What is Strategic management? Strategic management Process, types.

Summary

This 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

00:00

📘 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.

05:01

🔍 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.

Keywords

💡Strategic Management

Strategic Management is the overarching process that organizations use to set goals, analyze their environment, and develop plans to achieve their objectives. It is central to the video's theme, as it encompasses planning, monitoring, analysis, and assessment of organizational needs. The script defines it as being based on a clear understanding of the organization's mission and vision, and it guides the actions necessary to meet future goals.

💡Strategic Planning

Strategic Planning is a subset of business management that involves setting both short-term and long-term goals. It is a critical component of strategic management, as it includes planning strategic decisions, activities, and resource allocation. The video script highlights its importance in helping organizations make logical decisions and develop new goals quickly to adapt to changing conditions.

💡Mission and Vision

Mission and Vision are foundational elements of an organization's strategic direction. The mission statement defines the organization's purpose, while the vision statement outlines its future aspirations. In the context of the video, having a clear mission and vision is essential for strategic management as they guide the organization's actions and strategic planning.

💡Resource Allocation

Resource Allocation refers to the process of distributing an organization's resources, such as finances, personnel, and materials, to various projects or business units. The video script mentions it as part of strategic planning, emphasizing its importance in achieving organizational objectives by ensuring that resources are used effectively.

💡Strategic Management Process

The Strategic Management Process is a systematic approach that includes goal setting, information gathering, strategy formation, implementation, and monitoring. The video script outlines this five-phase process, illustrating how each phase contributes to the development and execution of an organization's strategic plan.

💡SWOT Analysis

SWOT Analysis is a strategic planning tool used to identify Strengths, Weaknesses, Opportunities, and Threats related to business competition or project planning. The video script describes it as a method that helps leaders decide if the organization's resources and abilities will be useful in the competitive environment and to improve strategies for success.

💡Balanced Scorecard

The Balanced Scorecard is a performance evaluation method that breaks down assessment into four areas: learning and growth, business processes, customer perspectives, and financial data. The video script explains that this method can generate timely reporting mechanisms, providing a comprehensive view of the company's growth.

💡Goal Setting

Goal Setting is the first phase of the strategic management process, where short-term goals are established as a blueprint for achieving long-term objectives. The video script emphasizes the importance of goal setting in providing every member of the organization with a clear mission that motivates them.

💡Implementation

Implementation is the phase where the strategic plans are put into action. The video script highlights that employees involved in this process should have a clear understanding of the plan and organizational goals to ensure they are executed with perfection.

💡Monitoring

Monitoring is the final phase of the strategic management process, where every step associated with the plan is analyzed, managed, tracked, and evaluated. The video script explains that this stage allows for comparison of desired outcomes with current outcomes and makes adjustments as necessary.

💡Advantages and Disadvantages

The video script discusses the pros and cons of strategic management. Advantages 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 strategic management, and the complexity of the process.

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

[Music]

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

[Music]

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

[Music]

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

[Music]

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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