Strategic management involves the creation, development and implementation of the major initiatives and goals undertaken by an organisation’s top leadership team.

Strategic management is based on careful assessment of resources and internal and external environments in which the organisation competes. Whilst providing overall direction to the enterprise, strategic management involves clearly defining the organisations objectives and then developing the plans and polices to achieve them.

There are many models, frameworks and approaches that assist strategic decision-making and the innovative thinking that supports it. The main issue is identifying exactly how to focus that thinking for best effect.

Firstly, clarity is required as to what is meant by ‘strategy’.

Secondly, what are the different layers of strategy that apply to an organisation?


Defining the term ‘Strategy’

As mentioned above, let’s start by defining what we mean by strategy, as defined by Dr. Vladimir Kvint, strategy is “a system of finding, formulating and developing a doctrine that will ensure long-term success if followed faithfully”.

Leading on from this definition, Michael Porter (Professor at Harvard USA) believes there to be three principles that underpin underlying strategy. These principles are:

  1. Creating a “unique and valuable (market) position”
  2. Making compromises by choosing “what not to do”
  3. Aligning the organisations activities to support the chosen strategy

As leaders, once we have considered these principles, we can turn our attention to the 3 key questions that guide effective thinking and action…

  1. Corporate strategy key question: “What business should we be in?”
  2. Business strategy key question: “How shall we compete in this business?”
  3. Operations management key question: “How can we improve efficiency and control costs within the boundaries set by the organisations strategy?”


Benefits of Strategic Management

The benefits of strategic management flow through all aspects of the organisation. First and foremost, it energises and motivates the people (who are the heart of any organisation) from the top senior team down to junior team members.

Some core benefits:

  • Generating Ideas – What needs to be communicated becomes very clear and helps the senior team define and ‘sell; the way ahead for the organisation and it’s people.
  • Outcome Focused Workforce – Specifying a clear outcome that the organisation desires ensures that employees help to create and work towards a shared vision.
  • Helps Achieve Organisational Success – All employees not only have the same vision, but also have some shared priorities to help them stay focused on the ‘big picture’.
  • Organisational Purpose & Growth – Growth and security maintain motivation and optimism about the future. This has a positive impact on performance
  • A Highly Skilled & Ethical Workforce – This is not only critical to growth and security of the individual, but to the security of the organisation as well.


If you would be interested in learning more about strategic leadership, head over to our courses page and see what courses we have on offer.

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