1.

STRATEGY

Originally, term strategy has been derived from Greek ‘strategos’ which means generalship, that is, art of the
general. Because of this nature of origin of strategy, most of the dictionaries define strategy in military
sense. For example, according to Oxford Dictionary, “military strategy the art of so moving or disposing the
instruments of warfare (troops, ships, aircrafts, missiles, etc.) as to impose upon the enemy the place, time,
conditions for fighting oneself. Strategy ends or yields to tactics when actual contact with enemy is made.”

Chandler has defined “strategy is the determination of the basic long-term goals and objectives of an
enterprise and the adoption of the course of action and the allocation of resources necessary for carrying
out these goals.” This definition was followed by many particularly professors of Harvard Business School,
USA.

However, Stanford Research institute, USA has taken a different view. It states that strategy is a way in
which a firm, reacting to its environment, deploys its principal resources and marshalls its main efforts in
pursuit of its purpose.

Michael Porter has defined strategy as the “creation of a unique and value position in involving a different
set of activities and, thus, a company that is strategically positioned performs different set of activities from
its rivals or performs similar activities in different ways.”

William Glueck has defined strategy “A strategy is a unified, comprehensive, and integrated plan relating
the strategic advantages of the firm to challenges of the environment. It is designed to ensure that the basic
objectives of the enterprise are achieved.”

Strategy is a long-term course of action through which an organisation relates itself with the environment so
as to achieve its objectives.

Based on this definition, we can derive the features of strategy which are as follows:

1) Strategy is a major course of action through which an organisation tries to relate itself with environment
to develop certain advantages which help in achieving its objectives.
2) Strategy is a relative combination of actions aimed at to meet a particular condition, to solve certain
problems, or to achieve a desirable end. This combination of actions differs from situation to situation.
3) Strategy may even involve contradictory action. Since a strategic action depends on environmental
variables, an organisation may take contradictory actions either simultaneously or with a gap of time.
For example, to pursue a growth strategy, an organisation may sell some of its businesses while
expanding other businesses. This is happening throughout the World and in India too.
4) Strategy is forward looking; it has orientation towards future. Strategic action is required in a new
situation. No new situations requiring solutions can exist in the past and, therefore, strategy is relevant to
future.

2. STRATEGIC MANAGEMENT

Definition:

“Strategic management is defined as the set of decisions and actions in formulation and implementation of
strategies designed to achieve the objectives of an organization.”

- By John A. Pearce
- By Richard B. Robinson
 “Strategic management is a systematic approach to a major and increasingly important responsibility of
general management to position and relate the firm to its environment in a way which will assure its
continued success and make it secure from surprises.”

- By Igor Ansoff

FEATURES OF STRATEGIC MANAGEMENT:

1. Strategic management is basically a process. It has emerged out of management in other fields where the
concept of management is taken as a process for achieving certain objectives of the organization. Thus
strategic management involves establishing a framework to perform various processes. The concept of
strategic management must embody all general management principles and practices devoted to strategy
formulation and implementation in the organisation.
[Link] focus of strategic management is on relating the organisation to its external environment. This
emphasises that there is continuous interaction between the organisation and its environment taking an open
systems approach. Thus, the organisation must create adequate channel through which external information
will pass to various points in the organisation.
3. Strategic management is basically top management function. Thus in order to ensure effective top
management function, it is necessary that a distinction should be made between strategic management and
operational management which emphasises day to day operations in the organisation, so that top
management can focus more attention on the strategic aspect rather than emphasising on operational
management. Since the environment of the organisation is always changing providing new opportunities and
threats, top management must spend more and more time on this aspect. Thus, there is a considerable change
on the emphasis of top management functions in the organisation, particularly large and complex
organisations. The change is from operational management to strategic management.

BENEFITS OF STRATEGIC MANAGEMENT:

The benefits of strategic management can be identified in the following contexts:

[Link] Benefits:
Effective strategic management results in financial benefits to the organizations in the form of increased
profit. The basic reason for this phenomenon is that the companies which adopt strategic management are
able to realign their strategies according to the needs of environment much more quickly than those which
do not follow this approach.
[Link] Uncertainty:
Strategic management tries to offset environmental uncertainty by prescribing the future course of action
in the light of various forecasts made by the organization. Forecasting and strategic planning are the basic
core of strategic management and these provide a clue about what is likely to happen in future. This
process allows the top management of an organization to provide direction and control for its success.
[Link] in objectives and direction:
Strategic management focuses on organizational objectives and direction of action for achieving these
objectives. Sometimes, people in the organization may not be specific about its objectives because of lack
of clarity and precise definitions.
For example, often we take profit as the objective of a business organization. It is too abstract to be
pursued.
[Link] organizational effectiveness:
Strategic management ensures organizational effectiveness in several ways. The concept of effectiveness
is that the organization is able to achieve its objectives within the given resources. Thus, for effectiveness,
 it is not only necessary that resources are put to the best of their efficiency but also that they are put in a
way which ensures their maximum contribution to organizational objectives.
[Link] satisfaction:
Strategic management contributes towards organizational effectiveness by providing satisfaction to the
personnel of the organization. In an organization where formal strategic management process is
followed, people are more satisfied of their roles thereby reducing role conflict and role ambiguity.

LIMITATIONS OF STRATEGIC MANAGEMENT:

Strategic management as a fundamental aspect of top management is essential but there are certain particular
limitations to use it:

[Link] and Dynamic Environment:

Strategic management is essential to overcome the problems posed by complex and dynamic
environment. For strategic management, we require knowledge of the trend in the environment.
However, with increasing complexity and an accelerating rate of change, it becomes more and more
difficult to predict the future outcome.
[Link]:
Strategic management brings rigidity in the organization through strategic planning. Strategies are
selected and implemented in a given set of environment, both external and internal. When these
variables are taken into account, the organization sets various parameters for its working, for examples,
designing of organization structure, prescribing rules and procedures, allocating resources, etc.
No doubt, this is a real problem in strategic management, but this problem can be overcome by building
enough flexibility in the system through an open-systems approach of strategic management.
[Link] Appreciation of Strategic Management:
Problems in strategic management come because the managers are inadequately aware about its
contribution to the success of the organization and the way in which strategic management can be
undertaken. For example, managers often fail to isolate the strategic work, and they use short-term
outdated evaluation techniques:
[Link] failure to isolate strategic work is very common to many managers.
[Link] problem in strategic management emerges from the fact that managers often attach importance
to short-term achievement.
[Link] in Implementation:
Seldom corporate strategy is as clear to organizational members as is thought by its framers. Even the
most persuasive, articulate, and specific strategy by the top management may not carry the same
meaning throughout the organization. The internal conflicts among departments, individuals, or
organizational and personal values cannot be solved by strategic management. In many of these cases,
non-strategic management functions are more important.

3. Policy

The term policy is described from the Greek word “politeia” relating to polity, that is citizen and the Latin
word ‘polotis’ meaning polished, that is to say clear. According to New Webster English Dictionary, the
policy means the art or manner of government a nation, the line of conduct which rulers of nation adopt on a
particular question specially with regard to foreign countries the principle on which any measure or course
of action is based. While these descriptions of policy relates to any field, in organisational context, Kotler
has defined policies as follows:-
“Policies define how the company will deal with stakeholders, employees, customers, suppliers, distributors,
and others important groups. Policies narrow the range of individual discretion so that employees act
consistently on important issues”

 Based on the above definition, policy may be defined as follows:-

A policy is the statement or general understanding which provides guidance in decision making to members
of an organization in respect to any course of action.

 On the basis of this definition, following features of policy can be identified:-

1. Policies provide guidelines to the members in the organisation for deciding a course of action and thus,
restrict their freedom in choosing the course of action. From the point of view, policies are quite
important role theory. They are not an end but means to end and explain what organizational members
should do as contrast what they are doing, Policies, when enforced, permit prediction of roles with
certainty.
2. Policies are generally expressed in a qualitative, conditional, and general way. The verbs most often used
in stating policies are to maintain, to continue, to follow, to adhere, to provide, to assist, to assure, to
employ, to make, to produce and to Such prescriptions may be either explicit or, as is more often the
case, these may be interpreted from the behaviour of organizational members, particularly those at the
top level.
3. Policy formulation is a function of all managers in an organisation because some form of guideline for
future course of action is required at every level. However, the higher the level of a manager, the more
important is his role in policy making.
4. A policy is formulated in the context of organizational objectives. Therefore the policy tries to contribute
towards the achievement of organizational objectives.

4. TACTICS
Tactics is a term which creates conclusion because in ends-means chain, what might be a strategy for a
lower unit may become tactics for a higher unit.
Tactics is related to efficient utilization of various organizational resources committed through strategy.
Further understanding about tactics may be developed by making difference between strategy and tactics.

Difference between Strategy & Tactics:

Points Strategy Tactics

Level of Strategy is developed at the highest Tactics is employed & relates to lower
conduct level of management. level of management.
periodicity The formulation of strategy is Tactics is determining on a periodic basis
continuous & irregular. The process is by various organization. A fixed time
continuous but the timing of decision table may be followed for this purpose.
is irregular. For exa: preparation of budget at regular
intervals.
Time Strategy has a long term prospective Time horizon of tactics is short run &
Horizon Whereas, its time horizon is flexible. definite the duration is uniform.
Uncertainty Elements of uncertainty are higher in Tactical decisions are more certain as
the case of strategic formulation & its they are taken within the framework set
implementation. by the strategy.
Information A manager requires more information Tactical information is generated within
need for arriving at a strategic decision. the organization particularly from
accounting procedures & stastical
sources.
Type of Strategic decisions are never delighted Tactical decisions can be taken by
personnel below a certain level in the managerial personnel at lower levels because this
involved in hierarchy. involves minor implementation of
formulation strategic decisions.
Subjective The formulation of strategy is affected Tactics is normally free from such values
values considerably by the values of the because this is to be taken within the
person involved in the process. context of strategic decisions.
For exa: what should be the goals of
the organization is affected
considerably by the personal values of
the person concerned.
Importance Strategies are most important factor of Tactics are of less important because they
organization because they decide the are concerned with specific path of the
future course of action for the organization.
organization as whole.

5. Business

Business can be defined along 3 dimensions.

(1) Product (2)Customer (3) Technology

However whatever dimension is chosen for defining business, it must reflect two features

(1) Focus and (2) Differentiation.

(a) Focus in Business definition

While defining a business an organization should focus on its chosen field on business activities .Focus
of business may be defined in terms of the kind of functions the business performs rather than the broad
spectrum of industry in which the organization operates.

For example – Business of textile company located in Surat.

Textile

Personal Wear Nonwear

Suiting shirting Saris Undergarment

Cotton Silk Synthetic

High priced low priced Medium price

Sharp focus on business definition provides direction to the company to take suitable actions.

(1) Differentiation in business definition

Differentiation is how an organization differentiates itself from others so that the business concentrates on
achieving superior performance in the market. Differentiation can be developed on several bases: quality,
price, delivery, service or any other factor which the concerned market segment values. An organization can
cultivate those strengths that will contribute to the intended differentiation. For example – An organization
can not differentiate on both moves in the same direction that is it cannot keep its product quality high at low
price.

Dimensions of Business definition

Different Dimension for defining business focus on different variable Derek F. Abelm suggest that business
may be define along 3 dimensions

(1) Customer Group

(2) Customer Function
(3) Alternative Technology
(1) Customer group relate to “who is being satisfied”
(2) Customer function relate to “what is being satisfied”
(3) Alternative technology describe “How the ends are being satisfied”

Taking these 3 dimensions and Peter Drucker narration of Customers an organization has to define its
business in 3 contexts

(1) Customer segment

(2) Product
(3) Technology
(1) Customer Segment

According to Peter Drucker “what is our business is not determined by the producer but by the customer….
by the want the consumer satisfies when he buys a product or service.” The customer segment can be
defined in terms of satisfaction it looks for in a product and the price it is ready to pay for that satisfaction
and the location of that segment. For example Hindustan Uniliver has define its business to cover anyone
and everywhere and satisfaction offer through its branded product. The company has included in its portfolio
various personal and home products foods and Beverages, grocery items like salt, price etc.

Whereas many company do not include everyone in its customer segment .For example Hero cycle has
define its segment in terms of people in lower income located in semi urban and rural areas.

(2) Product Dimension

Every organization defines the business it participates and the product it offered. Most business is
characterized by a range of product that can group along several dimensions. For example –product features,
quality, price distribution, service and so on. Since an organization cannot compete along all these
dimensions, it is better to define its business in such a way that is derive competitive advantages out of this
business. For example Hero cycle has defined its business not as bicycle but cheap and sturdy bicycle and
offered bicycle that are low price sturdy and functionally useful rather than the once X and Y micron layers.

(3) Technology Dimension

The third dimension on which business is defined is technology which is used in production and delivery of
product. Technology consists of equipment, machine, tools and other physical aspects and sets of activities,
methods and procedure for the completion of work. Technological dimension of business specifies what
activities are to be undertaken to produce and deliver products and services and to enhance their value for
customers. Value creation is a process of enhancing the utility of a product from customer’s point of view. A
customer would buy a product any when he/she perceive that products offers value higher than or atleast
equal to its price it is determined by their perception. The organization has to define what values the
customer considers important - it may be lower price for others it may be regular delivery after sales service
product innovation, quality etc. The organization has to define how it would enhance the values of the
product to its customer.

6. STAKEHOLDERS

STAKEHOLDER APPORACH OF ORGANISATIONAL OBJECTIVES

This phenomenon is known as stakeholder approach of objectives. Cyert and March have proposed a
behavioural theory of organizational objectives which suggests that organizational objective determination is
a continual bargaining-adaptive process. There are two essential elements of this process: 1)Coalition
2)Bargaining. How coalition and bargaining affect organizational objectives.

1. Coalition. Coalition refers to combination of two or more individuals, groups, or organizations for a
common goal. Thus, coalition is the goal-oriented alliance among individuals, groups, or organizations with
different interests that is formed to mobilise joint resources so as to influence the outcome of contest. The
goal of a coalition is to increase its power vis-a-vis other groups. Coalition concept is very common in
political parties where two or more political groups or parties combine to fight against the third. Business
organizations may behave in the same manner. The organisation is viewed as coalition consisting of a
number of groups such as owners, managers, suppliers, employees, government agencies, etc.

2. Bargaining. The term bargaining refers to the negotiation of an agreement between two or more parties
for the exchange of goods or services. It implies flexible rather than rigid position. There is enough scope for
a compromise or a mutual give and take before reaching any final agreement to settlement. In organizational
context, this process may take place between an organisation and several elements in the environment, for
example, supplies, creditors, trade unions, and so on. The basic requirement of this process is fixation of
negotiated actions or goals. For example, what an organisation can do over certain matters related to
workforce is not determined by the organisation alone but through the collective bargaining between the
organisation and the trade union concerned.

Bargaining affects the objective setting rather implicitly. It may focus on resources and to the extent it sets
the limits on the resources available or the ways they may be employed. Thus, bargaining places certain
limitations on organizational choice of objectives. Bargaining involves direct interaction with other
organizations in the environment rather with a third party. The outcome of bargaining process will be
determined by the relative strengths of the parties concerned.

From the behavioural approach of organizational objectives, it appears that stakeholders have a significant
say in setting organizational objectives and determining other strategic issues. Therefore, it is imperative that
this approach is taken into consideration which can be done through identification of various stakeholders
and their expectation from the organisation and integrating their expectations with the organisation.

Stakeholders and Their Expectations

An organisation, being a creation of human beings, has nothing of its own. Whatever it owns as a separate
legal entity is contributed by someone who may be in different forms such as shareholders, other financiers,
employees, customers, creditors and suppliers, government, and society. Some of them have high stake in
the organisation; some may have low stake. For example, shareholders have high stake while government
may have low stake in the outcomes of organizational operations. Therefore, the organisation has to identify
the expectations of various stakeholders that they have from the organisation. Though these expectations
may vary from countries owing to social and cultural differences, in Indian context, these expectations are as
folllows:

Shareholders. Shareholders expect reasonable return on their investment and safety of their capital. The
interests of the majority shareholders are generally protected through either participation in management
process of the organisation concerned or through intervention in key decisions, if necessary. However,
minority shareholders do not have this power. Therefore, the organisation is expected to utilise the resources
in a way which enhances shareholder value. In order to protect shareholders' interest, provisions have also
been made in the Companies Act which put certain limitations on the management to refrain it from taking
arbitrary actions.

Other Financiers. Besides shareholders, financial resources are provided by other financiers particularly
financial institutions and banks. In fact, in many cases, their contributions are much more than that by the
shareholders. Such financiers expect that they will be paid interest and principal as stipulated. In order to
ensure this, sometimes, they appoint their own nominees on the Board of Directors of the companies
concerned. Sometimes, they put restrictions on the payment of dividend to the shareholders. In extreme
cases, they may change the management pattern of a company. At one point of time, a consortium of
financial institutions led by Industrial Development Bank of India proposed the merger of four steel
companies-Essar, Jindal, Ispat, and Lloyds-into one entity to protect their investment in these companies.

Employees. Employees are stakeholders in an organisation by virtue of their involvement in organizational

processes. In today's competitive contest when every organisation is trying to develop competitive
competence through human resources, their stake has become vital. Employees expect from their
organisation that it will provide them fair salaries and wages, pleasant and motivating working conditions,
secured future in terms of employment security and retirement benefits, and above all partner in building the
organisation.

Customers. In the present context when every business organisation focuses its attention on winning and
maintaining customers, they have become important stakeholder. They expect fair product price with
commensurate quality, widespread distribution and sales network providing ease in procuring the product,
honesty in dealing and treating with them, fair advertising devoid of any false, misleading and exaggerated
publicity, good after-sales services, and so on.

Creditors and Suppliers. Creditors and suppliers affect an organisation in several ways and are affected by
it. They expect from the organisation the creation of healthy and cooperative inter-business relations,
relevant and accurate information, prompt payment of supplies, and so on.

Government. Government is very closely related with the business system of the country. It provides
various facilities for the development of business. Though it regulates the business, it is meant for the
development of overall business and healthy competition among various participants. In the light of this,
government expects that an organisation behaves like a law-abiding citizen, pays taxes and other
government dues fully and timely, does not corrupt administrative system and democratic process, and does
not buy any political favour by any means.

Society. Organizations exist within a social system and get various facilities from it. Therefore,
organizational objectives should be aligned with those of the society. Parsons, a famous sociologist, has
viewed that organizational objectives are an extension of what the society needs for its survival. Therefore,
the society has legitimate claims over organizations and expect that they should maintain fair business
practices, set up socially desirable standards of living and avoid ostentation and wasteful expenditure, play
fair role in civic affair, provide and promote general amenities and help in creating better living conditions,
and set examples for others about how development programmes can be taken for the benefits of the society.
Integrating Expectations

After identifying various stakeholders and their expectations, an organisation can integrate these into its
objectives. However, integration of various expectations poses problems because of conflict in two or more
expectations. For example, it is perceived that profitability is inversely related to meeting social obligations.
However, this is not necessary. In the present context, profit is treated as a byproduct of the more social
commitment of the corporation as observed by Lord Griffiths, former Vice-Chairman of Goldman Sachs
International. In integrating various expectations, all these cannot be put at par and, therefore, there should
be some type of reconciliation and priorities as most of the organizations do while setting their objectives.

7. SBU (Strategic Business Unit)

The multi-product Companies have different businesses organized as different divisions or product groups.
These are generally known as profit centres, or from strategic management point of view as strategic
business units (SBUs).

SBU concept was evolved by General Electric Company (GEC) of USA to manage its multi product
business. The fundamental concept in the SBUs is to identify the discrete independent product/market
segment served by an organization. Since each independent product/market segment has a distinct
environment, an SBU should be created for each such segment. Thus, different SBUs are involved in
Distinct Business Areas (DBAs) with each area serving the distinct segment of the environment. In taking
up strategic management in a multi-SBU organization. The following features become important:

1. Each SBU is managed as a portfolio of the organization with a clearly defined product/market segment
and clearly-defined strategy.
2. Each SBU develops its strategy tailored to its capabilities and needs with overall corporate capabilities
and needs.
3. Each SBU is allocated resources-both physical and human-according to its needs and contributions to the
achievement of organizational objectives.

As against an organization with multi-SBU a single-product/market organization has single strategic

business unit. Naturally, operation of strategy in these types of organizations will be different. In a single-
product company, the corporate-level strategy serves the whole business. This strategy is implemented at
next lower level by functional strategic. In multiple-level Product Company, the business –level strategies
are inserted-generally a strategy for each SBU-between corporate strategy and functional strategy and the
strategies of these units are guided by the corporate strategies. Relationships among corporate-level,
business-level and functional-level strategies for single SBU firms and multiple SBU firms are presented
below
 Corporate
Top
Strategy
Management

Middle

Management
Operations Marketing Financial Personnel
Strategies Strategies Strategies Strategies

(FIGURE 1.1 corporate and functional strategies in single-SBU firms)

Corporate
Strategy Top Management

SBU 1 SBU 2 SBU 3 SBU Top

Strategy Strategy Strategy Management

Operations Marketing Financial Personnel Middle

Strategies Strategies Strategies Strategies
Mgmt

(FIGURE 1.2: Corporate, SBU and functional strategies in multiple-SBU firm)

Strategic Business Unit:

In multi-product or multi geographical area companies, division are created in the form of various strategic
business units (SBUs).SBU concept was evolved by General Electric Company (GEC) of USA to manage its
multi product business. The fundamental concept in SBU is to identify the independent product /market
segments served by an organization and creating SBUs accordingly. For example, GEC was earlier having
nine product groups and forty-eight divisions which were reorganized into forty-three strategic business
units, many of which crossed group, division and profit centre lines for instance, three separate division in
food preparation appliances were merged in a single SBU to serve hose ware market. In India, many
companies have organized their businesses on the concept of SBU. In fact, most of the companies in
Information technology sector which are engaged in development of software for different purposes and for
different customer segments have adopted this approach.
VISION:

Vision is the starting point of expressing an organisation’s strategic intent. Nations have vision;
organizations have vision; and individuals have vision. They have vision either explicitly or implicitly. In
spite this phenomenon, there is lack of unanimity about the exact content of vision. Let us have an attempt to
develop clarity about vision. In dictionaries one of the several meanings of the word vision is “a mental
image of what the future will or could be like.” Taking this meaning in the organisational context, we may
say that vision represents what the organization would be in future; it implies that the organization should
create projections about where it should go in future and what major challenges lie ahead. This statement
appears to be effective from practitioners’ point of view but lacks clarity from academic point of view.
Therefore, let us go through academic exercises relating to defining and describing vision.

Burt Nanus, a well known expert of organisational vision, has defined vision as “a realistic, credible and
attractive future for an organization.” Let us disect this definition. It contains four elements.

1. Realistic: A vision must be based on reality to be meaningful for an organization; it should not be merely
day-dreaming but a dream to be converted into reality.
2. Credible: A vision must be believable to be relevant to members of the organization concerned. If the
members of the organization do not find the vision credible, it will not be meaningful or serve a useful
purpose. One of the purposes of a vision is to aspire those in the organization to achieve a level of
excellence, and to provide direction for their actions.
3. Attractive: A vision must be attractive so as to inspire and motivate organizational members. People
must want to be part of the future that is envisioned for the organization.
4. Future: A vision is not for the present; it is for the future. Simply, a vision is not where an organization is
now but where it will be in future.

Oren Harari, another expert on organizational vision, defines vision as follows:

“Vision should describe a set of ideals and priorities, a picture of the future, a sense of what makes the
company special and unique, a core set of principles that the company stands for, and a broad set of
compelling criteria that will help define organizational success.”

This definition adds two more dimensions-a core set of principles and criteria for measuring success-in
defining vision. An additional framework for examining vision has been put by Collins and Porras. They
conceptualise vision as having two major components: a guiding philosophy and a tangible image. Guiding
philosophy is a system of fundamental motivating assumption, principles, values, and tenets. Guiding
philosophy stems from the organisation’s core beliefs and values and purpose. Tangible image is composed
of a mission and a vivid description. According to Collins and Porras, “Mission is a clear and compelling
goal that serves to unify an organisation’s effort.” Vivid description is a picture of the end that completion of
the mission represents. As opposed to Nanus, Collins and Porras do not focus on a vision statement, but on a
vision as consisting of elements mentioned above. A persual of stand about vision taken by Collins and
Porras suggests that they have taken a wider view of vision by treating mission as a component of vision
while current trend in strategic management, both at academic as well as practice levels, makes distinction
between these two terms which we shall discuss later in this chapter.

Based on the above discussion, we may define vision as follows:

Vision is a mental perception of the kind of environment an organization aspires to create within a broad
time horizon and underlying conditions for the actualization of this perception.
Features of a Good Vision:

Features of a good vision are as follows:

1. A good vision is idealistic. Though this feature of vision is contrasting with the statement that vision
should be realistic, however, both features can be reconciled. Vision should be realistic so that people
believe that it is achievable, but idealistic enough so that it cannot be achieved without stretching.
2. A good vision clarifies direction for the organization concerned. It should provide answer to the
question, ‘where will the organization go in future’.
3. A good vision inspires organizational members and encourages commitment from them. This inspiration
and commitment is the key to achieving what the vision envisages.
4. A good vision reflects the uniqueness of the organization, its distinctive competence, what it stands for,
and what it is able to achieve.
5. A good vision is appropriate for the organization and for the times. It implies that the vision should be
consistent with organisation’s values and culture and its place in its environment.
6. A good vision is well articulated and easily understood by those who are responsible to convert it into
reality.

Developing a vision:

Developing a vision is like a having a dream to be covered into reality in future. Therefore, a question is:
who does formulate vision for an organization? There may not be a clear-cut answer of this question because
of differences in organizational practices. For example, in a family-manage organization, the head of the
family may set the vision though he may consult key members of the family. In other types of organizations,
vision is the outcome of agreement of various stakeholders both within the organization and outside it. For
example, in the case of public sector organization, government plays a key role in defining where the
organization should go in future. Irrespective of this difference, following steps are relevant for developing a
vision:

1. Conducting a Vision Audit: First step in developing a vision is to assess the current direction and
momentum of the organization. At this stage, key question that should be answered are: Does the
organization have a clearly-stated vision? What is the organization’s current direction? Do the key
organizational leaders know where the organization is headed and degree of the direction?
2. Targeting the Vision: This step involves starting to narrowing on a vision. At this step, key questions
are: What are the boundaries and constraints to the vision? What must the vision accomplish? What
critical issues must be addressed in the vision?
3. Setting the Vision Context: Since vision is the desirable future for the organization, there is a need for
identifying what the organisation’s future environment might look like. However, vision has a very long-
term orientation and, therefore, only broad directions of future environment should be identified rather
than going for elaborate forecasting of environment.
4. Developing the Future Scenarios: developing the future scenarios follows directly from setting the
vision context. Scenarios are the likely future behaviors of the environment. Since distant future
environment cannot be predicted accurately, alternative scenarios are developed for different
environmental behaviors. Based on these scenarios, an organization readies it to operate in the best
possible scenario. When the environment does not behave according to this, alternatives scenarios are
used.
5. Generating the Alternative Visions: At this stage, possible visions are developed for possible
environments. The purpose of this step is to generate vision reflecting different directions in which the
organization may go. At this stage, it is better that different directions use a relatively unconstrained
approach.
6. Choosing the Final Vision: Here, alternative visions are evaluated in the light of environmental
variables as well as organizational variables. That vision is selected which is most likely to meet the
demands of these variables.

Role of Vision in Strategic Formulation

The starting point of strategy formulation is establishing strategic intent containing vision, mission and
objectives. Vision occupies the top position in this hierarchy. Therefore, all strategic actions should focus on
the vision to convert it into reality. In general, vision helps in formulating strategies in the following
manner:

1. Vision provides clue about where the organisation is heading for in future. Since various strategies try to
ensure that the organization reaches its destination, these should be in accordance with the vision. In
fact, action without vision is just like passing time.
2. Vision of an organization tries to place it in a unique position which requires unique actions. These
actions are defined by various strategies.
3. Since vision is a source of inspiration to organizational members and encourages them for commitment,
they tend to give their full contributions in strategy formulation and implementation.

MISSION:

Mission is at the second level of hierarchy of strategic interest and broadly defines why an organization
exists. According to dictionary meaning, mission, defines in broad way. Refers to that aspect for which an
individual has been or seems to have been sent into this world. This is true for organization also. They exist
for certain cause and this case is reflected in their mission. For example, HUL has defined its mission as”
commitment to national priorities which ensures that the company is a part of people’s lives at the grass root
level, making a difference to India and Indians-in depth and in size.” Most of the organizational definitions
of mission put emphasis on this basis theme with addition of some more relevant aspects. For example,
Thompson has defined mission as follows:

“Mission is the essential purpose of the organization, concerning particularly why it is in existence, the
nature of the business it is in, and the customers it seeks to serve and satisfy.”

Since mission of an organization implies the image which it seeks to project, very often, mission sets apart
an organization from others. Thus, Pearce and Robinson have defined mission as follows:

“The company mission is defined as the fundamental unique purpose that sets a business apart from other
firms of its type and identifies the scope of its operations in product and market terms.”

Components of Mission:

Identifying various components of a mission, even in the case of business organizations. Is quite a difficult
task because of the differences in opinions about the exact scope of a mission statement and. Consequently,
the various elements which should be included in it. These differences exist at the conceptual as well as
practices levels. We shall see some mission statements of companies to find out such differences. A perusal
of mission statements of 21 companies both Indians and foreign. These components are as follows:

1. Organization’s self concept.

2. Organizational philosophy
3. Organizational image
4. Long-term objectives
5. Nature of business

1. Organization’s self- concept:

Before defining organization’s self- concept. Let us see its implications in the context of an individual. Self-
concept of an individual deals with his explanation of “who I am.” Defining of this self-concept gives him
meaning about his personality and through this. The type of behavior he should engage in. this self-concept
develops in him through interaction in the society and defines his identity. This identity differentiates him
from other individuals.

Like an individual an organization also has self-concept as it is a collectivity of individuals. Organization’s

self-concept is not developed in the way it is developed is an individual through interaction with others.
Theoretically speaking, organization’s self-concept must reflect the aggregations of self-concept of all
individuals who create and sustain it. However, in practice, it is developed by the key decision makers, may
be promoters (mostly) and other key decision makers. Thus, in essence, it reflects the self-concept of these
decision makers. In defining the self-concept of an organization, the pertinent questioners are:

1. What is organization’s role in industry? Does it play the role of leadership along some dimensions or
will it be a follower?
2. Does it act as a catalyst or follow industry conventions?

Both these questions taken together decide the strategic position of the organization in industry or in
the economic system of a country. For example, self-concept of Reliance Industries Limited says “growth in
the way of life at Reliance.” Kelley has summarized the role of self-concept as follows:

1. Organization’s self-concept is based on management perceptions of the way others will respond to the
organization.
2. Self-concept will function to direct the behavior of people employed by the organizations.
3. The actual response to the organizations will in part determine its self concept.
4. Self concept is incorporated in the organizational statement to the explicitly communicated in
individuals inside and outside the organization that is to be actualized.

2. Organizational philosophy:

Like an individual, an organization has its philosophy. The philosophy of an individual has its origin in two
premises: fact premises and value premises. Fact premises represent his descriptive view of how the world
behaves. These are drawn on the basis of researchers and experiences. Value premises represent his view of
the desirability of certain goals and activities. Value premises are drawn from various value forming
institutions of the society-family, peer groups, educational institutions, religious groups, etc. In the same
way an organization develops its philosophy, also called as creed or etho, and consists of a set of
assumptions, beliefs, values, aspirations and other philosophical priorities. This decision making process,
particularly in dealing with various stakeholders of the organization.

3. Organizational image:

Image of the organization is external manifestation on the basis of which society and its people create a
positive or negative view about the organization. Based on this image, people deal with the organization.
Therefore, the companies try to project a favorable image through its various activities which might be
closely related to its business operations and also the activities related specifically to building favorable
image like public relations activities. A fundamental feature of organizational image as a component of
mission is that many companies include this to provide guidelines for decision making by their managers.
For example, Wipro ltd has incorporated in its mission statement that “it will adhere to the highest level of
business integrity and ethics in its dealings.” Wipro does not compromise on this. If any deal requires
compromise on integrity, the economy does not do it. Every year, the company issues 30-40 notices to those
employees who are suspect of being short on integrity front and if any unethical behavior is proved, the
employees concerned are sacked regardless of their positions.

4. Long-term objective:

Many companies include long-term objectives in their mission statement. Such objectives are in qualitative
form which can be perused regardless of time. Such objectives are survival, growth and profitability. Many
companies do not specify these in their mission statement and, instead, they prefer to term these in the form
of enhancing shareholder value. For example, Reliance Industries Ltd states that “we are committed to
enhance our shareholder value.” However, this statement has direct relevance to long-term objectives of
survival, growth and profitability and shareholder value should be seen as intertwined phenomenon. If
anyone is taken away, others become less effective.

5. Nature of Business:

Perhaps, this is the most contentious issue in the components of organizational mission because many
companies do not like to include it in their mission and leave it to be included in their business definition or
business mission. Such companies are either multi-product ones in whose case, all businesses cannot be
defined in mission statement; or even single-product companies which wish to keep their option open to
include new businesses in future. Such companies only indicator the approach to be adopted in undertaking
business.

Whenever companies include nature of business in their mission statement, they do it are there contexts:
product/service, market segment and technology. All these three components are put together because only
in combination, they provide meaningful definition of business.

Formulation of Mission

Every organisation develops some kind of mission, either explicitly or implicitly; either written or unwritten.
However, for a large organisation where face -to –face interaction is not possible among organisation
members or outsiders related to it, it is better to have mission explicitly expressed and in written from. In
formulating such a mission, two factors are important which must be taken into consideration: contents of
mission and mission statement.
Contents of Mission. The first basic factor in mission formulation is determination of its content. Though
this issue will be discussed later owing to divergent opinions about these contents, here, it suffices to say
that mission should include the beliefs, assumption, and desires of the following types.
1. Entrepreneur self-concept of the business can be communicated and adopted by employees and
stakeholder.
2. The organisation will be to satisfy the entrepreneur’s needs and aspiration which he seeks to satisfy
through the organisation.
3. The organisation will create favourable public image which will result in contributions from
environment.
4. The organisation can grow and be profitable than just survive in the long run with the support of various
constituents.
5. The product or service offered by the organisation can provide benefits at least equal to its price.
6. The product or service can satisfy the need of the customers not adequately served by others presently.
7. Technology used in producing product or service will be cost and quality competitive.

At the initial stage of an organisation, the above assumptions from, the part of mission in a definite way. As
the organisation grows or is forced by environmental factors to change some part of its mission, there may
be need for redefinition of these part. However the revised mission will reflect the same core factor like
growth perspective, image of the organisation, and need and aspirations of entrepreneur.

Mission Statement. Mission statement is the description of organisational mission. Explicit mission
statement is desirable as it serves the purpose of communicating to the organisation’s members about the
corporate philosophy, character, and image of the organisation which govern their behaviour in the
organisation. Further, section of the society dealing with the organisation knows well in advance as how to
interact with the organisation. Therefore, while farming the mission statement, following points should be
taken into consideration so that it serves the purpose for which it is prepared:

1. Mission should be clear, both in terms of intentions and words used.

2. It should be feasible, neither too high to be unachievable, nor too low to demotivate the people for work.
3. It should be precise but explanatory, neither too narrow so as to restrict the organisation’s activities, nor
too broad to make itself meaningless.
4. It should be distinctive, both in terms of the organisations’s contribution to the society and how these
contributions can be made.

Role of Mission in Strategic Management

Organizational mission, when clearly defined, helps strategists in formulating their strategies in the
following ways:

1. It helps in deciding the direction in which the organization proceeds. Therefore, strategic actions can
easily be geared in that direction.
2. It helps the organization to clarify its aspirations and those of various stakeholders. The strategic actions
can be aligned to these aspirations.
3. It serves as a reference point in dealing with various stakeholders within and outside the organization.
4. It helps in integrating the organization with its relevant environment by taking suitable actions the way
these have been specified in the mission.
5. It helps in integrating the various subsystems of the organization as these subsystems look at their
objectives and operations in the light of organizational mission.
6. It coveys clear message about the organization to those outsiders who come in contact with it. They
develop positive attitudes towards organization if they are well aware about its mission.
Goals and Objectives

Goal and objectives are the end results which an organisation strives for. Since there may be different ways
in expressing end results like market leadership (a qualitative measurement), or a certain percentage of
increase in a particular year (a qualitative measurement), the question is: for which result the term objective
should be used and for which result the term goal should be used. This problem arises because two terms are
used in a variety of ways; many of them are conflicting.

First, these terms are used interchangeably meaning one and the same thing. Therefore, there is no
difference between the two. To make distinction between long-term and short-term orientation, these
prefixes are used either with objectives or goals. Second, some authors use goals as the long-term result
which an organisation seeks to achieve and objectives as the short-term results. Third, some writers reverse
the usage referring to objectives as the desired long-term result and goals as the desired short-term results.

Factors Affecting Objective Setting

These factors are forces in the environment, realities of an organisation’s resources and internal power
relationships, value system of top executives and awareness by management of the past objectives of the
organisation. A description how these factors affect objective setting is presented here.
1. Forces in environment:- Here, forces in environment refer to various stakeholders of the organisation.
They may be shareholders, other financiers, employees, customers, suppliers, government, and society.
Each of the stakeholders has certain expectations from the organisation and many times, these
expectations may be conflicting. Therefore, organisational objectives emerge out of integration of these
expectations. Organisational objectives will tilt in the favour of those stakeholders who have higher
bargaining strength.
2. Organisation’s Resources and Internal Power Relationships:- This factor implies that objectives
depend on organisation’s resources and internal power relationships. Organisation’s resources include
both human and non-human resources-financial and physical-that the organisation has or it can mobilise
during the period for which objectives are being set. After all, objectives can be pursued only through
resources. Internal power relationships refer to power of different strategists or group of strategists, for
example, key strategic and board of directors. These strategists try to impose their views on key strategic
issues including objective setting. Further, if the organisation has multiple objectives which is a common
feature, these strategies affect the type of emphasis that each objective will receive.
3. Value System of Top Executives:- This Factor affects philosophy that an organisation adopts with
regard to strategic management in general and objective in particular. Values are in the form of
convictions about what is good or bad, desirable or un desirable. This applies to objective too. For
example, if top executives are money-oriented, they will emphasise financial objectives as against those
top executives who have philanthropic values and emphasise social objectives.
4. Awareness by Management:- Awareness by Management of the past objectives of the organisation and
achievement of these plays crucial role in setting objectives and priority to different objectives. In fact,
organisations operate on the principle of community. In this progress, they set their objectives based on
past with incremental change rather radical change. Radical change is likely to take pace when there is
radical change in top management for any reason like takeover.
Perusal of various factor affecting objectives setting suggests that objectives setting is a complex process
and objective emerge out of consensus building. For this consensus building, vision and mission, taken
together, provide clues as objectives are means for realising vision and mission which stand higher in
hierarchy of strategic intent.
Issues in objective setting
There are basic issues in objective setting. These are as follows:
1. Specificity:- objectives may be stated at many different levels of specificity ranging from generalised
overall organisational objectives to specific individual objectives. Many organisations set overall
objectives followed by functional and operational objectives as objectives can be arranged in a
hierarchy. Here, we are concerned with overall objectives. Level of specificity in objectives should be
such that organisational members are clear about what the organisation intends to achieve and sets
standards of performance measurement. For example, at the beginning of 21st century, Tata group has set
growth objective in terms of doubling group turnover in four years and net profit in three years. The
degree of specificity in this statement of objectives is quite sufficient for organisational members as well
as for performance measurement. In a situation where objectives cannot be quantified, this should be
expressed in such a way that qualitative aspect can be interpreted easily. For example, if an organisation
states its objectives in teams of new product development, the organisation must provide measurement
criterion for ascertaining whether it is achieving its objectives or not.
2. Multiplicity:- there are multiple objectives which an organisation may strive to achieve simultaneously.
Multiplicity of objectives is required because an organisation has to cover all aspect of its functioning.
The issue of multiplicity of objective deals with respect to organisational levels, and nature. Another
issue in multiplicity of objectives is number of objectives. Too few objectives are as bad as too many
objectives. Ideally speaking, number of objectives should match the key result areas. Thus, in very large
organisation, there would be more number of objectives as compared to a small organisation. Very
shortly, we shall see the areas in which objectives are set.
3. Periodicity:- objectives may be set for different time periods-long term, intermediate term, and short
term-though most of the organisations set objectives for long term and short term. Long-term objectives,
by nature, are less certain and, therefore, stated in a general way, for example, growth objectives for long
term. Short-term objectives are relatively more certain and are set in specific way, for example, growth
for short term may be expressed as increasing revenues by 25 per cent next year. Where objectives are
set for both long-term and short-term periods, the letter are derived from the former so that there
integration between two sets of objectives.
4. Reality:- A basic feature of objectives is that they should be based on reality of those factors which
affect objective setting. However, a common phenomenon with may organisations is that they tend to
have two types of objectives based on this reality factor-official objectives and operational objectives.
Official objectives are those which organisations wish to attain and operational objectives are relevant
for image building rather putting them in actual practice.
5. Quality:- objectives may be set both in good and bad forms. Good quality objectives are those which
provide specific direction and tangible basis for performance evaluation. Objectives which fail to do so
may be treated as bad. Examples given below narrate good and bad objectives.

Formulation of Goals and Objectives

Virtually, all organisations have a formal, explicitly recognized, legally specified organ for setting the initial
objectives or their amendments. Generally, the top management determines the overall objectives which
members of the organisation unit to achieve. In some organisations, the objectives may be set by the vote of
the shareholders; in others, by vote of the members by a small number of trustees or by few individuals who
own and run the organisation. In large corporate entities, such bodies as board of directors, governing board
or executive committee may set the objectives. These bodies may formulate or change the objectives
according to the needs.
In Practice, the objectives are set in a complicated power play involving various individuals and groups
within and without the organisation, and by reference to the values which governs behaviours in general and
the specific behaviour of the relevant individuals and groups in a particular society. There are many factors
which enter the struggle to determine the organisational objectives.

Role of Objective

Every organisation has some objective, either specified or unspecified. Clearly-specified objective govern
behavior of organisational members and, as such, every organisation should specify its objectives clearly.
The role and function of objectives may be defined as follows:

Directions for Decision Making:- Objectives provide the directions for decision making in various areas of
the organisation’s operation. The objectives set the limits and prescribe the areas in which the managers can
make decision. Since there is no ambiguity about the ends to be achieved, managers are quite clear about the
expectation which the organisation has form their functions. From this point of view, clearly-specified
objectives serve a number of purposes:

1. Clear definition of objectives encourages unified planning. Objectives embody the basic idea and
fundamental theories as to what the organisation is trying to achieve. This is necessary to give the
meaning and direction to the work of the people associated with the organisation. Such objectives are the
focus for different individuals, and unifying effect arises when various plans prepared by several people
are adjusted to a common objective.
2. Objectives work as a motivating force by providing direction to organisational members.
Individuals have framework to fit their personal needs with organisational objectives. A sense of
accomplishment of meting objectives itself is a source of motivation for the people in the organisation.
3. Voluntary coordination, an essential feature of the organisational objectives, is achieved easily if the
objectives are clearly specified and mutually agreed upon. People tend to work within their own areas of
discretion and adjust according to the needs of others if they know their own and other’s objectives.
Performance Standards:- Objectives provide standard against which performance of the organisation, its
units, sub-units, and individuals can be measured. Without performance standards which are derived from
the objectives, there cannot be any meaningful control activities in organisation. Such control measures not
only ensure the achievement of organisational objectives by taking corrective action. If needed , but also put
a psychological pressure on those who are responsible for achieving the organisational objectives.
Basis for Decentralisation:- Decentralisation includes assigning decision-making authority to lower level
people, thereby a subordinate is given considerable leeway in deciding to perform his work. Decentralisation
is necessary for large-size organisation. However, independent decision-making authority to subordinates
may lend to disintegration of the organisation unless there is a clear indicate the contribution to be made by
each unit for tying them effectively and allowing the manager concerned to exercise their individual skills
and initiative.
Integrating organisation, Group, and individual:- Clearly specified objectives may provide integration of
organisation and its various groups and individuals. An organisation cannot exist apart from its individuals
and various groups associated with such as creditors, customers, etc. If the objectives are clear, these will
communication the relationship between the organisation and various group and individuals. Therefore, the
group and individuals can better be integrated because they have clear basis for dealing with the
organisation.
Strategic management process:-

Model of strategic management process for a single business firm

Like any other management, strategic management is a process. The logic of a process is that its particular elements are
undertaken in a sequence through time. The strategic management process involves determination of strategy or set of strategies
and deals with putting a strategy into operation. It consists of four phases

1. Establishing strategic intent

2. Strategy Formulation Feedback

3. Strategy Implementation

4. Strategic Control
1. Establishing strategic intent:-
Since organisations are deliberate creations that have some specific intent that is, what they will achieve in future and why they
will achieve it. In strategic management it is known as strategic intent and consist of three major elements- vision, mission and
objectives arranged in a hierarchy in that order. Vision represents what an organisation would be in a future. Mission of an
organisation is the fundamental unique purpose that sets it apart from other organisation and identifies the scope of its operation in
product and market terms. It also prescribes how the organisation will deal with its various stakeholders. Objectives are the end
results which an organisation strives to achieve in future.

2. Environmental analysis:-
The second important aspect of the model of strategic management process is the environmental analysis. Since an organisation is
a social system, it operates within the environment which consists of many factors such as society, competitors, technology, legal
framework, political framework and logical framework. An organisation has to interact continuously with these factors. Various
factors of the environment have dual effect in interaction process with the organisation: they affect the working of the organisation
and are also affected by its working. However, the effect of environment is more on the organisation rather than otherwise. The
interaction process provides opportunities or threats to an organisation depending on the situation.

3. Organisational Analysis:-
What opportunities or threats are posed by the environment and how the organisation can take advantages will depend greatly on
the organisation’s strengths and weakness. Organisational analysis brings this strengths and weaknesses. Through organisational
analysis, the organisation evaluates its strengths and weaknesses so that it can relate itself by emphasizing its strengths and
overcoming its weaknesses. Organisational strengths and weaknesses also help in identifying the relevant environmental factors
taken for detailed analysis. Thus, strategic opportunities and threats are determined on the basis of both environment analysis as
well as organisational analysis.
4. Identification of strategic alternatives:-
Interaction of organisation with its environment in the lights of its strengths and weaknesses will result in various strategic
alternatives. This process may result in large number of alternatives through which an organisation can relate itself to the
environment. However, all alternatives cannot be chosen even if all to them produce the same results. Obviously, managers may
like to limit themselves to the serious consideration of some of the strategic alternatives so that they are saved from unnecessary
exercise .Therefore, the strategic alternatives should be identified in the light of the strategic opportunities and threats generated
through environmental analysis, organisational analysis ,and organisational strategic intent .

5. Choice of strategy:-
The identification of various strategic alternatives leads to the level where managers can consider some alternatives seriously and
may choose one of the most acceptable. This is the stage of strategic decision process and all factors relevant for decision making
are relevant here. Since the particular strategy attempts to affect the organisational operation in some predetermined manner. The
choice process systematically considers how each alternative strategy affects the various critical factors of the organisational
functioning. Further, the chosen alternative should be acceptable in the light of organisational objectives. Thus, it is not necessary
that the chosen alternative is the best one. In the choice process, apart from the various organisational and environmental factors,
personal factors play considerable role because strategy reflects the personal values and aspirations of a strategist.

6. Implementation of Strategy:-
Once the creative and analytical aspect of strategy formulation has been settled, the organisation tries to convert the strategy into
something operationally effective. To bring the result, the strategy should be put to action because mere choice of even the
soundest strategy will not affect organisational activities and achievements of its objectives. In strategy implementation, various
activities involved are design of organisation structure to strategic management process suit the chosen strategy, effective
leadership, development of functional policies, development and allocation of resources, development of effective information
system, etc.

7. Strategic control:-
Strategic control may be treated as the last stage of strategic management process. However, this is an ongoing process and
strategic control should be taken as the process for future course of action. For effective implementation and consequently
achievement of organisational objectives, it is necessary that there is continuous monitoring of the implementation of the strategy
so that suitable action is taken whenever something goes wrong.

Control of strategy and its implementation may result in various actions that the organisation will have to take to be successful,
depending on the situation. Such actions may required in the area of correcting implementation of strategy, choice of strategy, or
change in organisational objectives and consequentially leading to change in the identification of strategy. Therefore, strategic
management process should never be taken as static but as dynamic so that new action is taken whenever there is any change in
any of the factors affecting strategy.

Implications of Strategic Management as a Process

1. All the elements of the process can be thought of in sequential nature. It implies that each step must be undertaken in a
sequence for a new strategic action. In the case of an existing organisation and existing strategic action, these elements may not be
put in a very strict sequence because the action may be repetitive. For eg. Formulation of strategy, its implementation and control
may go in continuity. Thus this becomes a continuous process.

2. The various elements of the process are interrelated. The interrelatedness suggests effect of each factor on others. Thus there
may be a two way impact of a factor; each affecting others and in turn, being affected by others. However, the relative force of
this impact may differ for various elements. It may be major in some cases but minor in other cases depending on the nature of
various external and internal forces. Further for many such relationships may not be direct but may be indirect.

3. Feedback is necessary to relate the implementation of the strategy with the early stage elements of the process. Feedback can be
defined as the post implementation results of a strategy which are collected as inputs for the enhancement of future decision
making through strategic management process. Thus feedback is as essential as any other element.

4. Strategic management can be termed as a dynamic system. The term dynamic is used to describe the constantly changing nature
of conditions which affect inter relatedness and interdependent strategic activities. Since the organisation has to function in an
environment which is dynamic and constantly changing, the various elements and activities of strategic management have to be
adjusted accordingly.