Strategic management is the art and science of formulating, implementing and evaluating cross-functional decisions that will enable an organization to achieve its objectives. It involves the systematic identification of the firm 's objectives, nurturing policies and strategies to achieve these objectives, and acquiring and making available these resources to implement the policies and strategies to achieve the firm 's objectives. Strategic management, therefore, integrates the activities of the various functional sectors of a business, such as marketing, sales and production to achieve organisational goals. It is the highest level of managerial activity, usually initiated by the board of directors and executed by the firm 's Chief Executive Officer (CEO) and executives.
The success of a company is due to the awareness of the company of its external environment with the anticipated concerns, prediction of trends and generation of ideas. This automatically would lead to the identification of opportunities and threats, which are considered by managers as they strive to develop strategic direction and formulate and implement strategies.
A leading scholar in strategic management, Michael Porter defines strategic management as “the 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 fulfil stakeholder expectations.” In essence, it is the environmental elements that need to be explored and identified to determine the business direction. Therefore, this process is defined by researching and identifying the strategic analysis, strategic direction, strategic formulation, strategic implementation and strategic evaluation effectively. The external environment can be divided into the operating environment and the organisational environment. The starting
References: 1) Definition of Strategic Management, http://www.oppapers.com/essays/Definition-Strategic-Management/127324 - Date accessed - 22 March 2010 2) Brad Garlinghouse, ‘Yahoo Memo: The “Peanut Butter Manifesto”, WSJ.com, November 18, 2006 3) Cathy Enz., ‘Hospitality Strategic Management Concepts and Cases’, Chapter 2 pg 32-62 4) Dora Rizutto, ‘What is Strategic Drift?’, www.ccab.com.ar/Portals/0/Library/DRizutto.pdf, Date accessed-24 March 2010 5) Wilson, R.M.S. Gilligan, Colin, ‘Strategic Marketing Management ‘, The Business Intelligence Providers, OCLC NetLibrary, Chapter 4, pg 119-131