Business Strategies and Strategic Management
In order for a business to be successful, business strategies and strategic management is required. Managers work on enhancing a company’s overall performance by specifying the mission, vision, goals, and development policies, and effectively making use of resources.
Strategic management is a special form of management that works on tactics to achieve the desired goals. These strategies are needed to ensure that the company does what the management expects on the basis of market developments. These actions are a continuous process of evaluation and control of the business that are reviewed either annually or quarterly in order to see how the strategies have been put into action and whether they achieved the desired effects or have to be adapted.
There is no universal strategic managerial method, and strategic management is characterized as subjective and highly context-dependent. This is why there are various ways of how strategic management can be put into effect depending on the size and nature of a company. A global company needs to focus specifically on the views and requirements of its stakeholders, while smaller or medium-sized companies could benefit from an entrepreneurial approach such as defining a mission that will influence their work. A distinction can also be made between a prescriptive, according to rules and norms, and a descriptive, according to the actual activities, approach.
In business strategy, competition plays a major role. Gaining a competitive advantage compared to other companies can be done by a specific manner of production and market performance for example. A company can either produce a number of different products from different segments, such as the consumer brands Unilever and Procter and Gamble, or gain an advantage through economic prices, such as dollar or euro stores. Another possibility is producing niche products, such as expensive designer cars like Aston Martin.
Management strategies also comprise marketing strategies, product development strategies, human resource strategies, financial strategies, legal strategies, supply-chain strategies and information technology strategies. On a smaller level, there are operational strategies which deal with day-to day activities such as schedules rather than with overriding long-term development of specific departments.