Strategic Management: Formulation and Implementation

The Concept Of Strategy

Once the objectives have been decided, the strategic decision makers are in a position to decide how to achieve them. This is a choice of strategy. Without a strategy, there is no established course to follow, no cohesive plan to produce the intended results.

Therefore, crafting and implementing a strategy for the business are core management functions. This chapter consists a discussion of the key concepts in strategic decision making. But particularly, it considers the central concept - strategy itself.

Strategy As A Field Of Study

Strategic decisions involve a determination of broad directions and the development of comprehensive plans to attain those directions. Richard Vancil has defined the concept of strategy as follows:

The strategy of an organization ... is a conceptualization expressed or implied by the organization leader, of (1) the long-term objectives or purposes of the organization, (2) the broad constraints and policies ... that currently restrict the scope of the organization's activities, and (3) the current set of plans near-term goals that have been adopted in the expectation of contributing to the achievement of the organization's objectives.

During the past thirty years the concept of strategy has become one of the everyday words of managers. However, the concept of strategy is not new. Military-diplomatic strategies have existed since prehistoric times. The term "strategy" is derived directly from the ancient Greek "strategos", which means "a general" and connoted the art and science of directing military forces. The term later was adopted in the political realm, and at the time of Machiavelli was extended to mean the planned exercise of power and influence to achieve the political ends of the state (Machiavelli 1950).

More recently, strategy has taken on new meanings and is frequently used to refer to the endeavors of various organizations, primarily business organizations, to anticipate, respond to. and generally survive in their environments.

A number of the tools of military strategy developed during World War II subsequently were employed in the business sector - make business at once more efficient and capable of achieving its goals. Military principles and strategy games provide insight to the identification strategies. However, the application of these discrete management techniques was somewhat problematic.

The corporate environment is more complex in many respects than the military, and the battle is continuous, without termination (Henderson 1979). Therefore, caution is in order when considering the more recent transposition of strategic thinking form the military sector to the business realm.

The term "strategy" as used in the military refers to the large-scale planning and directing of operations during wartime as well as peacetime. When used in the business organization, it refers to the broad, overall deployment of the firm's resources to achieve organizations objectives.