What is Strategy?

The term strategy entered the business world from military services where it was originally used. The strategy works as a blueprint of an organisation that defines its vision, mission, and also helps in determining the future course of action. The strategy helps an organisation to minimise the strengths of competitors by maximising its own strengths. The strategy is formulated to achieve current goals of an enterprise by optimum allocation and utilisation of internal resources and by collaborating different organisational pursuits.

Strategy tries to achieve synergy and balance between objectives, resources and concepts to maximise the possibility of success and fruitful results. In wider terms, strategy refers to determining the fundamental longterm organisational goals and at the same time developing plans, acquiring, allocating and deploying resources to achieve those goals. The purpose of formulating strategy is to bring consistency and alignment in the activities of an organisation, which can be accomplished by various endeavours, methods and resources.

Type of Strategy

• Shareholders:- Shareholders of an organisation can also be seen as strategists for that organisation. In the case of public sector organisations, the government plays the role of the shareholder; whereas, in the case of private organisations, the general public and lenders are the shareholders. The shares of individuals in case of organisations are very less in any the organisation, which is why; it will not affect the strategic eval shareholders of private organisations especially lenders (banks and other financial institutions participate in strategy formulation within the organisation; their only motive is to make a handsome on their investment. The government can perform an important role in the strategic control and evaluation of public sector organisations through its various agencies.

• Board of Directors:- Another strategist in an organisation is the board of directors. The formal evaluation ar selection of different executive decisions within the organisation along with understanding they're respective environmental. business and organisational consequences are the responsibility Of Board of Directors. In certain organisations, the actual power to supervise strategic evaluation can be in the hand of the Board. On the contrary, in other organisations, this power/authority can be seized by the Chief Executive Officer or any other higher authority like headquarter (in case of MNC), concerned ministry (in case of a public organisation), etc

• Chief Executives:- Chief executives are also strategists in the organisation. The overall strategic evaluation and control within the organisation is the responsibility of chief executives. Ideally, the performance of the organisation under a CEO is not the basis to judge him/her. To accurately judge the CEO, only his/her performance should be evaluated. Now, the question arises who should be given the responsibility of evaluating the CEO. In cases where the chief executive is not answerable to anyone (mainly in case of an entrepreneurial organisation), it became difficult to assign this responsibility rather than depend on self-evaluation. However, in case of the presence of higher authorities like majority shareholders or family council (in case of family organisations), the performance of the CEO is evaluated by these higher authorities.

• Managers:- Individuals executing the management functions within the organisation are called managers. These are also strategists. A manager is charged with the responsibility to control the one or more employees/departments to safeguard that these departments or employees complete their allotted duties in a pre-determined manner. Individuals making important decisions in the organisation which can affect its growth and performance are shareholders or Board of Directors. These constitute the top management of the organisation. Any type of managerial position is accountable for more responsibility and normally gets higher pav as compared to a general employee. To take the right decisions, middle-level managers can contribute to the strategic control and evaluation as the addressees of directors, and as providers of feedback and information.

Level of Strategy

There is only three strategy level here, they have been further defining.

• Corporate Strategy
• Business Unit Strategy
• Functional Strategy

Image Source - Google | Image by - https://read-to-lead-0.blogspot.com/

7s Strategy

• Strategy: The strategy concept includes the purpose, mission, goals, objectives, action plans and policies framed by the organisation. The 7S framework recognises the fact that it is easier to frame a strategy than to execute it.

• Structure: The structure denotes the organisational chart. In other words, it systemically signifies the
• whole business organisation. It also allocates various roles and responsibilities to each unit. This is the most visible and easiest to change element in the 7S framework.

• System: Systems determine the rules, regulations and procedures which govern the functioning of the organisation. These systems are made by the organisation and govern the way of doing business in the organisation. It is considered as the main agenda of managers during any process of organisational change.

• Staff: Staff is a very important element of the 7S framework. It is concerned with the recruitment of individuals for different departments and evolves them as managers of tomorrow. It is a comprehensive process of recruitment, selection, motivation, and reward-giving. It also denotes the kind of culture the organisation wants to create in the organisation and whether new recruits can assimilate in the organisation.

• Skills: Skills are the ‘unique competencies’ which redirect the organization's abilities. These skills can be in the of engineers skills, new product development, market research, analytics. These skills can bein the of engineering skills, new product development, market research, analytics, customers care and delight, quality etc.

• Style: Style is a variable which determines the effectiveness of the management tones the effectiveness of the management to successfully implement the organisational changes. It is a way the managers handle the clients, top-level management, severed action plans, etc. Style defines a true leader of the company.

• Shared Values: Shared values are the basis of the McKinsey framework. It defines the values beyond the set goals and objectives of the organisation. These are the norms and etiquettes which govern the working of the organisation and which guide the behaviour of the members of the organisation. The shared values are also called superordinate goals. 

Scope of Strategic

The decisions and activities which define the future perspective of an organisation by outlining its activities and structure are called strategic management. These activities and structure determine the scope of strategic management, which are described below:

• Economics:- Strategic management involves analysing and studying the market for formulating the strategies according to the market conditions. It is the field that is concerned with monitoring the patterns of competitors to scrutinise their competitive strategies, their production process, their costing strategy, etc. so those counter-strategies can be formulated. It tries to understand the degree of competition in the market. Strategic management also facilitates in analysing the environmental factors and their relations with the organisations as well as their relative influences on organisational operations.

• Sociology:- An organisation operates in an environment and in a specified market. Strategic management is a study of this environment and market. It includes providing a direction to the organisational activities. It strives to achieve the organisational objectives by establishing a relation between the strategic alternatives and employee performance outcomes. It correlates employee performance with organisational activities and how performances can be improved. Moreover, a business has some responsibilities towards the society in which it operates, as an organisation is a social entity. 

• Marketing:- Strategic management involves studying the market structure, competitor analysis, strategic of the firm's products, etc., so that effective strategies can be formulated for becoming a market leader. It emphasises on conducting researches on market structure and studying the influence of market-oriented factors and strategic alternatives that in turn helps in strategic planning. It is an interrelated field of study that requires concentrating on the factors that influence the business and planning so that they are handled effectively.

• Management:- Strategic management strives to achieve the organisational goals by continuously encouraging internal capabilities and utilising the resources in an optimum way so that the needs of holders can be satisfied. It deals with analysing the decisions made by the top management for the sustainable development of the organisation. It is the responsibility of the management to identify the environmental factors that influence the organisation, recognise the opportunities and threats existing in the environment, and formulate the strategies accordingly to deal with them.

Basic Model of Strategy

Image Source - Google | Image by - https://read-to-lead-0.blogspot.com/

• Environmental Scanning:- There basic is the monitoring, scanning and collections information internal and external environment. 

• Strategy Formulations:- There basic is the formulations vision, mission, objective etc are formulations for long-term or short-term plan help to recognized activities.

• Strategy Implementation:- In the Implementation as the selected strategy must be effectively put into action for organizations.

• Evaluations and Control:- After a strategy is an implementation successfully worked or not checked under Evaluation or control activities.

Benefits of Strategic

• Fulfilling the responsibilities of the Board Members:- One of the most important reasons for implementing the process of strategic management in an organisation is that it relieves the board members from their duties.

• Helps in Assessing the Objectives:- Strategic management relieves the board and senior management from their daily tasks to some extent so that they can focus on securing the future of the organisation. Disciplines of strategic management help the organisations to gain a wider perspective instead of putting all their efforts in meeting short-term challenges.

• Develops a Decision-Making Framework:-  With the help of an appropriate strategy, employees can make routine decisions within a framework while ensuring that those decisions are contributing to the progress of the organisation in one direction. The strategy helps in setting the vision, checks reason for existence and values of the organisation, defines its objectives, differentiates between threats and opportunities, identifies techniques to enhance organisation's strengths and minimise the weaknesses. Thus, it defines an outline and specifies the limits within which decisions are made.

• Helps in Measuring the Progress:-  By implementing the process of strategic management, the organisation is forced to establish objectives and set measures of organisational success. To establish success measures, t is important that the organisation analyses the factors that are crucial to its current success. Then the organisation needs to revise, re-evaluate or update, and then implement its objectives. It is also important that the board members and corporate-level managers are also aware of these performance measures.

• Provides an Organisational Viewpoint:-  While handing the operational issues, managers generally tend to overlook the interdepartmental issues or the issues related to the organisation as a whole. Strategic management considers the organisation's viewpoint and also lays stress on the interrelated sectors so that a strategy that is beneficial for the entire organisation is developed.

• Improves Stability:- Certain strategies provide strength to the organisation by opening more avenues of growth. For example, if a business deals with only a couple of clients, then to survive, it is not in the position to lose any one of them. Strategic management aims at helping the organisations in acquiring more customers so that the business is no longer dependent on only a few clients. By implementing strategic management, an organisation can enhance its stability by executing strategies like - developing a new product line, acquiring a new company, catering a new customer segment, etc.

• Strong Labour Supply:-  Strategic management helps in conducting hands-on staffing practices so that the quality and quantity of labour can be improved. A strong workforce can be developed by – preparing organisational charts, providing employees with a comprehensive job description, refining recruitment policies, conducting yearly appraisals, organising training sessions, taking measures to lower employee turnover rate, preparing a succession plans, developing competitive compensation plans and abiding by the laws and regulations related to central and state government.

• Strengthens Brand Management:-  A company's brand image can be damaged by introducing a new product in the product line or by acquiring a company that does not match the market image of the organisation. Strategic management keeps in mind the objectives of brand management while making organisational decisions.

• Identifies SWOT:- Strategic management scans the organisation's environment for identifying the strengths, weaknesses, opportunities and threats that are faced by the organisation as a whole, as well as by its separate departments. Once these are identified, it becomes easy to find out the issues related to the product line, marketing channels, pricing methods, marketing practices, staffing practices, e-commerce activities, etc.

Limitations of Strategic

• Time-Consuming:-  Strategic management process is extremely time-consuming. An organisation has to put immense efforts and resources for implementing the process of strategic management.

• Challenging Process:-  Implementing the process of strategic management is quite difficult. It takes a highly skilled and specialised workforce to craft and execute a strategy. A Master's or Doctorate degree in the same discipline is needed to become a strategist. Appointing these strategists or working with an organisation providing strategic assistance is generally quite expensive for an organisation.

• Absence of Short-Term Benefits:-  Although the investors are interested in achieving quick returns, the rewards for applying strategic management principles can be realised only in the long-run. At times, strategic management causes short-term losses for the organisation to deliver long-term benefits. These short-term losses can diminish the value of the organisation that may cause it to shut down.

• Unexpected Outcomes:-  Many concepts of strategic management are related to making future predictions. But practically the future cannot always be foretold. Any significant political or financial change in the environment may lead to results that would be totally different from those that were projected while formulating a strategy. It is very challenging to predict future business outcomes due to the dynamic nature of the environment. Hence, in such circumstances, strategic management can prove to be a bane for the organisation.

• Poor Adaptability:-  Strategic management may create inflexibility and bureaucracy in an organisation and takes away the ability of the organisation to react to the changes in the environment. As a result, the organisation is not able to exploit environmental opportunities and steer clear of the threats.

• Limited to Set of Rules:-  An organisation cannot apply the process of strategic management according to some prescribed norms, programmes and schedules. It is based on a theory that deals with every situation in a prescribed manner. This makes strategic management a belief or dogma of business and management rather than a practical approach. This becomes a hindrance in strategy formulation.