The Importance Of Strategic Management In The 21st Century

The business of the twenty first century irrespective of its size is going to be part of the global business community affecting and being affected by social change, events and pressures from around the world. This is so because the business environment is changing, dynamic, turbulent, discontinuous and highly competitive. In this period, the relationship between business and society has changed radically. Key drivers of this change have been globalization of trade, increased size and influence of corporate organizations, the repositioning of government and the rise in the strategic importance of stakeholder’s relationships, knowledge, and brand reputation.

To complete successfully in this environment, organizations continually need to improve

Pathak (2009) considered strategic management as a stream of decisions and actions, which leads to the development of an effective strategy or strategies to help achieve corporate objectives in a competitive way. Furthermore, Abu Bakar, et. al. (2011) described strategic management as a concept that concerns with making decisions and taking corrective actions to achieve long term targets and goals of an organization. The importance of strategic management in a firm can be answered by analyzing relationship between strategic management and organizational performance. Moreover, Mahoney (2012) elaborated that strategic management addresses the organizational structure, resources and capabilities, and the strategic positioning of the organization to create, capture, and sustain competitive advantage. In addition, Dudin (2013) explained strategic management as a process in a firm consists of setting the vision, mission and goals, analysis of external and internal business environment, selection of a favorable strategy, strategic planning, and proposals for organizational, administrative changes, setting measures on control systems and strategy implementation, and evaluation of the

The debate about strategic management is not limited to its definition and its components, but it extended to how to measure, evaluate and manage it. Different models and methods have been used by different scholars, academicians and practitioners to measure, evaluate and manage strategic management practices and examine its influence on organizations ' performance. Newbert (2007) used the resource-based view (RBV) to evaluate and manage strategic management. Ritson (2011) used Porter’s five forces model to identify the key environmental forces, and to assess any industry and analyze the three major things: the current situation, the opportunities and the threat. Hin et. al. (2011) and Hin et. al. (2013) used Wheelen and Hunger Strategic Management Model as reference. The model is segmented to four sections: environmental scanning; strategy formulation; strategy implementation; evaluation and control. Arabzad and Shirouyehzad (2012) stated that many approaches and techniques could be used to analyze the strategic issues in the strategic management process. One of these techniques is SWOT analysis which organizations use it to implement its strategic objectives and identify all the factors involved in making decisions. Strengths and weaknesses are assessed by the internal environment; while opportunities and threats are assessed by the external environment. Jalaliyoon, et. al. (2012) used an analytical hierarchical process (AHP) technique to evaluate and manage strategic