Strategic Management Process Paper Strategic management is essential for corporations in the 21st century to realize and uphold competitive advantage. According to Alkhafaji, strategic management is a process involving the assessment of the corporations’ external, internal business environment with the aim of achieving its long-term objectives (2003). The strategic management process entails environmental scanning, strategy formulation, implementation and evaluation of the decisions that aim at directing the corporation in achieving its objectives. Wheelen and hunger explain that organizations success relies on strategic management (Wheelen and Hunger, 2010). According to David, strategic management is about the integration of management, finance, marketing, research and development, production and information system in an organisation (David, 2011). Strategy formulation in the process of strategic management involves coming up with a vision and mission to guide the corporation.
Strategy formulation looks into the organisations strengths, weaknesses, opportunities and threats. It is in this stage that the corporation comes up with the objectives and the strategies aimed at directing the organisation in upholding its mission and vision. It entails making decisions of what business to venture in, the allocation of resources in the organisation and ways of sustaining its competitive advantage.
Strategy implementation involves encouraging a strategy supportive culture in the corporation, improving the organisational structure, looking into the allocation of resources toward the formulated strategies. The implementation process also involves the utilisation of information systems and promotion of employee motivation based on the organisational performance. Lastly, strategy evaluation involves the assessment of the formulated strategies to know which strategies work well and which strategies need to be modified. Strategy evaluation as summarised by Wheelen and Hunger entails looking at the performance of the organisation.
Modification of formulated strategies is also part of strategy evaluation aimed at sustain its competitive advantage (Wheelen and Hunger, 2010). Let us consider Wal-Mart a company that has been producing an outstanding performance during the global economic recession. This success is a result of its clear vision; mission as well as its strategic plan, which saw Wal-Mart, increases its revenue in 2008 from $348 billion to $378 billion. Wal-Mart also increased its net market income from $11.2 billion to $12.7 billion. Wal-Mart mission is to enable its consumers save money to be able to live better.
The company supports the mission through the low prices strategy accompanied by efficient operations logistics and information systems. In 2008, Wal-Mart’s focus targeted its foreign expansion this was by devoting 53% of its international spending on the emerging markets. This was an improvement from the previous 33% spending on international markets. The company also targeted improving its internal environment. This was by remodelling of its stores in the United States instead of adding new stores.
A major change in improving their stores was their successful process of revamping their electronic department to make it more interactive and roomier. This strategic change will make Wal-Mart accessible to its consumers (Colvin, 2009). When considering its external environment Wal-Mart focused on beefing up its electronic product line as a way of attacking its competitors in the market. The company also targets to obtain all the businesses run by its competitors. The company also looks at collaborating with leading businesses as a way of sustaining its competitive advantage. The company also came up with new environmental labelling program that will estimate the environmental cost incurred in the manufacturing of their products.
This program provides environmental impact information to Wal-Mart’s customers. This new marketing strategy will see Wal-Mart recognized as an environmental friendly organisation (Colvin, 2009). References Colvin, G. (2009). The world’s most admired companies. Fortune, 76-86. David, F. R. (2011). Strategic Management: concepts and cases. Upper Saddle River, NJ: Pearson Education Wheelen, T. L., & Hunger, J. D. (2010). Concepts in strategic management and business policy (12thed. ). Upper Saddle River, NJ: Pearson Education.