Organizations always face the challenges of dynamic business environment. In 21st century, the environment has become more dynamic and unpredictable. The changing business environment requires strategic thinking in companies to develop good corporate strategies. Only when developing effective strategies, corporate can remain the competitive position. By creating strategy, organization can remain the competitive advantage which other companies are unable to implement. Corporate strategy is not only for large firms but also for small business. However, there is a quotation suggests that “Strategic management is nothing more than a set a o myths, parables and homilies that give senior management a feeling of comfort that they can control the destinies of their organizations. It has neither theoretical substance nor empirical content and is delusional in its intention. The future is not only unpredictable it is also unknowable”. This assignment shall argue the citation by considering different factors. First, the assignment will identify the meaning of strategy and it does matter. And then the essays will have brief discussion of industry matter for the performance of an organization. Finally, the assignment will draw conclusion through the relevance of strategy in management practices.
1. What is strategy and does it matter?
There are many ways to define strategy by various researchers. Henry Minzberg (1971) defines “Strategies are both plans for the future and the patterns from the past”. According to Johnson and Scholes (2005), strategy as follows: "Strategy is the direction and scope of an organisation over the long-term: which achieves advantage for the organisation through its configuration of resources within a challenging environment, to meet the needs of markets and to fulfill stakeholder expectations". Porter (1996) defines that strategy is about being different. It means organizations needs to deliver unique value by intentionally choosing set of actitvites
Although there are various concepts of strategy, most of them can be referred to strategy is a planning process to achieve long-term advantage. According to Whittington (2001), in a dynamic and changing environment, by making internal and external factors predictable and plastic, goods plans can be shape. Hence, strategy matter is that the difference between success and failure can be made by analysis and decisions. In any organization, strategies are divided into different levels: corporate strategy, business unit strategy, and operational strategy.
The evolution of corporate planning has driven to strategic management. Grant (2010) considers strategic management is the transition from corporate planning. David (2001) defines strategic management is the process of formulating, implementing, and evaluating decisions methods that allow a company or organization to achieve organization’s goal. Strategic management also involves identifying mission and vision of organization. Once mission and vision are defined, a strategy will be designed align to objectives. Strategy does not stop at implementation, it will undergoes evaluation to make sure the relevance of strategy for company’s goals.
Knights and Morgan (1991) claim that corporate strategy plays a central place in managers thinking of themselves and their organizations. According to Ghemawat (2002), in 1960s, before SWOT, no strategy can help to define a firm’s distinctive competence while the marketplace keeps changing. A firm needs to analyze strategy choices to respond quickly to unpredictable environment. Most firms’ strategy tends to follow the success in the past in which traditional habits are increasingly inadequate. That means, managers need new tools to make effective strategic decisions. However, making decision is a complex process, so the most useful tool is using frameworks to sort out the choices. Thus, the rise of private consultant company like BCG or McKinsey...