What Is Strategic Management And What Are The Purposes Of Strategic Management?

The word Strategy means "to make plan for the right way, path or direction" while the word Management means "to organize the things in a required or desired way". So the word strategic management means "a process to organize the business on a right path to get profit and glory from the scared resources."
The term strategic management refers to the managerial process of making the long term decisions, prediction about the business future position along with the sense of purposeful action plan.
In more simple words the strategic management is a managerial process of making strategies towards organizational objectives and evaluating the performance of employees and adjustments according to the requirements of the department to get best possible result from the formatting strategy.
Some of the purposes of strategic management are:
1. To provide the better and up-to-date information about the organization's current position and to predict where can be the organization stand in future.
2. To make managers and organizational members more alert about the opportunities and threatening development in their corresponding field.
3. To help the entrepreneur to unify its managerial and organizational efforts.
4. To create a more proactive management posture.
5. To promote the development of a constantly evolving business model.
6. To provide the opportunities to managers for evaluating the company's budget according to the situation.

It is a plan of action and managerial decisions which measure the future growth and long term performance of any organization or business. The term strategic management originated from the army which used strategies in wars. So the word strategic means something that is done cleverly. Strategic management is used in business to build up the competitive edge against any competition. Many successful businesses use competitive advantage in order to lead the market or to come at the top. So this is used very commonly today. It links the management functions in a way that brings the desired results.

Strategic management gives a business specific thoughts to overcome current problems and to look to the future. The basic purpose of strategic management is to foresee business value in the future, to eliminate the possible risks in the environment, and to look for the changing markets trends. Simple management and strategic management are different. Generally the manager does not look for future outcomes when dealing with simple management. They just deal in to day to day management but strategic management deals with the future consequences. Now the purpose of strategic management is not only profit making but it involves the entire sector which requires special attention.

To determine the direction of an organisation

To provide a basis for team work

To minimise wastages in the future

To facilitate decision making

To improve morale of the employees.

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