Strategic Management Process is an ongoing process of five steps which defines the way an organization makes its strategy to achieve its goals. Using Strategic Management Process, an organization decides to implement a selected few strategies along with stakeholders, details the implementation plan and keeps on appraising the progress & success of implementation through regular assessment. The five stages of strategic management process are shown in the figure below.
The process is not a one time implementation but we can think strategic management process as a loop which keeps on going to achieve the objectives as per the need.
1. Goal Setting:
The vision and goals of the organization are clearly stated. The short-term and long-term goals are defined, processes to achieve the objectives are identified and current staff is evaluated to choose capable people to work on the processes. This can be done through proper environmental scanning.
2. Analysis:
Data relevant to achieve the goals of the organization is gathered, potential internal and external factors that can affect the sustainable growth of the organization are examined and SWOT analysis is also performed.
3. Strategy Formulation:
Once the analysis is done, the organization moves to the Strategy Formulation stage where the plan to acquire the required resources is designed, prioritization of the issues facing the business is done and finally the strategy is formulated accordingly
4. Implementation:
After formulation of the strategy, the employees of the organization are clearly made aware of their roles and responsibilities. It is ensured that funds would be available all the time. Then the implementation begins.
5. Strategy Evaluation:
In this process, the strategies being implemented are evaluated regularly to check whether they are on track and are providing the desired results. In case of deviations, the corrective actions are taken.
As shown in the figure, the five stages are not stand-alone and constantly interact with each other in order to ensure better management of the business.
The strategic management process enables the organization of plan ahead through proper approach in order to gain competitive advantage wrt competitors. The process equips the organization to deal various internal and external factors. The process can differ for various organization depending on their size, domain, focus and core competency but the importance of strategic management process remains the same.
Strategic Management process is not an objective one time process which would yield the expected results in the first attempt. Optimizing the strategic management process for the organization may take time. The 5 steps stated above may have to be revisited multiple times and still the results may differ. The main limitation is the time it would take to completely tune and manage the process for a particular organization in order to see real benefits but having said that strategic management process if mastered properly can lead to serious advantage for the organizations.
Hence, this concludes the definition of Strategic Management Process along with its overview.
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