Strategic Management

Strategic management seeks to create a “desired future.” The future can be created and shaped in a desired way by knowing what the desired future is and how to get there, revealing and organizing the obvious, allowing us to work with “what we are” to achieve “what we should be.”

Conceptually, strategic management is in step with the evolution in management theories. The classical behavioral and quantitative schools of management emphasized aspects of the organization and its performance that could be controlled by management; issues such as production planning, subordinate behavior, improving the work environment, the role of informal groups in work efficiency, quantitative models of decision-making, and so on.

But the political atmosphere of society, the feelings of individuals and institutions outside the organization, were never their main issue, because the environment was relatively stable and no such need was felt.Gradually, with continuous economic growth, reliable environmental conditions disappeared and accelerated changes and events occurred in the world.Therefore, the rapid and complex changes and transformations of society and its impact on the growth and development of companies caused managers to focus their attention on the organizational environment and concepts such as system, economy, long-term planning, strategy and strategic management process to be taken into consideration by management experts. These concepts and theories were the response of management science to the vast economic and social transformation and changes.

Definition of management

There is no consensus on the definition of management, and management experts and theorists with different goals and biases have provided different definitions.

• Management is the art of getting work done through others (Fall, 1924)
• The process of coordinating individual and group activity towards group goals (Donley et al., 1971)
• The process of planning, organizing, leading, and supervising the work of organizational members and using all available organizational resources to achieve the organization’s desired goals (Stoner et al., 1995)

• The science and art of coordinating the efforts and endeavors of organizational members and using resources to achieve organizational goals.
• Playing the role of leader, information source, decision maker, and liaison for members of the organization (Alwani)

Strategic definition

The word strategy is derived from the Greek root strategema, meaning army commander, composed of stratos, meaning army, and ago, meaning leader. The concept of strategy was first used in military science to mean the art, direction, application, and coordination of forces to achieve war goals. Elsewhere, strategy is defined as follows:”Strategy is a set of main goals, policies, and overall plans to achieve these goals in a way that is able to explain what kind of business and what kind of organization we are or want to be in.”

Ansoff, as the first scientist to explain strategy in a comprehensive and meaningful way, believes that the greater the consistency between an organization’s goals and current activities, the greater and more regular the rate of growth and development will be.

Strategic Management

Strategic management is the process of ensuring that an organization achieves the benefits of employing appropriate strategies. According to this statement, an appropriate strategy is defined according to the needs of an organization at a given time.

Strategic management process

The strategic management process can be divided into four stages:

• Analysis of the situation
• Developing a strategy
• Strategy implementation
• Strategy evaluation

Analysis of the situation

• Long-term goals, the organization’s mission (why we exist and what we are), the organization’s vision (what we want to be)

• Analysis of the organization’s internal environment and capabilities
• External environment analysis

Developing a strategy

In strategy formulation, we must first list the set of usable strategies and then select the superior strategy using various models that have been mentioned in strategic management discussions and according to the results obtained in the situation analysis that was mentioned in the first stage. In this stage, middle and even lower-level managers of the organization must be involved to create motivation in them.
The general framework for developing your strategy has the following three steps:

• First stage: Entry stage
• Second stage: Analysis and comparison stage
• Step Three: Decision Making

The general framework for developing a strategy and the practical methods used in this field are as follows:

Strategy implementation

To implement strategies, the following tools should be used:
• An organizational structure that is consistent with the strategies
• Coordination of the organization’s skills, resources, and capabilities at the executive level
• Creating an organizational culture that is consistent with the organization’s new strategy
Successful implementation of a strategy requires the cooperation of managers from all departments and functional units of the organization.

Strategy evaluation

To determine the extent to which the objectives are being achieved, the implemented strategy must be monitored and controlled. Strategy evaluation involves three main activities:
• Reviewing the fundamentals of the company’s strategies
• Comparing expected results with actual results
• Taking corrective action to ensure that performance is in line with planned plans.
The information obtained from the strategy evaluation process should be such that it facilitates operations and actions and identifies those or units that need improvement.

Obstacles to implementing strategic plans

“The Seven Deadly Strategic Mistakes” which outlines common mistakes and problems in strategy implementation:
Fatal Mistake #1: Strategy is not worth implementing
A strategy is worth implementing if it has the power to inspire and help employees understand how their tasks relate to the strategy,It can be used as a guide for prioritizing decisions and provide insight to employees to facilitate communication.

Fatal Mistake #2: Employees are not clear about how the strategy will be implemented.
There are a number of important issues that need to be addressed at the outset. These include:
• Priorities: What are your priorities?
• Timeline: How quickly should the strategy be implemented?
Impacts: How does the strategy impact your activities?
Impacts: How does the strategy impact your activities?
• Risks: Identify and mitigate risks that hinder strategy implementation.

Fatal Mistake #3: Customers and employees don’t fully understand the strategies.
The strategy implementation plan should include a communications plan that specifies who should be informed about the strategy and to what extent.

Fatal Mistake #4: Responsibility for implementing changes is unclear.
Employees must be fully informed and assigned specific responsibilities for implementing the strategy. The more people directly involved in the implementation process, the better.

Fatal Mistake 5: The CEO and senior managers leave the stage when the performance begins.
Often, senior management’s level of interest decreases after a strategy is developed and agreed upon. If employees feel that senior management is not fully committed to the strategy, their interest will also decrease.

Fatal Mistake 6: Failure to Identify Obstacles
Plans are never executed accurately. Organizations operate in a dynamic and changing environment, so unforeseen events may arise during implementation. These obstacles must be identified, and when these crises and uncertainties occur, employees must be encouraged to develop creative solutions to overcome these obstacles.

Fatal Mistake 7: Forgetting about the business Another risk is that strategy development and execution become so focused on senior management that they forget that they have a business to run.