Strategic Management Process

Strategic Management Process may be simply defined as the process through which a company formulates its business strategy.

Elements in Strategic Management Process


A. Establishing the hierarchy of strategic intent –

  1. Creating and communicating a vision

  2. Designing a mission statement

  3. Defining the business

  4. Adopting the business model

  5. Setting objectives

B. Formulation of strategies –

  1. Performing environmental appraisal

  2. Doing organizational appraisal

  3. Formulating corporate level strategies

  4. Formulating business level strategies

  5. Undertaking strategic analysis

  6. Exercising strategic choice

  7. Preparing a strategic plan

C. Implementation of strategies –

  1. Activating strategies

  2. Designing the structure, systems and processes.

  3. Managing behavioral implementation

  4. Managing functional implementation

  5. Operationalizing strategies

D. Performing strategic evaluation and control

  1. Performing strategic evaluation

  2. Exercising strategic control

  3. Reformulating strategies


Model of Strategic Management Process


It involves establishment of hierarchy of strategic intent. This includes formulation of the following-

Vision-what an organization wishes to achieve in the long run

Mission-it states the role an organization plays in the society

Business definition-it explains the business in terms of customer group, customer function and alternative technologies

Business model-it clarifies how the business will make revenue

Objectivewhat is to be achieved? It serves as a yardstick for measuring performance.


It involves organizational appraisal and environmental appraisal to identify strengths, weakness, opportunity and threat of the organization. SWOT analysis is conducted to capitalize on strengths and opportunities, minimize weakness and neutralize threats.

Formulation of strategy takes place at four levels. At corporate level it deals with decisions regarding management of portfolio of business . At business level it aims at developing competitive advantage in individual business units. Then decisions at functional level and operational level are taken.

Strategic alternatives and choice – Alternative plans are required to select the best strategy out of many possible options, the most appropriate strategy in the light of SWOT is selected which leads to a strategic plan.


A strategic plan is put to action by six sub-processes. They are-

  1. Project implementation– It deals with setting up of an organization

  2. Procedural implementation– It deals with different aspects of regulatory framework within which the organization operates

  3. Resource allocation– It procurement and commitment of resources for implementation

  4. Structural implementation– It refers to design of appropriate organization structure and systems, and reorganizing to meet the needs of strategy

  5. Functional implementation– It includes policies to be formulated in different functional areas

  6. Operational implementation– It involves plans regarding productivity, process, people and pace

  7. Behavioral implementation– It refers to leadership styles for implementation of strategy and issues like corporate culture, politics, use of power, personal values, ethics, CSR.


It involves measurement of organizational performance. A feedback system is setup and key performance indicators are determined. Feedback from strategic evaluation helps in exercising control over the strategy and reformulate strategies as and when necessary.

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