1.

Strategic Management
Strategic management is the art and science of formulating, evaluating and implementing strategy
in a business organization in the today's fast changing environment in order to achieve long term
objective of the organization.
Strategic management can be thought of having three elements within it. Strategic management
includes the understanding of
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Strategic position of an organization,

Strategic choices for the future, and
Turning the strategy into action.

a) Strategic position
Strategic position of an organization is concerned with impact, on a strategy, of
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external environment,
strategic capability,
expectations and influence of stakeholders

External environment of an organization is the operating environment which is external to and

beyond the control of the organization.
The most general layer of the environment is often referred to a macro environment which includes
the various influences categorized as political, environmental, social, technological, economical and
legal. These factors of the environment impact to a greater or lesser extent on almost all
organizations. PESTEL framework can be used to indentify how future trends on political,
economical, social, technological, environmental and legal environment might impinge on the
organizations. If future environment is likely to be very different from the past, it is helpful in
scenario building which helps the managers to consider how strategies are needed to change on the
basis of the ways in which business environment might change.
The next general layer is called an industry or a sector. An industry or a sector means the group of
business organizations producing same products and/or services. A fives forces framework of
Porter and cycle of competition can be useful in finding how competitive dynamics within and around
the organization are changing. As such, the most general layer of the environment consists of
competitors and market. The concept of strategic group and market segment are helpful in
indentifying the direct and indirect competitors and customers need and expectations respectively.
Strategic capability of an organization is the suitability and adequacy of resources and
competencies of the organization required to survive and prosper. Resources are the assets of an
organization which may be tangible and intangible. Tangible resources are the physical resources of
the firm like plant and machinery, money and material etc. However, intangible resources are nonphysical assets like information, reputation and knowledge. Likewise, competences are the activities
and processes through which an organization deploys its resources efficiently.

b) Strategic Choices
Strategic choices involve understanding of
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underlying bases for future strategy at both level ( corporate and business ) of organizations,
the options for developing strategy in terms of both of the directions in which strategy might

move, and
the methods of strategy development.

c) Strategy into action

Strategy in action means translating strategy into action. It involves strategy implementation
and evaluation and control.