How to Define the Components of Strategic Management

Written by kevin blankinship
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How to Define the Components of Strategic Management
Strategic management involves several important components. (manager image by Dmitri MIkitenko from Fotolia.com)

Strategic management is an administrative model used in many different organisations, including businesses, non-profit organisations and volunteer groups. The basic idea behind strategic management is to combine purposeful planning with meaningful action. A company or organisation first defines and clarifies a specific mission or set of goals---this is the planning part. Then, organisation leaders develop a comprehensive plan for implementation and execution of the mission or goals. Finally, leaders track progress and receive feedback in order to improve the implementation process. Each of these processes represent an important component of strategic management.

Skill level:
Moderate

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Things you need

  • Written mission or goals
  • Strategic management manuals

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Instructions

  1. 1

    Create an actionable plan or strategy. Set realistic goals at the level of individual departments and divisions. Write a company-wide mission statement. The first component of strategic management can be defined as the strategic planning portion of the overall process of creating and implementing a strategy. This is otherwise known as a general plan of action.

  2. 2

    Perform a SWOT analysis to prepare for implementation of the strategy. The acronym SWOT stands for strengths, weaknesses, opportunities and threats. SWOT analysis takes various internal and external factors into account when considering potential challenges to a company's implementation of strategy. For example, as Technical Notes points out, does the company have the wherewithal to undertake full implementation, as conceived in the planning process? Are there external factors that might prevent successful implementation? Such questions are considered during SWOT analysis, a major component of strategic management.

  3. 3

    Design and implement the strategy. Outline actionable steps which will lead to desired outcomes of the strategy. For example, a company that includes assurance of job security and employee job satisfaction as part of its strategy might allocate resources to undersign a more comprehensive health insurance policy. The inclusion of implementation as a major component of strategic management differentiates this administrative model from strategic planning, which focuses almost exclusively on outlining an organisation's mission and goals.

  4. 4

    Track the progress of the implementation. Develop and execute a strategic review or audit of individual departments. Conduct employee surveys to determine the effectiveness of desired goals. This component of strategic management is not only important in the implementation process itself, but also for the refinement of overall company strategy. Effective feedback will aid leaders in shifting priorities, as they polish the organisation's strategic vision.

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