Page 84 - PRAGMATIC STRATEGY

Strategic Management and Decisions

Strategic management is part of the overall process of management which consists of
several activities including planning, organising, decision making, co-ordinating, leading,
motivating and being enterprising.

Which of the following do you think would not be regarded as a strategic decision?
(a) a complex decision with a time horizon of years
(b) a decision to launch a new product
(c) a decision made by the marketing manager for next month's sales targets
(d) a decision based upon incomplete information

A Definition of Strategic Management

There is no universally agreed definition of strategy or strategic management but broadly
speaking:

A strategy is the means (plans, policies and actions) by which an organisation seeks to achieve
1
its goals particularly sustainable competitive advantage over its rivals .

Strategic Management is concerned with the organisation's:

• goals and objectives - the purpose of the organisation and what it is trying to achieve;

• business environment - factors external to the firm which will have some influence on
both its objectives and how it sets out to achieve them;

• resources, competences, activities, products structure and culture - factors internal to
the firm which will influence its objectives and how it seeks to achieve them;

• strategic options – the alternative ways in which the organisation can deploy its bundle
of resources and competences to achieve its goals and how it chooses between them;

• implementation of its strategy and management of change - the methods by which the
organisation seeks to put its chosen strategy into effect;

• strategic issues - internal and external issues facing the firm which must be considered
when seeking to achieve competitive advantage.

1 in the case of 'not for profit organisations' like the Health Service, Education etc. rather than
competitive advantage strategy is concerned with delivering value for money. This relates to providing
the best quality service with efficient use of resources. The major issues are essentially similar to those
which arise for commercial organisations seeking to provide competitive advantage.