The Strategic Management Process
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The Strategic Management Process
Strategic management is a tool that is utilized by the management team to help them in the development and execution of a number of competitive moves. These competitive moves are generally derived from the demands of the external environments in which the firm operates. The internal environment also has far-reaching effects on the success of the organization. “External and internal factors are the underlying bases of strategies formulated and implemented by organizations (David, 2010). It helps to guide the organization in determining what it does and why it is done. Strategic management is also used to enhance the success of an organization both in the present and future endeavors.
Firms practicing strategic planning processes tend to outperform their counterparts that
do not. In fact, executives have reported higher levels of satisfaction with strategic
management tools and ideas than with most other management tools. Furthermore, 81
percent of companies worldwide reported doing strategic planning. In North America, the
figure was even higher (89 percent).
Managers may decide to follow different strategic management plans to arrive at their prospective goals. With that said, an action plan involves setting goals that are used to guide the company in sound process and should always include an analysis of the current business situation. They should further formulate objectives and strategies based on the analysis, and implement and evaluate procedures that will ensure that progress is made toward each strategy and objective.
The Strategic Management Process for Honda is comprised of five levels of strategy. (1) The Enterprise Strategy, which includes its mission and vision, (2) Corporate Strategy, (3) Business Strategy, (4) Operational Strategy, (5) Organizational Culture.
The Strategic Management Process of Honda Ltd.
Define the current business.
Every company must choose the environment in which it will compete. For example, it should determine the type of products it will sell where it will sell them and how the products or services will differ from its competitors. Hondas business model is to sell durable and innovative automobiles at a very economical rate. They are striving to obtain new technology that will utilize alternative energy. They are currently researching ways to utilize advanced technological material to fuel the vehicles they produce, while providing a driving pleasure for their customers.
(b) Mission- The mission lays out a broader idea of what the current main tasks are. It communicates what the company is, what they do, and where they are headed. Hondas Mission Statement is to try to maintain a global point of view, with the dedication to supply the highest quality products at a reasonable price for worldwide customer satisfaction. Moreover taking new challenges with the pursuit of Initiative, Technology, and Quality.
(c) Visions- The visions of a company are usually long-term, with broader images. It is a general statement to show the future direction of the company. Managers use this to formulate strategies that will help to