Forming a strategy is a process and involves choosing an appropriate course of action to realize organizational goals and objectives which in the long run will aid the realization of the set vision (Vuori & Huy, 2017). Ideally, the process involves six steps which are rational and ought not to be followed in chronological order.
Formulation of objectives: This is the main component of the strategy statement and focuses on the state of affair whereas the strategy focuses on the process of reaching or achieving the objective. A strategy includes fixation of the objective and the medium applied in the realization of the objective (Grant, 2016). In this case, therefore, a strategy is a wider term which benefits n bow the resources are managed to achieve an objective.
Assess the organization environment: At this step, the general economic and industrial surrounding is evaluated. This involves both quantitative and qualitative assessment of the existing products (Satyro et al., 2017). This is done to enable the management to identify the strengths and weaknesses and understand their competitors better.
Create quantitative targets: At this step, there is a need for the organization to fix their quantitative target values to be in line with the objectives. This is done with the long-term consumers in mind to understand the contribution that might be brought by every department.
Aiming with department plans: Contributions from every department in the organization are then identified and a strategic plan formulated as per the department needs. This, however, requires a close analysis of macroeconomic trends.
Undertake a performance review: This includes discovering and analyzing the gap in the plan versus the desired performance. Critical evaluation of organization previous performance, critical conditions and the desired future state needs to be conducted (Bamberger, Biron & Meshoulam, 2014). During the critical evaluation, the degree of gap between the actual reality and the long-term aspirations of the organization are identified and attempts made to forecast future conditions in case the current trend persists.
Choose a strategy: This is the final step of the process. This is decided after a consideration of the organizational goals, strengths, potential, and limitations.
Bamberger, P. A., Biron, M., & Meshoulam, I. (2014). Human resource strategy: Formulation, implementation, and impact. Routledge.
Grant, R. M. (2016). Contemporary Strategy Analysis Text Only. John Wiley & Sons.
Satyro, W. C., Sacomano, J. B., Contador, J. C., Almeida, C. M., & Giannetti, B. F. (2017). Process of strategy formulation for sustainable environmental development: Basic model. Journal of Cleaner Production.
Vuori, T. O., & Huy, Q. N. (2017, January). Board Influence on Top Managers' Strategy Formulation Process: Cognitive and Emotional Dynamics. In Academy of Management Proceedings (Vol. 2017, No. 1, p. 11479). Academy of Management.
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