Table of Contents

Introduction........................................................................................................................3
1. Role of Strategic Planning in Organization.................................................................3
1.1. Processes by which Organizations Identify their Goals and Values....................3
1.2. Role of Strategic Business Management and Planning in an Organization........4
1.3. Classic and Contemporary Models used in Developing Business Strategies and
Planning.........................................................................................................................4
2. The Impact of Internal and External Factors on Organization....................................5
2.1. Ways in which these Factors can Influence the Organizational Management
and Planning Strategies.................................................................................................5
2.2. The Influence of Organizational Governance Requirements on Management
and Planning Strategies.................................................................................................5
2.3. The Impact of Internal and External Risk Factors on Strategic Business
Management Activities...................................................................................................6
3. Strategies that Organizations use to achieve Competitive Advantage.......................6
3.1. How an Organization Positions itself to outperform its Competitors?..................6
3.2. Appropriate Competitors Advantage Strategies...................................................7
4. Environmental Factors that affect Strategic Business Management and Planning....8
4.1. Global Issues’ Impact upon Strategic Management............................................8
4.2. Impact of Stakeholder Interests in shaping Strategic Management....................8
4.3. Ways in which Organization’s respond to Environmental Factors.......................9
Conclusion.........................................................................................................................9
References.......................................................................................................................11
Introduction
Strategic management is a very important part of a company. This refers to the
development and implementation of strategic goals and initiatives are set by the
stakeholders of the organization. More simply, it is very important that the strategies are
well in place to help and support business functions and the operations to ensure a wise
decision-making process. Therefore, strategic management includes evaluation of
business goals, organizational visions and goals, and future plans. In addition, we
employ strategic management processes to run the business that we have effectively
and efficiently. Communicating this strategy to all levels, internally and externally is very
essential to success so that both employees and the organization understand their
goals and directions, and outsiders understand your position as an organization.

1. Role of Strategic Planning in Organization

1.1. Processes by which Organizations Identify their Goals and
Values
Researchers have given 3 important approaches organizations adopt to
identify their goals and values.

The work process approach, with its basics in the industrial engineering
and the work measurement, mainly focuses on the task accomplishment.
It begins with a very simple yet a very powerful idea. Organizations
complete their work through a linked set of activities that span the
departments and then the functional groups. Work process approach that
the organizations adopt is probably the most familiar to the administrators.
It makes great use of quality movements and reengineering principles.

Then there is behavioral process approach, with its basics in group

dynamics and the organizational theory, focuses on the patterns of deep-
seated behavior. These patterns portray the characteristic behaviors and
ways of interaction of the organization. The decision-making and
communication process is one example. All behavioral processes have
some common characteristics. They are generalizations extracted from
the checking of everyday routine work and do not exist independently
except for the process in which they are occurring.

Finally, the change process approach, with its basics in strategic

management, social psychology, organizational theory and economic
history, focuses on the event timing. These processes, are responsible to
 evaluate how the individuals, different groups, and the organizations
evolve, adapt and grow (Garvin, 1998).

1.2. Role of Strategic Business Management and Planning in an

Organization
Strategic management is a very notable term that involves the innovation,
strategic planning processes, thinking strategies and finally the operational
strategic planning. In particular, strategic business management is
primarily research-based. Successful business strategies need to take into
account customer opinions, employee opinions, and industry best
practices. A common way to promote strategic business leadership is to
include many plans on the board, staff with valuable and diverse
experience, and be cautious about the impact of decision making on all
business functions within the organization. Annual business plans are
maximum times put together, but in the 21st century that we’re living in, it
is important to adapt to a more flexible and changing environment and
needs of the employees (GISMA Business School, 2019).

1.3. Classic and Contemporary Models used in Developing

Business Strategies and Planning
The definition is embedded in the name, so it's easy to define a strategic
planning model. The strategic planning model is a way out for an
organization to execute a strategy and create a plan to execute it in order
to enhance operations and achieve goals better. Some of the models are
as follow:

Firstly, Strategic Alignment Model (SAM) is one of the most commonly

used. It consists of two parts: functional integration and strategic fit. This
actually means that SAM comes in line with the business and the IT
strategies. To do this, one needs to identify the organization's key goals
and the steps taken to achieve those goals. The plan needs to maximize
the process to best achieve these goals.

Then is the Balanced Scorecard (BSC) consisting of a clear message

given about what has been achieved. Align your work with your overall
strategy, prioritize, measure, and monitor your progress. The model
comes in line with the strategy and with the financial measurements. One
of the reasons for using BSC is to help identify the relationships between
different sectors of planning and strategic management.

The basic model, also known as the simple model, is mostly used in the
new organizations that don’t have any past related to the strategic
 planning for supporting decision-making. But it is also a good model for
organizations that don’t have any time or resources available to invest in
deep and comprehensive strategic planning (GISMA Business School,
2019).

2. The Impact of Internal and External Factors on Organization

2.1. Ways in which these Factors can Influence the Organizational
Management and Planning Strategies
The internal factors of a company or an organization generally refer to the
events, structures, factors, people, systems and conditions within the
company/ organization that are within the hold of the organization. A
company's mission, organizational culture and leadership style are usually
factors related to the internal factors of the organization. Therefore, these
are the internal factors that influence an organization's activities, employee
behavior and attitudes. Changes in the leadership style, organizational
mission, or the culture can have a very significant effect on an
organization.

The external are the factors that come from the outside. The enterprise,
cause change within the organization, and is most often outside the
control of the enterprise. Economics, technology, customers, competition,
political and resources are common external factors that affect an
organization. Even if the external factors occur outside the organization, it
can have a very prominent impact on ongoing processes, build, and long-
term sustainability. Ignoring the external factors can be a huge mistake for
the managers. Therefore, administrators do not need to take a retroactive
approach that can lead to completely different outcomes, and should
continuously monitor and adapt to the external environment and make
early proactive changes. It is essential to work on it (Hartzell, 2012).

2.2. The Influence of Organizational Governance Requirements on

Management and Planning Strategies
Organizational governance plays a vital role in planning strategies and
management. It defines the overall roles and each element’s
responsibilities of the board that is present and the executives in the
organization. It also concludes how the organization will be managed. This
is applied to a number of features of the business, can be business
establishment an organization's objectives, vision and strategic goals,
provide management with the appropriate leadership and the culture to
 achieve those goals, and establish clear indicators for measuring
performance.

In addition, organizational governance helps maintain sound relationships

between the board of directors, management, and various outside
stakeholders. This prevents conflicts and moreover confirms that all the
parties’ work for the same common goal.

In my company Paypal Holdings, same would be the case that the

organizational governance would be defining the overall roles and
responsibilities of the work force. The organizational governance that I
have is solely responsible for managing the company’s financial and
strategic work (Peakstone Global, 2022).

2.3. The Impact of Internal and External Risk Factors on Strategic

Business Management Activities
External: If the economy is in a bad state, even a well and stable running
business may not be able to survive. If the business is not of that
uniqueness, one will surely have to deal with the incoming competitions.
When someone starts a business, he is against a well experienced and
professional company built up in the same field. Changes do come in the
government policy, which can have a prominent impact on the business
e.g. the tobacco business. With the exclusion of the employees, the
customers and the suppliers might be the most important people one
deals with.

Internal: Employees and workers are one of the most important parts of
the organization’s internal matter, unless it's just a single person’s show.
Even if there is a great economy, the lack of finance can result in the
equilibrium between survival and death of one’s business. The internal
culture is only made up from the attitudes, values and priorities that our
employees live in. The novel and keen culture of all the workers or
employees competing with one another creates a completely different
environment than an organization that stresses upon collaboration and
comradeship. Organizational culture usually flows from the top to bottom
(Peakstone Global, 2022).
3. Strategies that Organizations use to achieve Competitive
Advantage
3.1. How an Organization Positions itself to outperform its
Competitors?
In Paypal, whether dealing with competition within the formation from
other sales reps or outside threats from competitors in the field,
competition drives everyone to do our best. Some of the ways we adopt to
deal with the competitors are as follows:-

Positioning strengths against weaknesses - All competing companies

have weaknesses. This is an area where the company can perform better
or better than "other" companies. Even if the competitors have a large
market share, a good product, or a low price, one can still accomplish the
mission.

Success Story Sharing - Storytelling offers the opportunity to transform a

solution from a hazy intangible confused idea into a real-time vision for a
potential customer.

"One Stop Shop" or "Specialty Shop" - We have to decide, Is our firm a

comprehensive company offering a wide range of things, products and
services, or our company focuses only on specific products or services
Are you a guessing expert? You can take advantage of these two
business classifications.

Ask Better Questions - Most salespeople who ask better questions do

not respond well to their questions. It's not just open and closed questions.
Having the knowledge of the right questions, how to ask that question, and
the timing of the questions you have to keep taking is very important to the
entire purchasing process.

Discuss Future Goals - Practice explaining the company's long-term

excellence plan to present future goals. Be ready to position the company
to be committed to a long-term strategy of continuous progress and
improvement (Protosow, 2018).

3.2. Appropriate Competitors Advantage Strategies

Competitive strategies allow the companies to outperform their industry
competitors. All these strategies involve the cost leadership, differentiation
and concentration. Companies that follow cost leadership strategies must
gain the minimum production expenditure per unit in a firm.
 The industries in which a company operates can be classified as emerging
industries, mature industries, shrinking industries. Whereas Paypal is firm
with tough competitors in the market but it is regarded as an emerging
firm.

A fragmented industry is termed by the lack of market leaders who can

shape what happens in the industry. Emerging industries are what result
from technological innovation, changes in the relative cost terms, or the
brought up of new costumer’s needs. The declining industry is termed by a
fix decline in the sales over a long period of time (Business Strategy,
2018).

4. Environmental Factors that affect Strategic Business

Management and Planning
4.1. Global Issues’ Impact upon Strategic Management
As global communication progresses, developing business strategies on a
global basis is becoming increasingly important. Events at some of the
company's overseas operations can affect the entire organization. In
addition, regional disputes can lead to disputes that can impair the
operations of the region. All strategic managers need to consider some
global concerns when developing and executing plans. Companies doing
business in different countries should continuously check the stability of
their local governments. Confiscations, rebellions, and even revolutions
can result in governments confiscating corporate assets and nationalizing
the resources needed to maintain the power. As you have a relationship
with the public government, hostile forces in one country may even
consider your company part of the problem. Strategic management needs
to oversee the stability of the local governments in each country in which
the company operates.

As for Paypal, the world is electronically connected, and information flows

from one sector of the earth to another sector. Conflicts have the potential
to rapidly globalize, so businesses need to protect their reputation in every
country in which they do business. Marketing to countries with obvious
ethnic teams have been seen around the globe, so the strategic managers
believe that the company's local promotional message is consistent with
the overall positive value (Johnston, 2019).
4.2. Impact of Stakeholder Interests in shaping Strategic
Management
In a modern world where stakeholders are having a huge impact on
business outcomes, organizations need to get the potential impact of
different stakeholder teams on their processes. Stakeholders are basically
the individuals, characterized groups, or organizations which are directly
included in or indirectly have an impact by a service, project, product or
business. In result stakeholders also influence why and how companies
do business. From deeply invested to slightly more interested, internal and
external stakeholders do not stand out or speak out more than they do
these days.

Paypal is such a company which cannot work without the help of

stakeholders. Each and every stakeholder has got a different role to play
and different stage of impact on these business operations and planning.
However, not everyone who is involved is alike.

Key primary stakeholders are the ones with central focus on to the
purpose of the firm or organization. These key elements contribute largely
and directly to the success and progress of the company. They can be
either internal (directors, board members, shareholders, employees) and
external customers.

Secondary stakeholders then have indirect impacts – government

agencies, communities, suppliers. Every single organization in the field,
from public companies in the run to small businesses, has a complex
stakeholder ecosystem, all of which have a prominent and tangible impact
(Stakeholder Capitalism, 2021).

4.3. Ways in which Organization’s respond to Environmental

Factors
For an organization to prosper and prosper, it needs to adapt, harness
and adapt to the forces of the external environment. An organization is a
group of people who are deliberately brought together to achieve their
goals through framed and matched goals and aims. As a result,
organizations play in diverse external environments which are internally
framed and made to meet both needs and the opportunities. Various types
of companies include non-profit, governmental, voluntary, commercial,
public, private, family-owned and operated organizations that are listed on
the stock exchange. Organizations are mostly known as companies,
associations, groups, institutions, consortia, and conglomerates.
 The purpose, nature, size, location, scope, and mission of an organization
all tend to determine the environment among which they operate, but
never the less, the needs of that environment is to survive and prosper.
And you need to deal with unforeseen circumstances. This chapter
actually tells how a firm adapts to the environment and how it is framed to
meet the challenges and hurdles of those environments. The important
lines for the readers of this are: being always able to know the elements of
the external and internal environment of each organization that may be of
interest to or influence as an employee. And get inside view to develop
strategies and ways to help deal with factors (Black et al., 2019).

Conclusion
If it collects dust on the shelves, strategic planning is useless. For this reason,
implementation is probably the most important step in the planning process. It turns
strategy and planning into action and success. Planning is answer to what and why, but
execution is something that is just as important as who, where, when, and how are
Strategic planning is for a lot of the reasons, involving lack of ownership or
misunderstandings about planning among the stakeholders, the lack of accountability or
different authorities, inability to link strategies to the budgets, and inability to link
employee incentives to strategies. Success of a company in all aspects depends on
quality implementation of a proposed plan. It starts from the top management, who
should be responsible for the execution. However, it is very important that all of the
stakeholders are included. Start by judging whether one has the right and sufficient
budget, content, staffing, resources, and system to implement the plan. Then support
the weaknesses before inserting the plan into workable action. As in most of the cases,
communication is very important. Stakeholders are concerned on why company has
participated in strategic planning, how plans of the company and specific goals help the
company's mission and values, and then how the day-to-day work of workers affects the
company's prosperity, while developing the ownership and the scorecards for tracking
and seeing the progress, performance management and the reward systems for the
appropriate stakeholders. Educating the managers on how employees' do their work,
can help them reach till their goals and keep a track of the progress on regular basis.
Rather, a framed performance assessment across the company should be the norm.
References
Black, S., Gardner, D.G., Pierce, J.L. and Steers, R. (2019). The Organization’s
External Environment. [online] opentextbc.ca. Available at:
https://opentextbc.ca/organizationalbehavioropenstax/chapter/the-organizations-
external-environment/.

Business Strategy (2018). Generic Competitive Strategies | Business Strategy |

Business, Management | Textbook | Book. [online] Icmrindia.org. Available at:
https://www.icmrindia.org/courseware/Business%20Strategy/Generic%20Competitive
%20Strateg.htm [Accessed 25 Jul. 2022].

Garvin, D.A. (1998). The Processes of Organization and Management. [online] MIT

Sloan Management Review. Available at: https://sloanreview.mit.edu/article/the-
processes-of-organization-and-management/.

GISMA Business School (2019). What is the importance of Strategic Business

Management? [online] en. Available at: https://www.gisma.com/blog/what-is-the-
importance-of-strategic-business-management.

Hartzell, S. (2012). How Internal and External Factors Drive Organizational Change -

Video & Lesson Transcript | Study.com. [online] Study.com. Available at:
https://study.com/academy/lesson/how-internal-and-external-factors-drive-
organizational-change.html.

Johnston, K. (2019). Global Concerns of Strategic Management. [online] Small

Business - Chron.com. Available at: https://smallbusiness.chron.com/global-concerns-
strategic-management-14588.html.

Peakstone Global (2022). Role of Corporate Governance in Strategic Management.

[online] Peakstone Global. Available at: https://www.peakstoneglobal.com/governance-
of-strategy/.

Protosow, M.D. (2018). 5 Tactics to Outperform Your Competition. [online]

blog.dmtraining.net. Available at: https://blog.dmtraining.net/blog/bid/335628/4-tactics-
for-outperforming-your-competition.

Stakeholder Capitalism (2021). What are the impacts of stakeholders on a

business? [online] alva. Available at: https://www.alva-group.com/blog/what-are-the-
impacts-of-stakeholders-on-a-business/.