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Mastering Strategy: Strategic Management

Strategic Management is about identification and description of the strategies that managers

can carry to achieve better performance and a competitive advantage for their organization. An

organization is said to have competitive advantage if its profitability is higher than the average

profitability for all companies in its industry. Strategy is an action plan to build and achieve a specific

goal or set of goals, while operating in an organizational framework. According to Rajiv Nag, Donald

Hambrick & Ming-Jer Chen, Strategic management is a process of a building capabilities that allow a firm

to create value customers, shareholders, and society while operating in a competitive market. (p.2)

Strategic management involves certain functions or activities. The systematic way of doing these

functions or activities is described as strategic management process.

Strategy formulation is the first phase in the strategic management process. It is concerned with

devising a suitable plan of action after studying the external business environment, analyzing the

industry and assessing the internal capabilities of the business concern.

Strategy implementation is the second phase in the strategic management process. It is

concerned with putting the strategy into operation or translating the strategy into strategic action

Strategy evaluation and control is the last phase in the strategic management process. Strategy

evaluation is concerned with examining whether the strategy implemented is working or producing

results or accomplishing its objectives or not. Strategic control is concerned with continuous monitoring

and tracking the strategy putting the strategy in the right path or direction.
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Keeping an Eye on Expenses and Goals means we need to monitor the goals and financial

matters in the firm. The following image is an example of a strategy map applicable in the public-sector

organization

The common approaches strategy according to Richard O. Rumelt the definition of strategy is

diagnosis, guiding policy, and actions plans this strategy identified the problems that must be address.

While Michael Porter provided the four key elements that needs to considered first is SWOT (Strength,

Weaknesses, Opportunities and Threats), ethical points or personal values of key executives, the

industry opportunities and threats, and broader societal. Lastly the five approaches or 5Ps by Henry

Mintzberg which is plan, pattern, positions, ploy and perspective these five approaches can help to

develop a robust business strategy.