In the conditions of market competition, in order to increase business efficiency and successfully develop economic entities, it is necessary to switch to the application of the principles of strategic management. In this article, we will discuss strategic management roles and responsibilities.
What is strategic management?
The basis of business management is the development of a strategy, its adaptation to the specifics of the company, and its implementation. The development, implementation, and implementation of the strategy are the priority tasks of management, so there is always a demand for managers who can actively shape the future of the company. Managers develop the strategy and are responsible for choosing the company’s business model. The strategy creates performance benchmarks, a vision of competitive advantage, and an action plan to satisfy customers and achieve high performance.
Strategic management is the process of determining the interaction of an organization with its environment, expressed through the use of selected goals and the achievement of the desired result by allocating the organization’s resources following an effective plan of action. The purpose of strategic management is to develop the potential and maintain the strategic ability of the enterprise to survive and function effectively in an unstable environment.
The successful economic activity of any organization depends on a formulated mission, a set goal, an analysis of the internal and external environment, certain strategies, and monitoring the progress of their implementation, which make it possible to determine the reserves of more efficient all available resources and increase competitiveness, improve the financial results of economic entities.
What are the 3 roles of strategic management?
Today, strategy is one of the necessary attributes of an effective business. As practice shows, no company in a competitive environment can successfully exist without its clear formulation. Therefore, the organization’s strategy is a comprehensive management plan containing a combination of business organization and competition methods aimed at achieving organizational goals.
The management has the following responsibilities:
- Designation of the purpose and main goals of the company’s business;
- management of the “strategy – structure – control” complex;
- providing feedback on the company’s results and strategy.
- investigation of the external environment of the company;
- analysis of its internal situation;
- choice and development of strategy at the firm level;
- portfolio analysis of a diversified firm;
- designing its organizational structure;
Strategic management at the enterprise includes 3 main roles:
- Strategy planning involves the implementation of such sub-functions as:
- forecasting precedes the actual drawing up of strategic plans. It is based on the analysis of a wide range of internal and external factors, the conditions for the functioning of the enterprise to anticipate the possibility of development and risk assessment;
- strategy development: taking into account the results of the analysis, the management of the enterprise formulates a mission (business area, global goal), determines the prospects for the development of the organization, and develops a strategy.
- budgeting includes the cost estimate of the program and distribution of resources.
- Coordinating the actions of managers in the formation and implementation of the general strategy consists in coordinating strategic decisions at various levels and consistently consolidating the goals and strategies of structural units at higher levels of management.
- Control consists of continuous monitoring of the process of implementing strategic plans. It is designed to identify impending dangers in advance, identify errors and deviations from the adopted strategies and policies of the enterprise.