Strategic management: concepts, history, and organizational implementation

Strategic Management

The concept of strategic management is one that is highly important to organizations around the world (David, 2009). It involves taking a look at the top management of a company and the resources that management team is using on behalf of the company's owners and in order to show a specific level of performance. The mission, vision, and objectives of the organization must be examined, and it is necessary for them to come into play when attempting to understand the issue (Mintzberg, Ahlstrand, & Lampel, 1998). Plans and policies also have to be developed, and programs and projects must be created to meet the objectives that have been set by the company. When resources are allocated in order to ensure that these objectives can be met, strategic management helps to set out the right resources in the right amounts and at the right time so that the company can become and remain successful (Dess, Lumpkin, & Taylor, 2007; Grant, 2010).

The company then uses a balanced scorecard to evaluate its performance and see how much progress it is making toward its objectives (David, 2009). Studies have indicated that the expectations of stakeholders should be used as a jumping-off point for companies that are attempting to determine what kinds of goals they should have and how they should go about reaching those goals (David, 2009; Dess, Lumpkin, & Taylor, 2007; Grant, 2010). Addressed here will be the current situation as it relates to strategic management, as well as the history of the issue. Both of these are important to understand, because where something came from is often just as important as where it is now and where it is going. Understanding the past can help a company make good choices about its future, and can help a person or a company determine whether there were mistakes made that should be corrected in order to keep moving forward and remaining successful.

In order to have a successful study, a review of the literature will be undertaken. Then the methods and standards that were used will be addressed, and any questions that are being considered for further research into the area of strategic management will be discussed. From that point, it is vital that conclusions be drawn and recommendations be offered to wrap up the study. Without these components, it is often not clear whether a researcher has a thorough understanding of what the study was designed to do, and it is also not clear if said researcher is certain as to what else should be done in the area and should be questioned when it comes to that particular issue. In short, studies without these components lack completeness and that can make it difficult for anyone in the future to use the study as a jumping off point for similar studies or studies into related issues.

Literature Review

Reviewing the literature is a significant part of any kind of study, and that is true when it comes to understanding strategic management. The goal is not to address how it works with every type of company because there are often differences that are significant. Instead, the goal is more about looking at the way strategic management was handled in the past and the way it is being handled now. There are important differences to address, and there are some things that have stayed virtually the same throughout any other changes that have been made to the business world. With that in mind, strategic management is an ever-evolving issue with roots that really do not change much from one time period to the next. Having a good understanding of that and being aware of how it plays into what companies do and do not do in order to be successful can go a long way toward being more effective in business (Dess, Lumpkin, & Taylor, 2007; Grant, 2010).

Current Situation

Currently, strategic management has changed and evolved into what it is today, and it is still changing because the business world is not sedentary. There are some specific aspects of strategic management that are being used now, and that were not used in the past. Whether they remain part of strategic management in the future remains to be seen. Change is good, and is often necessary for proper planning (Nag, Hambrick, & Chen, 2007). In other words, if a company has goals and objectives and refuses to ever make any changes to those goals and objectives, that company may find that it is not able to accomplish the things that are important to it. Part of management - and a very large part of strategy - is the idea that goals and plans and objectives have to be reachable and also changeable in order to fit the changing times and any adjustments in the marketplace (Nag, Hambrick, & Chen, 2007). Companies that have no goals do not succeed, but companies that are too rigid and immobile often have the same kinds of problems.

Strategic management should apply to the entire organization, but it should also target a specific area in order to make sure that the company has a focus. Cost leadership, differentiation, or the actual focus of a company are three of the generic strategies for management that can be chosen from in order to make sure a company is aware of where it should be headed next (Nag, Hambrick, & Chen, 2007). A company that attempts to follow strategic management of all three of those areas will often fail, but a company that chooses just one and makes it "their own" can see a great deal of success. Companies need to consider the area in which they want to stand out from their competition. Do they want to have the lowest prices, the most focus on a specific area, or the widest differentiation of goods and services? What really matters most to the company, and what is the company good at from an overarching standpoint? Answering those questions will allow the company's management to make choices regarding which path would be the best for success.

There has been some argument, however, that a pursuit of both low cost and differentiation can pay off big for businesses (Hill, 2007). When a company provides a large number of products and services, and it provides all of them at a lower price than the competition, it is highly likely that the company will be able to see success (think companies like Walmart, that provide a wide variety of goods and do it cheaply). While differentiation and/or low cost is not the only way to make money and have success as a business, it is one of the best ways for management to move forward. Especially in a tight economy, consumers want to be able to buy things that are inexpensive, and they want to get everything all in one place so they do not have to spend gasoline to go to a bunch of different places to get what they need. Companies need to strategize in a way that utilizes the external environment and provides consumers with what they want (Hill, 2007).

Strategic management is very fluid, and highly complex (Hill, 2007). The organization has to adapt to what consumers need, and it also has to focus on what it wants and the goals it has set. Management can set goals for the organization, but those goals will not be realistic if the company does not account for what matters to consumers (Hill, 2007). The entire organization will be affected by the strategy created by management, and managers have a serious obligation to do their best so the people who are working under them are protected. Poor strategic management decisions can easily lead to a company that is not successful, and that can put a large number of people out of work. When that happens, it hurts not only those people but the company's customers and the entire economy. Strategic management is analytical, but it is also conceptual. In other words, managers have to be both logical and intuitive in order to consider everything they need to do to keep a business operating correctly and keep seeing a high degree of success.

One part of strategic management that started in the past and continues through the present day is the concept of strategy that is driven by technology. As early as the 1950s, Peter Drucker talked of the "knowledge worker" (Hubbard & Beamish, 2011). That idea continued all the way through the development of strategic management and is still important today. Now, the knowledge worker of the past has become the information technology worker of today and the future. Iphones, computers, email, and other technology and communication options have been increasing in availability and usage, and that will continue to be the case well into the future. Because that continues to occur, strategic management will continue to evolve (Hubbard & Beamish, 2011; Johnson, Scholes, & Whittington, 2005). Information technology has sociological implications for strategic management and leadership, as well (Hubbard & Beamish, 2011).

In order to have sound strategic management, a company needs to pay close attention to how it structures itself (Johnson, Scholes, & Whittington, 2005; Liebeskind, 1996). With too much structure, there will not be any way for a company to expand and move forward. People will be "stuck" where they are, and they need to have the opportunity to be productive and expand their capacity for learning and development (Johnson, Scholes, & Whittington, 2005). That nurtures new and different patterns of thinking, which can also help people focus on the things that matter to them and how they can consider ideas that are "outside the box" in order to come up with creative options for the company (Johnson, Scholes, & Whittington, 2005). When being creative, a company can expand its horizons and provide more options to customers and potential customers, as well.

How people learn and interact with one another is a very important part of strategic management, as well (Liebeskind, 1996). When a strategy is created, it has to be used by everyone in the company or it will not be successful. That means each person in the company needs to be "on board" with that strategy. The job of a leader who is undertaking strategic management is one that can be stressful at times. However, that does not mean a leader should ignore what he or she knows is right when it comes to creating strategy for the company. Not every person in a company may agree with a strategy, and that can make it difficult to keep everyone on the same page (Liebeskind, 1996). Still, most strategies created by individuals in management positions are designed so that the vast majority of the people in the company are in agreement with what the leadership has determined. That makes things easier for everyone involved.

It is important to consider all of the information that has been collected about strategic management, but there is such a large number of books and articles that have been written about it. That can make wading through everything written about the issue highly time consuming. It is also possible that a great deal of contradictory information will be found, and that can lead to confusion in those who do not have a strong grasp of strategic management already. Confusion can result in a struggle to be sure about what should be done from a strategy standpoint, or in an inability to make a decision about what to include in a review of the literature. However, the fact that strategic management continues to change and evolve means that there will always be disagreements and dissenting opinions regarding the issue. That has to be considered, since it is one of the issues with which researchers deal when they work to create new studies on management trends.

Methods and/or Standards

Researchers have to consider how others have examined the issue, and they also have to consider whether there have been large changes in the field they want to study since the last study has been undertaken. Without being aware of these things, a researcher could miss the mark when it comes to the current study he or she plans to conduct. For this particular study, it is also important to address what standards will be held to and what methods will be used to conduct the study. The standards will be those that are used in all proper research, but there will not be a need to consider protecting the subjects because the study will not be collecting new data from individuals. Instead, what will be collected will be information that is already available in books and journal articles, as well as reliable online sources. By collecting information that way the researcher has a large base of knowledge and information from which to draw and is not concerned with any regulations that are related to collecting information from actual participants for the current study.

Questions for Further Research

In order to get answers regarding the future of the field of strategic management, researchers often ask questions that can be studied by the researchers in a future study or by other researchers who want to perform their own studies in the issue. These questions are a jumping-off point for research that will continue, and could lead researchers to finding new and better ways to do things or discovering something important and significant about the way a particular field is currently being handled. In this study, the questions for further research are as follows:

1. Should strategic management encompass all levels of employment at a company, or only the "bottom line" goals?

2. Does having employees who are not "on the same page" jeopardize the mission and vision of the company?

3. How can strategic managers keep their employees interested in the goals they have set for the company?

4. Will strategic management continue to evolve with the changes that are being made in technology?

5. Does technology run the risk of holding managers back by doing "too much" for them and not requiring them to think on their own?

There are many other questions that could be asked as research continues, as well, but these questions will allow researchers to consider more issues that relate to strategic management in the future.

Conclusions/Recommendations

The largest conclusion that can be drawn about strategic management is that it is continuing to change and develop, and has been since it was created in the 1950s. Even though strategy has been a part of life for thousands of years, the idea of using it in a management capacity in a specific way and to create and meet desired goals is still relatively new in the scheme of things. Because that is the case, those who are interested in strategic management must continue to study it in an effort to ensure that they have a good understanding of all the changes that are taking place within it. Changes can occur quickly, which means that a person will need to remain focused on the differences in strategic management from one point in time to the next.

The main recommendation for those who are interested in strategic management - either in the capacity of using it or in the capacity of studying it - would be for those individuals to carefully consider where strategic management has come from and where it appears to be going. Plan for where management is headed from a strategic standpoint, and consider the trends that are taking place. When a person is able to anticipate what is taking place in the near (and even far) future, he or she can naturally have more success in business if that anticipatory knowledge is put to good use. Strategic management is not about just taking a look at what is going on currently and making decisions. It is also about focusing on trends for the future and making predictions and determinations that can be used to move the company into higher levels of success.

Good strategic managers are always looking ahead and considering what may take place in the future. They use knowledge and intuition to choose the most likely scenarios, and from that point they consider how they want to use those scenarios to their advantage. Not every individual is good at that, but most managers have honed their perception and intuition so that they can put those talents to good use along with logic and information. Then they can consider the directions that are available to them and choose the right one to take. This does not always work out as planned, of course, but it is much more likely to result in success than simply making a choice based on a lack of information and knowledge. Thinking clearly about what to do next and having knowledge of the trends for the future is a great way to utilize strategic management to its fullest extent.