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Strategic Management ProcessHaving a Strategic Management Process is very important for any existing business and those who are just getting started in the business world. There are four elements in a strategic management process which include situation analysis or environment scanning, strategy formulation, strategy implementation, and strategy evaluation. All the elements and steps of this process are important to the success of a business. Situation Analysis When a company begins their situation analysis they determine the present strengths, core competencies, influences and threats internally and externally. Internally a company must examine their employees, the interaction they have with one another, and interactions with management. The company will analyze their brand awareness and the company’s organizational structure during this step of the strategic management process. Communication with all levels of the company’s staff is crucial to address and correct any issues which could be a threat to the effectiveness of the company. As the company gains success continued communication is needed to address changes in the internal and external influences to stay competitive in the business world. Strategy Formulation After a company has analyzed their situation they will take the information to develop a strategy formulation which is determining the best course of action to achieve the goals and objectives of the company. During this step of the strategic management process the company will set their objectives, determine the environment it should operates and sets targets. By communicating with each department of the company they will analysis macroeconomic trends. Performance analysis is important to determine if the company is on track and succeeding and estimate the future success of the company based on the current plan. During the strategy implementation step of the strategic management process the company will take all the information collected during the previous steps and implement a strategy based on the goals and objectives of the company. Developing organization which will carry out the strategies, developing strategy encouraging policies, developing a reward system to encourage constant improvement and using strategic leadership are all steps a company will implement during this part of the process. Strategy Evaluation A company must evaluate the strategy in place in order to determine the effectiveness of their strategy. Communications by all organizational levels is critical in determining if the company’s plan is successful or needs to be adjusted. This is the final phase of the strategic management process. During this step the company will measure performance, analyze variance, and take actions to correct if needed. During the entire strategic management process communication by all levels of the company is extremely important for success and effectiveness. Without feedback from all areas within a company this process would not be able to be used or adjusted to ensure the company meets all of its goals and objectives. Running any successful business requires communication, evaluation, and analyzing throughout the growth of the business. This process helps a company determine, in depth, what needs to be done in order for objectives to be reached and allows the company to continue to stay focused on improving their success. Related Articles: What is Strategic Management |
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