In light of the various theories of Strategic Management and Competition touched

Question

In light of the various theories of Strategic Management and Competition touched on in this course (e.g., the Resource Model of the Firm, internal/external analysis, SWOT, Value Chain Analysis, Balanced Score Card, Porter’s Five Forces at different stages of industry development, Competitor Analysis & Inter-firm Rivalry with the notions of Market Commonality and Resource Similarity, along with the drivers of competitive behavior, Ansoff Matrix, Sustainable Competitive Advantage), which parts of the strategic management process do you think are most difficult, and why?

Given the importance of strategic management, why do so many strategies fail? In light of the various theories of Strategic Management and Competition touched on in this course (e.g., the Resource Model of the Firm, internal/external analysis, SWOT, Value Chain Analysis, Balanced Score Card, Porter’s Five Forces at different stages of industry development, Competitor Analysis & Inter-firm Rivalry with the notions of Market Commonality and Resource Similarity, along with the drivers of competitive behavior, Ansoff Matrix, Sustainable Competitive Advantage), which parts of the strategic management process do you think are most difficult, and why?

Given the importance of strategic management, why do so many strategies fail?

Explanation / Answer

Strategic management and planning is an organization's process of defining its strategy, or direction, and making decisions on allocating its resources to pursue this strategy. In order to determine the direction of the organization, it is necessary to understand its current position and the possible avenues through which it can pursue a particular course of action.

Theories of Strategic Management and Competition:

1. Resource Model of the Firm,

2. Internal/external analysis,

3. SWOT,

4. Value Chain Analysis,

5. Balanced Score Card,

6. Porter's Five Forces at different stages of industry development,

7. Competitor Analysis & Inter-firm Rivalry with the notions of Market Commonality and Resource Similarity

Strategy implementation is considered the most difficult state in strategic management because it involves change In order to implement, it is essential that all support given by managers and the workforce when this happens, only then can implementation be possible. Hence, as long as the change is not receptive, implementation cannot take place. Therefore, more time is needed to induce the idea of change and this makes it as the most difficult aspects of Strategic Management.

Successful strategy implementation is critical to the success of the business venture. This is the action stage of the strategic management process. If the overall strategy does not work with the business' current structure, a new structure should be installed at the beginning of this stage. Everyone within the organization must be made clear of their responsibilities and duties, and how that fits in with the overall goal. Additionally, any resources or funding for the venture must be secured at this point. Once the funding is in place and the employees are ready, execute the plan.

On average 80% of organisations fail to deliver the strategy they set out to achieve. There is no one single reason for this failure; usually it’s a combination of issues that stifle plans including:

lack of coordination Most organisations fail at the strategy execution stage when there’s a lack of coordination and focus on delivery. Organisations need the discipline to update all components of the strategy, chase actions, track performance and implement any changes. management commitment When it comes to deploying strategy, management have to lead by example. If employees believe the management team aren’t committed then their support will slide away. skills
& experience Many senior managers lack the leadership, strategic planning, communication skills required to deploy strategy effectively. failure to follow the plan Everyone in the organisation is too busy fire-fighting or simply doesn’t understand the requirements to be able to stick to the plan, deliver it and, importantly, track the performance. budget Many organisations forget to work out how much they need to invest in a new strategy. communication
& understanding Very often senior people go through the process of creating a strategy, but still don’t understand it or they send out mixed messages. Typically, 95% of employees claim they’re not aware of or don’t understand their organisations’ strategy! remuneration Remember the old adage, ‘what gets measured, gets done and what gets remunerated, gets done even better’ – 70% of middle managers do not have compensation linked to successful strategy implementation not enough time When a new strategy with action plans is created you can guarantee most people’s immediate reaction is likely to be they haven’t got time to take on additional work. You need to know how you will overcome this antipathy. over optimistic There’s no shame in opting for competence rather than excellence. Don’t mislead or demoralise stakeholders by attempting to achieve an overly ambitious strategy.

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