Strategic management

• Business Policy


  A set of guidelines and principles established by an organization to guide decision-making and behavior within the company
• Business Policy


  • Outlines the objectives, strategies, and rules that govern various aspects of business operations
  • Provides a framework for consistency, transparency, and efficiency, helping organizations achieve their goals while maintaining ethical standards
  • Covers areas such as finance, human resources, and operations, providing a roadmap for effective management and organizational success
• Features/Characteristics of Business Policy

  • Guiding Principles
  • Goal Alignment
  • Flexibility
  • Authority Delegation
  • Consistency
  • Communication
  • Resource Allocation
  • Risk Management
  • Compliance
  • Performance Evaluation
  • Continuous Improvement
  • Customer Satisfaction
  • Ethical Standards
  • Cost Control
  • Conflict Resolution
• Importance of Business Policy

  • Strategic Alignment
  • Consistency
  • Risk Management
  • Compliance and Legal Adherence
  • Operational Efficiency
  • Resource Allocation
  • Communication Tool
  • Employee Guidance
  • Customer Satisfaction
  • Cost Control
  • Continuous Improvement
  • Competitive Advantage
• Strategy

  A deliberate and systematic plan of action designed to achieve specific goals or objectives
• Strategy

  • Long-Term Perspective
  • Goal-Oriented
  • Resource Allocation
  • Competitive Advantage
  • Adaptability
  • Systematic Planning
  • Risk Management
  • Decision-Making Framework
  • Alignment with Environment
  • Innovation
  • Monitoring and Evaluation
  • Communication and Alignment
  • Sustainability
  • Dynamic Nature
• Strategy Alternatives

  • Stability
  • Expansion
  • Retrenchment
  • Combinations
• 5 P's of Strategy

  • Plan
  • Ploy
  • Pattern
  • Position
  • Perspective
• Importance of Strategic Management

  • Direction and Focus
  • Resource Allocation
  • Adaptability to Change
  • Competitive Advantage
  • Improved Decision Making
  • Enhanced Organizational Performance
  • Innovation and Creativity
  • Risk Management
  • Effective Communication
  • Stakeholder Alignment
• Characteristics of Strategic Management

  • Strategy Formulation
  • Strategy Implementation
  • Strategy Evaluation
• Levels of Strategy

  • Corporate Level Strategy
  • Business Level Strategy
  • Functional Level Strategy
• p and organizational culture

  Support the strategy
• Communication

  Communicating the strategy throughout the organization to gain commitment and understanding
• Strategy Evaluation


  Organizations assess the effectiveness of the implemented strategies in achieving the set objectives. It involves monitoring, reviewing, and adjusting strategies as needed.
• Strategy Evaluation

  1. Performance measurement: Establishing key performance indicators (KPIs) to evaluate progress

  2. Regular assessment: Continuously monitoring and evaluating strategy implementation

  3. Feedback and control: Gathering feedback from various sources and making necessary adjustments

  4. Learning and adaptation: Encouraging a culture of learning and adapting strategies based on feedback and changing circumstances

  5. Corrective action: Taking corrective actions when performance falls short of expectations or when unexpected challenges arise
• Corporate Level Strategy


  Decisions and actions taken by top management to determine the overall direction of the entire organization. It deals with questions of what businesses to be in and how to manage the portfolio of businesses.
• Types of Corporate Level Strategy

  • Diversification: Deciding the range of industries and markets the company will operate in
  • Vertical Integration: Determining the extent to which the company will own and control its own supply chain
  • Geographic Expansion: Deciding on the geographical locations where the company will operate
  • Portfolio Management: Managing the mix of businesses to optimize overall corporate performance
• Business Unit Level Strategy


  Focuses on how a particular business unit within the organization will compete in its chosen market. It is concerned with how to gain a competitive advantage in a specific industry or market segment.
• Types of Business Unit Level Strategy

  • Cost Leadership: Striving to be the low-cost producer in the industry
  • Differentiation: Seeking to offer unique and high-quality products or services
  • Focus or Niche Strategy: Concentrating on a specific market segment or niche
  • Innovation: Emphasizing the development of new products or processes
• Functional Level Strategy

  Developed by the managers of each business function (such as marketing, finance, operations) and outlines how each function will contribute to the overall business unit strategy.
• Types of Functional Level Strategy

  • Marketing Strategy: Outlining how the company will promote and sell its products or services
  • Financial Strategy: Managing financial resources to support business goals
  • Operational Strategy: Determining the most effective and efficient ways to produce and deliver products or services
  • Human Resources Strategy: Aligning the workforce with the overall business strategy
• Operational Level Strategy


  The lowest level of strategy, focusing on specific operational issues and decisions. It is concerned with day-to-day operations and processes.
• Types of Operational Level Strategy

  • Cost Efficiency: Finding ways to reduce costs in day-to-day operations
  • Quality Improvement: Enhancing the quality of products or services
  • Process Innovation: Introducing new and more efficient ways of doing things
  • Supply Chain Management: Optimizing the flow of materials and information throughout the supply chain
• Strategic Business Unit (SBU)

  A semi-autonomous unit within a larger organization that operates as an independent entity with its own specific business strategy. SBUs are typically created to manage a distinct product or service line, cater to a specific market segment, and have their own set of competitors.
• Criteria for defining SBUs

  • Distinct Market Focus
  • Unique Products or Services
  • Competitive Environment
  • Operational Autonomy
  • Strategic Control
  • Accountability
• Advantages of SBUs


  • Focus: Concentrated attention on specific markets or products
  • Flexibility: Adaptability to changing business environments
  • Resource Efficiency: Better allocation of resources
  • Accountability: Enhanced responsibility and ownership
  • Competitive Advantage: Improved competitiveness in targeted areas
  • Performance Measurement: Clear metrics for individual unit performance
  • Innovation: Encouragement of innovation within specific business domains
  • Market Responsiveness: Swift response to market changes and trends
  • Risk Management: Isolation of risks within specific units
  • Strategic Alignment: Alignment with overall corporate strategy
• Strategic Intent

  A visionary and ambitious direction-setting approach for organizations, establishing audacious long-term goals, inspiring employees and guiding decision-making.
• Elements of Strategic Intent

  • Mission: Defines the organization's purpose, outlining why it exists and the fundamental reason for its existence
  • Vision: Envisions the desired future state, providing a clear and inspiring picture of where the organization aims to be
  • Goals: Establishes broad, long-term aims that guide overall organizational direction and strategy
  • Objectives: Specifies measurable outcomes and milestones that contribute to achieving the broader goals
  • Plans: Outlines the actions, strategies, and initiatives devised to accomplish the objectives and, ultimately, fulfill the mission and vision
• Mission Statement


  A concise declaration of an organization's purpose, outlining its core values, objectives, and guiding principles.
• Criteria for Mission Statement

  • Clarity
  • Conciseness
  • Alignment
  • Inspiration
  • Direction
  • Differentiation
  • Timelessness
  • Memorability
  • Inclusivity
  • Authenticity
• Vision Statement


  A succinct portrayal of an organization's long-term aspirations and ultimate objectives, serving as a beacon guiding the company toward its desired future state.
• Criteria for Vision Statement

  • Futuristic
  • Inspiring
  • Clear and Concise
  • Alignment
  • Challenging
  • Timeless
  • Memorable
  • Inclusive
  • Differentiating
  • Achievable
• In a business organization, goals serve as the strategic objectives that guide its actions and decisions towards achieving long-term success.
• S.M.A.R.T. Criteria

  Specific, Measurable, Achievable, Relevant, Time-bound
• Objectives

  Specific, measurable targets set to achieve the overall mission and vision, serving as stepping stones toward realizing broader goals.
• Importance of effective objectives

  • Guidance
  • Focus
  • Motivation
  • Measurement
  • Accountability
  • Alignment
  • Efficiency
  • Adaptability
  • Communication
  • Sustainability
• Plans


  Systematic and detailed outlines of actions designed to achieve specific objectives or goals, serving as a blueprint for decision-making, resource allocation, and coordination among different departments.
• Criteria for Plans

  • Clarity
  • Alignment
  • Measurability
  • Realism
  • Flexibility
  • Specificity
  • Timeliness
  • Resource Allocation
  • Communication
  • Risk Management