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Strategic Management
Chapter 1
| Term | Definition |
|---|---|
| Strategic Management: can be defined as the art and science of formulation, implementing, & evaluating cross-functional decisions that enable and organization to achieve its objectives. | definition implies, strategic management focuses on integration management, marketing, finance/accounting, production/operation, research and development & information systems to achieve organizational success. |
| The term Strategic Management in this text is used synonymously with the term strategic planning. | The term strategic management is used to refer to strategic formulation, implementation, and evaluation |
| Strategic Planning: referring only to strategic formulation. | The purpose of Strategic Management is to exploit and create new and different opportunities for tomorrow; long-range planning, in contrast, tries to optimize for tomorrow the trends of today. |
| The term Strategic Planning originated in the 1950s and was very popular between the mid-1960s and the mid-1970s. It was widely believed to be the answer for all problems. | Strategic Plan is, in essence, a company's game plan. |
| Strategic plan results from though managerial choices among numerous good alternatives, & it signals commitment to specific markets, policies, procedures, & operations vs less desirable" courses of action. | Stages of Strategic Management: consist of three stages: Strategy Formulation, Strategy Implementation & Strategy evaluation. |
| Strategy Formulation: includes developing a vision and mission. | Vision & Mission must identify an organization's external opportunities and threats, determining internal strengths and weaknesses, establishing long-term objectives, generating alternative strategies, & choosing particular strategies to pursue |
| Strategy-Formulation include issues deciding what new business to enter, abandon, how to allocate resources, whether to expand operation or diversify, enter int'l markets, merge or from a joint venture & how to avoid takeover. | No organization has unlimited resources, strategist must decide with alternative strategies will benefit the firm most. |
| Strategy Implementation: requires a firm to establish annual objectives, devise policies, motivate employees, and allocate resources so that formulated strategies can be executed. | Strategy.Implementation. includes developing a Strategy-supportive culture, creating an effective organizational. structure, redirecting marketing efforts. |
| Strategy Implementation includes preparing budgets, dvelping and utilizing infrmtion systems, & linking employee compensation to orgatinal performance. | Strategy Implementation often is called: "action stage" of strategic management. It means mobilizing employees & managers to put formulated strategies into action. Considered the most difficult stage in Strategic Management. |
| Strategy Evaluation is the final stage in strategic management. Managers desperately need to know when particular strategies are not working well; is the primary means for obtaining this information. | All strategies are subject to modification because external and internal factors are constantly changing. |
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techy3131