Question

Discuss the process of strategy formulation. How can TQ improve this process?

Answer 1

Firstly, Strategy formulation is the process of analytical selection of the best suitable course of action in order to achieve the organizational vision and objectives.

The process of strategy formulation involves of six major steps:-

1.Organizational objectives- This step involves setting up the long-term goals of an organization. Once these objectives are determined the strategic decisions can be taken.

2.Organizational environment- This steps includes the usage of SWOT analysis, this involves the identification of companies strenghts and weaknesses while keeping an eye on the competitior`s actions to understand the coming opportunities and threats.

3.Quantitative goals- This step involves setting up of company`s short-term and long-term targets to reach its objectives.

4.Divisional plans- Under this step seperate targets are set up for each department of the company so that all the departments work to achieve the company`s objectives as a whole.

5.Performance analysis- This step includes the estimation of actual work done in the organization and comparing it with the standards set. This is done to keep a close eye on whether the organization is performing up to the mark or not.

6.Selection of strategy- This is the final and most important step of strategy formulation.It involves evaluation of all the available alternatives and choosing the best amongst them in order to be the working strategy of organization. This step sets the standards and plans upon which the company will survive in the dynamic business environment.

TQ stands for total quality or total quality management, it is an approach which an organization takes in order to improve quality of output and meeting customer requirements by controlling processes. It provides organization with the tools to gain a competitive advantage in the marketplace. TQ improves the process of strategy formulation by providing the organization a regular feedback from the customer side which helps the organization in meeting up costomer`s ever changing needs and make changes in the strategies and working of the organization accordingly. Organisations which use this tool from time to time are always able to have a competitive advantage over the other companies in the market.