The strategic management process involves a set of activities that an organization follows help organizations formulate and implement strategies to achieve their long-term goals.
The key elements of the strategic management process are:
1. Vision,
Mission, and Values: The strategic management process begins
with developing a clear understanding of the organization's vision, mission,
and values. This helps to provide a framework for setting objectives and making
decisions. It is a part of Strategic Intent
2. Situation Analysis: Situation analysis is a process of understanding the internal and external factors that impact an organization or a particular situation. It is an important step in the decision-making process as it helps to identify the strengths, weaknesses, opportunities, and threats that an organization or a situation faces.
Here are some more details on situation analysis:
a) Internal analysis: This involves examining the internal factors of an organization or situation, such as its resources, capabilities, and organizational structure. It helps to identify the strengths and weaknesses of the organization or situation.
b) External analysis: This involves examining the external factors that impact an organization or situation, such as the political, economic, social, and technological factors. It helps to identify the opportunities and threats that the organization or situation faces.
c) SWOT analysis: SWOT analysis is a tool used to analyze the internal and external factors of an organization or situation. It stands for strengths, weaknesses, opportunities, and threats. This tool helps to identify the areas where the organization or situation can improve and the areas where it needs to be careful.
d) PEST analysis: PEST analysis is another tool used to analyze the external factors that impact an organization or situation. It stands for political, economic, social, and technological factors. This tool helps to identify the trends and changes in the external environment that can affect the organization or situation.
The situation analysis is a critical step in the decision-making process as it provides a comprehensive understanding of the internal and external factors that impact an organization or situation. It helps to identify the opportunities and threats that an organization or situation faces and how to leverage them to achieve its objectives.
3. Strategy Formulation: Based on the situation analysis, the organization formulates its strategy by identifying its goals, defining its competitive advantage, and determining the actions required to achieve those goals.
4. Strategy Implementation: This involves putting the strategy into action by allocating resources, designing the organization's structure and systems, and establishing a plan for execution.
5. Evaluation and Control: The final step in the strategic management process is evaluating the performance of the strategy and making necessary adjustments to ensure its success. Regular monitoring and feedback are critical to identifying and addressing any issues that arise during the implementation process.
Unveiling the mystery of strategic management process in action for Apple Inc.:
Let's consider the case of Apple Inc., a technology giant that designs, develops, and sells consumer electronics, computer software, and online services. Apple has been successful in the global market with its innovative products and services. However, the company's success did not happen by chance. It was the result of a well-planned and executed strategic management process.
1. Vision, Mission, and Values: Apple's vision is to create innovative products that enrich people's lives. Its mission is to design the best user experience and deliver seamless integration of hardware, software, and services. Apple's core values include customer-centricity, innovation, and design excellence.
2. Situation Analysis: Apple's situation analysis includes an internal analysis of its resources, capabilities, and competencies, as well as an external analysis of the market, competition, and technology trends. For example, Apple's internal analysis revealed that its design and engineering teams are among the best in the world, and its supply chain is efficient and effective. Meanwhile, the external analysis showed that Apple faced strong competition from other technology giants such as Samsung and Google.
3. Strategy Formulation: Based on its situation analysis, Apple formulated a strategy that focused on innovation and differentiation. The company's goal was to create products that would stand out in the market, while maintaining its focus on design, simplicity, and ease of use. Apple also focused on expanding its product portfolio to include new and emerging markets, such as wearable’s and home automation.
4. Strategy Implementation: Apple implemented its strategy by investing heavily in research and development, and by partnering with key suppliers and vendors to improve its supply chain efficiency. The company also focused on creating a unique customer experience, with its own retail stores and online services, such as Apple Music and iCloud.
5. Evaluation and Control: Apple regularly evaluates its strategy by monitoring its financial performance, customer satisfaction, and market share. The company also adjusts its strategy as needed, based on changing market conditions and customer feedback. For example, in 2014, Apple launched the larger-screen iPhone 6 and 6 Plus, responding to customer demand for larger screen sizes.
Apple's strategic management process has helped the company achieve its goals and remain a leader in the technology industry. By focusing on innovation, differentiation, and a unique customer experience, Apple has been able to stay ahead of its competition and remain a top performer in the global market.
Overall, the strategic management process is a continuous cycle of planning, implementing, and evaluating strategies to ensure an organization's success in the long run.
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