Compare and contrast strategic planning with strategic management.
Strategic planning is more often used in the business world, whereas strategic management is often used in academia. Sometimes, strategic management is used to refer to strategy formulation, implementation and evaluation, with strategic planning referring only to strategy formulation. The purpose of strategic management is to exploit and create new and different opportunities for tomorrow; long-range planning, in contrast, tries to optimize for tomorrow the trends of today.
Which stage in the strategic-management process is most difficult? Explain why.
Strategy implementation is the most difficult stage in the strategic-management process because it requires personal discipline, commitment and sacrifice. Successful strategy implementation hinges upon managers’ ability to motivate employees, which is more of an art than a science.
Explain the relationship between strategic management and competitive advantage for firms. How can a firm achieve sustained competitive advantage?
Ans: Strategic management is all about gaining and maintaining competitive advantage. Competitive advantage is anything a firm does especially well compared to rival firms. When a firm can do something that rival firms cannot do, or owns something that rival firms desire, that can represent a competitive advantage. Getting and keeping competitive advantage is essential for long-term success of an organization. A firm must strive to achieve sustained competitive advantage by (1) continually adapting to changes in external trends and events and internal capabilities, competencies and resources, and by (2) effectively formulating, implementing and evaluating strategies that capitalize upon those factors.
Define what strategists are. Describe what they do in an organization.
Strategists are individuals who are most responsible for the success or failure of an organization. They help an organization gather, analyze and organize information. They track industry and competitive trends, develop forecasting models and scenario analyses, identify business threats and develop creative action plans. Strategic planners usually serve in a support or staff role. Usually found in higher levels of management, they typically have considerable authority for decision-making in the firm.
Explain environmental scanning.
Environmental scanning is the process of conducting research and gathering and assimilating external information. It identifies, monitors and evaluates external opportunities and threats.
Discuss some forces that influence the formality of strategic-management systems.
Firms that compete in complex, rapidly changing environments, such as technology companies, tend to be more formal in strategic planning. Firms that have many divisions, products, markets and technologies also tend to be more formal in applying strategic-management concepts. Greater formality in applying the strategic-management process is usually positively related with the cost, comprehensiveness, accuracy and success of planning across all types and sizes of organization.
List 10 major benefits of strategic management, as stated by Greenley.
There are 14 benefits stated by Greenley. Students are to list any 10 of the following: (1) it allows for identification, prioritization and exploitation of opportunities, (2) it provides an objective view of management problems, (3) it represents a framework for improved coordination and control of activities, (4) it minimizes the effects of adverse conditions and changes, (5) it allows major decisions to better support established objectives, (6) it allows more effective allocation of time and resources to identified opportunities, (7) it allows fewer resources and less time to be devoted...
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