What is Strategic management? Strategic management Process, types.
Summary
TLDRThis video offers an in-depth exploration of strategic management, defining it as a comprehensive process involving planning, monitoring, analysis, and assessment to align with an organization's mission and goals. It outlines the five-phase strategic management process, including goal setting, information gathering, strategy formation, implementation, and monitoring. The video also covers SWOT analysis and the balanced scorecard as key strategic tools, highlighting the advantages of strategic management such as enhancing decision-making and progress measurement, while acknowledging its challenges like the difficulty of predicting the future and the complexity of the process.
Takeaways
- 📈 Strategic management is a comprehensive process that includes planning, monitoring, analysis, and assessment to meet an organization's objectives.
- 🎯 It is based on a clear understanding of the organization's mission, vision, and the guiding principles for future actions.
- 📊 Strategic planning involves setting both short-term and long-term goals, as well as making strategic decisions and allocating resources to achieve them.
- 🔍 The strategic management process includes five phases: goal setting, gathering and analyzing information, strategy forming, implementing the strategy, and monitoring.
- 👥 Goal setting starts with short-term goals that act as a blueprint for accomplishing long-term objectives and involves defining roles and responsibilities.
- 🔎 Information gathering and analysis involve using data from within the organization and the market to develop a constructive plan.
- 🛠 Strategy forming uses the collected data to create a unique strategy that meets all necessities and requirements based on available resources.
- 🚀 Implementation is crucial as it involves putting the plans into action with a clear understanding of the organizational goals.
- 👀 Monitoring involves tracking and evaluating every step associated with the strategic management plan, allowing for adjustments and new planning if needed.
- 🔑 Types of strategic management include SWOT analysis for inspecting internal and external factors and the balanced scorecard for evaluating business performance in four areas.
- 🛡️ Advantages of strategic management include discharging board responsibility, providing a framework for decision making, enabling progress measurement, and offering an organizational perspective.
- 🚧 Disadvantages include the challenge of anticipating the future environment, the cost associated with employing external consultants, and the complexity of the process which requires endurance and time.
Q & A
What is strategic management?
-Strategic management is the process of planning, monitoring, analysis, and assessment of all necessities that an organization needs to meet its aims and objectives. It is based on a clear understanding of the organization's mission and vision and guides its actions towards future goals.
What are the key components of strategic planning?
-Strategic planning involves setting both short and long-term goals, planning strategic decisions, activities, and resource allocation needed to achieve those objectives.
Why is having a defined process for managing an organization's strategies important?
-A defined process for managing strategies helps organizations make logical decisions, develop new goals quickly to keep pace with evolving technology, market, and business conditions, and ensures that various functional areas of the organization work effectively and harmonize well.
What are the five phases of the strategic management process?
-The five phases are: 1) Goal setting, 2) Gathering information and analyzing, 3) Strategy forming, 4) Implementing the strategy, and 5) Monitoring.
What is the purpose of goal setting in the strategic management process?
-Goal setting, particularly short-term goals, serves as a blueprint for accomplishing long-term objectives and helps in separating roles and duties, motivating team members in the long run.
How does gathering information and analyzing data contribute to strategic management?
-Data gathered from within the organization and the market helps in developing a constructive plan that forms the foundation for strategic management, allowing the company to recognize internal strengths and weaknesses affecting its operations.
What is the significance of the strategy forming step in the strategic management process?
-In strategy forming, all collected data and information are used to create a unique strategy that meets all necessities and requirements based on available resources, including controlling asset purchases and recruitment of experts.
How is the strategy implemented in an organization?
-Implementation involves employees having a clear understanding of the plan and organizational goals, ensuring that plans are executed with perfection.
What does the monitoring stage of strategic management involve?
-Monitoring involves analyzing, managing, tracking, and evaluating every step associated with the strategic management plan, allowing for comparison of desired outcomes with current outcomes and making necessary adjustments.
What are the two important types of strategic management discussed in the script?
-The two types discussed are SWOT analysis, which inspects internal and external factors, and the Balanced Scorecard, which evaluates business performance across four areas: learning and growth, business processes, customer perspectives, and financial data.
What are some advantages of strategic management?
-Advantages include discharging board responsibility, providing a framework for decision-making, enabling measurement of progress, and offering an organizational perspective that considers all components and their interrelationships.
What are the disadvantages of strategic management mentioned in the script?
-Disadvantages include the difficulty of anticipating the future environment, the cost associated with employing external consultants, and the complexity of the process, which requires endurance and time from management.
Outlines
📘 Strategic Management Overview
This paragraph introduces the concept of strategic management as a comprehensive process involving planning, monitoring, analysis, and assessment necessary for an organization to achieve its goals. It emphasizes the importance of understanding the organization's mission and vision and the strategic planning subset of business management. The paragraph outlines the strategic management process, which includes goal setting, information gathering and analysis, strategy formation, implementation, and monitoring. It also touches on the need for organizing functional areas effectively and the significance of strategic management in decision-making and adapting to changing conditions.
🔍 Strategic Management Process and Tools
The second paragraph delves into the specifics of the strategic management process, detailing its five phases: goal setting, information gathering and analysis, strategy formation, strategy implementation, and monitoring. It explains the role of each phase in creating a cohesive and effective strategy. Additionally, the paragraph discusses two key strategic management tools: SWOT analysis, which examines internal strengths and weaknesses and external opportunities and threats, and the balanced scorecard, which evaluates business performance across four perspectives: learning and growth, business processes, customer perspectives, and financial data.
🏆 Advantages of Strategic Management
This paragraph highlights the benefits of strategic management, starting with the discharge of board responsibility, which is crucial for effective governance. It also underscores the provision of a framework for decision-making, ensuring that all staff operate in alignment with the organization's strategic direction. Furthermore, it enables the measurement of progress by setting clear success metrics and objectives. Lastly, strategic management offers an organizational perspective, considering the interrelationships between components to produce a holistic strategy.
⚠️ Disadvantages and Challenges of Strategic Management
The final paragraph addresses the potential downsides of strategic management, such as the difficulty of anticipating the future environment, which is essential for effective planning. It acknowledges the cost associated with strategic management, especially for organizations that may not be able to afford external consultants. Additionally, it points out the complexity of the process, which involves considering both internal and external environments, long-term and short-term objectives, and the company's resources and organizational structure. This complexity requires significant time and effort from management to execute.
Mindmap
Keywords
💡Strategic Management
💡Strategic Planning
💡Mission and Vision
💡Resource Allocation
💡Strategic Management Process
💡SWOT Analysis
💡Balanced Scorecard
💡Goal Setting
💡Implementation
💡Monitoring
💡Advantages and Disadvantages
Highlights
Strategic management is the process of planning, monitoring, analysis, and assessment for an organization to meet its aims and objectives.
It is based on a clear understanding of an organization's mission and vision for the future and the purposes that guide its actions.
Strategic planning involves setting both short and long-term goals and planning strategic decisions, activities, and resource allocation.
A defined process for managing strategies helps organizations make logical decisions and develop new goals quickly.
Strategic management organizes various functional areas of the organization effectively and ensures they harmonize well.
The strategic management process includes five phases: goal setting, gathering information and analyzing, strategy forming, implementing the strategy, and monitoring.
Goal setting starts with short-term goals that act as a blueprint for accomplishing long-term objectives.
Gathering information and analyzing data from within the organization and the market is crucial for developing a constructive plan.
Strategy forming uses collected data to create a unique strategy that meets all necessities and requirements.
Implementing the strategy requires employees to have a clear understanding of the plan and organizational goals.
Monitoring involves analyzing, managing, tracking, and evaluating every step associated with the strategic management plan.
SWOT analysis is a method to inspect internal and external factors, identifying strengths, weaknesses, opportunities, and threats.
The balanced scorecard evaluates business performance across four areas: learning and growth, business processes, customer perspectives, and financial data.
Strategic management discharges the responsibility of the board of directors and provides a framework for decision making.
It enables the measurement of progress by setting measures of success and establishing objectives.
Strategic management offers an organizational perspective, looking at all components and their interrelationships for a holistic strategy.
One of the disadvantages is the need to anticipate the future environment, which can be challenging and may affect strategy if not accurate.
Strategic management can be expensive, especially for not-for-profit organizations that may not afford external consultants.
It is a complex process that requires endurance and time from management to execute effectively.
Transcripts
in this video you are going to learn
strategic management
topics i have discussed are what is
strategic management
strategic management process types of
strategic management advantages of
strategic management and disadvantages
of strategic management
let's start the video
strategic management can be defined as
the process of planning monitoring
analysis and assessment of all
necessities that an organization needs
to meet its aims and objectives
strategic management is based on an
organization's clear understanding of
its mission and vision for where it
wants to be in the future and the
purposes that will guide its actions
the process requires a commitment to
strategic planning which is a subset of
business management that involves an
organization's ability to set both short
and long-term goals
strategic planning also comprises the
planning of strategic decisions
activities and resource allocation
needed to achieve those objectives
having a defined process for managing an
organization's strategies will help
organizations make logical decisions and
develop new goals quickly in order to
keep pace with evolving technology
market and business conditions
one of the major aspects of strategic
management is to organize various
functional areas of the organization
effectively as well as to assure these
functional areas harmonize and get
together well
strategic management process
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in general the strategic management
process typically includes five phases
number one
goal setting
fixing short-term goals is an excellent
way to start as they act as a direct
blueprint in accomplishing long-term
objectives
separating roles and duties to people
and team management should be carried
out at this basic stage
the process provides every member of the
enterprise with a mission that motivates
them in the long run
2.
gathering information and analyzing
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the data gathered from within the
organization and the market help in
developing a constructive plan that acts
as a foundation for strategic management
this method allows the company to
recognize internal avoidances that have
been affecting the operations of the
organization
3.
strategy forming
in this step all the data and
information collected are used to form a
unique strategy that satisfies all the
necessities and requirements
based on the resources available the
business has to control the asset
purchase and recruitment of experts
identifying the capability of your
resources becomes important in strategic
management
4.
implement the strategy
if the planning is the one side of the
coin then implementing those plans is
another side of the coin
in this stage the employees involved in
this process should have a clear idea of
the plan and organizational goals to be
implemented with perfection
number five
monitoring
the monitoring stage involves analyzing
managing tracking and evaluating every
step that is associated with the
strategic management plan by this time
you can compare the desired outcomes
with the current outcome
here you can do certain adjustments and
new planning if required
now come to the types of strategic
management
the strategic management concept can be
implemented in various ways
here are two of the important strategies
i will discuss
1.
swot analysis
this analysis allows you to inspect
internal and external factors
internal factors are basically the
strength and weaknesses that are present
in your organization
external factors are basically the
positive and the negative factors which
are opportunities and threats
respectively that present outside of
your organization
the swot method helps leaders decide
whether the organization's resources and
abilities will be useful in the
competitive environment and to improve
the strategies to remain successful in
this environment
2.
balanced scorecard
balanced scorecard age you find which
facets of your business require
improvements by breaking down the
performance evaluation method into four
areas known as legs
these areas are
learning and growth
business processes
customer perspectives
and financial data
this method can generate timely
reporting mechanisms that show all
statistics associated with the growth of
the company
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advantages of strategic management
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1.
discharges board responsibility
the first and the most important reason
behind having strategic management is
that it discharges the responsibility of
the board of directors
2.
provides a framework for decision making
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the strategy gives a framework in which
all staff can make day-to-day
operational decisions and ensure that
those decisions are all moving the
organization in a single direction
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3.
enables measurement of progress
strategic management allows an
organization to measure its success
in the setting of measures of success
the organization first decides what is
crucial to its ongoing success and then
forces the establishment of objectives
and holds these crucial measures in
front of the board of directors and
senior management
4.
provides organizational perspective
strategic management takes an
organizational view and looks at all the
components and the interrelationship
between those components in order to
produce a strategy that is excellent for
the entire organization and not a single
component
disadvantages of strategic management
1.
anticipate the future environment
one of the significant disadvantages of
strategic management is that it requires
the organization to anticipate the
future environment in order to build up
plans and as we all know anticipating
the future is not a simple task
the conclusion is that if the future
does not unfold as anticipated then it
may cause ruin the strategy taken
2.
it is expensive
in the not-for-profit sector there are
many organizations that cannot afford to
employ an external consultant to help
them build up their strategy
3.
complex process
it comprises the internal and external
environments long-term and short-term
objectives strategic control of the
company's resources and last but not
least it also has to look at the
organizational structure
this is a long process because a single
variation in one element can affect all
the factors
being a complex method it calls for lots
of endurance and time from the
management in order to execute strategic
management
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