Strategic decisions are the decisions that are made within the entire operational roles within a corporation. They deal with the entire resources as well as the human capital within a corporation and act as the interface between the resources and the human capital (Kuhn, 2006). They entail the major resource propositions for a corporation (Baden-Fuller, 2004). This may entail the taking into possession new resources as well as organizing and reallocating other resources.
Further to the above role, strategic decisions ensure there is harmony in regards to the organizational resource capabilities in contrast to its threats and opportunities. They also matter themselves in making decisions on behalf of the corporation so as to lead it towards what the corporation is aspired to become of as well as what it ought to become. Due to the dynamic nature of corporations, the best way to incorporate the changes therein is through strategic decisions.
These decisions are in most cases complex in nature, and are mostly made at the top most level of the corporation. They are characterized with a lot on uncertainty as they are in most cases futuristic in nature. Safe for this, another characteristic is that they are subject to a lot of risks.
These are however different to administrative as well as operational decisions as explained by Alexander (1985). This is because the former matter themselves with the organizations routine and are directed towards facilitating the implementation of strategic as well as operational decisions. On the other hand the former matter themselves with the technical decisions that are required for the execution and implementation of strategic decisions.
The steward theory is to the effect that managers, if th...
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• Hitt, Michael A; Hokisson, Robert E.; Ireland, RD. Strategic Management. 6th Ed., Masson, Ohio: Souht. Wester 2005.
The Strategic management is help to accomplish the goals and intention for organizations recourses and future plans by following the important elements, which are planning, controlling, analyzing by study both internal and external strengths and weaknesses.
Generally, strategic management is a set of managerial decisions and actions that determines the long-term performance of a company, involving both internal and external environmental scanning, strategy formulation, strategy implementation, and evaluation and control. According to the study of strategic management, the corporation should concentrate on monitoring and appraising outside opportunities and threats based on an organization’s strengths and weaknesses (Thomas Wheelen and David Hunger, 2012).
Strategic management is regarded as an important process for businesses (Bowman and Asch, 1987; Kumar, 2010; Thomson and Strickland, 2003; Viljoan and Dann, 2003). The growing environment where these organization or company compete somehow will determine whether the company standstill or gone. Thus, most companies are trying to improve their performance to survive and expand. Strategic management process is important for a firm’s success because it enables a firm to develop a future direction, provides the ways to achieve its mission, and ultimately leads to value creation (Porth, 2003). A review of literature by Powell (1992) also indicates that firms who adopt strategic management generally improve their performance.
Pearce, J. A., & Robinson, R. B. (2013). Strategic management: planning for domestic & global competition (13th ed.). New York: McGraw-Hill/Irwin.
Strategic management seeks to coordinate and integrate the activities of the various functional areas of a business in order to achieve long-term organizational objectives. A balanced scorecard is often used to evaluate the overall performance of the business and its progress towards objectives. Strategic management hinges upon answering three key questions:
The current business environment is very competitive. Only those companies that will employee efficient strategies will achieve success. Strategic management helps an entity to utilize its resources effectively achieve a cost advantage. A cost advantage plays a key role in ensuring that a company offers competitive product prices in the market. Basis of management comes from earlier thinking and books on strategy that date back to thousands of years ago (Ambrosini and Bowman, 2009). Strategic management refers to a continuous process of analysis, creation and monitoring strategic progress of an entity to ensure sustainability (Helmstetter, Cleveland, Evans and Galloway, 2002). Organizations formulate strategies in order to focus their energy to one direction to achieve superior performance. Ambrosini and Bowman (2009) indicate that strategic management and strategic planning mean the same thing except that the term strategic management is used in academic while strategic planning is used in the industry. According Hopkins, Mallette and Hopkins (2013, strategic management is essential in sustaining competitive advantage. Organizations need to sustain their competitive advantage in order to be ahead of their competitors. According to Ambrosini and Bowman (2009), companies which have competitive advantages, perform better financially than other companies in the industry, and they also perform better than the industry average. Strategic management is also important in viewing the organization as a whole.
Hitt, M., Ireland, and Hoskisson, R. (2009).Strategic management: Competitive and Globalization, Concepts and Cases. In M.Staudt & Stranz (Ed).