Strategic Management

Topics: Strategic management, Strategic planning, Management Pages: 44 (16763 words) Published: September 26, 2010
Planning and Management
Strategy Formulation
Strategy can be defined as a guide through whom organizations progress from the current state of affairs to a future desired state. Strategy is most importantly an effective tool used to forecast the future of a good organization rooted in long range plans. It makes a strong argument for an organization to effectively position itself within its constrain and environments, thereby maximizing its potential for flowing with the environmental changes. This makes it possible to adjust accordingly as circumstances in the environment change. Swayne, Duncan and Ginter (2008) simply affirm that it is a road map that defines an organization’s direction and how to get where it is intended to go, and even provide the bearings of how tro get there with no hassles. History of Strategic Planning

Swayne, Duncan and Ginter (2008) trace the concept of strategy back to the military. Thus in the 1950s several authors according to Swayne, Duncan, and Ginter (2008) began to relate strategic management to business. Strategic planning then developed between the 1960s and 1970s as leading companies began practicing and publicizing its merits. At that time and before, it became apparent that strategic management would have made sense if it included planning and budgeting, with planning being the central theme. In the last four decades, strategic management concepts have been employed within health care organizations with mixed results. Before the 1980s, however; individual organizations had few incentives to utilize strategic management because most health care organizations were independent, freestanding, not-for-profit institutions, and health services reimbursement was on a cost-plus basis. Swayne, Duncan and Ginter (2008) also note that in recent years the expansion of health care systems, the fragmentation of markets, the growth of investor-owned hospital companies, and the emphasis on cost containment have induced individual health care organizations to investigate strategic management (Swayne, Duncan, and Ginter (2008). As may be expected, throughout its history, strategic management has retained its basic emphasis on planning but has been expanded to encompass implementation and control or in other words managing the strategic momentum. More and more health care organizations have subscribed and committed to the process of strategic management as a means of managing increasingly large, complex, and diversified organizations in dynamic environments. Strategic planning is not an easy process for any and all organizations. Many health care organizations have tried it and have not been all successful as they mostly fail to put together the real concepts of understanding all its intricacies and the main thrust of conducting the planning process. This being said, most plans end up not being implemented because there was no proper planning and if they were planned, there was no clear understanding of how they work, hence the failure by those who attempted. This dilemma however; has led to some planners and educators designing a framework if which the process would be clarified and major issues within the process are simplified for those who are willing to attempt the process. This has helped create a conducive environment for planning and many other organizations have rallied behing the planning process and according to Plenert (2001) it has made it easier for ordinary organizations to effectively formulate, plan and implement quality strategic planning. Strategy Formulation

Strategic planning encompasses a few components as already discussed. These components are what make up a complete plan. The plan also works with the participation of everyone involved and requires the top management’s commitment. The administrator must be demonstrating leadership for the team members to follow the lead and get the organization to succeed. The...
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