Unit One: Why Is Strategy Important To Business?
Kaplan University, MT460-01 1403C Term
Author: Michelle Edwards
Professor: Dr. Andryce M. Zurick, PhD, EBC
Date: April 29, 2015
Why Is Strategy Important To Business?
Introduction
Having a strategy will determine where you are now, where you want to go, and how you get there. Strategic management is the foundation of any business. It is a company’s game plan which begins with their vision, mission, and their goals. Strategic management involves planning directing, organized, and the controlling of a company’s strategy-related decision and goals.
The Main Components of the Strategic Management Process
Having an achievable goal in mind and being successful in communicating that goal from the top executive down. Strategic Management emphasizes the monitoring and evaluating opportunities and threats of the company’s strengths and weaknesses. The main components of the strategic management are environmental scanning, strategy formulation, strategy implementation, and strategy evaluation and control. These strategies are in detail and explain the company’s mission, internal and external analysis, and implementing processes that will assist in achieving organizational objectives.
Environmental scanning involves completing the SWOT (strengths, weaknesses, opportunities, threats) analysis that gathers the external (competition) and internal (employees/staff changes) factors that influence the future. Strategy formulation is a development of long range plans, and the opportunity and threats of the company. After the external and internal factors are assessed it utilizes the mission objectives, policies, and the developmenting strategies. Strategy Implementation is where the vision, direction, and requirements necessary to achieve the company’s goal which is usually coming from the CEO. This process turns strategies and plans into actions in order to accomplish strategic objectives and goals. Unfortunately, this process demands a lot of time and money to become successful and is usually neglected my ignoring the budget and the lack of communication of the strategy to all members of the company. Strategy evaluation and Control is important to the company’s existence because it alerts the managers of any potential problems or any negative impact on the company. It is essential for the company’s to accurately analyze current policies to be successful.
Strategic management has three levels (tiers) and each level has its own focus to be successful and center their on either “doing the right thing” or “doing things right”. Corporate level (doing the right thing) is the financial and marketing portion of the business which focuses on the planning, review, evaluate, and counseling. Business level (doing the right thing) is the decision making level. Functional level (doing things right) is to develop annual objectives and short term strategies.
The Importance of Having a Business Strategy
Business strategy is an outline of what your business is what you want to accomplished, and how you plan to achieve it. It specifies the actions that you have received from achieving your goal. It provides the big picture for the company that shows how all activities are coordinated to achieve a desired end goal
The Organization’s Vision, Mission, Purpose, Values, Goals, and Philosophy
Vision is generally a statement of the company’s goals in a single sentence or a few concise paragraphs. It concentrates on the end goal not reaching the goal. Thinks
