Strategic Management Model

Components of the Strategic Management Model

The strategic management model is a comprehensive framework that reflects the process of strategic management, encompassing the activities of strategy formulation, implementation, and evaluation. The model is dynamic and continuous, meaning that these activities should be performed on an ongoing basis.

A. Strategy Formulation Activities

Strategy formulation involves several key activities, including:

1. Develop Vision and Mission Statements:

2. Vision and mission statements provide direction and purpose for the organization.

3. Establish Long-Term Objectives:

4. Setting specific results that the organization aims to achieve over a longer period.

5. Generate, Evaluate, and Select Strategies:

6. Creating and choosing the most appropriate strategies to achieve the organization's objectives.

7. Perform External Audit:

8. Analyzing external factors to identify opportunities and threats that could impact the organization.

9. Perform Internal Audit:

10. Assessing internal capabilities and resources to identify strengths and weaknesses.

B. Strategy Implementation Activities

Strategy implementation is the process of putting formulated strategies into action. Key activities include:

1. Implement Strategies - Management Issues:

2. Addressing management-related issues such as leadership, organizational structure, and resource allocation.

3. Implement Strategies - Marketing, Finance, Accounting, R&D, MIS Issues:

4. Executing strategies across various functional areas of the organization, ensuring alignment with overall strategic objectives.

C. Strategy Evaluation Activities

Strategy evaluation involves assessing the effectiveness of implemented strategies. Key activities include:

1. Measure and Evaluate Performance:
2. Continuously reviewing organizational performance to ensure strategic objectives are being met and making necessary adjustments.

Role of Business Ethics, Social Responsibility, and Environmental Sustainability

The model also reflects the importance of:

• Business Ethics: Ethical considerations influence all strategic management activities, ensuring that strategies are aligned with moral and ethical standards.
• Social Responsibility: Organizations must consider their impact on society and contribute positively to social well-being.
• Environmental Sustainability: Strategies should be designed with a focus on minimizing environmental impact and promoting sustainability.

Role of Global and International Issues

Global and international issues also play a critical role in the strategic management process:

• Global and International Issues: These factors influence all strategic decisions, from formulation to evaluation, as organizations operate in an increasingly interconnected world.

Strategic Management Model Overview

Figure 1-1 represents a widely accepted comprehensive model of the strategic management process. It provides a clear and practical approach to formulating, implementing, and evaluating strategies, emphasizing the need for continuous adaptation to changing conditions.

Most Important Activity in the Strategic Management Model

The feedback loop is the most important activity in the strategic management model. It allows organizations to continuously adapt their strategies in response to changing internal and external conditions.

'Retreats' in Strategic Management

Many organizations conduct formal meetings, known as retreats, semi-annually to discuss and update their vision/mission, opportunities/threats, strengths/weaknesses, strategies, objectives, policies, and performance. These meetings are often held off-premises to provide a focused environment for strategic discussions.

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