The Strategic Management Process

• Basic management planning process consists of five steps:

  • Setting objectives
  • Making basic planning forecasts
  • Reviewing alternative courses of action
  • Evaluating which options are best
  • Choosing and implementing your plan
• 1. A Plan shows the course of action for getting from where you are to the goal. Planning is always “ goal-directed”
  2. Policies and procedures provide day-to-day guidance employees need to do their jobs in a manner that is consistent with the company’s plans and goals.
  3. Procedures spell out what to do if a specific situation arises.
• A strategic plan is the company’s overall plan for how it will match its internal strengths and weaknesses with its external opportunities and threats in order to maintain a competitive position.
• Business model “is a company’s method for making money in the current business environment.”
• Strategic management is the process of identifying and executing the organization’s strategic plan by matching the company’s capabilities with the demands of its environment.
• The Strategic Management Process

  Steps:

  1. Define the current Business
  2. Perform SWOT Analysis
  3. Formulate a new direction
  4. Translate the mission into strategic goals
  5. Formulate strategies to achcieve the strategic goals
  6. Implement the strategies
  7. Evaluate the performnace


  Steps 1-5 is Strategic Planning

  Step 6 is Strategic Execution

  Step 7 is Strategic Evaluation
• In order to define the strenghs and weakness, the company should “Audit” / Study.
• Audit may include analyzing called PEST factors.

  P- Political factors E- Economic factors

  S- Social factors

  T- Technological factors
• Environmental scanning - To help management determine the future direction of the organization. In other words it guides them on how to place thier business in the current trent.

  • Economic Trends
  • Competitive and Market Trends
  • Political Trends
  • Technological Trends
  • Social Trends
  • Geographic Trends
• A vision statement is a general statement of the firm’s intended direction;

  Mission statement summarizes what the company’s main tasks are today.