Home Business The Strategic Management Process

The Strategic Management Process

0
77
strategic management
source: https://medium.com/
Spread the love

                       The Strategic Management Process

Strategic Management Process
Source: https://www.assignmentpoint.com/

 

  • Strategic planning  basics:

A most important part of strategic management is strategic planning.

In this article, we will learn the two critical elements needed to easily create and implement your strategic plan.

While recreating direction for your business.

So these two critical elements what they are not, they’re not confusing, they’re not time-consuming, they’re not complicated, they’re simple.

Too many businesses get caught up in jargon and think fancy words are making business better or make them more appealing and it just won’t.

However, by strong strategic management, your strategic plan will definitely improve your business.

So let’s check some facts that will help you with the strategic management in your business.

If your organization is like a lot of companies realize that relying on lock Bishop rare.

It’s just not going to keep your organization strong.

That’s because companies of the implemented manager’s strategic plans really remain focused and know what to do each state.

Inc.com states that:

Ninety-six percent of businesses fail within 10 years.

 And you know what that is a staggering fact.

  • Why did it happen? 
  • Why do these types of businesses fail?
  • Many reasons including:
  • No flexible strategic plan.
  • Not using the plan that was created and
  • No time to implement a plan.

That you invested time money probably paid consultant. You don’t have the time to implement that plan. But your business is not doing what you wanted to do.

Companies that have implemented manage their strategic plans are not chasing their tails.

And plugging holes wonder when they can actually the best time in the long-term direction of their organization.

More companies are creating and implementing strategic management through a strategic plan.

As they see it as an essential part of creating longevity for their organization.

  • Forbes:

Let’s see what Forbes has to say about strategic management,

The primary reason businesses fail is that they simply run out of cash.

Why do you ask? Well, they:

  • Didn’t plan,
  • Didn’t implement their plan and
  • I did not stay focused on their plan.

You start to see a pattern here, the pattern is no plan no longevity.

So if you’re not strategic planning your competition is most likely doing it.

This means while you invest time and money applying band AG today your competition is working the strategic plan.

How to expect your business to thrive if you do not have a plan then you don’t have the best strategic management.

  • Most companies:

Let’s learn at what most companies where they fall into a pocket of:

  • Your business is growing but you have no plan to support the growth.

What’s wrong with that? your company is growing but are your costs growing more quickly than your revenues.

  • Your business is growing and you have a plan but you don’t use it.

Where do I find the time? We can’t afford to find the time.

Do you want to become one of the statistics that we just discussed, of course, you don’t want to be one of those businesses that fail?

  • Your business is suffering and you have no plan to revive it.

And you really want to spend your time plugging holes tearing off band-aids for fighting fires when you could be advancing your business.

or maybe you fall into this category.

  • Where your business is suffering and you have no time to implement the plan that you think you have.

You rather have a plan or you don’t or maybe this is your category.

  • Your business had a plan in the past but it still has the dust on that fancy binder that the consultant person left behind for you to implement.

And it’s probably outdated so when are you going to have time to implement your plan.

When the bank is calling well at least you still have that fancy binder and look great on that shelf.

“But without a doubt I do not have the time to implement a sketch when I’m so immersed in the day-to-day operations of my business.”

It means isn’t that just a great excuse as to why you’re not implementing your plan.

Go ahead you have any other excuses just stick them in here you know procrastination I’m always fighting fires you know it.

These excuse to speak for themselves you’re fighting fires because you haven’t planned. 

  • What is strategic planning?

strategic management
Source: https://www.nmcstrategicmanager.com/

So let’s learn at a few definitions of strategic planning that are part of strategic management.

  • First Definition:

“Strategic planning is an organizational administration exercise that is used to set priorities, center of attention energy and resources improve the operation.

ensure that employees and other stakeholders are working closer to common goals, hooked up agreement around intended customs/ results, and regulate the organization’s direction in response to a changing environment.”

It is a disciplined effort that produces indispensable decision and action that shape.

And guide what an organization is who it serves, what it does, and why it does it with a center of attention on the future.

Effective strategic planning articulates now not solely where an organization is going and the moves wanted to make progress.

But additionally how it will understand if it is successful.

We are taking about strategic planning fundamentals here so severely strategic planning definition.

  • Second Definition:

“Strategic planning is an organization’s process of defining a strategy or direction and making selections on allocating its resources to pursue the strategy.”

It may additionally also lengthen to control mechanisms for guiding the implementation of the strategy.

That’s a little better and it’s getting closer but you know what we are really just not there.

  • Third Definition:

A process that helps you decide on the steps needed to create success in your business then taking action on those steps.

In starting of the article mentioned that there are in the strategic management:

The two critical elements that are needed to easily create and implement your strategic plan while recreating direction for your business.

I.e 

  • Information 
  • Action

They cannot live apart they support each other and are needed and concert with each other to create success.

1.) Information: 

Information is G.O.A.L.

  • G- Gather
  • O- Organize
  • A- Analyze
  • L- Leverage

You need to gather information. 

Information that is pertinent to your business.

Then you need to organize that information in effective manner.

Once you’ve organized that information you need to analyze that information.

Does it make sense will touch deeper and all these topics as we continue on in the training?

Then you need to leverage that information.

Information is an important part of strategic management.

Once you have taken all the information pieces you will build a foundation there the four simple steps associated with information.

  • Gather Information:
  • When you’re gathering your information you should include as many staff as possible.

Harvard Business School States ninety-five percent of employees do not understand their company’s strategy.

How are they supposed to execute a strategic plan if they understand it?

  •  Profitability – They are not part of it you need to gather information on your profitability.
  • Sales&Margin – If you’re losing money your sales and margins.
  • Inside (rebate) dollars – Obviously any rebates and incentives provided by suppliers or partners.
  • Innovation – Any innovation that your company is performing or is looking at.
  • Production- Information – You need to know your product base.

You need to understand your products you need product information.

And maybe other pieces of information that are specific to your business because everybody’s business is unique.

  • Customer satisfaction:

You need to gather information about customer satisfaction.

Customers are really satisfied with the kind of service that they’re getting.

  • Market share:

To gather information about your market share.

  • Operational (cost) information:

You know are your costs completely out of whack your cost online.

You need information on your costs to understand how much it costs to service a customer.

  • Employee information:

You need information from your employees.

How many employees are they’re being paid properly do they have great benefits.

  • Corporate Identity/Culture:

What is your corporate identity or what is your culture?

You need to understand that as well maybe it’s important to you maybe it’s not you should gather information on it.

  • Brand Recognition:

As your brand recognized, as your company recognized.

What do you recognize?

How do your clients/customers see you?

How does an organization/industry see you?

And if you have an online business or bricks and mortar business with an online component you need to know.

What your click-through rate is,

what your cost to acquire a customer is,

what your stick great on your website is.

There are many pieces and you will come up with pieces of information that sense specifically for your organization.


Different Types Of Management

Innovation Management

Facility Management

Knowledge Management

Total Quality Management

Business Management

Marketing Management

 

  • Organize Information:

ow, it’s time to organize that information we need to take it and make sense of it.

  • What bucket suits your organization?
  • Do you have a sales and marketing bucket?
  • You have an operational bucket because you really need to understand your costs.
  • You have a procurement or purchasing bucket. Accounting bucket that’s accounts payable accounts receivable.
  • Give corporate identity buckets or even an industry trend pocket.

You’re going to have to decide what those buckets are based on your business you know what does it all means.

  • Analyze Information:

We’re going to analyze the information we’ve gathered with organized it.

We need to analyze that, 

  • What does it really mean?
  • Are you doing well are you doing? poorly?
  • Does it give you a picture of where you currently stand?
  • Is providing you with a foundation? 
  • Does it give you an understanding?
  • Does it matter how you got here?
  • Do you have a way to identify the progress?

When he analyzed the information that you have compiled a picture will start to become extremely clear.

You will see where your business currently stands and how strategic management works in your business.

Read Also: Strategic Management Course

  • Leverage Information:

Now it’s time to really leverage that information.

You gathered this information you’ve pulled it together, you organized it and you’ve analyzed it.

You may have knowledge about worthiness you may not have had before.

Do you have that many products that are not profitable? why do we sell them?

Do we have that many products that provide superior margins?

Why don’t we sell more of them those products it doesn’t make sense?

Does it cost how much to service that segment or customer? It doesn’t make sense for us to be doing that business.

Our shipping cost of that high or that low? We’re doing really poorly or really well.

Our customers can never get us they can never get through to us?

Our sales team maybe they lack accurate information.

Our product line is not focused?

Our employees are not engaged?

The industry has left us behind?

Do we have that much obsolete product?

Nobody can find us on the web?

To submit to you does any of this look familiar.

These are challenges that every business face.

But when you gather organized to analyze and leverage your information.

You will have a very good picture of where you currently stand.

2.) Action:

Let’s learn now at critical element number two which is active in strategic management.

Information without action is just a pile of information that is useless.

Action without the information you may take the wrong steps you may go the wrong direction and make things worse as opposed to better.

So we’re looking at P.I.T.A

  • P – Plan
  • I – Implementation
  • T – Track 
  • A – Adapt

P.I.T.A  is you create a plan you implement that plan you track that plan and how it performs and then you adapt.

Because no plan is perfect.

These are the four simple steps associated with action in your strategic plan.

  • Plan:

You know your current position because you have completed the information phase and you’re ready to plan.

– G.O.A.L

You identify,

  • Where you want to go?
  • Where do you desire to take your business?
  • What do you want to enhance upon? and 
  • Where are the opportunities for you to make your business better?

And it’s really basic from there we bridge the gap.That is the basics of strategic planning.

But encourage you to choose an ultimate strategic plan leader.

It’s the killer queen that when it comes to the strategic plans their ultimate responsibility for that to be successful.

The other thing suggests that you ensign an information gatekeeper.

This gatekeeper keeps the ultimate files with the most up-to-date information on your strategic plan.

This gatekeeper must be extremely diligent and have no problem asking colleagues for updates when they’re due.

And suggest a strategic plan file and a KPI or a key performance indicator tracking file.

We’re creating a plan so you have to identify:

What are your priorities?

These are some of the things that you must do to get your plan started.

 Keep the number of priorities manageable.

We found that three to five priorities usually a significant step forward.

There are many more than that you may get lost.

Some people go with 8-10 priorities and they’re worse off than before they started strategic planning keep it simple keep it basic.

What your timelines for those priorities?

To assign the lead responsibility person for each priority.

You will have the ultimate leader in your strategic plan.

But you will have somebody responsible for each priority.

And increase key overall performance indicators. 

Like we learned about in the information portion.

You have to determine what measures make sense for your business and how are you going to understand if you’re improving or not.

Each priority is going to require resources and allocate resources for each priority it could be:

  • Financial resources,
  • People internal or external,
  • Equipment or 
  • Time. 

It needed to make sure these priorities happen.

And on your business, there could be different things that you need as far as resources to get a priority to fruition.

You also keep detailed notes that will make it so much easier you will thank yourself later.

When you have these detailed notes to refer back to during your plan.

  • Implement:

We’ve created a plan from all the information you’ve gathered and now it’s time to implement that plan.

Unveiled that plan and get staff by and get them to support the plan.

You need to show that you have listened to their import you need as many people as possible to see a part of them in the plan.

But keep the plan unveiling at a very high level do not get stuck in the major details.                           

Take the first steps and acting on your priorities.

Don’t put it off.

You’ve created a plan you invest time energy and money.

Don’t put it off get started and follow through on the actions that you said that you would take.

  • Track:

In the strategic management, tracking of a strategic plan document and a Key Performance Indicator document. 

These two very concise documents will have you understanding exactly what progress you’re making.

Led by your designated strategic plan leaders.

This plan forwards these files they’re managed by your gatekeeper.

That we talked about earlier and these are going to be straight forward KPIs.

The tracking that you have monthly senior manager reviews to make sure progress is being made.

Maybe it’s not monthly maybe its quarterly that’s up to you and your business.

But also suggest that quarterly or semi-annually staff reviews are imperative to keeping staff engaged involved and moving forward.

The more staff that are engaged and updated the more than willing to commit to fulfilling the actions required to the plan.

It’s proven time and time again so keep staff engaged.

Each priority should have a snapshot view that will show you a simple that you can look at a glance.

And know how you’re progressing with each priority in your strategic plan.

An action view with all the actions required to make the priorities happen and bring them to fruition.

You don’t want is a Gantt chart view that lays it out week-over-week as to what activities are happening at what time.

And of course, you need to track the key performance indicators.

To tell you please keep detailed progress notes as mentioned earlier in this article.

It will make it so much easier don’t waste your time on a strategic plan unless you’re going to respect it and keep great notes.

We’re talking about a strategic plan snapshot view and really it is very simple.

It is a snapshot it will show the project or priority who is leading that project what the start date target is the end date.

It will take to get that priority completed and when the next review date is.

But you’ll also see how far you’re into the project the percentage of completion.

This is a very clear concise view that will tell you at a glance how close you are to finishing your projects.

Now next we’re going to look at an action view.

These are all the tasks all the actions required to support everything that you’re trying to do on the priorities.

It’s going to tell you who’s accountably responsible for those each one of those tasks again start and end dates how long it would take for that to happen.

And of course what the action is and what project is tied to and again whether it’s completed and how much progress has been made. 

But it tells you how close you are to completing the items required to support that priority or project.

The strategic management
Source: https://www.scoop.it/

If you want the fancy Gantt chart view then we have that too and maybe you do maybe you don’t.

But it is something that may make sense to some others may not care about it but that’s an idea what a Gantt chart looks like.

  • Business Development Bank of Canada(BDC):

The BDC says that half of all Canadian companies do not measure their performance.

If you’re not measuring your performance then you’re susceptible to challenges.

BDC also states that there are only nine percent of Canadian businesses look at their productivity level and that’s staggering.

Do you have a handle on your productivity? because you really should.

And if you don’t how do you know how well or how poorly your business is doing well.

Now the last piece of P.I.T.A which is the second critical element regarding strategic planning is to Adapt.

  • Adapt:
  • No plan is perfect,
  • Conditions change,

      – Industry

      – Market

      – Competition

      – Your team

To change all the time and you have to be ready to adapt no plan is perfect.

So you must adapt to the changes that happen and that’s why suggested multiple times to keep great notes in your strategic plan.

Adapting to what happens in the business is critical to your success.

  • Brief of two critical elements:

Let’s have a brief review of the two critical elements needed to easily create and implement your strategic plan while recreating direction for your business.

Critical element number one, of course, is information.

Critical element number two is the action.

And again you need both of those pieces together to be successful in strategic planning.

So with information, we learned about gathering the information pulling together the information that you need then organizing it.

It makes sense to you and helps to create a snapshot.

Then you analyze and understand that information. 

It gives you a base once you have that basic need to leverage that information and take that information and turn it into action.

What you do then is you plan you create your plan you then implement your plan you track your plan and then you have to adapt your plan.

For the growth of your business strategic management must be there.

Because things will change.

Do you think that your business should have a strategic plan? 

The answer is you picked up at least a couple of pieces of great information.

Here that will help you with creating and implementing a strategic plan to create longevity for your business.

Read Also:- Different Types Of Management

Accounting Management

Sales Management

Supply Chain Management

IT Management

Procurement Management

Risk Management

Human Resources Management

Operations Management

 

NO COMMENTS

LEAVE A REPLY

Please enter your comment!
Please enter your name here