Strategic management can be defined as management activities which deals with matters like analysis, decisions, and actions which organizations may pursue with the aim of creating competitive advantage and formulating actions and policies to maintain it.
(Dess, Gregory G., G.T. Lumpkin and Marilyn L. Taylor. Strategic Management. 2 ed. NewYork: McGraw-Hill Irwin, 2005.)
Brinkerhoff (1994) gives a terse definition of strategic management. It is looking out, looking in and looking ahead.
Susan Scribner distinguishes strategic management from mere operational management or long term planning. It consists of five integral elements which are: goals setting, analysis, formation, implementation and monitoring.
According to Johnson and Scholes (2002) Strategic Management is the understanding of strategic position of an organisation, strategic choices for the future and turning strategy into action.
Strategic management deals with three areas and each area is further divided into three sub areas.
1. The Strategic Position
a. The environment
It refers to legal, social, political, technological and cultural environment in which the organization exists. There are so many variables some of which may be potential opportunities while others may be threats. It is important to understand the complexity of the environment and its impact on the organisation.
b. Expectations and purposes
It is the understanding of the expectations and fulfilling these expectations of the stakeholders.
c. Resources and competences
This refers to the strategic capability of an organization. As the external environment affects the performance of organization, the internal resources and competences provide competitive advantage.
2. Strategic Choices
a. Corporate Level Strategy
Corporate level strategy deals with issues at the corporate level. It is the highest level and deals with how the various parts are added value by the centre.
b. Business Level Strategy
These are the choices which in which the organization seeks to compete at the business level.
c. Development Directions and Methods
This refers to the development of strategy into different directions in the future.
3. Strategy into Action
a. Managing change
Strategy may require drastic changes from time to time. As strategic management is different from the the day to day routine tasks, it is important to implement changes whenever required.
How to enable success built on specific resources and competences.
Organising means to structure an organisation to achieve and support successful performance.
Strategic management primarily deals with long term and complex situation arising out of ambiguities. It is different from the routine and operation management and has wider and greater scope. Johnson and Scholes (2002) state that Strategic management is concerned with complexity arising out of ambiguous and non-routine situations with organization wide rather than operation-specific implications.