STRATEGY AND ORGANIZATION STRUCTURE (part2)

STRATEGY
1. Strategy is a plan of action designed to achieve a long-term goal or overall aim. In
the business industry, it refers to basic directional decisions that are made to
achieve purposes and missions.
2. It is important to differentiate between strategy and tactics. While strategy
focuses on long-term goals, tactics are shorter-term actions taken to achieve
those goals.
THE STRATEGIC MANAGEMENT PROCESS:
1. The strategic management process involves several steps. The first step is to
define the vision, mission, and values statements of the organization. This should
be followed by an external analysis of the business environment (PESTEL) and an
internal analysis of the organization (SWOT).
2. The information from PESTEL and SWOT analyses should be used to set clear and
realistic goals and objectives based on the strengths and weaknesses of the
company. This step involves formulating targeted plans to achieve the goals and
prioritizing the tactics most important to achieving the objectives.
3. The third step in the strategic management process is strategic implementation.
This is where planning stops and action begins. The strategies that have been
formulated are put into action.
4. The final step is strategic evaluation and control. Performance measurements are
taken, and if actual results vary from the strategic plan, corrective actions will
need to be taken. This may involve re-examining the goals or the measurement
criteria. If the strategy is not working according to plan, new plans need to be
formulated.
IMPORTANCE OF ALIGNING THE STRUCTURE WITH THE BUSINESS STRATEGY:
1. Organizations must identify outcomes that the new structure or process is
intended to produce. This will help to ensure that the structure is aligned with
the business strategy.
PORTER’S FIVE FORCES:
1. Porter's Five Forces is a framework for analyzing a company's competitive
environment. It helps with the development of business strategy.
 2. The five forces are: competitive rivalry, supplier power, buyer power, threat of
substitution, and threat of new entry.
IMPORTANCE OF STRATEGY:
1. Strategy creates a vision for the organization. It helps to create an action plan
that can be used to achieve the vision.
2. Measuring progress is an important part of strategy. Identifying strengths and
weaknesses, opportunities, and threats can help to maximize opportunities and
minimize threats.
3. Strategy also helps to make decisions in regards to required skill and knowledge,
resource allocation, capacity planning, and building capabilities.
ORGANIZATIONAL GOALS:
1. Organizational goals are strategically set objectives that outline expected results.
Based on these objectives, decisions and actions are taken, and employee efforts
are guided.
2. There are three types of organizational goals: strategic goals, tactical goals, and
operational goals. Planning goals derive from strategic objectives.
ORGANIZATIONAL EFFECTIVENESS:
1. Organizational effectiveness is the efficiency of an organization in meeting its
goals.
2. Factors that determine organizational effectiveness include growth, productivity,
financial profit, and technological innovation.
ORGANIZATIONAL EFFECTIVENESS MODELS:
1. There are several organizational effectiveness models. These include the goal
model, internal process model, resource-based model, strategic constituency
model, stakeholder model, competing values model, and abundance model.