Project Management And Fundamentals Of Strategic Management

In this article, you will learn about project management and the fundamentals of strategic management.

Introduction

 
Everyone knows that if you want to be successful, first you need to plan your strategy. It may be a war, a business, or any type of trip. We need to consider the positive side as well as the negative sides and plan accordingly.
 
In terms of Project Management, planning is essential to manage a project. It does not matter how difficult or complex it is.
 
Strategic Management gives you the ability to break your goals into sub-goals and by completing sub-goals, you will achieve your main goal.
 

What is Strategy?

 
Strategy is a long term plan an organization is willing to pursue in order to get its mission and purpose-filled.
 
The strategy depends on the nature/type of the company,
  • Old Economy
    Basic Metals, steel, power, other core industries
  • Traditional companies
    Automobiles, consumer electronics, consumer durables, entertainment
  • New World Economy
    IT Services, BPO ITES, Social Media

What is Strategic Management?

 
Strategic management is a continuous process of planning, monitoring, and analysis of strategy which is necessary for an organization to meet its mission, vision, and objectives.
 

Strategic Management Process

 
Strategic management is nothing but defining the steps of strategies that an organization is going to work towards to achieve its goals as well as better performance.
 
It is a continuous process that needs to be monitor and change whenever it requires by managers.
 

4 key components of strategic management

  1. Environment Analysis
    It includes providing and collecting information. It helps to analyze internal and external factors which influence the organization.
  1. Strategic Formulation
    It includes the best course of the strategies which helps an organization to achieve the vision, mission, and objectives.
  1. Implementation
    It includes implementation of the decided strategy which helps to design organization structure, managing human resources, indulging and distributing resources.
    1. Top management should ensure that the strategy is internalized at different levels of the organization
    2. Needs clear communication, formulation and assigning the KPIs
    3. Needs employee empowerment and mobilization of resources
  1. Review and Control
    It includes reviewing the implementation of the process which helps to measure performances of the organization and we can control it by taking corrective actions on the gaps.
    1. Top management examines and reviews whether the strategy is implemented in meeting the mission of the company
    2. Addresses need for any corrective measures.
    3. Continuous monitoring of the internal and external environment is part of the review and control process

Different Levels of Strategy

  1. Corporate level
    It addresses the fundamental questions such as what is the
    1. Purpose of the organization
    2. The vision
    3. Businesses want to pursue
    4. Expansion and diversification of each business
    5. Mergers and acquisitions
    6. Defining business guidelines
    7. Corporate governance
  1. Strategic Business Unit Level
    1. It decides the competitive advantage that an enterprise needs to succeed in the chosen business line.
    2. Has to conform to guidelines, governance mechanism, corporate philosophy, and strategy.
  1. Functional unit level
    1. This works in synchronization with corporate strategy and strategic business unit strategy
    2. Meant to create
Expertise, competence, competitive advantage, efficiency, and productivity which are vital to the achievement of the business goals.
 

Principles of good Strategy

  1. The essence of the strategy lies in creating tomorrow’s competitive advantage faster than competitors.
  2. Works on the assumption that no one size fits all.
  3. Creates competitive products to beat the hyper-competition.
  4. Evolve strategy that goes beyond the competitive advantage but also creates socio-economic impact.

Limitations of Strategic Management

  1. Analysis, if made without proper due diligence, may lead to the wrong strategy.
  2. Inadequate management’s commitment and lack of willingness to allocate resource may lead to failure of strategy.
  3. Ignorance of feedback and inputs from different levels of people within an organization may create future problems at the implementation stage.
  4. If all options are not evaluated before the finalization of strategy, there could be significant risks.
  5. Management may get distracted by short term tactical goals.
  6. No strategy can be stretched beyond the boundaries of a particular business.
  7. Demotivated employees may not participate in the strategic management process.
  8. Universal strategy adoption may lead to a company in a trap.
  9. Conflict management, change management in the planning process exert resistance or indifference to the progress of strategic management.
  10. Organizations sometimes fail to make strategic management as an integral part of the strategy-making the process.
  11. The process does not ensure unconditional success.

Conclusion

 
In this article, we have seen the meaning and importance of strategic management.