Strategic Manament - Benefits & Limitations

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Strategic Management - Benefits and Limitations

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Introduction

Firstly, the definitions of both Strategy and Strategic Management will be presented. Then what are the three levels of Strategy we see today. The Development of Strategic Management will be discussed along with examples from Nokia Corporation and we can see the benefits that Strategy plays in the success of an organisation. Organisations need to create value in order to survive and here the 5Q’s are discussed along with how Nokia would have answered these important questions. Nokia remained dominant in the industry until 2008 when the changes to the industry were not recognised by management and they doggedly pursued the strategy that had given them success. This proved to be the companies undoing…

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What is Strategy?

“If you don’t know where you are going, you’re going to end up somewhere else” Anon.

Hubbard & Beamish define strategy as:

‘Those decisions that have high medium term to long term impact on the activities of the organisation, including the analysis leading to the resourcing and implementation of those decisions to create value for key stakeholders and to outperform competitors.’

This definition gives us seven components to Strategy; decision making, longterm view, encompasses the whole organisation, creates value for customers and key stakeholders, the organisations functions are focussed and integrated, decisions are implemented and finally it is about outperforming competitors. Strategy involves the understanding of and the ability to manage the many variables presented to us in a world of rapid change, widening scope and a future of uncertainty.

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What is Strategic Management?

Strategic Management can be defined as:

‘The systematic analysis of the factors associated with customers and competitors (the external environment) and the organisation itself (the internal environment) to provide the basis for maintaining optimum management practices. The...