Strategic formulation and its success
Success a strategy is due to the planning, organization and evaluation process. In addition, the ability to develop strategic projections is to achieve long -term objectives. Strategic formulation is an important factor by drawing the company’s course. The formulation of a strategy to revolve around the mission, vision, objectives and business strategies. So, how important that the mission, vision, objectives and business strategies are aligned? What is the difference between strategic decisions and other types of decisions? How does strategic management evolve typically in organizations? What information is necessary for the proper formulation of the strategy? What does the strategy hierarchy mean? And what aspects of the corporation environment must present themselves to senior management?
The mission determines the reason for the company, defines the company and the type of business and the resources to be used. Is the reason, why we exist. "The mission is fundamental, since it represents the operational functions that it will execute in the market and will supply consumers". The importance of vision, according to Maldonado, "vision defines and describes the future situation you want to have". It is nothing else, to glimpse what we want to achieve, working in the present and waiting to achieve it. "The objectives of the organization derive from the mission. They are guides to assess the degree of movement towards the achievement of the mission and constitute the basis for determining the operational objectives for the subunits and departments of the organization ”. Strategies must be aligned, both to mission, vision and objectives. According to Maldonado, “an objective of the business strategy is to put the organization in such a position, which facilitates its mission effectively and efficiently. A good strategy of the company must integrate the goals of the organization, policies, and tactics in a cohesive whole, and it must be based on business realities. The strategy must connect to the vision, with the mission and the probable future trends ”. Success in a company is an integrated process, continuously improvement adapting to the changes and realities present. A good integrated strategy has the ability to prescribe its own future, giving it an advantage in the business world.
"Reduce uncertainty about what can happen in the future by providing information close to reality that allows decisions about the courses of action to be taken both in the present and in the future". Decision making has an inherent effect, so that it can lead to success to a company or bury it to failure. Therefore, the need to make strategic decisions. Decisions based, what are the strengths of the company possesses and its weaknesses, what is its opportunity in the market and what element would affect that opportunity. For David, “the strategic administration is defined as the art and science of formulating, implementing and evaluating multidisciplinary decisions that allow a company to reach its objectives. As this definition suggests, strategic administration focuses on integrating administration, marketing, finance and accounting, production and operations, research and development, and information systems, to achieve the success of an organization ". This is the big difference, that strategic decisions involve a great scaffolding from all departments of companies, require planning, organization, management and control and are decisions whose results are long term. While administrative decisions are decisions for maximization of the company’s resources; and operational decisions are decisions that potential the operation of profits.
According to Maldonado, “Strategic Management allows an organization to effectively use its strengths in order to take advantage of external opportunities and reduce the impact of external threats to a minimum. Formulation, execution and strategy evaluation activities make it possible for an organization to develop both offensive and defensive strategies ”. Meanwhile, David, “readjustments, restructures and reengineering have contributed to permanent changes in the business scene. Thousands of companies began doing business internationally and thousands more closed their global operations. Many of them prospered and others failed in recent years as they massified more industries, which made the strategic administration a
even more important factor to achieve success. In recent years, the old competitive advantages, such as printed media, news and entertainment were worn and new opportunities for new competitive advantages were created ”. There is no doubt, before the challenges and changes at the global level, strategic management has constantly in evolution tempering itself to current reality, leaving old styles behind and innovating with new business techniques and with new trends in available technology.
According to David, “the formulation of strategies implies developing a vision and mission, identify continue. Among the issues involved in the formulation of strategies are to decide on what new businesses, what business to abandon, how to assign resources, expand operations or diversify, enter international markets, merger or form a society, and how to avoid a hostile acquisition ”. For Maldonado, “the formulation of the strategy (s) consists in developing a broad answer to the questions of: how the company will compete, how it will grow, why customers should buy, and how to attract and retain your collaborators to, from there, define what the necessary objectives and means should be to achieve vision ". The formulation of the strategy seeks to take advantage of the strengths that the company has and develop the new opportunities that are not maximizing.
Speaking of the David hierarchy, it tells us: “The hierarchy of command in an organization, coupled with the professional aspirations of different people and the need to assign scarce resources, guarantees the training of coalition of people fighting for taking care of themselves first and then to the organization. People coalitions are usually formed around certain key strategic issues facing the company. The main responsibility of strategists is to guide the development of coalitions, feed the concept of equipment and earn the support of key people and groups ”. The purpose of the strategy hierarchy is to establish and make clear what the objectives are and thus, the better the resources and have a better direction. Among the objectives are: the general objectives, which have to do with the mission and vision of the company and the specific objectives, which has the quality of having a principle and expiration. In addition, we must add the strategic objectives, organizations are objective and are those that define the route to follow. There are the tactical objectives, which are the objectives by departments and the operations objectives, are those that give meaning to the tasks and operations of each area.
For Maldonado, “once the annual strategic objectives are defined by senior management, these must be deployed to the entire organization so that in each department or section the specific actions with which each one will contribute to the achievement of those objectives are defined. This is achieved by applying the deployment of objectives ". In addition, David adds, “strategists must strive to create a work environment in which change is recognized as necessary and beneficial, so that people can adapt more easily to him. Adopting an approach based on strategic administration for decision -making may require important changes in the philosophy and operations of a company. Strategies can apply several positive actions to minimize resistance to the change of managers and employees. For example, individuals affected by him must be involved in the decision of change, as well as in decisions ”. In other words, if senior management wishes to have results, it must promote a cordial, motivating and positive environment to the entire human resource.
Strategic formulation is a process to establish the address to follow and to achieve the goals. Strategic formulation must coordinate and be alienated to mission, vision, objectives and business strategies. Strategic decisions are projected in the long term. That is the big difference, any decision that is not strategic, are short -term decisions, at the moment. That is why the importance, that strategic management is in season to changes and new technologies. Thus, they can develop competitive advantage in the market and have the ability to be able to adjust to crises. The strategy hierarchy orders the objectives and maximizes resources. Senior management must coordinate a positive environment to impact human resources, in order to have good results.
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