Approaches To Strategic Management Essay

APPROACHES TO STRATEGIC MANAGEMENT “Strategic management is a process whereby decisions and actions are taken in order to develop an effective strategy or strategies to help achieve corporate objectives.

The central objective of strategic management is to find out why some organizations succeed while others fail. There are various determinants to company performance. They include: In general terms, there are 2 approaches, which are opposite but complement each other in some ways, to strategic management:

A. Traditional approach: It also known as industrial organizational approach. It is the oldest approaches formulated. It forms its basis on economic theories. There are various issues that this approach deals with, they include: competitive

Many a times most of the plans are never finished It can be updated as and when the situation changes.

Result focused It focuses on the analysis of market place and other factors but often which are not necessary to be taken into consideration for the plan It provides a clear linkage between the benchmarks that need to be attained.

Objectives It has many objectives thus lacks focus There are 16 benchmarks (equal number of quantitative and qualitative) that need to be achieved

Future and innovation Future is obvious and objectives are predetermined. Hence, no scope for new innovation Future is skeptical but there is a readiness to change and acceptance.

Strategic planning Strict rules and procedures are followed which are formulated by top authorities. Therefore, there might be a possibility of personal bias and correct information may be destroyed. This approach depends upon data, information and ideas given by groups and individuals. Thus, correct information will be gathered for planning and concerned