DETAILED LEARNING MODULE IN STRATEGIC MANAGEMENT

Module Number: 4
Module Title: BENEFITS OF STRATEGIC MANAGEMENT

I. Introduction
This module is Strategic Management. The subjects concentrate on the
rudiments of strategic management. The center of attention is the firm – the industry
and the competitive environment in which it operates, its long-term direction and
strategy, its resources and competitive capabilities, and its prospects for success. It
focuses also incorporates strategic audit, which is a hands-on experience for students
in strategy evaluation, (re)formulation, and implementation planning.
Below are used in this module:
This icon indicates SUPPLEMENTARY CONCEPTS OR TRIVIA
which can provide additional information about the topic in the activity
that you are doing.

This icon indicates STUDY QUESTIONS. It simply means that you will be
assessed based on prior concepts you have learned in this module. It is an
evaluative test to measure what you have learned from the module. Your score
will be recorded.

This icon indicates SUMMARY OF CONCEPTS you have learned from the
module. Write all relevant concepts you learned in bulleted form.

This icon indicates a GROUP DISCUSSION OR A DISCUSSION BOARD.

The instructor may call an online group discussion or meeting to explain or
clarify certain points and concept about the module. As such, the instructor can
create a discussion board to accommodate students who were unable to attend
the Online Group Discussion.

This icon indicates an ONLINE ACTIVITY. The instructor will give separate
instructions regarding the activity. An accessible social media platform can be
used.

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 This icon indicates a LEARNING ACTIVITY. The instructor will provide an
activity corresponding to the topics discussed.

II. Learning Objectives

Upon completing this module, the students must be able to:

1. Explain the need for integrating analysis and intuition in

strategic management
2. Describe the benefits of good business in strategic management
3. Explain the advantages and Disadvantages of entering global markets

III. Topics and Key Concepts

1. Benefits of Strategic Management

There are many benefits of strategic management and they include
identification, prioritization, and exploration of opportunities. For instance,
newer products, newer markets, and newer forays into business lines are only
possible if firms indulge in strategic planning. Next, strategic management
allows firms to take an objective view of the activities being done by it and do
a cost benefit analysis as to whether the firm is profitable.continuity, the
capability to exploit opportunities and react to external change by taking
ongoing strategic decisions.

The key point to be noted here is that strategic management allows a firm to
orient itself to its market and consumers and ensure that it is actualizing the
right strategy.

Strategic Management vs Strategic Planning

Strategic management involves formulating, implementing, evaluating, and
improving strategies to achieve an organization’s long-term objectives,
considering internal and external factors.

While strategic planning involves the proposal and formulation of schemes to

achieve a target. In terms of management, strategic planning helps optimize an

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 organization’s operations by identifying existing problems. Strategic planning
is used for creating a focused, timely, and beneficial strategic management
process.

Strategic management identifies actions to be taken, resources for allocation,

appropriate time and the approach for executing the actions. Strategic
planning’s function is to only identify the actions to be taken.

Strategic management focuses on producing strategic results while strategic

planning focuses on optimal decision making. In other words, strategic
management is action-oriented while strategic planning is analytical.

Parameters Strategic Management Strategic Planning

Definition Strategic management is the Strategic planning is the
procedure of formulation and process of determination of
implementation of planned organizational strategies
strategies to achieve business based on target objectives.
goals.
Processes Strategy formulation, Strategy proposal and
Involved implementation, evaluation, formulation
improvement
Tasks Identify relevant actions, Identify actions
resources, approach, & time
Focus Producing strategic results, Making beneficial decisions
additional solutions, and
customer segments
Type Action-oriented Analytical
Definition Strategic management is the Strategic planning is the
procedure of formulation and process of determination of
implementation of planned organizational strategies
strategies to achieve business based on target objectives.
goals.
Processes Strategy formulation, Strategy proposal and
Involved implementation, evaluation, formulation
improvement

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 Benefits of Strategic Management with Examples

What are the Non-Financial Benefits of Strategic Management?

Strategic management allows an organization to be more logical, rational, and systematic in its
strategies.

Revitalize Human Resources

Strategic management often includes proactive staffing practices that help hire the best talent and
be more competitive. Companies can prepare detailed job descriptions, improve recruiting
practices, provide 360-degree feedback, and take other steps that reduce turnover and boost
employee satisfaction.

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According to a case study published on Kesko Ltd., a trading sector company, the strategy
development started from a generic level and was later devised at field level for different
industries. Due to mutual trust and cooperation among the involved members, the company
witnessed growth in sales, customer numbers, and market share.

Identify Problems
Strategic management enables a detailed analysis of the organization’s strengths, weaknesses,
opportunities, and threats. Based on the problems, the company can take relevant actions like
changing the pricing model, recruiting more staff, adding distribution channels, etc.

For example, a new competitor opening a shop nearby can be a threat to your business. You can
plan loyalty campaigns, discounts, special offerings and other strategies on time to keep your
customers away.

Better Decision Making

You can make better decisions in a shorter time with strategic management. For example, if you
get the opportunity to take up a new project, you can make a better decision whether to invest

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resources in it or not. Given that a project aligns with your ideas, you can plan and allocate
resources to the project.

Improved Understanding of Competitors’ Strategies

Strategic management enables organizations to learn all the practices followed by their
competitors. They can then implement their strategies without imitating them. This move can
help in strengthening your business and meeting brand awareness goals.
For instance, HP maintained competitive advantage over the years by refining the marketing
strategy and re-branding from time to time. This helped ensure that its products met its
customers’ evolving technological needs.

Higher Stability
By selling into new markets, acquiring new businesses, and adding new products, you reduce
your dependency on individual entities. Your profits do not depend on the success of a single
product or client.
If you have just a few clients, you might have to work completely on their terms to prevent your
business from shutting down.

Learning Activity
PERSONAL SWOT ANALYSIS WORKSHEET:
Please identify your Strengths, Weaknesses, Opportunities and Threats

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 SUMMARY OF CONCEPTS

What have you learned? Write here all relevant concepts and terms you’ve
learned in a bulleted form *

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 REFERENCES:
 www.hbs.edu/research/facpubs/workingpapers/papers2/0001/01-002.pdf
http://harvardbusinessonline.hbsp.harvard.edu/hbsp/hbr/articles/article.jsp?articleI
D=
 96501&ml_action=get-article&print=true
 Michael E. Porter. The 5 Competitive Forces That Shape Strategy. HBR Jan. 2008.
Pp.
 78-93
 Chapter Summaries-Chapter 2: External Analysis: The Identification of Industry
Opportunities and Threats
 https://www.mindtools.com/pages/article/newTMC_05_1.htm
 https://college.cengage.com/business/hill/strategic/6e/students/summaries/ch02.html

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