- Show more
The strategy as a fundamental pillar in business
The strategy concept goes beyond military use can be applied, although without a strategy a war cannot be won. It can be said that the strategy is to develop the significant ability to compete. “Without a strategy, a company is like a ship without a helm around in circles. It is like a trap;It has no way out ”, Joel Ross and Michael Kami. The strategy is the way of being able to give direction and is the ingenuity of a company to excel from the others. Some of the questions we can ask about the strategy are: What is a strategy? How is strategic thinking defined? What are the five tasks of strategic management? What is the mission and vision of an organization? What is a company’s strategy? What is the importance of good strategic management? What is a strategic plan? As we advance in the writing we will answer those questions.
The basic question we should ask is: What is a strategy? According to Hitt, Ireland, & Hoskisson (2008), “A strategy is a set of commitments and actions, integrated and coordinated, designed to exploit central skills and achieve a competitive advantage. When companies decide for a strategy, they must choose between different alternatives. In this sense, the strategy that a company chooses indicates what it intends to do and what it does not intend to do ”. The intention of the companies is to develop strategies to achieve a competitive advantage, which allows them to go to the front of their competitors. For Hitt, Ireland, & Hoskisson (2008), "A company enjoys a competitive advantage when impleting a strategy that its competitors cannot copy or whose imitation would be too expensive". While Thompson, Peteraf, Gamble, & Strickland (2012), “a strategy designed and executed with skill, that facilitates the use of the opportunities that arise, that generates a good lasting performance, which adapts to the changing commercial conditions and thatresist the competitive challenges that rival companies raise it ”.
All critical thinking arises from the analysis. For Kenichi Ohmae, consultant and author "the analysis is the critical starting point of strategic thinking". According to Hill & Gareth (2009), “Strategic thinking implies generating a set of strategic alternatives or options of future strategies to be followed, given the strengths and internal weaknesses of the company and its opportunities and external threats and threats. In general, the comparison of strengths (Strengths), weaknesses (Weaknesses), opportunities (opportities) and threats (THREATS) is known as SWOT analysis (SWOT analysis, for its acronym in Spanish). Its central purpose is to identify the strategies to take advantage of external opportunities, counteract threats, accumulate and protect the company’s strengths, and eradicate weaknesses ”. In addition, Hitt, Ireland & Hoskisson (2008), adds: "To have a strategic avant -garde thought, administrators should know what questions to do and what tools to use to answer these questions". These tools will better allow decision making and respond to the demands of business competitiveness.
The functions of management are divided into five basic activities: planning, organization, motivation, personnel administration and control (David, 2013). Planning is the formulation of a strategy. According to David (2013), the planning “consists of all those administrative activities related to the preparation for the future. Among its specific tasks are the preparation of forecasts, determination of objectives, creation of strategies, policy development and determination of goals ”. The organization is part of the implementation of the strategy. According to David (2013), the organization “includes all administrative activities that generate a structure of tasks and subordination relationships. Specific areas include organizational design, specialization and description of positions, position specifications, the degree of control, the command unit, the coordination, the design and analysis of positions ”. Motivation is an important part in the implementation of the strategy. According to David (2013), motivation “are the channels channeled to form human behavior. Their specific issues include leadership, communication, working groups, behavior modification, delegation of authority, labor enrichment, job satisfaction and needs, organizational and moral change of employees and management ”. Personnel administration is an integral part of the implementation of the strategy. According to David (2013), “Personnel administration activities focus on employees or human resources administration. It includes the administration of salaries and salaries, employee benefits, interviews, hiring, dismissal, training, administrative development, employee safety, affirmative action, equitable employment opportunities, relationships withUnion, professional development plans, staff research, disciplinary policies, complaint procedures and public relations ”. Control is the part of the strategy evaluation. According to David (2013), “it refers to all those administrative activities aimed at ensuring that the results obtained are congruent with the projected. Key areas cover quality control, financial control, sales control, inventory control, expense control, variance analysis, rewards and sanctions ”.
The importance of mission and vision in a company is vital. According to Hill, & Gareth (2009), “a mission statement contains four components: the expression of the reason for a company or organization – the reason for its existence – which is normally known as a mission;the declaration of a desired future state, usually known as vision;the manifestation of the key values that the organization undertakes to respect, and a declaration of the main goals ”. The mission not only reflects what the company does, describes the reason for the existing of the company. The mission explains the questions of who are we? And what do we do? We take Nike as an example, its mission is "to provide inspiration and innovation for each athlete in the world". With his designs in his merchandise of sports shoes seeks to motivate everyone. So you can feel a complete athlete.
As for the vision, Hill, & Gareth (2009), tells us: “The vision of a company exposes a certain desired future state;It often expresses broadly, what the company tries to achieve. Nokia, the largest mobile phone manufacturer)!”This vision implies that not only voice telephony will be mobile (already), but will be the main system of other data -based services, such as image processing and internet navigation. This vision has led Nokia to develop mobile phone devices with multimedia that can not only be used for voice communication, but also to take photographs, navigate on the Internet, participate in games and manipulate personal and corporate information ”.
According to Maldonado (2018), “an organization’s strategy must be appropriate for its resources, objectives and environmental circumstances. The business strategy is of great importance for any company, small or large ”. The strategy must include the objectives, actions and resources that help execute the objectives. Maldonado (2018), tells us: “A 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 ”. One of the most iconic strategies was the strategy used by the Volkswagen company. Volkswagen introduced the "beetle" to the United States;With his slogan "Think Small" of Bill Bernbach Advertising Agency and achieved the unthinkable, sell a German vehicle of the Nazi era, in the United States with the memories and wounds of WW2. The "Beetle" of Volkswagen became the favorite car of the Americans.
There is no doubt that a good strategic management helps the growth and vitality of a company. According to Maldonado (2018), “the strategy is nothing more than a decision on the goals, objectives and actions of the organization to prosper in its environment. The taking of these occurs after an analysis of the organization’s environment, its markets and its competitors ”. The importance of a good strategy for Maldonado (2018), is "to link and insert the company in the outside environment with the aim of making the company more competitive". The competitive advantage allows the company to excel its competitors and achieve the goals and objectives set. What is sought is to maximize the resources that are available, with the purpose of making changes to maintain competitiveness and stabilize for the benefit of the company.
A strategic plan consists of three important points: vision, objectives and strategy. According to Thompson, Peteraf, Gamble, & Strickland (2012), "a strategic plan expresses the future management of the company, its business purpose, its performance goals and its strategy". Before developing a strategic plan, 3 questions must be asked and answered: Where are we currently? Where do we want to go? How will we get there? Although these questions seem basic are of vital importance to clearly establish the route to follow. SWOT analysis is a useful tool to establish the strategic plan. For David (2013), "these factors will lay the foundations of the strategic plan, because a company will strive to take advantage of its strengths, improve their weaknesses, avoid threats and capitalize on opportunities". The intention of the strategic plan is that the company can obtain and maintain a competitive advantage, over its competitors. A good strategic plan will strengthen the stability of the company and its long -term prosperity.
All companies have a strategy, even if this is informal, not structured and sporadic (David, 2013). In order for a company to succeed, they must focus its strategy, on establishing the route and direction to follow, through an analysis of strengths, weaknesses, threats and opportunities. Today lies the importance of strategic management, not only in defining the objectives, establishing the action to take and locate resources, but also in a deeper analysis that involves planning, organization, motivation, personnel administration andcontrol. As measures that involve the formulation, implementation and evaluation of strategies. This is the secret of a good strategy, which allows survival, vitality, prosperity of a company and the competitive advantage over its adversaries.