Unit 1 - The Nature of Strategic Management
Definition of SM (Simplified)
Involves formulating, implementing, and evaluating key decisions across all departments.
Aims to help an organization achieve long-term goals and sustain competitive advantage.
Combines both analytical thinking (science) and creative decision-making (art).
Focuses on:
o Internal capabilities
o External market conditions
o Aligning resources with strategic goals
Requires ongoing review and adjustment, not a one-time task.
Purpose of SM (Simplified)
Main goal: To gain and sustain competitive advantage.
Helps organizations outperform rivals consistently.
Enables faster, smarter decisions than competitors.
Aims for superior market position and profitability.
Focus is on thriving, not just surviving.
Encourages creation of unique value that’s hard to imitate.
Example: Like two people outrunning each other to escape a bear — success lies in
outpacing competitors, not just avoiding danger.
SM Model
1. Where are we now? – Assessing the current position through internal analysis and external
environment scanning.
2. Where do we want to go? – Defining the vision, mission, and setting long-term objectives.
3. How are we going to get there? – Developing strategies to bridge the gap between current
position and desired future.
Stages of SM
1. Strategy Formulation
Developing a clear vision and mission to define organizational purpose.
Conducting SWOT analysis to identify internal strengths and weaknesses, and external
opportunities and threats.
Establishing long-term objectives that are challenging yet attainable.
Generating alternative strategies based on the analysis.
Definition of SM (Simplified)
Involves formulating, implementing, and evaluating key decisions across all departments.
Aims to help an organization achieve long-term goals and sustain competitive advantage.
Combines both analytical thinking (science) and creative decision-making (art).
Focuses on:
o Internal capabilities
o External market conditions
o Aligning resources with strategic goals
Requires ongoing review and adjustment, not a one-time task.
Purpose of SM (Simplified)
Main goal: To gain and sustain competitive advantage.
Helps organizations outperform rivals consistently.
Enables faster, smarter decisions than competitors.
Aims for superior market position and profitability.
Focus is on thriving, not just surviving.
Encourages creation of unique value that’s hard to imitate.
Example: Like two people outrunning each other to escape a bear — success lies in
outpacing competitors, not just avoiding danger.
SM Model
1. Where are we now? – Assessing the current position through internal analysis and external
environment scanning.
2. Where do we want to go? – Defining the vision, mission, and setting long-term objectives.
3. How are we going to get there? – Developing strategies to bridge the gap between current
position and desired future.
Stages of SM
1. Strategy Formulation
Developing a clear vision and mission to define organizational purpose.
Conducting SWOT analysis to identify internal strengths and weaknesses, and external
opportunities and threats.
Establishing long-term objectives that are challenging yet attainable.
Generating alternative strategies based on the analysis.
