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History of Strategic Management
From art of war
From the Greek word ‘strategeia’ meaning the
art or science of being the general
Originally known as the grand plan which
included the strategic plan and the
implementation plan of acting on those plans
The grand strategy approach was later adopted
into business in form of business strategy which
is embedded in strategic management
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Cont-
From the mass production era of the industrial
revolution in light of the 1st and 2nd world war
which destroyed what was in place led to more
concern for long term survival hence need for
strategic planning and strategy implementation
The two main reasons for the ever increasing
need for strategic management are1) the ever
changing business environment & 2) the rapid
increase in size and complexity of companies.
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What is strategic Management?
A process that involves
carrying out decisions and
actions to develop an
appropriate strategy
(means) to achieve an
organization's objectives.
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Process whereby managers
establish an organization's long
term direction, set objectives,
develop strategies to achieve
these objectives in light of the
internal and external
circumstances, and undertake to
execute the chosen action plans.
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Determination of the basic
long term goals and
objectives of an
organization, and adoption
of courses of action and
allocation of resources
necessary to carry out these
goals
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Characteristics of strategic management
It is not an event but rather a
process.
Futuristic and long term oriented.
Focus on strategy as a central theme.
Focuses on creating competitive
superiority.
Top management point of view.
Prioritizing resource allocation.
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The strategic Management Framework
Defining the business of the
firm / enterprise
Setting objectives &
performance targets
Formulating strategies
Implementing the selected
strategy
Evaluation and control
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The Strategic Planning Process
This is the process of revising the
existence of the enterprise (mission
statement), setting the long-term goals
and objectives in view of your
environment, formulating the best strategy
of getting where you want to be.
It does not include the strategy
implementation phase(1/2 way the battle
of outwitting your rivals)
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Dimensions of strategy
A strategy as a plan: course of action, a
guideline to deal with a situation
A strategy as a ploy- i.e a maneuver to win
competitors
A strategy as a pattern i.e. a series of
consistent actions/activities
A strategy as a position- a means of locating
an organization in the environment/market
A strategy as a perspective-it unites an
organization by a common thinking towards
achieving common goals
