Question

the process of crafting a strategy in a new company

Answer 1

The managerial process of crafting and executing strategy has five phases which includes

1.Developing a strategic vision.

2. Setting objectives

3.Crafting a strategy to achieve the objectives and vision

4. Implementing and executing the strategy

5. Monitoring developments, evaluating performance and making corrective adjustments.

Developing a strategic vision describes a strategic vision as the route a company intends to take in developing and strengthening its business. In this step, a strategic vision of where the company needs to head and what its future is in regard to its products, customers, market and technology focus is sort and detailed. This managerial step provides long-term direction, infuses the organization with a sense of purposeful action, and communicates to stakeholders.Appeals to the long-term interest of employees, customers, stockholders, and others who have a stake in the enterprise (directional); Feasible: Comprises realistic, attainable goals; Focused: Is clear enough to provide guidance in decision making; Flexible: Is general enough to allow individual initiative and alternative responses in light of changing conditions; and Communicable: Is easy to communicate; can be successfully explained within five minutes process, an integral part of the ongoing task of visionary leadership. A clear strategic vision crystallizes an organization’s long-term direction; reduces risk of rudderless decisionmaking; creates a committed enterprise where organizational members enthusiastically pursue efforts to make the vision a reality; provides a beacon to keep strategy-related actions of all managers on common path; and helps an organization prepare for the future.

Setting objectives :-Objectives are quantifiable aims in line with a mission. Objectives as the end results of planned activities. They should be stated as action verbs and tell what is to be accomplished by when and quantified.Objectives are different from goals as a “goal” is an operation ended statement of what one wants to accomplish with no quantification of what is to be achieved and no time criteria for completion. Two types of objectives required which includes the financial and the strategic objectives. Financial objectives focus on improving financial performance while strategic objectives focus on improving competitive vitality and future business position. The main reasons why objectives should be set as: conversion of the vision into specific performance targets, and creating yardsticks to track performance. This is because the vision is too big to use as target as it could take long before accomplishment. The objectives will be used to track performance and see if the company is still on the right track. These are mostly set by the business and operational strategies in line with the vision. The well-stated objectives as being: quantifiable, measurable and contains a deadline for achievement. They spell-out how much of what kind of performance by when. Objectives should be set at levels that stretch an organization to perform at its full potential, deliver the best possible results, push firm to be more inventive, exhibit more urgency to improve its business position and be intentional and focused in its actions. Objectives must be derived from “what our business is, what it will be, and what it should be.” They are the action commitments through which the mission of a business is to be carried out, and the standards against which performance is to be measured. 2) Objectives must be operational. They must be capable of being converted into specific targets and specific assignments. They must be capable of becoming the basis, as well as the motivation: for work and achievement. 3) Objectives must make possible concentration of resources and efforts. They must winnow out the fundamentals among the goals of a business so that the key resources of men, money, and physical facilities can be concentrated. They must, therefore, be selective rather than encompass everything. 4) There must be multiple objectives rather than a single objective. To manage a business is to balance a variety of needs and goals that requires multiple objectives. 5) Objectives are needed in all areas on which the survival of the business depends.

Crafting an strategy:-Crafting strategy is concerned principally with forming responses to changes under way in the external environment, devising competitive moves and market approaches aimed at producing sustainable competitive advantage, building competitively valuable competencies and capabilities, and uniting the strategic actions initiated in various parts of the company. Successful strategy making depends on the business vision, perceptive analysis of the situation, attracting and pleasing customers, and outcompeting rivals. An effectively formulated strategy integrates, marshals, and allocates the firm’s internal resources and makes appropriate use of external environmental information. The idea is to formulate a mission-consistent strategy that will lead to sustained superior performance. Poor strategy formulation can result in costly business failures.

- Implementing and executing the chosen strategy:-Executing the strategy is primarily an operations-driven activity which is tougher and more time consuming than crafting the same. This is because of the variety of managerial activities to be performed and most importantly battling resistance to change that might occur. Good strategy execution requires putting desired competencies and capabilities in place, upgrading them as needed, and modifying them as market conditions evolve.

Evaluating performance and initiating corrective adjustments:-After the strategy is implemented, evaluation of performance and initiating corrective adjustments in vision, long-term direction, objectives, strategy, or execution in light of actual experience, changing conditions, new ideas, and new opportunities is necessary. This phase of the strategy management process is the trigger point for deciding whether to continue or change the company's vision, objectives, strategy, and/or strategy execution methods