Strategic Management Process

Not only big companies that have strategic management, but the small company should be managed by using the strategic management. Management is a set of strategic decisions and actions designed to achieve the target company. Thus, strategic management decision-making involves long-term and complicated and oriented to the future with greater resources that requires participation and top management. Management is a strategic process that involves three levels of the planners at the company's business units and functional and the other planners.
Strategic management process consists of eight steps are: define the vision, mission and business social responsibility, to analyze the external environment, to analyze the internal environment, choose a destination and business goals, develop strategic business, expanding programs, implementing programs, and collect feedback. All these steps to keep hampered business units to the environment and guard against potential problems and the new.
Similar small company with big companies, should have the vision and mission. Vision is a unique destination that differentiate the company from the company with other similar companies and to identify the scope of operations. Vision is a general statement or formula that is broad and durable about the willingness or the purpose of the company. Vision is the business philosophy of decision-making strategy company, suggests the image of a company is, reflects the company's self-concept and identify the areas of products (goods, services, ideas) and the company's main customers are the main needs are met companies. In brief, the vision of disjoint products, markets, technology companies that applied, and this is done such that reflects the values and priorities of the company's strategic decision-making. While the mission is operasionalilasi of vision.
Intel has a vision of encouraging ongoing innovation boundaries so that people can make life more fervent, more fulfilled and easier to manage. Bill Gates at the beginning of the founding of Microsoft, has the vision of "A computer on every desk in every home, running the Microsoft device."
Mission Levi Strauss & Co.. is "maintaining the commercial success of the company responsible for the global marketing leisurely bermerk clothes." Motorola's mission statement, namely "Our fundamental objective is total customer satisfaction."
Analysis of the external environment will lead to opportunities and threats companies. The external environment the company consists of three devices factors, namely the environment far, the industry environment and the operational environment.
Environmental far from consisting of the factors that comes from outside, and usually not associated with the operation of the company's specific situation, namely the economic, social, cultural, technological, demographic, political, legal, and ecological.
Environmental insudtri consisting of competition among the members of the industry, entry barriers, product substitution, the bargaining power buyers and the bargaining power suppliers.
The operational environment include factors that affect the competitive situation of the company, namely the position to compete, profile customers, suppliers, creditors, and the labor market.
Three factors were opportunities and raise the threat in their products are profitable. For example, Coca-Cola in 1993 to analyze the environment far, to get the results as follows:
- Increasing the income disposabel, sales of Coca-Cola will increase,
- Inflation affect the success of the Coca-Cola
- Consumption of soft drinks measures with the age of a person,
means the older, reduced drinking soft drinks,
the young group that most drinking
light.
- Technology makes the world more narrow, so it appears the market
"Young people" a new more accessible.
From the environmental industry produces Coca-Cola:
- Coca-Cola get strong competition from Pepsi
- The main raw materials of Coca-Cola is corn syrup berkadar fruktosa high, a kind of sugar, for the United States can be supplied by the source of most of the domistik. To outside the United States consumption of sucrose can be replaced. Other material is aspartam, a sweetener used in products low-calorie soft drinks from the Nutra Sweet Company.
- Buyers of soft drinks is the pembotol individuals and the rights to obtain franchises.
- There are many drinks substutusi of the popular soft drink, among other beverages sitrus (Citrus Beverage), juice (fruit juice)
Analysis of the internal environment will result in the company's strengths and weaknesses. Analysis of Internal company is also known by the name Analysis Company Profile. This analysis describes the strength of the company, both the quantity and quality marketing, human resources, physical resources, operations, financial, management and organization.
Marketing Strengths and weaknesses can be seen from the company's reputation, market, product quality, service quality, pricing effectiveness, effectiveness of distribution, promotion effectiveness, sales force, innovation and effectiveness of geographic coverage.
Strengths and weaknesses of human resources can be shown from the management of human resources, employee morale and skills, ability and attention of top management, employee productivity, the quality of life of employees, employee flexibility, adherence hokum employees, the effectiveness of the rewards to motivate employees, and employees.
Financial consists of the availability of capital, cash flow, financial stability, relationship with the owners and investors, and the ability to deal with the bank, the amount of capital that is planted, the benefits obtained (the value of shares), the effectiveness and efficiency of the system accounting for budget planning and cost-benefits and resources the level of the company.
Operations include the company's facilities, economies of scale, production capacity, production capability on time, expertise in production, the cost and availability of raw material suppliers, location, layout, optimization of facilities, inventories, research and development, patents, trademarks, protection hokum, control and operating efficiency and cost-benefit equipment.
Strengths and weaknesses organization and management structure can be obtained from the organization, image and performance of the company, notes the company in achieving the targets, communication in the organization, the organization's overall control system, climate and cultural organizations, the effective use of the system in decision making, strategic planning system, synergy in the organization, information systems and good management of good quality.
After the power company to do the analysis, weaknesses, opportunities and threats also known as among the SWOT Components Analysis, to formulate the next target. Target explain the objectives of the specific amount and time. Thus, the target to facilitate the planning, implementation and control. Target companies can be profitability, market position, productivity, leadership in technology, human resource development, the relationship between employees and social responsibility.
Few companies that have only one target. Most companies have a mixture that includes the profit target, sales growth, increased market share, limiting the risk, reputation, innovation, and so forth. Determine the target company's management and conduct business according to the target (Management By Objectives-MBO).
Dilemmas include, among other important short-term profit versus long-term growth, market penetration of the market versus the development of new, target profit versus non-profit target, the growth of high versus low risk. Each option in the target group requires a different marketing strategies.
Target shows what a company wants to be achieved, the strategy is a game plan for achieving it. Every business must plan a strategy to achieve the target. Multidevisional big business, usually have a three-level strategy, namely the corporate strategy, business strategy and functional strategies.
Corporate strategy describes the overall direction of the company about the company's general attitude towards the growth and management of various business and product lines to achieve a balance portfolio of products and services.
Business strategy or strategies are developed to compete in the Division level and the emphasis on the improvement of the position of competing products or services companies in specific industries or market segments served by the Division. Business strategy is, for example, the generic strategy of Michael E. Porter, the strategy of Jack Trout, Strategic Intent from Hamel and Prahalat and blue ocean strategy of Kim and Mauborgne.
Storm conditions are terrible for the company to force company-admired companies, which the world can create a strategy to survive and grow. Strategy is the science of determining the direction of planning and operations of large-scale military. Strategy is how to propel the team to the most advantageous position before the actual battle with the enemy. Business strategy focuses on improving the competitive position of products and services company in the industry or market segment, which served a certain company. Business strategy to overcome the problem of how companies and unit-unit compete in business and industry.
Generic strategy of Michael E. Porter. This strategy consists of the cost benefits of the strategy, strategy and differentiation strategy focus. Strategy overall cost advantage is a strategy that create business units work hard achieve cost production and distribution of the lowest, so the price can be lower than competitors and gain a large market share. Differentiation strategy is a strategy to concentrate the business units to achieve the best performance in providing benefits for customers are considered important by most of the market. While the strategy is a strategy focused business units that focus on one or more of a narrow market segment of the market in pursuing greater.
Strategies from Jack Trout mentioned that the core of the strategy is how to survive in a competitive world, how to create a better perception in the minds of consumers, to be different, identify strengths and weaknesses competitors, a spesialisas, to control one simple word in the head, which gives the direction of leadership and understand the reality of the market by becoming the first of which became better.
Hamel and Prahalat states that compete for future needs four things. First, how should understand that compete in the future is different to compete in the current period. Second, to make steps to find and increase the depth of knowledge about the opportunities that will come. Third, in mobilizing resources for the travel company in the future. Fourth, take time to come first, without taking excessive risk taking.
Meanwhile, the blue ocean strategy of Kim and Mauborgne, or the Blue Ocean Strategy, considers that compete is to create market space that is not their. Blue Oceans is a whole industry that does not exist at this time, the market space is not known and there is no competition. In the blue Oceans demand is created, not the worst of competition. Demand is growing quickly and profitably. To create the blue Oceans in two ways, the company can improve a complete new industry, for example, create eBay auction, but online. The second way, the blue Oceans can be created from within red Oceans during the company to change the existing industry boundaries.
The strategy emphasizes the functional pemaksimalan especially on the productivity of resources, such as marketing strategies, financial strategies, human resource strategy, operating strategy and the strategy of research and development.
According to Porter, companies that perform the same strategy and is intended to target the market or that segemen same strategic groups. Companies that implement the strategic with the best will get most profit. So the companies that have the lowest costs among the companies that implement the low cost strategy will appear most good. Companies that do not, apply a clear strategy "of a middle way" will fail. For example, International Harvester experiencing difficult times, because he is not in the industry company with the lowest cost, achieve the highest value, or the best serve in some market segments. Middle of the road trying to appear in all strategic dimensions, but because the various dimensions of strategic management company requires a different and sometimes inconsistent, these companies do not eventually winning in a bidangpun.
The companies also found that the most effective strategy requires that they have a strategic partner. Even companies giant AT & T, IBM, Philips, Siemens often can not be a leader, either, in the National and global, without forming strategic alliances with domestic companies and / or a multinational complement or enhance the skills and resources they. To try in other countries, the company may need a license products, establish cooperation with local companies, buy from local suppliers to meet the requirements of "local content" and so forth. As a result, more companies are working to develop a strategic global network. For more details, see the description Vision 2000 on page 76 titled "Weird Supper: APPLIED Global Growth Through Strategic Alliance."
Many take the form of strategic alliances and marketing alliances that are divided into four categories:
• Alliance products and / or services: One company gives the company a license to produce other products, or the two companies jointly market their products that complement each other, or a new product, for example, Apple cooperates with the Digital Vax together to design, produce , And market a new product. Sprinty recently joined RCA as the benefits to replace their phone service to Sprint. H & R Blockdan Hyatt Legal Service business services, the two have worked together in a marketing alliance.
• Alliance campaign: A company agrees to make the campaign for the products or services other companies. For example, Burger King, working with Disney to offer objects characterized Lion king or Pocahontas and other products to buyers burgernya. Similarly, a bank may be willing to Expo and a painting of a local gallery.
• Alliance logistics: Here, a perushaan offer logistical support to other product companies. For example, Abbott Laboratories save and send all medical and surgical products 3M to homes across the United States.
• Collaboration price: One or more companies participate in kolobarasi rates. Usually the hotel network and other car rental companies to provide discounts.
Companies need to have thought that in the relatively find business partners that will complement the strengths and weaknesses they cover. If managed properly, alliances allow companies to achieve higher sales with lower costs.
After the business unit to develop strategies main business unit to develop a detailed program supporters. So if the business unit decided to excellence in technology, business units must plan programs to strengthen the department litbangnya, collecting intelejensi technology, to develop advanced products, train technical staff of the seller, efforts to create ads for superior technology, and so forth.
Once the program is formulated with a temporary, functional staff must evaluate the cost of the program. Questions appear as: Does participation in trade exhibitions certain significant? Whether certain sales contests useful? Are employ sales will provide additional contribution to earnings? Activity-based accounting should be applied to every marketing activities to determine whether these activities will result in enough to cover costs.
Clear strategies and support that may not be cooked will be useful, if the company fails to implement them carefully. According to McKinsey Consulting Firm, the strategy is but one of the seven elements shown by the house that is well managed. The success of the business framework 7-S from McKinsey. The first three elements of the strategy (strategy), structure (structure), and the system (systems) are considered as "hardware" of success. Four elements of the next style (style), staff (staff) skills (skills) and with the value (the shared value) is the software. "
Elements software first, style, meaning that the company has a way of thinking dab behave the same. So that all employees of McDonald smiles on the customers and IBM employees are very professional in dealing with customers. The second, staff, that means the company has memperkerjakan people who say, train them well, and menugaskanmereka on the appropriate tasks. The third, the ability, means that all employees have the ability to menjalanjkan company strategy. The fourth, with the value, meaning that all employees have the values of the same guidelines. Kala elements of "soft" inin there, companies are usually more successful in the implementation of the strategy.
During the company implement its strategy, companies need to observe and monitor the results in the development of new environmental and internal eksternalnya. Some environmental stable from year to year. The other slowly evolving in a way that can be estimated. However, there are also environmental changes big and fast can not be predicted. Companies must be sure one thing: the environment will change. And if that change occurs, the company that happens, companies must review and revise the implementation. Programs, strategies, or even the target.
Control of the organization consists of three types, namely the control of the strategic, management control and operational control. Control is the strategic process of evaluation strategy, the strategy is well formulated and implemented after. Control of management focus on the achievement of the targets of various substrategi consistent with the strategy and the achievement of the main targets of the medium-term plan. While the operational control based on the performance of individuals and groups are compared with the role of individuals and groups that have been determined by the plan of the organization. Each type of control is not separate and not significantly different and in fact may not be different from one with the other.
Control strategies focus on the way with the strategy that dimplementasikan, to detect any problems or areas of potential problem areas and make the necessary adjustments. Newman and Logan use the terminology "rudder control system" to highlight some important characteristics of the control strategy. Typically, a range of important time between the beginning of the implementation of the strategy with the achievement of results that diharapkannya. During that time, a number of projects implemented, the investment made and the actions undertaken to mengimplentasikan new strategy. Also, the internal situation and environment companies are growing and developing. Control strategy is needed to control the company through these events. Control strategy should provide some immediate correction based on the performance of the middle and new information.
Henry Mintzberg states that issue as well the organization plans to create a strategy, but that different strategies may appear. Starting with the strategies planned or expected related to several things:
• Strategy, which is expected to be realized that the strategy called intentionally (deliberate strategy)
• Strategy, which is not expected to be realized that the strategy called not realized (unrealized strategy)
• Strategy realized that never expected called an emergency strategy (emergent strategy)
Robert Anthony of the Harvard Business School stated that the planning and control connected between the two organizations in the near future so that to make the separation between both unwanted and not understood. Planning must precede control, control must reflect the planning. Anthony suggested that the planning and organization disegmantasi into three categories, namely strategic planning, management and control of the assignment (operational). He stated that strategic planning means planning and strategic control, similar with the control of management is the activity involves planning and control.
Control strategy, according to Schendel and Höfer focuses on two questions (1) whether the strategy is implemented as planned, and (2) whether the results made by the strategy is expected. This definition refers to the study of traditional measures and feedback that is the final step of the strategic management process. Normative model of strategic management process that describes the major steps include the formulation of strategies, implentasi strategy and evaluation (control) strategy.
Control strategy based mainly on the traditional process that involves the study and performance feedback to determine the plans, strategies and targets have been achieved with the information that is used to solve problems or take corrective action.
Contributors to the new conceptual literature shows control of the strategic feedback to anticipate the future considering changes quickly and the external environment is not sure. Schreyogg and Steinmann (1987) have made the initial discovery in developing a new operating system on a sustainable basis, to check and evaluate the assumptions, strategy and results are critical. Strategic control as a critical evaluation of the plan, activities and results, thus providing information for the actions of the future. Schreyogg and Steinmann proposed the model of the classical feedback to include control of the strategic assumptions, control and supervision of the implementation of the strategic. Pearce and Robinson added a special component of the warning. The fourth type of control is designed to meet the needs of top management to oversee the strategy when implemented, to mendekteksi critical issues, and to make the necessary adjustments. Control of this strategic assumptions related to the environment and key operational requirements necessary for the successful implementation of the strategy.
Control is designed to check the assumption that systematically and continuously whether or assumptions used during the planning and implementation process is still reliable or not. It involves environmental conditions, namely environmental factors (economic, technological, socio-cultural, political, legal, demographic, ecological, government regulations, etc..) Factors and industry (competitors, supplier, buyer, goods and barriers to entry substitution). All the assumptions may not require that the similarity of control. Therefore, managers must select assumptions and variables that according to the changes and will be a major impact on the company and the implementation of the strategy.
Control is the implementation of the strategy have questioned whether the overall need to be changed or not see the results of the implementation of the strategy. Controlling the implementation of the strategic operational control is not replaced. Controlling the implementation of the strategy relates to the functional strategy, organizational structure, leadership style, the system of benefits and information systems. Unlike the operational, strategic implementation of sustainable questioned the fundamental direction in strategy. Controlling the implementation of these things involve 2, which is monitoring the strategic trust (the new strategic program or programs key strategic) and review important events.
Supervision is a strategic control to monitor events that may affect the way the strategy both inside and outside the company. Compared with the control and the assumption of the implementation, monitoring strategic designed relatively less focused, open and the activity of a broader search. The basic idea behind the strategic supervision is some form of public monitoring of the various sources of information will be important not find the opportunities that are not previously anticipated. Possess a strategic Pengawasan way similar to conduct observations of the environment, although the observation of the environment are usually seen from the part of the planning cycle, which is made in chronological order to produce information for the new plan. Conversely, the strategic supervision is designed to save the strategy that has been built on the basis of development.
Control of special warning is thinking back to the company's strategy in depth, and often quickly result of the unexpected incidents. The unexpected incidents such as these natural disasters, aircraft accidents, authorities alihan company, product defects, the products contain toxic, and so forth. These events can dramatically change the company's strategy. Pearce and Robinson suggest that the warning was only for a specific implementation strategy, because the warning is indeed a special sub-section of the supervision of the strategic guided entirely in the strategic management process.
Although the control system must be made in accordance with the specific situation, but the control system to follow the same basic process, usually following the six langakah as follows:
• Determining what is manageable
• Setting standards
• Measure performance
• Comparing the performance standards
• Determining the reasons for irregularities
• Conducting action correction