Strategy

Dictionary define the word strategy as something that has to do with war and ways to win over enemy. In business organizational context the term isn’t much different. Businesses have to respond to dynamic and often hostile external forces for pursuit of their mission. Strategy seeks to relate the goals of the organization to the means of achieving them.

Strategy is the game plan management is using to take market position, conduct its operations, attract and satisfy customers, complete successfully, and achieve organizational objectives. Strategy is associated with unified design and action for achieving major goals, gaining command over the situation with a long-range perspective and securing a critically advantageous position.

Its implications for corporate functioning are obvious. Strategy is consciously considered and flexibly designed scheme of corporate intent and action to achieve effectiveness, to mobilize resources, to direct effort and behavior, to handle events and problems, to perceive and utilize opportunities, and to meet challenges and threats to corporate survival and success.

Strategy provides an integrated framework for the top management to search for, evaluate and exploit beneficial opportunities, to perceive and meet potential threats and crises, to make full use of resources and strengths, to offset corporate weaknesses and to make major decisions in general. Top management operates in an environment of partial ignorance and uncertainty. Strategies are formulated at the corporate, divisional and functional level. Corporate strategies are formulate by the top managers.

They include the determination of the business lines, expansion and growth, vertical and horizontal integration, diversification, takeovers and mergers, new investment and divestment area, these corporate wide strategies need to be operational by divisional strategies regarding product lines, production volumes, quality ranges, prices, product promotion, market penetration, purchasing sources, personnel development. Strategy is partly proactive and partly reactive.

A company's strategy is typically a blend of proactive actions on the part of managers to improve the company's market position and financial performance and as needed reactions to unanticipated developments and fresh market conditions. The biggest portion of a company's current strategy flows from previously initiated actions. This part of management game plan is deliberate and proactive, standing as the product of management analysis and strategic thinking about the company's situation and its conclusion about how to position the company in the marketplace.

A portion of a company's strategy is always developed as a reasoned response to unforeseen development. So, apart from adapting strategy to changes in the market, there is also a need to adapt strategy as new learning emerges about which pieces of the strategy are working well and which aren’t