Why Is Strategy Important to Business?

Strategy is determining where you are now, where you want to go, and how to get there. It’s the art of developing and implementing specific actions and decisions that will help a business to achieve goals and objectives as set out by the owners. Through the strategy process the overall direction of the company is set including opportunities and threats in the outside world and the internal strengths and weaknesses of the business. The aim of a business strategy is to ensure that the threats posed by the external environment are minimized and also to strengthen or minimize the effects of internal weaknesses. The opportunities and strengths are combined to ensure maximum productivity is achieved. The more the external environment changes the more opportunities there are likely for a company, but the more threats can be a problem if not prepared for. Without a business strategy, it would be difficult for an owner to realize the opportunities available.
Strategic management in contrast with business policy is a technical approach having a five step model. Strategic management is a set of managerial decisions and actions that determine the long run performance of a company. Strategic management does not have to be just a part of the top level management. In fact, organizations should focus on strategic management at all levels of the management and the entire hierarchy of the company should be involved both in planning and implementation phases. Strategic management does not have to be just a part of the top level management. Organizations should focus on strategic management such that all levels of the management and the entire hierarchy of the company should be involved in both planning and implementation phases. The basic theory of strategic management involves the action of creating and implementing plans and decisions for the benefit of the organization and to help it achieve its objectives. Strategic management analyzes and scan the environment therefore future

References: Karger (1991). Strategic Management: The Key to Corporate Success Pearce II, J.A., & Robinson, Jr., R.B. (2008). Strategic management. (11th ed.). New York, NY: McGraw-Hill. Mission and Vision Statements http://www.referenceforbusiness.com/management/Mar-No/Mission-and-Vision-Statements.html#ixzz1LGZLzvbI