The Five tasks of the Strategic
Management Process
• The strategic management process is comprised
of five tasks which are:
• 1. Developing a strategic vision and mission.
• 2. Setting objectives
• 3. Crafting a strategy to achieve the objectives
and vision.
• 4. Implementing and executing the strategy.
• 5. Evaluating performance and making corrective
adjustments.
2. The Strategy Making Tasks
• DEVELOPING A STRATEGIC VISION & MISSION
• A strategic vision describes the direction that
a company intends to take in developing and
strengthening its business.
• It lays out the company’s strategic course in
preparing for the future.
Vision Ctd
• In other words, a vision is the desired future
state of the organisation.
• It is an aspiration around which a strategist
might seek to focus the attention and energies
of members of the organisation (It expresses
the aspirations of the executive leadership).
Examples of Vision Statements
• Federal Express: “ Our vision is to change the
way we all connect with each other in the
New Network Economy”
• Microsoft: “A computer on every desk, and in
every home, running on Microsoft software”.
• A good vision is one that is distinctive and
specific to a particular organisation.
A Good Vision Statement
• It avoids generic, feel good statements like
“We will become a global leader and the first
choice of customers in every market we
choose to serve”.
• The above statement can apply to any
organisation, and offers little guidance about a
company’s direction that it intends to take.
• Thus a good vision must:
Good vision ctd
• 1. Illuminate the company’s directional path
and
• 2. Provide managers with a reference point for
making strategic decisions and preparing the
company for the future(in terms of products,
markets, customers etc).(Thompson
&Strickland 2010)
Characteristics of an Effectively
Worded Vision Statement
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1. It is graphic
2. It is Directional
3. It is focused
4. It is Flexible
5 . It is feasible
6. It is desirable
7. It is easy to communicate
Characteristics of an ineffective Vision
Statement
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1. It is vague or incomplete
2. It is not forward looking
3. It is too broad
4. It is bland or uninspiring
5. It is not distinctive
6. It is reliant on superlatives like most
successful, global or worldwide leader, first
choice of customers.
American Red Cross
• The mission of the American Red Cross is to improve the
quality of human life; to enhance self reliance and concern
for others and to help people avoid prepare for and cope with
emergencies.
A Mission Statement
• A mission is a general expression of the overall
purpose of the organisation, which is in line
with the values and expectations of major
stakeholders and concerned with the scope
and boundaries of the organisation.
• It is simply explained by the statement “ What
business are we in?”.
A vision vs a Mission
• A vision portrays a company’s future business
scope (where we are going), whereas a
company’s mission describes its present
business and purpose (who we are, what we
do, and why we are here?)
• An example of a Mission Statement for CUT
Company Values
• A company’s vision and mission should be
linked to its statement of values.
• A company’s values are the beliefs, traits, and
behavioral norms that company personnel are
expected to display in conducting the
company’s business and pursuing the strategic
vision and strategy e.g. fairness, integrity,
innovation, teamwork, transparency, superior
customer service etc.
Communicating the Strategic Vision
and Mission
• The strategic vision and mission must be
effectively communicated in the entire
organization so as to enlist the commitment of
company personnel to actions that moves the
company in the intended direction.
• According to Thompson & Strickland, strategic
visions become real when the vision statement is
imprinted in the minds of organization members
and then translated into hard objectives and
strategies.
SETTING OBJECTIVES
• The purpose of setting objectives is to
translate the strategic vision and mission into
specific performance targets (results and
outcomes)
• Well stated objectives should be SMART.
• There are two different types of objectives
that can be set i.e Financial objectives and
Strategic objectives
Setting Objectives
• The company’s financial and strategic
objectives can include both short term and
long term performance targets.
• Quarterly and annual objectives are examples
of short term objectives.
• Long term objectives are targets to be
achieved in two or more years
Financial Objectives
• These relate to the financial performance
targets that the organisation sets to achieve.
• Examples of these can be to achieve:
• 1. A certain percent increase in annual
revenues
• 2. Acertain percent of annual increase in after
tax profits.
• 3. A certain percent increase in earnings per
share, profit margins, ROCE, etc
Strategic Objectives
• These are targets in terms of outcomes that
indicate that a company is strengthening its
marketing standing, competitive strength and
future prospects.
• Examples of strategic objectives:
• 1. Winning a certain percentage of mkt share.
• 2. Achieving lower overall costs than rivals.
• 3. Being a mkt leader in terms of getting new
or improved products to the mkt.etc
Crafting a Strategy
• The Third Task of Strategic Management
• Strategy involves determining whether to
 Concentrate on a single business or several business
(Diversification)
 Cater to broad range of customers or focus on
particular niche.
 Develop a wide or narrow product line
 Pursue a competitive advantage based on
 Low cost or
 Product superiority or
 Unique organisational capabilities
Crafting a Strategy ctd
• The above options will be taken in a quest to
answer the following questions(or hows):
• How to grow the business
• How to please customer
• How to out complete rivals
• How to respond to changing market conditions
• How to manage each functional piece of the
business and develop needed organizational
capabilities.
• How to achieve strategic and financial objectives
Crafting Strategy as an entrepreneurial
activity
• Strategy- making is a market – driven and
customer driven activity that involves
Risk-taking and venturesomeness
Innovation and business creativity
Keen eye for spotting market opportunities
Keen observation of customer needs
Choosing among alternatives
Characteristics of Entrepreneurial
Managers
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Boldly pursue new strategic opportunities.
Emphasize out-innovating the competition
Lead the way to improve firm performance
Willing to be first-mover and take risks
Respond quickly and opportunistically to new
developments.
• Devise trail blazing strategies
Why Do Strategies Evolve
• There is always an ongoing need to react to
Shifting market conditions
Fresh moves of competition
New technologies
Evolving customer preferences
Political and regulatory changes
New windows of opportunities
Then crisis of the moment
Conclusion on the First 3 Tasks of
Strategic Management
• A Strategic Vision and Mission + Objectives +
Strategy = A Strategic Plan.
• These are the basic direction setting tasks.
• They help a company to :
1) Cope with industry and competitive
conditions.
2) Combat the expected actions of the industry
‘s key players and
Ctd
3) Confront the challenges and issues that stand
as obstacles to the company’s success.
• Thus a company’s strategic plan lays out its
future direction, performance targets and
strategy.
Implementing Strategy
• This is the fourth task of strategic
management.
• It involves converting strategic plans into
actions and results.
• It is an operations-oriented, make-thingshappen activity aimed at performing core
business activities in a strategy-supportive
manner.
Strategy Implementation
• Management has to assess what the company
will have to do differently or better to achieve
the targeted financial and strategic objectives.
• Thus strategy implementation is an internal
operation driven activity involving organizing,
budgeting, motivating, culture building,
supervising and leading to make the strategy
work as intended!
What does strategy implementation
include?
• Building a capable organization
• Allocating resources to strategy –critical
activities
• Establishing strategy- supportive policies and
procedures
• Motivating people to pursue objectives
• Tying rewards to achievements of results
Implementation Process Ctd
• Installing needed information, communication
and operating systems
• Instituting best practices for continuous
improvement
• Creating a company culture and work climate
conducive to successful strategy execution.
• Exerting strategic leadership
Evaluating Performance
• The Fifth Task of Strategic Management.
• It involves monitoring external developments,
evaluating the company’s progress and
making corrective adjustments.
• It is the strategic point for deciding whether to
continue or change the company’s vision,
objctives, strategy and/or strategy execution
methods.
Evaluation ctd
• The tasks of strategy are not a one- time only
exercise
Times and conditions change
Events unfold
Better ways to do things emerge
New managers with different ideas take over
Who Performs the Five Strategic
Management Tasks
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Senior corporate level executives
Subsidiary unit managers
Functional area managers
Operating managers
Approaches to Performing
the Strategy-Making Task
Chief Architect
Manager personally functions as chief strategist
Delegate-It-to-Down-the-Line Managers
Manager delegates some strategy-making responsibility to
subordinates in charge of key organizational units
Collaborative/Team
Manager enlists assistance and advice of key subordinates in
hammering out a consensus strategy
Corporate Intrapreneur
Manager encourages subordinates to develop and champion
proposals for new ventures
Strategizing: an Individual or Group
Responsibility
• Teams are increasingly used because
Strategic issues cut across departmental lines
Ideas of people with different backgrounds
can be tapped into
More people will have an ownership stake in
strategy
Strategic Role of a Board of Directors
• Continuously audit validity of a company’s
long-term direction and strategy
• Evaluate strategic leadership skills of the CEO
and candidates to succeed the CEO
• A board of director’s role in the strategic
management process is to critically appraise
and ultimately approve strategic action plans
but rarely, if ever, to develop the details.
Benefits of “Strategic Thinking” and a “Strategic
Approach” to Managing
• Guides entire firm regarding “what it is we are trying to do and to
achieve”
• Makes managers more alert to
“winds of change, new opportunities,
and threatening developments
• Unifies numerous strategy-related
decisions and organizational efforts
• Creates a proactive atmosphere
• Promotes development of an evolving business model focused on
bottom-line success
• Provides basis for evaluating competing
budget requests
HELPS A COMPANY PREPARE FOR THE FUTURE!