In this article, I’m sharing with you the characteristics of strategic management that will help you to understand the the features that strategic management has.
Characteristics of strategic management
Following are the 8 characteristics of strategic management:
1) Long-term Issues
The issues which strategic management handles are usually of long-term nature. These issues not necessarily affect the organisation immediately but will benefit the organisation in the future. For example, if a company spends on the education of its employees, it may not witness increases in productivity in the short-run, but in due course, highly educated employees will deliver better results and will also help in increasing the returns.
2) Competitive Advantage
Strategic management assists the managers in looking for fresh avenues for achieving sustainable competitive advantage. When strategic management principles are applied regularly in the proceedings of the organisation, managers can increase the number of satisfied customers, provide goods and services at economical prices, and can develop a highly satisfied workforce.
3) Impact on Operations
An effective strategic management process affects operational issues positively. For example, if increases in salary and performance are correlated then this would increase the operational productivity, as the employees will be motivated to put more effort in their work. Operating decisions are the ones that involve topics like deciding the best way to handle sales with a particular segment of customers or making decisions regarding selling products on credit. Decisions concerned with operational issues are made by lower level managers.
Strategic management makes decisions regarding situations that would occur in the future and are not a part of the day-to-day activities. Managers are ignorant about the after effects of their decisions because of the dynamic and uncertain business environment.
Since strategic management is uncertain, it becomes complex as well. Managers come across situations related to the business environment that are not easy to understand. There is a need for analysing internal and external environments.
The implementation of strategic management affects the entire organisation and not merely the operation on which strategic management principles are applied. It entails strategic choices and is a systematic approach.
7) Long-Term Implications
The implications of strategic management are long-term and do not affect the routine operations of the organisations. The concepts of strategic management are concerned with the mission, vision and objectives of the organisation.
8) Facilitates Strategic Implementation
Strategic management makes sure that strategies are effectively executed and implemented with the help of action-oriented plans.