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A Simple Approach to Understanding Strategic Management

Aug 11, 2008
Strategic Management seems to be one of those buzz words that the business community throws around. It seems like only a few people actually knows what it means and everyone else is trying to decipher the definition as they go. Don Hofstrand has one of the simplest explanations of it on the internet:

"Essentially strategic management answers the questions of 'where do you want your business to go' (goals,) 'how is your business going to get there' (strategy) and 'how will you know when you get there' (evaluation)."

He goes on further to explain that an easy way to understand it is through the analogy of a trip. First you chose where you want to go, there are many different location to choose from some close to a foreign country. What you chose all depends on what resources you feel you have a available and how long you want it to take you to get there.

Second you decide and plan how you are going to get there. You decide what route you feel would be best. Then what mode of transportation you can take to get there. Perhaps you want to drive, or fly or take a train or maybe even walk. This of course will be influenced by the number and amount of resources you have. Things such as how much money you can invest, who you know where to get special deals and what avenues of travel you know about to take advantage of.

And lastly after and during your travel you evaluate how your trip is going and went. Did the mode of transportation get you there in the fastest more efficient way possible? Was the destination you chose everything you thought it would be? Was there anyone on your trip you would rather not have on your next vacation?

All of these steps and considerations apply to business. You plan where you want to go, how you want to get there and then you evaluate the decisions you made and make changes for your next trip or business goal. Strategic management is the process it takes to plan, prepare and evaluate your business goal or trip.

So next time you get caught up in talking about strategic management take a step back and see if you are truly implementing it in your business. If you discover you are not then challenge yourself to learn more about it and work to implement it in your organization.
About the Author
Bart Icles knows the power of fully understanding of various business terms. He recommends talking with CMOE to get a better grasp on phrases like Strategic Management and Teamwork.
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