INTRODUCTION TO STRATEGIC MANAGEMENT
STRATEGY
In order to understand business functions, it is important to understand the term strategy. After
all, every business needs a strategy to be successful. The word ‘strategy’ comes from the ancient
Greek word ‘Strategos’, meaning ‘the art of the General’.
However, in business, it is more about the managerial response to changes in the
business environment than the art of war. In this article, we will take a quick look at the
meaning and types of strategies in business.
Definitions of Strategy
Kennth Andrews defined strategy as “the pattern of major objectives, purposes or goals and
essential policies or plans for achieving the goals, stated in such a way as to define what
business the company is in or is to be in and the kind of company it is or is to be.” This
definition of strategy emphasizes on purpose and the means by which purpose will be
achieved. It also emphasizes on the values and the cultures that the company stand for.
Kenichi Ohmae defines strategy as “the way in which a corporation endeavors to different
itself positively from its competitors, using its relative strengths to better satisfy customer
needs.” Ohmae’s definition highlights the competitive aspect of strategy and the strengths
required to satisfy customer needs. This definition thus aims at customer satisfaction as the
driver of the strategy.
According to Glueck, “Strategy is the unified, comprehensive and integrated plan that relates
the strategic advantage of the firm to the challenges of the environment and is designed to
ensure that basic objectives of the enterprise are achieved through proper implementation
process”
This definition of strategy lays stress on the following:
1. Unified comprehensive and integrated plan.
2. Strategic advantage related to challenges of environment.
3. Proper implementation ensuring achievement of basic objectives.
PREPARED BY MR. ANTONY AMBIA Page 1
, Another definition of strategy is given below which also relates strategy to its environment.
“Strategy is organization’s pattern of response to its environment over a period of time to
achieve its goals and mission”
1. It is organization’s pattern of response to its environment.
2. The objective is to achieve its goals and missions.
However, various experts do not agree about the precise scope of strategy. Lack of consensus
has led to two broad categories of definitions: strategy as action inclusive of objective setting
and strategy as action exclusive of objective setting.
Nature of Strategy
Based on the above definitions, we can understand the nature of strategy. A few aspects
regarding nature of strategy are as follows:
Strategy is a major course of action through which an organization relates itself to its
environment particularly the external factors to facilitate all actions involved in meeting
the objectives of the organization.
Strategy is the blend of internal and external factors. To meet the opportunities and threats
provided by the external factors, internal factors are matched with them.
Strategy is the combination of actions aimed to meet a particular condition, to solve certain
problems or to achieve a desirable end. The actions are different for different situations.
Due to its dependence on environmental variables, strategy may involve a contradictory
action. An organization may take contradictory actions either simultaneously or with a gap
of time. For example, a firm is engaged in closing down of some of its business and at the
same time expanding some.
Strategy is future oriented. Strategic actions are required for new situations which have not
arisen before in the past.
Strategy requires some systems and norms for its efficient adoption in any organization.
Strategy provides overall framework for guiding enterprise thinking and action.
PREPARED BY MR. ANTONY AMBIA Page 2
STRATEGY
In order to understand business functions, it is important to understand the term strategy. After
all, every business needs a strategy to be successful. The word ‘strategy’ comes from the ancient
Greek word ‘Strategos’, meaning ‘the art of the General’.
However, in business, it is more about the managerial response to changes in the
business environment than the art of war. In this article, we will take a quick look at the
meaning and types of strategies in business.
Definitions of Strategy
Kennth Andrews defined strategy as “the pattern of major objectives, purposes or goals and
essential policies or plans for achieving the goals, stated in such a way as to define what
business the company is in or is to be in and the kind of company it is or is to be.” This
definition of strategy emphasizes on purpose and the means by which purpose will be
achieved. It also emphasizes on the values and the cultures that the company stand for.
Kenichi Ohmae defines strategy as “the way in which a corporation endeavors to different
itself positively from its competitors, using its relative strengths to better satisfy customer
needs.” Ohmae’s definition highlights the competitive aspect of strategy and the strengths
required to satisfy customer needs. This definition thus aims at customer satisfaction as the
driver of the strategy.
According to Glueck, “Strategy is the unified, comprehensive and integrated plan that relates
the strategic advantage of the firm to the challenges of the environment and is designed to
ensure that basic objectives of the enterprise are achieved through proper implementation
process”
This definition of strategy lays stress on the following:
1. Unified comprehensive and integrated plan.
2. Strategic advantage related to challenges of environment.
3. Proper implementation ensuring achievement of basic objectives.
PREPARED BY MR. ANTONY AMBIA Page 1
, Another definition of strategy is given below which also relates strategy to its environment.
“Strategy is organization’s pattern of response to its environment over a period of time to
achieve its goals and mission”
1. It is organization’s pattern of response to its environment.
2. The objective is to achieve its goals and missions.
However, various experts do not agree about the precise scope of strategy. Lack of consensus
has led to two broad categories of definitions: strategy as action inclusive of objective setting
and strategy as action exclusive of objective setting.
Nature of Strategy
Based on the above definitions, we can understand the nature of strategy. A few aspects
regarding nature of strategy are as follows:
Strategy is a major course of action through which an organization relates itself to its
environment particularly the external factors to facilitate all actions involved in meeting
the objectives of the organization.
Strategy is the blend of internal and external factors. To meet the opportunities and threats
provided by the external factors, internal factors are matched with them.
Strategy is the combination of actions aimed to meet a particular condition, to solve certain
problems or to achieve a desirable end. The actions are different for different situations.
Due to its dependence on environmental variables, strategy may involve a contradictory
action. An organization may take contradictory actions either simultaneously or with a gap
of time. For example, a firm is engaged in closing down of some of its business and at the
same time expanding some.
Strategy is future oriented. Strategic actions are required for new situations which have not
arisen before in the past.
Strategy requires some systems and norms for its efficient adoption in any organization.
Strategy provides overall framework for guiding enterprise thinking and action.
PREPARED BY MR. ANTONY AMBIA Page 2
