Republic of the Philippines

POLYTECHNIC UNIVERSITY OF THE PHILIPPINES

Office of the Vice President for Branches and Campuses
Santa maria bulacan campus
Santa Maria, Bulacan

Course Title : STRATEGIC MANAGEMENT

Course Code :
Course Credit : 3 UNITS

LEARNING MODULE FOR THE

SUBJECT STRATEGIC MANAGEMENT

Course: BS ACCOUNTANCY
Semester: 1st Semester
Lesson number: 01
Topic: Strategic Management Model

OBJECTIVES

Define strategic management, strategic model and strategic planning.

Differentiate strategic analysis from strategic decision-making and strategic intelligence
from strategic thinking.
Formulate a sample company vision, mission statement and company goals and objectives.

EXPLANATION OF THE LESSONS

Strategic Management Defined

Strategic management is a continuous process of strategy creation. Strategic analysis

consists of a systematic evaluation of variables currently existing in the external and internal
environments while strategic decision-making is deliberately bringing together the right
resources for the right markets at the right time. Strategic formulation is designing strategies on
the business and corporate levels. Strategy implementation is employing these crafted
strategies to achieve organizational set goals and objectives while strategic control is the
application of an appropriate monitoring and feedback system.
 Defined as the science of creating, executing, and evaluating cross-functional decisions
to enable an organization to achieve its goals and objectives, the components of the strategic
management process have to be effective.

The Strategic Management Process

Strategic Intelligence is the capability of an organization to possess relevant and related

knowledge, abilities, foresight and systems thinking, such that it is able to assess its own
strengths and vulnerabilities, the pressing challenges confronting the organization, as
well as the trends and opportunities existing in the environment.
Strategic Thinking is the cognitive process of competently and analytically weighing
factors and arriving at critical decisions in the context of the current milieu of which an
organization is part.
Organizational competitiveness pertains to the ability of any business/company to
utilize its resources optimally and sustainably for maximum performance and
productivity.
Comparative advantage refers to the ability of an organization to produce a particular
good or service at lower marginal and opportunity costs than its competitors.
Strategic performance is the accomplishment of a high level of productivity that is
characterized by efficiency in the context of lean and quantifiable management.

The strategic management model shows the relationships between and among the
input, process, and output. When these specific processes are executed and managed
creatively, distinctly, and strategically, the organization can ultimately achieve organizational
success. In particular, the output is exhibited in the strategic intelligence acquired, strategic
thinking mode developed, organizational competitiveness, comparative advantage, and
strategic performance attained by the organization.

Strategic Planning – is to devise a strategic mode of preparing, addressing and steering

organizations to where they want to go. Strategic planning is defined as a continuous,
repetitive, and competitive process of setting the goals and objectives that an organization aims
to attain, defining the means to achieve them, and assessing the best way to realize them in the
context of the prevailing environment while measuring performance through set standards,
and periodically but continuously conducting reassessments.

Types of Strategic Plans

There are two principal types of plans:

1. Medium/long-range plans – prepared in the context of the coming three to five, ten or more
years. It describes the major factors or forces that affected the organization’s long-term
objectives, strategies, and resources required.

2. Annual/yearly plan - short-term; succinctly describes the organization’s present situation, its
goals and objectives, strategies, monitoring mechanism and the budget for the year ahead.

Need for Strategic Planning

Strategic plans have to be prepared purposefully for effective and efficient

implementation, thus, leading to the attainment of their set objectives. The benefits of
designing and putting into effect a strategic plan cannot be overemphasized.

Organizational Vision
To help organizations achieve strategic direction, they need to articulate and have a
commonality in vision, mission and goals. The organizational vision is an inspirational statement
of what am organization desires to achieve. Like an unseen force, the organizational vision
binds the company and its employees together.

Mission Statement
The mission statement differs from the organizational vision. The mission statement
defines the current purpose of an organization; it answers what the organization does, for
whom it is done, and how it does what it does.

Organizational Goals and Objectives

Organizational goals are pursued to make the specific strategies succeed.

By their very nature, goals have the following properties:

1. Goals provide organizations focus and direction. They neatly converge toward the purpose of
any firm, thus, streamlining all unnecessary and redundant considerations.

2. Goals move organizations to action. Because goals have to be attained, organizations are
motivated to function and perform toward their vision.
3. Goals develop in organizations the traits of persistence; Thus, organizations continue to
persevere until they achieve their desired success.

Relationship between Organizational Goals and Objectives

Strategic objectives are, in general, externally focused. According to Peter Drucker (2008),
objectives fall into eight major classifications:

1. Market standing (e.g., desired share of the current and new markets);
2. Innovation (e.g., development of new goods, services, and of skills and methods
required to supply them);
3. Human Resources (e.g., selection and development of employees);
4. Financial Resources (e.g., identification of sources of capital and their uses);
5. Physical Resources (e.g., equipment and facilities and their uses);
6. Productivity (e.g., efficient use of the resources relative to output)
7. Social responsibility (e.g., awareness and responsiveness to the effects on the
community of the stakeholders); and
8. Profit requirements (e.g., achievement of measurable financial well-being and
growth.)

Values and Value System

Organizations are guided by values. Values are inherent roots of motivation within an
individual, an organization, a community, or a nation. Values are generally exhibited in two
different ways, namely, beliefs and attitudes. More particularly, beliefs are cognitive
manifestations while attitudes are characteristically behavioral.

Value System of an Organization

 The value system is characteristically broader in scope; aside from values, it includes
other variables such as the organization’s dreams, aspirations, interests, expectations,
philosophies, as well as leadership and management styles and ethical practices.

Organizational Climate and Culture

Organizational climate is often defined as the regular and repetitive patterns of
attitudes and behavior exhibited by employees of an organization. Organizational Culture
denotes a wide range of social phenomena including an organization’s customary dress,
language, behavior, beliefs, values, symbols, of status and authority, myths, ceremonies, and
rituals and modes of deference and subversion.

RESEARCH ANALYSIS

Discussion Questions: Type in your answer.

1. How will you describe in your own words the reality of dynamism? Cite example prove why
the environment is considered dynamic. Relate this to the current situation of the world where
the COVID 19 virus is rampant in all countries.

2. Define hyper competition. Give two important catalyst of competition and expound on their
respective perspective roles in setting off hyper competition in the global environment. Relate
this to the current situation of the world where COVID 19 virus is rampant in all countries.

ASSIGNMENT

1. Study the biography of Howard Schultz, CEO of Starbucks. Include his childhood, if there
is something significant, his interests, his educational attainment, professional and
career orientation and other facts that might have contributed to the success he is
enjoying now.
 2. Study the beginnings of Starbucks, the challenges it encountered through the years and
its journey toward success.

3. Based on the story of Howard Schultz, CEO of Starbucks, from management, result-
driven, practical and inspirational strategies implemented, which struck you as
something worth imitating? Explain your answer.

I. FORMATIVE ASSESSMENT
Multiple Choices:
Direction: Choose the correct answer. Write your answer beside the number. USE CAPITAL
LETTERS. Avoid erasures.
1. The 21st Century is marked by the following characteristic;
a. a spirit of predictability c. the reality of dynamism
b. an environment of certainty

2. The current landscape of competition today:

a. is highly threatening c. friendly
b. static

3. In a hypercompetitive environment, organizations:

a. do not help each other c. outsmart each other
b. do not collaborate with each other

4. Organizations conduct their businesses by offering:

a. less products c. innovative products
b. few products

5. In surviving this cut-throat competition, the challenge today is:

a. to adopt traditional activities
b. to adapt to the changing times
c. to employ tried and tested activities

6. Strategic management is:

a. coming up with organizational policies
b. a continuous process of strategy creation
c. managing people

7. Strategic intelligence is:

a. ensuring that everyone has the same mindset
b. possessing and using relevant and related knowledge, abilities, foresight,
and systems thinking in an organization
c. thinking about the welfare of every employee

8. Strategic decision-making is greatly demonstrated when:

 a. all employees are happy and content
b. the stakeholders earn good profits
c. the right resources for the right markets at the right time are brought
together

9. This is needed to systematically evaluate the variables currently existing in the

external and internal environments:
a. strategic analysis c. strategic decision-making
b. strategy formulation

10. Uniquely designed and effectively communicated formulated strategies allow

organizations to attain:
a. organizational competitiveness c. strategic decision-making
b. competitive advantage

11. Strategic management is:

a. conveniently practical c. the same as strategic planning
b. theoretical in nature

12. Strategic planning is:

a. adopted by businesses and companies
b. applied in an academic environment
c. research-oriented

13. Strategic planning is a repetitive and continuous process:

a. that serves as a blueprint of what the organization intends to accomplish
b. that continuously makes and changes plan
c. that involves the top management only.

14. The grand plan is also known as:

a. the departmental plan
b. the unit plan
c. the organizational plan

15. A medium/long-range plan is prepared:

a. for one year
b. less than one year
c. from three to five, ten or more years

16. The vision of an organization:

a. motivates the organization to go where it wants to go
b. is a nicely and attractively worded slogan of the organization
c. is an individual goal of a department

17. The mission statement of an organization:

a. is the same as its vision
 b. never changes in time
c. defines the current purpose of the organization

18. The goals of an organization:

a. is micro in perspective
b. is macro in perspective
c. is the same as organizational objectives

19. The strategic objectives of an organization:

a. are general in nature
b. are specific in nature
c. are environmental in nature

20. The value system of an organization:

a. is only behavioral
b. is only attitudinal
c. is both behavioral and attitudinal

PRACTICAL TEST

Briefly provide answers to the following questions.

1. How will you define strategic management?

2. What role do organizational input play in the attainment of the success of an organization?
Identify each of these inputs?

3. Differentiate strategic analysis from strategic decision-making. Give example.

4. Discuss in what ways strategic management and strategic planning are similar. In what ways
are the two different?

5. What are the disadvantages of conducting strategic planning? Will you still advise
organizations to conduct strategic planning? Why?

6. Why is mission and vision are important to an organization?

7. What values/ value system do you want an organization to demonstrate? Explain your
answer.

REFERENCES
Textbook:
Strategic Management Made Simple
2015 Edition
Felina C. Young
Other References:

Prepared by: Jonathan M. Mercado, CPA