Strategic management involves setting long-term goals and creating, implementing, and assessing strategies to attain them. It requires constant strategic decision-making and action to adapt to changing conditions.
This process involves assessing an organisation’s current status and evaluating its strategic development opportunities and challenges.
The aim of strategic planning is to achieve future success.
By aligning goals, resources, and activities with the mission and vision, the organisation accomplishes this.
Effective strategic planning requires an understanding of the organisation’s SWOT analysis—its strengths, weaknesses, opportunities, and threats.
Moreover, it is essential to consider external changes and adjust the plan accordingly. A robust strategic plan should aid in setting goals and allocating resources over a three to five-year period.
Strategic management has several significant traits, including:
Strategic management seeks long-term goals that align with an organisation’s mission and vision, providing a broader perspective.
The decisions made in strategic management have implications for the organisation’s future for several years to come.
A unified approach: Strategic management that takes into account an organisation’s internal strengths and weaknesses, external opportunities, risks, and competitive landscape.
Strategic management necessitates continuous monitoring and evaluation.
Its components encompass regular reviews and revisions of strategy in response to internal and external changes.
A holistic approach to strategic management recognises that an organisation is a complex system with interconnected components.
What we mean by this is making plans for interdependent functional domains, which include marketing, finance, and operations.
Risk management: Effective strategy implementation necessitates the management of strategic risks and uncertainties.
This involves recognising threats, analysing their probabilities and impacts, and developing contingency plans.
Strategy formulation in entrepreneurship
Four factors were anticipated to influence this process, including the need for Pan-African entrepreneurs to enhance their skills to grow their companies.
This requires an examination of opportunities, threats, and the strengths and weaknesses of the competitive environment.
Following this analysis, set goals and objectives to guide decision-making and resource allocation.
These goals should be grounded in a comprehensive understanding of the company’s capabilities and market position.
The implementation of strategies is the final step in strategy creation.
Strategic approaches are shaped by several key factors. Some are listed below:
- Mission: Effective strategy formulation involves developing a clear and concise mission statement to guide an organisation’s strategic planning and decision-making.
An organisation’s mission statement articulates its purpose, guiding principles, and primary goals.
It sets the organisation’s direction and strategic objectives. A clear mission statement assists organisations in making strategic decisions that align with their values.
Defining an organisation’s mission helps prioritise its key aims. It enables the organisation to create a coordinated, purpose-driven plan.
With a mission statement, an organisation can convey its goals and ideals to its partners, consumers, investors, and staff.
Consequently, individuals may find it easier to support, align with, and engage in the organisation’s strategic aims. An effective strategy necessitates a clear, coherent mission statement.
2.Vision: A strategic plan should encompass actions that support the organisation’s goals.
The organisation’s vision serves as its future objective. Vision is vital to strategic planning as it informs all actions and decisions.
A clear and well-defined vision can identify and prioritise both the current state and the organisation’s goals.
Define the organisation’s vision: Start by defining the ideal future state. This is necessary to progress.
The process of SWOT analysis: SWOT analysis—assessing the company’s strengths, weaknesses, opportunities, and threats—should be done.
Setting strategic aims and goals: After a SWOT analysis, set strategic goals that align with the company’s vision.
Strategy formulation: Strategies are action plans that help the company achieve its strategic goals.
Implementing the plan: Creating a visionary strategic plan culminates in its implementation.
The process of creating a plan of action based on the organisation’s vision is called strategic formulation, involving vision.
- Value principles: Strategic formulation involving values entails defining an organisation’s long-term goals and objectives while considering its values. The values of an organisation shape its culture, behaviour, and decision-making.
Aligning strategic objectives with those of the company is crucial for achieving its goals in accordance with its core capabilities.
A company may go through several phases to develop a value-based strategic plan. Include these:
Definition of the organisation’s values: Identifying the organisation’s core principles and beliefs enables it to steer its activities and make informed decisions.
Ensuring that an organisation’s values align with its mission: To ensure that an organisation is working towards its goals in accordance with its principles, one must ensure that its values align with its mission.
Setting strategic goals and objectives: These are the company’s long-term aspirations. It is essential that these goals align with the company’s values and mission.
Planning to achieve goals: When establishing strategies, consider the organisation’s values and mission. When formulating strategies, consider the organisation’s mission and values.
Implementation entails executing the plan and ensuring that the organisation adheres to its aims, values, and mission statement.
- Goals and objectives: Strategic formulation, which includes objectives, involves creating goals that support an organisation’s vision and mission.
In this process, the organisation’s key success factors are identified, and a strategy is developed to achieve the goals.
Strategic planning commences with the organisation’s mission and vision, providing a framework for goal setting and establishing the organisation’s orientation.
After setting goals and a vision, the business should conduct a SWOT analysis to identify its strengths, weaknesses, opportunities, and threats.
After completing the SWOT analysis, the company can identify areas for development and set goals to achieve them.
After setting goals, the company must create a plan to achieve them. This strategy must specify the steps, resources, and deadlines.
Performance and progress evaluation objectives must be included in the strategy.
Every company that wants to succeed in a competitive market must create a strategic plan with goals.
Finally, the organisation monitors progress and adjusts the plan as needed.
The formulation of a strategic plan requires not only an in-depth understanding of the organisation’s mission and vision, but also the ability to identify the most essential factors that contribute to success and to build a strategy to achieve these goals.
Until then, think, eat, sleep, and dream about branding!
- *Dr Farai Chigora is a businessman and academic. He is the head of business science at Africa University’s College of Business, Peace, Leadership, and Governance. His doctoral research focused on Business Administration (Destination Marketing and Branding Major, UKZN, SA). He can be contacted for feedback at [email protected] or via WhatsApp mobile: +263772886871.
- *Dr Tabani Moyo is an extra-ordinary researcher with the University of North West, South Africa’s Social Transformation School. He holds a Doctorate in Business Administration (Research focus on new media and corporate reputation management, UKZN), chartered marketer, fellow CIM, communications and reputation management expert based in Harare. He can be contacted at [email protected] @TabaniMoyo (X)
