IMPORTANCE OF STRATEGY

Importance of Strategy

Importance of Strategy

Introduction

Every action and operation in the world needs a set of predetermined processes and procedures, with proper supervision, in order to assure their appropriate execution and implementation. There exists a proper course of attaining the goals and objective in personal life as well as professional. It is the end goal and objective which eventually determines the path one needs to follow in order to accomplish them; these paths denote the necessity of shaping up suitable strategy, plan and approach via which we can enable and provide one and others with the scheme and system to follow.

Strategy

Often strategy is misconstrued by the potency or effectiveness of the procedures and processes to produce desired results. As discussed earlier, the goal is the final destination, whereas, the strategy is the gateway to that destination. Moreover, strategy encompasses the guidance, range and capacity of a firm over both the short and long terms. The strategy helps the firm to attain advantage and objectives via the arrangement and relationship of resources of the organization, and the factors of the competitive environment, in which the operations are being carried out; in order to fulfill the requirements of the market as well as meet the expectations of the stake holders.

Moreover, strategy defines where is the business heading or intends to go both in short and long terms. The choice and decision of entering into markets, and the appropriate pursuance of required activities in that market, measure for tackling the competition in the market. The formulation of appropriate resources; in terms of capital, Human Resource, technical assistance etc; in order to tackle competition and excel in the market; and the influence of external and internal environmental factors on the operations of a business.

Strategic management denotes taking the appropriate Strategic Decisions that respond to the above mentioned factors. Moreover, the strategy formulation or strategic management comprises of five key steps; which are, the setting of goals and objectives, which enable a firm to enunciate it vision. Analysis of the external and internal environment, as well as the strength and weaknesses of the firm; the formulations of the strategy in accordance with the goals and other factors, the successful and effective implementation of the formulated strategies, and eventually the observance and supervision of those strategies (Hart, 1991).

For example, the Ford Motor company; after Toyota and Daimler Chrysler over took Ford in 2004, in terms of ranking. Ford reformulated its shot and long term strategies, undertook excessive study of the SWOT analysis bearing in mind company's strengths and weaknesses; and the opportunities and threats of the respective environment in which the company carried out their operations, they formulated suitable strategies for their future operations, and eventually paved better ways for them.

Significance of Assessment of Environment in Strategic Decisions

The environment plays a significant role in carrying out a particular business. Formulating the strategies and implementing them can have drastic repercussions if the firm has not taken in to account the varying and diverse environmental ...