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Importance of Strategic Management

Updated on January 5, 2011

Models for Strategic Management

Importance of Strategic Management

Strategic management has gained importance in recent years. During last century organizations focused on long-term planning. Long-term planning supposed that external and internal environment will remain stable for long period of time and thus they made plans for long duration. Today it is clear to the managers and entrepreneur’s that environment can change at any point of time and their plans should follow a strategy that includes contingency planning too.

What is a Strategy?

A strategy can be defined as a step-by-step plan to achieve a goal.

Strategic Management:

Strategic management is an ongoing process of formulating strategies for the organization that bring profit to the organization and create harmony between organization and its environment. It lists the strengths that the organization already possess for the achievement of its objectives; weaknesses that hinder in goals accomplishment; opportunities and markets that can be exploited in favor; and threats that are present in external and internal environment: this is in short called as SWOT analysis.

While making decisions about the strategy the organization analyzes what are the distinctive competencies the company already possesses. Distinctive competency can be a valuable asset for the company. Distinctive competencies make the process of strategy formulation much more directional and successful.

Importance of Strategic Management in Organizations:

A well-formulated strategy can bring various benefits to the organization in present as well as in future.

  1. Strategic management takes into account the future and anticipates for it.
  2. A strategy is made on rational and logical manner, thus its efficiency and its success are ensured.
  3. Strategic management reduces frustration because it has been planned in such a way that it follows a procedure.
  4. It brings growth in the organization because it seeks opportunities.
  5. With strategic management organizations can avoid helter & skelter and they can work directionally.
  6. Strategic management also adds to the reputation of the organization because of consistency that results from organizations success.
  7. Often companies draw to a close because of lack of proper strategy to run it. With strategic management companies can foresee the events in future and that’s why they can remain stable in the market.
  8. Strategic management looks at the threats present in the external environment and thus companies can either work to get rid of them or else neutralizes the threats in such a way that they become an opportunity for their success.
  9. Strategic management focuses on proactive approach which enables organization to grasp every opportunity that is available in the market.

 

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    • seryhu profile image

      seryhu 6 years ago from Canada

      Excellent Hub, strategic management is a must to a company's success!!

    • gulnazahmad profile image
      Author

      gulnazahmad 6 years ago from Pakistan

      Thanks seryhu. Strategy is the key to success in every field and it is gaining popularity.

    • profile image

      mohamed 5 years ago

      that's usful info

    • gulnazahmad profile image
      Author

      gulnazahmad 5 years ago from Pakistan

      Mohammed thanks for the comment.

    • profile image

      MOLYRUTHER 5 years ago

      THUMBS UP :)

    • profile image

      Mohammad imran 5 years ago

      Thank you so much for help,

    • gulnazahmad profile image
      Author

      gulnazahmad 5 years ago from Pakistan

      Thanks Molyruther and Imran for the comments

    • profile image

      anjum 5 years ago

      thanks you for help

    • profile image

      reshmapatnam 5 years ago

      wonderful,sm is very much necessary for the org."s excellence according to the changing scenarios n preferences in the present context...........

    • profile image

      kusekwasalu 5 years ago

      you are marvelous. you gave us important information.

    • profile image

      hussien 5 years ago

      well illustrated, keep up the good work!

    • profile image

      archana 5 years ago

      thanks 4 the information

    • profile image

      dankwa jephter 5 years ago

      it will interest you to know what my professor said.That in football strategic management is called ways-and means.

    • profile image

      Awio Benard 5 years ago

      Thanx 4 da providing this info.

    • profile image

      Kiran aalishan 5 years ago

      there should be some examples related to this topic

      so that it can be more understandable.

    • profile image

      phindile 5 years ago

      this will assist me in my assigmnet thank you,will definitely reference your work,hopefully you details reflect for refrence purposes.

    • profile image

      Vivek 5 years ago

      Thanks. This helped me to prepare a good answer for my coming exam

    • profile image

      Innocent 5 years ago

      Thanks, now i can use it in planning organization.

    • profile image

      sadick kigaile 5 years ago

      its so important and predictive information to the future of an organization,thank you

    • profile image

      mathew k rutto 5 years ago

      thank you for your advice on how we can make good planns for our organizations.

    • profile image

      Irfan Ulla Khan 4 years ago

      Superb.

      Tomorrow is my exam and this study become very useful for me.

      Thank you so much

    • profile image

      paul 4 years ago

      Ahm,.. Can I have a question pls..

      What are the possible changes which may serve as challenges for creative managers in the future?

    • profile image

      Angykyz 4 years ago

      wonderful work which you are doing,next month will be writing my final exams,i know your help will surely make me succeed in my exams.Thanx and stay blessed.

    • misslong123 profile image

      Michele Kelsey 4 years ago from Edmond, Oklahoma

      You did a great job at illustrating the strategic models. I love the diagrams. You were very thorough in the topic. Can I refer my readers to you to increase your traffic? I will look forward to following your hubs. I hope you will be my follower and refer my hubs on yours as well. Keep up the great work! :) Michele

    • profile image

      irene 3 years ago

      this is very good please add more

    • profile image

      mukta 3 years ago

      it was the apt answer for my not of MBA. A VERY BIG THANKYOU

    • profile image

      Nora 3 years ago

      Thanks for this great work. I need more notes on the importance of strategic management.

    • profile image

      bosco 3 years ago

      fantastic

    • profile image

      derick 3 years ago

      thanks and God bless you

    • profile image

      EMMANUEL AKORLI 3 years ago

      YESSSSSS .........THIS IS EXACTLY WHAT I NEEDED.

    • profile image

      ISAMAT SIMON PETER 3 years ago

      Yes! i have got the answer for the question i had in mind.Thanks

    • profile image

      EDMON 2 years ago

      GOOD WORK

    • profile image

      STEPHANIE NYANTA OKAE 23 months ago

      THIS IS GREAT, EXACTLY WHAT AM LOOKING FOR

    • profile image

      Manisha 21 months ago

      Thanks for such a nyc & simple answer.. It helps me to make my notes effective

    • profile image

      najjuko sumaya 20 months ago

      u made my research easier

    • profile image

      Abhishek Saxena 18 months ago

      Very nice notes.

    • profile image

      Sanju 10 months ago

      Nice notes.

    • profile image

      Zekrullah KOCHAI 12 days ago

      Usefull information , thanks

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