A while back, I sent an email describing the strategic management process. Although the email was written for an internal audience, it's generic enough to be reproducible here...
Strategic Management is a five step process:
- Corporate Identity
This is the definition of the company and is broken down into three components:
- Vision (Why?)
A vision is a simple statement that describes why the business exists. It lays the foundation for future strategic planning. Google's corporate vision is to "organize the world's information and make it universally accessible and useful."
- Mission (What?)
The mission describes what the company does in pursuit of the vision. As an example, the original mission statement for Big Brothers Big Sisters of America was "providing and support committed volunteers who have one-to-one relationships to children and youth."
- Core Values (How?)
Core values are the backbone of our corporate culture. They define how we conduct business. These are unwavering absolutes that we maintain even if it affects profitability. For example, "we will always act with integrity."
- Vision (Why?)
- Situational Analysis
In the marketing world, this is referred to as a SWOT analysis. It's a detailed accounting of the internal (strengths and weaknesses) and external (opportunities and threats) environments.
- Strategy Formulation
Strategy formulation uses the corporate identity and situational analysis to define and select a strategy. There are three general strategic categories:
Operational strategies affect operational aspects of the company such as production, marketing, etc.
Business strategies focus on how the company competes within an industry.
Corporate strategies determine what business a company is in.
- Strategy Implementation
Implementation is putting a strategy into action. This is first step in strategic management that directly affects and requires follow-through from the entire organization.
- Strategy Evaluation
Two aspects of the strategy must be evaluated:
- How well the strategy was implemented, and
- Where the results of the strategy positive or negative?
Once the strategy has been evaluated, the process begins again at the Situational Analysis step.