of communication flowing and keeping a competitive edge.
Reference: Harrison; St. John (2008) Foundations in Strategic Management. Publisher: South-Western Foundations in Strategic Management The External Environment