STRATEGIC

MANAGEMENT
ORIGIN, NATURE and PROCESSES
Strategic Management
The ongoing process of setting of an
organization’s high-level goals,
developing plans of action, and
effectively allocating resources to
execute those plans.
 01
ORIGIN OF STRATEGIC
MANAGEMENT
ORIGIN OF STRATEGIC MANAGEMENT

01 1950 02 1960 03 1970

Basic Financial Long-Range Planning
Planning (Budgeting) (Extrapolation)

04 1980 05 Mid 1980s 06 1990

Creating Competitive Transition from strategic
Complex Systems
planning to strategic
Advantage management Strategy
NATURE OF
STRATEGIC
MANAGEMENT
“Strategic Management can be defined
as the art & science.”
Nature of Strategic Management:

Rational Strategic management is

An ART and
assessment of the different from other
SCIENCE aspects of management
future options.
Nature of Strategic Management:

Strategic Management Top Management

as a Process Function

General Management Relating Organization

approach to Environment
Nature of Strategic Management:

Long-Term Flexibility Innovation

Issues
 03
PROCESS OF STRATEGIC
MANAGEMENT
PROCESS OF STRATEGIC MGMT.

Environmental Scanning
● It aids in the analysis of the internal and external factors that
influence an organization.

Internal Analysis of the Environment

● Assists in determining an organization's strengths and
weaknesses.
● STRUCTURE
● CULTURE
● RESOURCES
PROCESS OF STRATEGIC MGMT.

External Analysis of the Environment

● The analysis of an organization's external
environment reveals opportunities and threats.
● NATURE ENVIRONMENT and SOCIETAL
ENVIRONMENT
● TASK ENVIRONMENT
SWOT Analysis.
It assesses internal, external, current, and future potential factors
that may affect the market position of a particular organization.
PESTEL ANALYSIS
It is a tool for identifying external forces that may have a positive
or negative impact on an organization.
PORTER’s 5 FORCES
It is developed by Michael E. Porter as a framework for assessing
and evaluating the competitive strength and position of a
business organization.
 STRATEGY FORMULATION
Setting Organizations’ Evaluating the Organizational
objectives Environment

Setting Quantitative Aiming in context with the

Targets divisional plans

Performance analysis Choice of strategy

PROCESS OF STRATEGIC MGMT.

Strategy Implementation
● Pulling strategy into action
● Also referred to as strategic execution
● The process of turning plans into action to reach a
desired outcome.
Following are the main steps in implementing a
strategy:

Strategy Implementation
● Disbursement of abundant resources to strategy-
essential activities.
● Restructuration and reengineering.
● Minimize the resistance to change
● Adapting production/operations processes
Following are the main steps in implementing a
strategy:

Strategy Implementation
● Developing an organization
● Creating strategy-encouraging policies.
● Linking reward structure to accomplishment of
results.
● Employing best policies and programs
● Making use of strategic leadership.
Following are the main steps in implementing a
strategy:

Evaluation and control

● This includes performance measurements. consistent review of
internal and external issues and making corrective actions
when necessary
The process of Strategy Evaluation consists of
following steps:

Fixing benchmark of
performance

Taking Corrective
Action Measurement
of performance

Analyzing
Variance