Importance of Strategic Management

  a. Why has strategic management been critical in today’s business world?
Goodstein, Nolan, and Pfeiffer, 1992, describe strategic management as the process by which the guiding members of an organization envision its future and develop the necessary procedures and operations to achieve that future. It is through this process that the company goals and objectives are set. In this increasingly competitive business environment, it has become difficult if not impossible for any business to thrive without a properly laid out strategic management framework. Strategic management provides a framework and structure for businesses to follow and adhere to given the expected and/or unexpected changes that are likely to occur in the business environment.   It is common knowledge for the ordinary person that failure to plan is planning to fail; the same goes for businesses which fail to strategise as they face the inevitable fate of collapsing when push comes to shove. Also referred to as forward thinking, strategic management is the pathway to the success of every business organisation.   It is the intention of the writer in this essay to lay out the importance of strategic management in today’s business world, paying particular attention to the factors that make it relevant to any business regardless of its nature.

With the advent of globalisation, running businesses has become a complex task. This places a demand on every business owner/manager to be well acquainted with what’s happening on the global economy.   The world has become one global family where economic upheavals in one country can negatively/positively affect the situation in the other country. As such it is the role of strategic management to anticipate such movements within the global economy and be able not only to evade disaster but also to capitalise on them. Globalisation brings with it intercultural interaction which may prove to be hostile to the...