# Strategic Management: Organizing Resources to Achieve Business Goals

![Strategic Management](https://www.investopedia.com/thmb/FLHLD4se6sck4GvsZTtdnoew7Ug=/1500x0/filters:no_upscale():max_bytes(150000):strip_icc()/strategic-management-ADD-Source-7c12087694c9443a99743b612dd1c5d5.jpg)

*— Investopedia / Alex Dos Diaz*

> **Definition**
>
> Strategic management strategies help companies restructure, set new goals, implement revised approaches, and determine results.

## What Is Strategic Management?

Strategic management is an organized effort to utilize company resources effectively. It involves the evaluation and reorganization of resources to achieve new objectives. It calls for the examination of the competitive landscape, internal organization, and existing strategies of a company or organization, with the goal of instituting new practices company-wide for better results.

### Key Takeaways

*   Strategic management involves organizing and evaluating a company's resources and competitive environment to achieve its goals and objectives.
*   The strategic management process typically includes goal setting, strategic analysis, strategy formulation, execution, and success evaluation.
*   Flexible organizations adapt more effectively to changes and have an advantage in strategic management over inflexible companies.
*   Strategic management can originate from any organizational level, with lower-level managers and employees often contributing to strategy development.
*   Effective strategic management aligns strategies with implementation and continually reassesses strategies to maintain competitiveness.

## Key Management Styles in Strategic Management

Leaders often learn from past strategies and examine the current environment. Strategic management may include an analytic process, where all threats and opportunities are accounted for, or merely applying new guiding principles.

The skills and competencies of employees, [business culture](https://www.investopedia.com/terms/c/corporate-culture.asp), and [organizational structure](https://www.investopedia.com/terms/o/organizational-structure.asp) influence how an organization can achieve its objectives. Inflexible companies may find it difficult to succeed in a changing business environment. Barriers between strategy and implementation can make it hard to tell if goals are met.

While an organization’s upper management is ultimately responsible for its [strategy](https://www.investopedia.com/terms/s/six-forces-model.asp), the strategies are often sparked by actions and ideas from lower-level managers and employees. In addition to the [CEO](https://www.investopedia.com/terms/c/ceo.asp), an organization may have other employees focused on strategy.

> **Important**
>
> Participative leadership occurs when management includes team members in the strategic decision-making process.

## Steps in Strategic Management: A Detailed Guide

Strategic management helps organizations turn visions into action to reach business goals and objectives. A prescriptive approach outlines how strategies are developed, while a descriptive approach focuses on how they are implemented. Most organizations generally follow a series of steps that include:

1\. **Goal Setting:** Establish clear, realistic goals to articulate the vision and identify both long-term and short-term objectives.

2\. **Strategic Analysis:** Examine internal and external forces, using tools like [SWOT analysis](https://www.investopedia.com/terms/s/swot.asp) to understand the impact on business goals.  

3\. **Formulation:** Develop strategies that outline how goals will be achieved and gain buy-in from key [stakeholders](https://www.investopedia.com/terms/s/stakeholder.asp).  

4\. **Execution:** Implement the devised strategy by allocating resources and defining roles and responsibilities.  

5\. **Determine Success:** Evaluate the effectiveness of strategies using defined [metrics](https://www.investopedia.com/terms/k/kpi.asp) and adjust as necessary to maintain competitiveness.

## Real-World Examples of Strategic Management in Action

Consider a large company that wants to achieve more ambitious online sales rates. To meet this goal, the company will develop a strategy, communicate the plan, apply it across various units and departments, integrate it with employee goals, and execute it accordingly. If an effective strategy is created, it will help the company achieve its targets through a single, coordinated process. 

Imagine a technical college aims to boost enrollment and graduation rates over three years. The goal is to be the best value for students and boost revenue. The school may evaluate its financials to create high-tech classrooms and hire the most qualified instructors. The college may also devote resources to marketing and recruitment.

## Why Is Strategic Management Important?

Strategic management allows a company to analyze areas for operational improvement. It may follow an analytical process—identifying specific threats and specific opportunities—unique to the company. A company may choose general strategic management guidelines that apply to any company.

## What Are the Key Elements of Strategic Management?

Strategic management is not a one-size-fits-all strategy. However, there are key elements that are found to be critical. These include goal setting, industry and organizational analyses, strategy formation, strategy implementation; and the measurement, monitoring, and controlling of strategies.

## What Internal Changes May Be Implemented in Strategic Management?

Some action steps that companies may take to execute their strategic management plans include realigning financial and personnel resources or changing the methods to create, sell, and deploy products and services.

## The Bottom Line

Strategic management involves organizing and managing resources to meet specific company goals and objectives. It can be useful for a variety of organizations, including businesses, universities, and nonprofits. The key stages in the strategic management process are goal setting, strategic analysis, strategy formulation, execution, and success evaluation. Strategic managers play an important role by overseeing plans and ensuring flexibility in response to a changing business environment. However, effective strategy development requires participation from all levels of the organization, including input from lower-level managers and employees.  

> **Article Sources**
>
> 1.  Harvard University. "[Strategic Leadership](https://professional.dce.harvard.edu/blog/strategic-leadership/)."
>     
> 2.  Strategic Planet. "[The Strategic Management Process](https://www.strategic-planet.com/2013/08/the-strategic-management-process/)."
>     
> 3.  Harvard University. "[A Manager's Guide to Successful Strategy Implementation](https://online.hbs.edu/blog/post/strategy-implementation?utm_source=google&utm_medium=cpc&utm_campaign=Content-US-Gen-PMax&utm_adgroup=&utm_content=&utm_term=&gad_source=1&gclid=EAIaIQobChMI2Zy02IrKiAMVu07_AR1DDArgEAMYASAAEgJRkfD_BwE)."