| The Importance of Business Strategy | MT460/04 | |

Management Policy and Strategy
Unit 2

Business Planning

The Strategic Management Concept The concept of strategic management involves several different aspects of business. In the simplest terms, a company generates objectives and goals by which it would like to operate. The manner in which those goals and objective are accomplished and the strategic decisions made regarding those fall into the concept of strategic management. There are several different key elements in the strategic management process. A company must first set a high level overview of what it would like to accomplish. This may include its mission statement, objective and subjective goals and also company philosophies. The company must then study itself to determine its strengths and capabilities as well as its internal makeup. This is called doing an internal analysis. After conducting an internal analysis, an external analysis must also be completed. This includes studying factors that are typically outside the realm of control for a company. This will aid in understanding the current market conditions as well as trends by competitors to help align business focus. Being able to understand the external environment will help a company be better suited for change if needed when situations arise in the external environment. Devising a plan and creating a vision for a company’s long term goals is vital for creating a direction towards which it will operate. By creating goals for both the short term and long term, a company will be able to accurately analyze and scrutinize the performance relative to the guiding mission. A company will need to align its resources in an efficient, yet effective manner so that the operations can be running in the most productive manner. Resources include not only monetary funds, but also the