What is meant by strategy ? Differentiate between goals and objectives? Answer: Strategy is the method by which an organization systematically achieves its future objectives. A business cannot progress for a long term without a reliable strategy. Strategy is a common direction set for the company and its various components to accomplish a desired position in the future. A meticulous planning process results in strategy. It is a comprehension of the goals which has logical step by step process. It defines the general mission and vision of an organization. It is important to consider that the decisions taken by an organization are likely to affect the employees, customers and competitors. Strategy guides the organization to achieve a long term goal. The strategy is advantageous to the organization through its configuration of resources within a challenging environment. It helps to meet the requirements of market and shareholders. Strategy is a plan that is aimed to give a competitive advantage to the organization over rivals through differentiation. Creating a strategy begins with extensive research and analysis. It is the process through which senior management concentrates on top priority issues tackled by the company to be successful in a long term. It is the design of decisions in an organization that sets its goals and plans to achieve it. The organization plans the future goals to contribute at large to its shareholders, customers and to the society. Strategy is always improving and is amendable. It is a plan of future activities which is aimed at the progress of an organization. It is a set of directions to enhance the position of the organization in the overall market. Business strategy is the method by which an organization achieves and maintains success. Difference between Goals and Objectives:
Goals| Objectives| 1. Are long term| Are usually meant for short term |
2. Are general intentions with broad outcome| Are precise statements with specific outcome| 3. Cannot be validated| Can be validated|
4. Are intangible-can be qualitative as well as quantitative | Are tangible-are usually quantitative and measurable| 5. Are abstract| Are concrete|
Q2. Define the term “Strategic Management”. What are the types of strategies? Answer: Strategic management is a systematic approach of analyzing, planning and implementing the strategy in an organization to ensure a continued success. Strategic management is a long term procedure which helps the organization in achieving a long term goal and its overall responsibility lies with the general management team. It focuses on building a solid foundation that will be subsequently achieved the combined efforts of each and every employee of the organization. Types of Strategies:
a. Corporate Level: The board of directors and chief executive officers are involved in developing strategies at corporate level. Corporate level strategies are innovative, pervasive and futuristic in nature.
The four grand strategies in a corporate level are:
* Stability and expansion strategy
* Corporate restructuring
* Combination strategies-concept of synergy
a1. Stability Strategy: The basic approach of the stability strategy is to maintain the present status of the organization. In effective stability strategy, the organization tries to maintain consistency by concentrating on their present resources and rapidly develops a meaningful competitiveness with the market requirements. Further classifications of stability are as follows:
1. No change strategy
2. Pause/Proceed with caution strategy
3. Profit strategy
a2. Expansion Strategy: The organizations adopt expansion strategy when it increases its level of objectives much higher than the past achievement level. Organizations select...