MZUMBE UNIVERSITY

FACULTY OF COMMERCE

DEPARTMENT: PROCUREMENT AND LOGISTICS MANAGEMENT

SUBJECT: BUS 5021 –STRATEGIC BUSINESS MANAGEMENT

TERM PAPER

LECTURER: MNZAVA J.A

PREPARED BY: JACOB KECHIBI, RG NO. 3125/T.10

QUESTION: examine the major components of a strategic plan, and explain the importance of
each component to the success of a business.

SUBMISSION DATE: 22/01/2011

TABLE OF CONTENTS pages

1.0 Introduction…………………………………………………………………………………..1

2.0 Definitions of terms…………………………………………………………………………..1

2.1 Strategic Business Management……………………………………………………………..1

2.2 strategic planning…………………………………………………………………………….3

3.0 Components of Strategic plan..........................................................................................…...4

3.1 SWOT Analysis/Environmental Analysis…………………….……………………………..5

3.1.1 External environment……………………………….……………………………………..5

3.1.2 Internal environment……………………………………………………….……………...6

3.2 Mission and vision……………………………………………………………………..……7

3.3 Objective …………………………………………………………………………………..10

3.4 Strategies……………………………………………………………………………….…..11

3.5 Policy……………………………………………………………………………..………...12

3.6. Strategy implementation/execution………………………………………………………..13

3.6 .1.Programme…………………………………………………………………………..…..13

3.6.2 Budget…………………………………………………………………………….……..13

3.6.3. Procedures……………………………………………………………………………….13

4.0 Importance of each component of a strategic plan to the success of the business……......14

4.1 Mission and vision…………………………………………………………..…………….14

4.2 Objective…………………………………………………………………………………..15

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4.3 Strategies ………………………………………………………………………………….15

4.5 Procedures……………………………………………………………………….………...17

4.6 Programs………………………………………………………………………………...…17

4.6 Programs…………………………………………………………………………………...18

4.7 Strategy implementation……………………………………………………………….….18

4.8 Evaluation and control…………………………………………………………….………19

5.0 The importance of strategic planning in an organization…………………………...……..20

6.0 Conclusion and recommendation………………….………………………………………20

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1.0 INTRODUCTION

Strategic planning is more than ensuring organization will remain financially sound and be able
to maintain its status in the market, it’s projecting where the corporation/organization expects to
be in five, ten, or fifteen years and how the organization will get there. It is a systematic planning
process involving a number of steps that identify the current status of the organization, including
its mission, vision for the future, operating values, needs (strengths, weaknesses, opportunities,
and threats), goals, prioritized actions and strategies, action plans, and monitoring plans.

Strategic planning is the cornerstone of every common-interest community/organization.

Without strategic planning; the organization will never know where it is going; much less know
if it ever got there.

An important concept of strategic planning is an understanding that in order for the corporation
to flourish, everyone needs to work to ensure the team’s goals are met. Team members include,
the board of directors, professional management whether onsite or through a management
company and various service professionals such as accountants and other professionals. This
team needs to work as a collective body to be successful. Part of the team concept is the
establishment of roles for the team players. Teams usually perform poorly if everyone or no one
is trying to be the quarterback.

2.0 Definition of terms

2.1 strategic business management

Strategic management is a set of managerial decisions and actions that determine the long-run
performance of a corporation. It includes strategy formulation, strategy implementation, and
evaluation and control. Strategic management is concerned with monitoring and evaluating
environmental opportunities and constraints in light of a corporation’s strengths and weaknesses.

According to: LM Prasad, defined strategic management as the set of decision and actions in
formulation and implementation of stages designed to achieve the objectives of an organization.

According to LM, said that this definition emphasizes two major aspects: strategy formulation
and strategy implementation and these aspects are oriented towards achieving organizational
objectives

2.2 Strategic planning

In an organization when comprehensive planning is undertaken for the organization as a whole,

divides strategic planning into two parts: strategic planning and operational planning. While
strategic planning has a long-term orientation, operational planning has a short term orientation.

Strategic planning is defined as the process by which the guiding members of an organization
envision its future and develop the necessary procedures and operations to achieve the future.

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According to C.B. Gupta (2005)- strategic planning is the process of determining the basic
objectives of an enterprise and decides on strategies and policies to achieve the objectives.

Strategic planning has the following characteristics:

 Strategic planning guides the choice among the broad directions in which the
organization seeks to move, the general planned allocation of its managerial, financial,
and physical resources over future specified period of time.
 Strategic planning takes into account the external environment and tries to relate the
organization with it. It is usually encompasses all the functional areas of the organization
and is effect within the existing and long-term framework of economic, political-legal,
technological, and social-cultural factors. Therefore, nature of external environment is of
prime concern of strategic planners.
 Since strategic planning sets trends and directions for managerial actions, its time horizon
is usually long, say five years or more.
 Strategic planning is usually undertaken by top management supported by specified
planning staff and other key managers below the top-level. At this level, people can take
overall view of the organization and have the capability to relate the organization with the
external environment.

3.0 Components of Strategic plan

A strategic plan composed of several components which include:
 Vision
 Mission
 Objectives
 SWOT Analysis
 Strategies
 Policies
 Programmes
 Budget
 Procedures
 Strategy implementation
 Strategy evaluation and control

The strategic management process

At the corporate level, the strategic management process includes activities that range from
environmental scanning to the evaluation of performance.

The top management scans both the external environment for opportunities and threats, and the
internal environment for strengths and weaknesses. Those factors which are most important to
the corporation’s future are referred to as strategic factors.

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The process of strategic management involves four basic elements:

 Environment scanning
 Strategy formulation
 Strategy implementation
 Evaluation and control

3.1 SWOT Analysis/Environmental Analysis

 Internal environmental (strength and weaknesses)

 External environmental( treat and opportunities)

Strengths, Weaknesses, Opportunities and Threats (SWOT) analysis is a strategy development

tool that matches internal organizational strengths and weaknesses with external opportunities
and threats. http//www.venture.com.
SWOT Analysis is the Key Component of Strategic Development. It can prompt actions and
responses. Successful businesses build on their strengths, correct their weaknesses and protect
against internal vulnerabilities and external threats. They also keep an eye on their overall
business environment and spot and exploit new opportunities faster than competitors. SWOT
analysis is a tool that helps many businesses in this process.
SWOT analysis is based on the assumption that if managers can carefully review such strengths,
weaknesses, opportunities, and threats, a useful strategy for ensuring organizational success will
become evident to a corporation.

3.1.1 External environment

The external environment consists of variables that are outside the organization and not typically
within the short-run control of top management. These environments are opportunities and treats.

Opportunities are a favorable condition in the organization’s environment which enables the
company to strengthen its position in the market place. Examples of opportunities are customers,
a new markets etc

Always opportunities are abundant. The organization must develop a formula which will help it
to define what comes within the ambit of an opportunity, and then focus on those areas and
pursue those opportunities where effectiveness is possible. The formula must define
product/service, target market, capabilities required and resources to be employed, returns
expected and the level of risk allowed.
Weaknesses of your competitions are also opportunities for you. The company can exploit them
in two following ways:
1. Marketing warfare: attacking the weak leader's position and focusing all efforts at that
point, or making a surprise move into an uncontested area.

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 2. Collaboration: the organization can use complementary strengths to establish a
strategic alliance with its competitor.

Threats are unfavorable condition in the organization’s environment which causes a risk for, or
damage to, the organization’s position. External threats arise from political, economic, social,
technological (PEST) forces. Technological developments may make your offerings obsolete.
Market changes may result from the changes in the customer needs, competitors' moves, or
demographic shifts. The political situation determines government policy and taxation structure.

3.1.2 Internal environment

The internal environment of a company/organization consists of variables that are within the
organization itself and are not usually within the short-run control of top management. These
internal environmental factors are strength and weaknesses and they include the company’s
structure, culture and resources.

Strength
Is a competence of the organization which it can use to gain competitive advantage over its
competitors. Examples of strength are (1) Versatility, which is ability to adapt to an ever
changing environment. (2) Growth, which is ability to maintain a continuing growth. (3)
Markets; ability to penetrate or create new markets. In terms of resources strength has the
following dimension: (4) Availability: ability to obtain the resources needed. (5) Quality: the
quality and up-to-dateness of the resources employed. (6) Allocation: ability to distribute
resources both effectively and efficiently.
Weaknesses
Company’s weaknesses are determined through failures, defeats, losses and inability to match
up with the dynamic situation and rapid change. The weaknesses may be rooted in  lack of
managerial skills, insufficient quality, technological backwardness, inadequate systems or
processes, slow deliveries, or shortage of resources.

Figure 1: Elements of a SWOT Analysis

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3.2 Mission and vision

The corporate mission is the purpose or reason for the corporation’s existence. A mission may
be narrow or broad in scope. A narrow mission clearly limits the scope of the corporation’s
activities in terms of product or service offered, the technology used, and the market served.

A mission may be narrow or broad in scope. A narrow mission clearly limits the scope of the
corporation’s activities in terms of product or services offered, the technology used and the
market served.

A broad mission widens the scope of the corporation’s activities to include many types of
products or services, markets and technologies. A broad mission might not clearly identify
which area the corporation wishes to emphasize. For example narrow scope: matatus, word
processors and sofa set. Broad scope: road transportation, office equipment and furniture.

The mission articulates the following: 1) the purpose of your existence, 2) for whom you exist,
and 3) the impact of your existence. The mission is your institutional touchstone and should
guide all of your decisions about what you collect, the programs and exhibitions you present, the
facilities you plan, and any other important decisions you make about the organization. An
example of mission is of Songea Municipal Council that is to provide quality socio-economic
services to its community by using its resources effectively, efficiently and applying good
Governance for improving living standard by the year 2013.

The Four Key Components of a Mission Statement:

The role or contribution that the business makes - is it a voluntary organization or a charity?
Are you in business to supply goods and services and make a profit?

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A definition of the business - this should be given in terms of the benefits you provide or the
needs that you satisfy. It should not define what you do or what you make. These should have
been outlined as part of the first component.

An outline of your distinctive competencies - the factors that differentiate your business from
the competition. These will be the skills or capabilities you offer that are not, or cannot be,
offered by your competitors.

The indications for the future - what the business will do. What it might do in the future and
what it will never do.

Characteristics of mission

1. It defines who you are.

Mission Statement reflects your own personality, and should be uniquely identifiable with you,
mission is not what you do, it is who you are. If anyone of your peers can say the same statement
in the same way as you, then you need to inject more of you in it. Stay away from the generic ("I
help people lead better lives"). Your personality can be projected in how you phrase your
statement, in the words you use, your tone of voice, etc.

2. It is independent of time, space, people, form or situation.

Mission Statement describes the gift you bring to the world. Mission Statement is not a job or
role description. The real test of your mission is if you can fulfill it alone on a desert island, on a
crowded bus, at a party, at work, with your spouse, i.e. fulfilling it is independent of location,
time or situation. Think of Tom Hanks in the movie "Castaway". If you were in his situation,
how could you live your mission and feel success?

3. It is short and simple.

It can be stated from memory, without looking it up, even when you are under stress. A mission
statement should be no more than about ten words in length, and simple enough so that a child
can understand and say it.

4. It anchors the central principles in your life.

The focus of the Mission Statement expresses the central theme of your life in a positive way,
that which you would defend to be true at almost any cost. It also describes how people are
touched or influenced by your presence.

5. It is action oriented.

Mission Statement is built around action verbs that describe your passions. A successful Mission
Statement inspires you to act.

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Vision Statement

Vision Statements also define the organizations purpose, but this time they do so in terms of the
organization's values rather than bottom line measures (values are guiding beliefs about how
things should be done.) The vision statement communicates both the purpose and values of the
organization. For employees, it gives direction about how they are expected to behave and
inspires them to give their best. Shared with customers, it shapes customers' understanding of
why they should work with the organization. An example of vision statement is of Songea
Municipal Council which aspires to have a community that enjoys sustainable high quality
standard of living.

Vision statement outlines what the organization wants to be or how it wants the world in which it
operates to be. It concentrates on the future. It is a source of aspiration. It provides decision
making criteria.

Characteristics of vision statement

Imaginable: It conveys a picture of what the future will look like. It is like painting a picture with
your words. It is an image that people can carry around in their heads.

Desirable: It appeals to the long-term interests of employees, customers, stockholders, and others
who have a stake in the enterprise. It is a vibrant, engaging, and specific description of what will
be like to achieve the vision. Passion, emotion and conviction are essential parts of the vivid
description.

Feasible: It comprises realistic, attainable goals. It has a clear finish line.

Focused: It is clear enough to provide guidance in decision making.

Flexible: It is general enough to allow individual initiative and alternative responses in light of
changing conditions.

Communicable: People get it right away; it takes little or no explanation.

Visionary: Inventing such a vision forces executives to be visionary rather than just strategic or
tactical. It should not be a sure bet – it will have only a 50% to 70% probability of success – but
the organization must believe that it can reach the goal anyway.

3.3 Objective

The corporate mission determines the parameters of the specific objectives to be defined by top
management. The objectives state what is to be accomplished and when.

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The term goal is often confused with objective. A goal is an open-ended statement of what one
wishes to accomplish without being very specific and with no time criteria for completion.

Objectives as measures of organization behavior and performance should possess certain

desirable characteristics;

Objectives support the goals and state how the goals will be accomplished. For example, an
objective related to the goal above might be: Increase the size of the endowment to support 33%
of the annual operating budget. Objectives are time bound and measurable. As such, the
following elements are associated with each objective:

 Accountability: assigns an individual to oversee completion of the objective.

 Timeframe: describes the “due date” for completion of the objective.

 Resources: describes the need for personnel (volunteer and professional) and funds
required to reach the stated objective

The following are characteristics of objectives:

• Relevant - directly supports the goal

• Compels the organization into action
• Specific enough so we can quantify and measure the results
• Simple and easy to understand
• Realistic and attainable
• Conveys responsibility and ownership
• Acceptable to those who must execute
• May need several objectives to meet a goal

GOALS Vs OBJECTIVES

GOALS OBJECTIVES
Very short statement, few words Longer statement, more descriptive

Broad in scope Narrow in scope

Directly relates to the Mission Indirectly relates to the Mission Statement

Statement

Covers long time period (such as 10 Covers short time period (such 1 year
years) budget cycle)

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Examples of objectives

1. Develop a customer intelligence database system to capture and analyze patterns in

purchasing behavior across our product line.
2. Launch at least three value stream pilot projects to kick-off our transformation to a leaner
organization.
3. Centralize the procurement process for improvements in enterprise-wide purchasing
power.
4. Monitor and address employee morale issues through an annual employee satisfaction
survey across all business functions.

3.4 Strategies

Monitor and address employee morale issues through an annual employee satisfaction survey
across all business functions.

Dictionary definitions tend to emphasize strategy in terms of a military context, such as the
science of forming and carrying out projects of military operations.

In management terms Koontz and O’ Donnell describe strategy as a decision about how to use
available resources to secure a major objective in the face of possible obstructions such as
competitors, public opinion, legal status, taboos and similar forces.

Strategy is a choice that is made after careful reflection of environmental condition, internal
capabilities and expected return. To some extent, the organization is betting available resources
on the success of a chosen strategy over alternate strategies.

Strategies are potential actions that require top management decision and large amount of the
firm’s resources. In addition, strategies affect company’s long term prosperity, typically for at
least five years, and thus are future oriented. Strategies have multifunctional or multidivisional
consequences and require consideration of both the external and internal.

A strategy is what you are going to provide or deliver in your project/program. The strategy will
state what and how you are going to achieve your objective. (eg. running the plumber education
sessions promote tempering valves).

Effectiveness of strategies is measured by process evaluation.

In order to achieve the strategies, there will be a series of actions (eg. develop the plumber's
education session, liaise with Plumbers Association, invite guest speaker, promote the session
etc) that you will need to determine:

 What you will do (eg. plumber's education session).

 How you will do it (eg. two hour session with guest speakers and dinner in three
locations).

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  Who can help (eg. Plumbers Association).
 When will it be done i.e. a timeline of when each strategy will be completed by  (eg.
develop training session by June, pilot test and training in July, conduct training in
August)

The formulation of sound strategy may be seen as having six important steps:

1. The company or organization must first choose the business or businesses in which it
wishes to engage—in other words, the corporate strategy.
2. The company should then articulate a "mission statement" consistent with its business
definition.
3. The company must develop strategic objectives or goals and set performance objectives
(e.g., at least 15 percent sales growth each year).
4. Based on its overall objectives and an analysis of both internal and external factors, the
company must create a specific business or competitive strategy that will fulfill its
corporate goals (e.g., pursuing a market niche strategy, being a low-cost, high-volume
producer).
5. The company then implements the business strategy by taking specific steps (e.g.,
lowering prices, forging partnerships, entering new distribution channels).
6. Finally, the company needs to review its strategy's effectiveness, measure its own
performance, and possibly change its strategy by repeating some or all of the above steps.

3.5 Policy

A policy provides guidelines for decision making throughout an organization. It is a broad

guideline which links the formulation of strategy with its implementation.

Policies represent the company’s commitment to the future orientation of the sector. A clearly
formulated policy can play an important “operational” role as a reference for action. It can help
to guide decisions and future actions in sector development, including the interventions of
international and bilateral cooperation agencies, in a coherent way. It is important that policy
promote the coordination and success of programmes and projects. The formulation of a “good
policy” is a necessary step in promoting the emergence and effective implementation of action
plans, programmes and projects.

Policies may be general or specific, organizational or functional, written or implied. They should
however, be clear and consistent. Various policies should be integrated in such a way that they
result in effective implementation of the strategy. A policy is helpful in choosing out the
alternative course of action.

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Strategies and policies both are means used to direct a firm towards its goal. While strategies are
plans of actions that lead to major commitments. Policies are guidelines to actions usually based
upon past experience. The strategic planner takes a comprehensive view of goal accomplishment
whereas the policy maker operates in a more limited vein.

3.6. Strategy implementation/execution

It is the process by which strategies and policies are put into action through the development of
program, budgets and procedures. It may involve changes within the overall culture, structure or
management system of the whole organization. The implementation of a strategy is carried out
by middle and lower managers but it review by top managers. Strategy execution involves the
day to day decisions in the allocation of resources. The divisional/ functional managers perform
their duties under the guidance of top managers to develop programs, budgets and procedures
that are used to achieve the objectives of the organization strategies. The functional managers are
also involved in strategy formulation at their levels.

3.6 .1.Programme
A program is a statement of the activities needed to accomplish a single-use plan.

3.6.2 Budget

A budget is a statement of a corporation’s programs in monetary terms. For planning and control
purposes, it lists in details the cost of each program.

3.6.3. Procedures

Procedures are sequential steps or techniques that described in details how a particular job or
activity is to carried out. A procedure details the various activities that must be carried out for the
completion of the organization’s program

4.0 Importance of each component of a strategic plan to the success of the business.

4.1 Mission and vision.

A good mission statement can put the organization in a good position in the market.

Several parts of a mission statement can help put the company in a good position. First, the
statement should help determine what business the company is engaged in and what the company
wants to become.

A vision statement define a broader goal of an organization

A Vision statement defines the purpose or broader goal for being in existence or in the business
and can remain the same for decades if crafted well. A Mission statement is more specific to

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what the enterprise can achieve itself. Vision should describe what will be achieved in the wider
sphere if the organization and others are successful in achieving their individual missions.

Mission statement enables an organization to define objectives

The mission statement can galvanize the people to achieve defined objectives, even if they are
stretch objectives, provided it can be elucidated in SMART (Specific, Measurable, Achievable,
Relevant and Time-bound) terms. A mission statement provides a path to realize the vision in
line with its values. These statements have a direct bearing on the bottom line and success of the
organization.

Mission and vision statement guide the organization on its operation

If you have a new start up business, new program or plan to reengineer your current services,
then the vision will guide the mission statement and the rest of the strategic plan. If you have an
established business where the mission is established, then many times, the mission guides the
vision statement and the rest of the strategic plan. Either way, you need to know your
fundamental purpose - the mission, your current situation in terms of internal resources and
capabilities (strengths and/or weaknesses) and external conditions (opportunities and/or threats),
and where you want to go - the vision for the future.

4.2 Objective

It enables an organization to increase profitability.

The ability of any firm to operate in the long-run depends on attaining an acceptable level of
profits. Strategically managed firms characteristically have a profit objective, usually expressed
in earnings per share or return on equity.

Through better objective an organization can increase productivity

Firms that can improve the input-output relationship normally increase productivity. Thus, firms
almost always state an objective for productivity. Commonly used productivity objective are the
number of items produced or the number of services rendered per unit of input.

Objectives help the company to success

Objectives it shows direction, aid in evaluation and provide a basis for effective planning,
motivating, organizing and controlling different activities.

Objectives enable the organization in making decision.

The objectives help to direct the decision makers on those areas where strategic decisions need to
be taken, objectives lead to desirable standards of behavior and help to coordinate strategic
decision making.

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Objectives enable to define company relationship/public responsibility

The company must recognize its responsibility to its customers, employees and societal at large.

An objective describes the changes you want to bring out in the in the target group or
problem. They relate to the risk factors and causes of the problem and are the smaller steps to
achieving your goals. You will more than likely have a number of objectives to help you to
achieve your goal. Like goals, objectives need to be S.M.A.R.T.

4.3 Strategies

A business strategy generally refers to the overall objectives, goals and vision of an organization
and the means of achieving the objectives, goals and vision. It is the art of formulation and also
implementing specific decisions and actions aimed at achieving the overall goals and objectives
of an organization. A business strategy as such provides the bigger picture showing how
individual activities are organized and coordinate to ensure that the overall desired goals and
objectives are met.

Importance of strategies to an organization

Strategy gives the overall direction of an organization

Without strategies is difficult to attain or achieve the desired results or goals (Pearce II, &
Robinson Jr, 2009), also a provides the bigger picture showing how individual activities are
organized and coordinate to ensure that the overall desired goals and objectives are met.

The aim of a business strategy is to ensure that the threats posed by the external
environment are minimized and also to strengthen or minimize the effects of internal
weaknesses.
The opportunities and strengths are combined to ensure maximum productivity is achieved.
Without a business strategy, it would be difficult for an entity to realize the opportunities
available to it as well as the threats. a business would not thus take advantage of an opportunity
posed by an environment thus would not be profitable. Without a strategy a business is also more
vulnerable to threats and its own internal weaknesses which increases costs and reduces
productivity (Pearce II, & Robinson Jr, 2009).

Strategies provide/facilitate changes in the market place

The formulation of strategy forces organizations to examine the prospect of change in the
foreseeable future and to prepare for change rather than to wait passively until market forces
compel it.
Strategies provide communication to members of the organization

A strategic plan, when communicated to all members of an organization, provides employees

with a clear vision of what the purposes and objectives of the firm are.

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Strategies assisting in allocation of funds decision

Strategic formulation allows the firm to plan its capital budgeting. Companies have limited funds
to invest and must allocate capital funds where they will be most effective and derive the highest
returns on their investments.

4.4 Policy

Policies and Procedures are the strategic link between the Company's Vision and its day-
to-day operations.

A well written policies & procedures allow employees to understand their roles and
responsibilities within predefined limits. Basically, policies & procedures allow management to
guide operations without constant management intervention.

4.5 Procedures

The procedures help an organization to understood and implement its plan.

The ultimate goal of every procedure is to provide the reader with a clear and easily understood
plan of action required to carry out or implement a policy.

Procedures help an organization to eliminate common misunderstanding.

A well written procedure will also help eliminate common misunderstandings by identifying job
responsibilities and establishing boundaries for the job holders.

Procedures help managers to control events in advance

Good procedures actually allow managers to control events in advance and prevent the
organization (and employees) from making costly mistakes. You can think of a procedure as a
road map where the trip details are highlighted in order to prevent a person from getting lost or
"wandering" off an acceptable path identified by the company's management team.

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4.6 Programs

Programs help to increase productivity and helps motivate other employee's to strive harder.

This gives them a sense of accomplishment, making them strive more and be examples to other
employee's and students. This also in effect give out a positive attitude and yet with a healthy
working environment.

Incentive programs are designed to reciprocate positive internal or external attitudes displayed
either by the employees (i.e. consistent early birds in the workplace) or by the customers or
clients, like customer loyalty. It is non-verbal communication that tells the end receiver that the
positive traits he or she is continually displaying - such as work ethics, mastery of tasks,
diligence or commendable performance - did not go unnoticed.

Incentives come in different forms inside a company - money-based and promotion-based. It

takes a sound and solid in-house character assessment team to notice when it is suitable to dangle
money in exchange for an improved performance and when it is time that the deserving tenured
employee gets a new workstation along with a new title and improved compensation. However,
in this case, compensation is just a matter of formality and propriety.

The implementation of incentive programs can now be done either internally through a task force
composed of the company's HR as well as other groups involved, or through outsourcing to
develop and implement a sound incentive program that can really work inside a specific
company. There are companies today that specialize in designing incentive programs, including
custom-made reward and recognition programs suitable to the personality of the company.

4.7 Strategy implementation

Strategy implementation is the process by which strategies and policies are put into action
through the development of program budgets, and procedures. The implementation of strategy is
carried out by middle and lower-level managers but it is reviewed by top management. It
involves the day-today decisions in the allocation of resources.

Strategy implementation is putting the strategy into effect and getting the organization moving in
the direction of strategy accomplishment. Implementation primarily focuses on the
administrative process. It depends on the skills of working through others, motivating, culture-
building and creating stronger fits between strategy and how the organization operates

Strategy implementation almost always involves the introduction of change to an organization.

Managers may spend months, even years, evaluating alternatives and selecting a strategy.
Frequently this strategy is then announced to the organization with the expectation that

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organization members will automatically see why the alternative is the best one and will begin
immediate implementation. When a strategic change is poorly introduced, managers may
actually spend more time implementing changes resulting from the new strategy than was spent
in selecting it. Strategy implementation involves both macro-organizational issues (e.g.,
technology, reward systems, decision processes, and structure), and micro-organizational issues
(e.g., organization culture and resistance to change

Five aspects of strategy implementation

1. Building an Organization Capable of Carrying out the Strategic Plan

2. Allocating and Focusing Resources on Strategic Objectives

3. Galvanizing Organizational wide Commitments to the Strategic Plan

4. Installing internal administrative support systems

5. Exerting Strategic Leadership

4.8 Evaluation and control

Evaluation and control is the process in which organization’s activities and performance results
are monitored. It involves comparing actual performance with set/established standards. The
results are used to take corrective measures where there is a deviation.

Strategy evaluation is critically important today because internal and external factors often change
quickly and dramatically. Key factors need to be monitored during strategy-evaluation activities. For
example, technology is shortening the product life cycle in nearly all industries. The low value of the
dollar is opening up many foreign markets to American exports and is fostering foreign acquisition of
U.S. assets and companies.

An organization’s evaluation and control program is a data gathering and action initiation
mechanism. This program monitors the external business environments, the internal performance
of business units, processes, and individuals, and the output products and services of the
organization. Once collected, data is processed to present a picture of the company’s overall
performance and to trigger actions in response to conditions representing opportunities or threats.

The evaluation and control program is comprised of several component processes that monitor
performance on a continuous, periodic, and event driven basis; driving action when necessary.
Component processes include:

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  organizational performance measurement system (continuous and periodic)
 external environmental monitoring program (continuous and periodic)
 condition reporting/corrective action program (event driven)
 self-assessments program (periodic and event driven)
 benchmarking (periodic)

Outputs from the various monitoring processes are often combined to create a richer
understanding of organizational performance relative to both internal performance standards and
external benchmarks. Synthesized data drives actions on a day-to-day operational basis and
serves as input to the strategic planning process. When predefined thresholds are reached or
exceeded, action is prompted to take advantage of opportunities or mitigate threats representing a
risk to the business or its operations.

Evaluation and control program components play a key role in an organization’s learning and
growth efforts. They not only identify improvement opportunities, they also identify internal and
external best practices that can be used to better existing processes. This continuous growth
mechanism is critical to an organization seeking to maintain and advance its position in the
marketplace. Articles in this topic are dedicated to discussing the leading practices of companies
successfully executing an evaluation and control program in support of strategic business
planning and tactical business execution.

5.0 The importance of strategic planning in an organization

The Strategic Plan sets out the marketing plan in action, showing how to implement the
marketing plan a cohesive and executable Sales plan.

The Strategic Plan developed a system to deal effectively with risks and potential problems,
culminating in the production of corporate strategies, tactics and programs. These programs are
implemented through the programs developed sales and marketing plan. Administrative
expenses, control mechanisms, milestones and sales forecasts are also part of the strategic plan.

The strategic plan is a strategic process for Management, Monitoring and reassessment. It
measures the performance of user control and corrective action, re-evaluation, when and where
needed. .

It gives the company a strategic vision, focus, structure and discipline, providing an environment
learning and awareness, with a method for identifying deficiencies and, in turn leads to
challenges.

Strategic planning is top-down and bottom-up, fully integrated operations of the company, the
vision and leadership of the CEO(top managers) , management, monitoring implementation,
sales and operations units.

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6.0 Conclusion and recommendation

Strategic management is a field that deals with the major intended and emergent initiatives taken
by general managers on behalf of owners, involving utilization of resources, to enhance the
performance of firms in their external environments. It entails specifying the organization's
mission, vision and objectives, developing policies and plans, often in terms of projects and
programs, which are designed to achieve these objectives, and then allocating resources to
implement the policies and plans, projects and programs. A balanced scorecard is often used to
evaluate the overall performance of the business and its progress towards objectives.

If this is the case, managers and decision makers must show the important of strategic planning
by implementing what is stated on the document and nothing else for the success of their
business and customer satisfaction.

Lastly, the firms/corporations must engage in a strategic planning that clearly defines objectives
and assesses both internal and external situation/environment to formulate strategy, implement
the strategy, evaluate the progress and make adjustments as necessary to stay on the truck.

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REFERENCE

www.ameinfo.com

http://EzineArticles.com/?expert=Davender_Gupta

www.associationlaboratory.com

Strategy Implementation - organization, levels, system, advantages, school, model, company,

business, system, Creating strategic plans, Implementing strategic plans, Cascading the plan
http://www.referenceforbusiness.com/management/Sc-Str/Strategy-
Implementation.html#ixzz19bC9BhCt.

Strategy Implementation - organization, levels, system, advantages, school, model, company,

business, system, Creating strategic plans, Implementing strategic plans, Cascading the plan
http://www.referenceforbusiness.com/management/Sc-Str/Strategy-
Implementation.html#ixzz19bBLcsH6

(Pearce II, & Robinson Jr, 2009).

Exploring corporate strategy, Jerry Johson, Kevan Scholes and Richard Whittington

Nag, R.; Hambrick, D. C.; Chen, M.-J,What is strategic management, really? Inductive
derivation of a consensus definition of the field. Strategic Management Journal. Volume 28,
Issue 9, pages 935–955, September 2007.

Nag, R.; Hambrick, D. C.; Chen, M.-J,What is strategic management, really? Inductive
derivation of a consensus definition of the field. Strategic Management Journal. Volume 28,
Issue 9, pages 935–955, September 2007.

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