The business world requires constant adaptability to cope with changes. In this sense, strategic management responds perfectly to this problem.
It is a management approach that applies to making long-term decisions. In a company, these strategic decisions are made by management to guide all stakeholders towards the achievement of objectives.
It is often associated with operational management, whose goal is to set the objectives of strategic management in order to make short-term decisions.
Definition: what is strategic management?
Strategic management is the result of decisions taken by managers in order to build and follow a strategy. Thus, these decisions will have a long-term impact and must promote the proper development of the company.
This type of management is based on a double analysis. Initially, it is based on an optimal knowledge of internal resources (financial, material, immaterial and human). In addition, there is a perfect knowledge of the external environment of the company (competitors, key success factors, opportunities and threats).
The implementation of strategic management is divided into 3 phases:
- Planning: defining the strategy
- Organizing: setting up an action plan
- Controlling: correcting discrepancies and readjusting actions
What is strategic management?
Strategic management is about making the best investment decisions in a changing environment.
The objective of strategic management is to create a strong development system to guarantee the company’s sustainability and strategic position.
5 benefits for the company
The implementation of strategic management provides several advantages:
- Improve the perception of the environment. It is the opportunity for employees to share the same vision and to have a guideline to follow.
- Improve decision making. Knowledge of the major elements is favorable to make the best choices.
- Improve the company’s performance. The definition of strategic objectives allows to stay focused on the essentials and to avoid getting lost in less important tasks.
- Improve communication and coordination. All employees will be mobilized to achieve common objectives and will have more interest in exchanging among themselves.
- Improve resource management. There is less risk of investing in the wrong places and more chance of capitalizing on growth drivers.
Ultimately, ignoring strategic management means taking the risk of plunging into uncertainty. However, the application of this management will lead to decisions that are often irreversible. We must do what is necessary to build the most appropriate strategy by taking into account the issues and measuring the risks.
Reporting as a management and control tool
The company will now have to manage and monitor its action plan. To help it in this task, it can use synthesis tools capable of providing key information on its results. To do this, the use of a report will make it possible to centralize the essential data transformed into data visualization in a single document.
To report, the company will need to select performance indicators capable of measuring the achievement of its objectives. For example, if the company wants to increase its sales by 10% next month, the most suitable indicator would be the revenue.
There are many indicators, but there has to be consistency with the objective. Reporting can be used by all business lines, it can be found in the human resources, marketing, management, sales, logistics, etc.
Example of commercial reporting
Reporting done with Powerslide. Click on it, it’s interactive!
Strategic management is a solution that allows to have a clearer and more global vision on the activity of a company. It improves the likelihood of making the right decisions using the right tools. It highlights the objectives that flow from the strategy in order to bring the employees together around common objectives.
You can start creating your first reports for free with Powerslide, our reporting and dashboard creation solution.