Any business needs to have a well-planned course of action which can be taken by the management of the business to make it move forward. These acts as the blueprint plan for the business management to channel the business resources in the most appropriate way to top ensure the achievement of the business goals and objectives. This brings about the development of the business strategic management plan. The business managers, therefore, takes into account the best way possible to harmonize the business goals, objectives, mission and vision with the available resources to help in the achievement of the business policies within a given period of time. This modality is quite different from other management functions in that it is not only future focused, but also tries to bring together all the relevant materials needed to achieve the policies of the organization. The strategic management is quite different from the other management practices s it is the sole management practice which tries to bring together all the other management practices in the organization as it also involves the synchronization of the available business resources to the business.
Importance of strategic planning
The strategic planning process is very important in the coordination of other management functions like finance, marketing, and production actions. Notably, it can be simply put that strategic management is the focal point of all the management functions. The marketing department, for example, must forward their estimates in time for the earlier planning by the managers. The personnel, as well as the production departmental heads, must forward to the management their resource requirements to the management so that the same can be catered for in the planning of the company activities for the financial year. Moreover, the business financiers and the financial management must plan their activities and their budget estimates in relation to the activities that the organization has made from the strategic plans which incorporate the business management practices and policy focus. Similarly, the accountant will be very much interested in the business policies to be focused on for the current financial year. As a result, they will have to get and secure the relevant policy objectives of the business made from strategic management.
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Differences between nonprofit organizations and profit organizations
The profit-oriented organizations have a wider variation with those of the non-profit-oriented organizations. Strategic management planning varies a lot in relation to the nature of the business in question. The profit related organization will make strategic management policies which are meant to bring about the highest profit margins possible to the organization they, therefore, focus on the strategies which will ensure that the policies made on the plans are meant to reduce the costs as much as possible and realize the business revenue to the highest possible levels. The nonprofit oriented organization do not have much focus on the strategies which would bring much revenue to the business, but would rather focus more on the activities which the business would like to undertake in the given financial year.
Areas of importance to strategic management
In case the business management will, not make effective strategic management plan in the business, the following areas will be most hit;
- The planning department will not be able to plan their activities in the organization
- The personnel department would not be able to precisely know the business policies to pass forward to the business employees.
- The marketing department will not be able to plan for the necessary market coverage to be covered in the given financial year.
- The production department would not be able to precisely synchronize the total products to the required company policy requirement
- The financiers and the financial departments would not be able to provide for the finances which the company may require for the efficient operation in the given financial year.
Importance of company mission statement
The mission statements therefore not only give the correct direction which the business is to go but also gives the best alternatives which the business performance can be evaluated and controlled against. The presence of a functional company mission statement will be manifested by the efficiency in the execution of the company plans and policies. The company will at the same time have a sense of direction and well-outlined ways of evaluating the performance.