1. I.H.M Dehradun
Theory
TOPIC - STRATEGIC MANAGEMENT
Notes by -:
G.K Sawhney
7895190950
Process of strategic planning
A formal system of strategic planning and management normally consist of the following
steps-:
1. Developing a strategic vision of where the organization is headed & defining the
business mission or purpose.
2.Analysis and diagnosis of the current & likely future environment identifying
opportunities & threat.
3.Appraisal of internal capabilities & potential strategy for strength & weakness of the
organisation.
4. Setting corporate objectives in broad term subject to the realities of external
environment & power relations, internal resources & the values & preferences of
executives.
5.Formulation of alternative strategies, evaluation & choice of option of appropriate
strategic.
6.Implementation of the chosen strategy establishing structural & administrative system
& planning.
7.Review of the strategy, monitoring the result.
STRATEGIC INTENTS
Developing strategic vision
Defining organizational mission
Setting Corporate objective
Analysis of internal & external environment

2. Formulation & evaluation of strategic option & choice of strategy
Implementation of strategy
Monitoring & return of strategy
Internal Environment External environment
* Human resource * Economical environment
* Capital * Social & cultural environment
* Land * Religion, income
* Equipment * Political
* Structure * Legal
* Mission * Technological
* Culture * Natural
* Financial aspects * International
* Marketing environment * Competitive
* Production * Demographic factor
(eg- age,sex,population)
MISSION
A company’s mission is along term view of what the organisation is striving to become in
future. The basic thrust of firm including its products business& markets. The mission
may be described as the scope of operation in term of product& market or of services &
client. An organisation mission statement tell what it is, why it exists & the unique
contribution it can make.
The mission of a business is the fundamental unique purpose that sets it
apart from other organisation of its type. It indicate the nature & scope of business
operation in term of product market & technology.
Features of a good mission statement-:
The mission statement answer the question:
*What is our business?

3. *It defines the business that the company wants to be in & serve as its guiding principle.
*It differentiates the company from its competitors.
* It is exciting & inspiring ,it adds zeal to the firm & its people.
*It is not time bound & cannot be easily achieved with a fix time frame.
* It represent the whole thrust of the organisation & its core values & belief.
Essential of mission statements-:
A mission statement should support these positions & should have essentials mentioned
below-:
1. Clarity-The mission statement should be clear to lead to action. The corporate
dreams must be presented in crystal clear manner preferably in positive tone.
2. Broad & enduring- The mission is a grand design of the firm’s future. It is a
general statement of the firm’s intend a kind of self image , the firm intends to
project for years to come.
3. Identity & image- The mission sets a firm apart from other of its style through
this statement the firm wants to maintain its distinct image & character in term of
quality ,services, latest technology & unique product offering, etc.
4. Realistic- Mission should be realistic & achievable ofcourse by running that extra
miles.
5. Specific- Mission should be specific, they must define the competitive scope
which the company will operate.
6. Values, belief & philosophy-The mission lays emphasis on the value the firm
stand for what it intends to do so that it stands out in a crowd what is unique about
its offering etc.
7. Vision- The mission is an expression of the vision of corporation. Its leader or
founder . A vision statement usually describe what the company wishes to
become in future.
8. Dynamic –The concept of mission is dynamic & not a static one. It must strike a
happy balance between the narrow & broad way of doing in the years ahead
between the present requirement & future expectations.
Elements of mission statement
A good mission statement reveals an organisation , customer, product, or services.
Market technology ,concern for survival, philosophy, self concept, concerned for public
image & concerned for employee. These nine basic components serve as practical
framework for evaluating & writing mission statements.
*CUSTOMER – Who are the firm’s customer product & service, market, technology ,
concerned for survival , growth & profitability, philosophy, self concept , concerned for
public image, concerned for employees.
OBJECTIVE
An objective indicates the result that the organisation expect to achieve in the long run. It
is an end result, the end point, sometime that you aim for & try to reach. It is a desired
result towards which behaviour is directed in an organisation objectives are the product
of specific concrete thinking. They commit person & organisation to achieve target &

4. goals . organizational objectives are defined as end which the organisation seek to
achieve by existence & operation . The objectives may be classified into two cateories-:
1) External institutional objectives
2) Internal institutional objectives
• External institutional objectives are those which define the impact of the
organisation on its environment.
• Internal institutional objectives on the other hand are those which define how
much is expected to be achieved with the resources that organisation commands.
Characteristics of objectives
Objectives have the following features-:
1) Objective from a hierarchy-In many organisation objectives are structured n a
hierarchy of important. There are objective within objectives. They are require
definition & chose analysis if they are to be useful separately & profitable as a
whole.
2) Objective from a network- Objective interlock an a network fashion. They are
inter-related & inter –dependent. The concept of network of objective implies that
once objective are established for every department & every individual in an
organisation. These subsidiary objectives should contribute to meet the basic
objectives of the total organisation.
3) Multiplicity of objective- Organisational pursue multi-farious objective at every
level in the hierarchy , goals & likely to be multiple in order to meet the demand
from various internal & external groups, organizations generally pursue multiple
objectives.
4) Long term & short range objectives-Oganisational objectives are usually
related to time, long range objective . extending over five or more years are the
ultimate or required objectives for the organisation short range objective ( one
year goal) & medium range objectives, two to four years period goals, reflect
immediate attainable goals, the short range & medium range objectives are the
means for achieving long term goals & the long terms goals supply a frame work
within which the lower level goals are designed.
Role of formal objectives
Objectives serve the following functions-:
1) Legitenancy- Objectives describe the purpose of the organisation so that people
know what is stands for and all will accept its existence & objective help to
validate the presence of organistion in its environment.
2) Direction- Objective provide guidelines for orgnisational efforts. They keep
attention focused on common purpose. Once objective are formulated , they
become the polar star by which the journey is navigated . Every activity is
directed towards the objective , every individual contribute to meet the goals.
3) Coordination- Objectives keep activities on the right track. They make behaviour
in organisation more national, more coordinated & more effective because

5. everyone knows the accepted rolls to work toward. In setting effective goals,
manager help members at all levels of the organisation to understand how they
can best achieve their own goals by directing their behaviour towards the goals o
organisation.
4) Benchmark for success-objectives serve as performance study against which
actual performance may be checked. They provide a benchmark for assessment ,
they help in the control of human effort in an organisation.
5) Motivation- Goals are motivators. The setting if goal i.e both specific &
challenging lead to an increase in performance because it makes clear for the
individual what he is suppose to do. He can compare with past & present & also
with others.
Organisational objective
Organisational objective are not flexible to behaviour organizations seek stability, goals
change overtime & they change continuously . Goals change means that goals priorities
are periodically revaluated keeping the ongoing changes in the external environment. The
reason why goals change are not far to see. Basically an oganisation is non-static & a set
of objectives can not be static if it is to succeed. Managers may feel that there is scope for
further expansion & instead of concentrating only on audio set(in the case of an
electronic firm). The production of video set may also be undertaken. At times demand
from alide group that make up the enterprise may change & the organisation may be
forced to change its goals. New government or labour ,leaders . for eg- may force a
change in the way a business set its goals priorities.The mission can also change in a
crisis. Normally goals changes are expressed in two forms-:
1) Goal displacement
2) Goal succession
• GOAL DISPLACEMENT – It generally takes place when goals are expressed in
a different manner. The official goals are ignored & changes take places. When
old goals have been achieved or discarded.
• GOAL SUCCESSION- It take place allowing old goals to outlive their utility
will be disastrous for organisation. When the organisation is confronted with
sales, outthroat competition, shortage of funds. The only way to survive is to find
out the new goal which can inject a fresh breeze of life.
MODE OF STRATEGY
Strategy making is a complex process. It involves linking together number of important
decision to form strategies to describe the strategy making process in term of modes is
difficult. There are combination of modes provide a more realistic description of the
process. To understand the combination or mixed mode of strategy making. It is
necessary to go through the characteristics of various modes.
1) Adaptive mode- Adaptive strategy making process is basically remedial in nature. In
this mode the executives concerned with solving problems of immediate importance
rather than developing long range strategies. This may imply bargaining with suppliers,

6. compromising with competitors or reducing conflicts among interest groups with the
organizations. The adaptive mode is characterised by the following features-:
a) The process has a reactive approach aimed at solving crucial problems emerging in a
complex environment.
b) This mode focus on minimum acceptability of satisfying objective.
c) Decisions are made in adaptive mode in sequential steps one thing at a time strategy
making in the adaptive mode is typically a never ending process.
d) Basin idea in this mode is to maintain flexibility & freedom to adapt the decision in
the more pressing need.
2) Intuition mode-The basic approach of this mode is that the strategy evolves in the
mind of the cheap executive workout ever being used & workout the aid of formal
procedure. In the intuition approach ,personal judgement is also necessary element in this
approach. The strategies developed by cheap executives over the years may be attributed
to their intuition & judgement.
3)Key factor approach- key factor approach or strategic factor approach. This approach
consists of determining significant factors that are important in the success of a particular
business & concentrating on major decision.
4) Integrated approach-This approach provide framework which consist of following
part:
a)Analysing the present internal & external conditions.
b) Identifying & evaluating the present strategy, the major objectives, policies ,plan&
currently guiding the form.
c) Generating alternatives to resolve the problems & look for opportunity.
d) Developing alternatives unified strategies by combining the various alternatives in
each of the problem opportunity area & evaluation of each unified. Strategy in term of
enterprise objective & choosing the strategy the best satisfy the objective.
5)Enterpreneurial approach-In this, the entrepreneur is defined as a creative thinker ,
an individual who combine in himself the role of innovation & risk taker.He is tough in
this position & is motivated by a powerful deed for achievement & independence.This
mode of strategy making reflect the following characteristics:
a) It is dominated by active search for opportunities. The focus in this mode is on
opportunities rather than problem solving.
b) In this mode power rest with one man.
c) The bold decision taken in the face of uncertainity , strategy in the organisation moves
forward by unusual way with corresponding gains.
d) The most dominant role in this mode consist of gowth & expansion in terms of an
asset, market , share & turnover.
Briefly speaking, strategy in this mode characteristics pushes ahead in the face of
environmental orders.the vision & direction are typically provided by young entrepreneur
& the heads of family owned enterprises.
The planning mode essentialy involves decision making in anticipation of
a future state that the company wants to be in strategy making in this mode is ideally
based on study of –
a) Fundamental socio-economic , purpose of the organisation
b) Values of top management

7. c) Evaluation of external & internal opportunities & problems
d) Evaluation of companies strength & weakness.
The following characteristics are of planning mode.
a) Strategy making depends on the role of analysis & planner as help to executives.
This ensures application of scientific technique & tools of analysis in the
planning process.
b) It involves a systematic & a structured approach to the solution of the problems.
c) It is a comprehensive process which produces a set of integrated decision &
strategies & ensure the development of strategic direction.
In short , the planning modes implies a strategy making process having oath
proactive & reactive thrust , systematic & structured in its approach & result in
integrated decision – making.

8. compromising with competitors or reducing conflicts among interest groups with the
organizations. The adaptive mode is characterised by the following features-:
a) The process has a reactive approach aimed at solving crucial problems emerging in a
complex environment.
b) This mode focus on minimum acceptability of satisfying objective.
c) Decisions are made in adaptive mode in sequential steps one thing at a time strategy
making in the adaptive mode is typically a never ending process.
d) Basin idea in this mode is to maintain flexibility & freedom to adapt the decision in
the more pressing need.
2) Intuition mode-The basic approach of this mode is that the strategy evolves in the
mind of the cheap executive workout ever being used & workout the aid of formal
procedure. In the intuition approach ,personal judgement is also necessary element in this
approach. The strategies developed by cheap executives over the years may be attributed
to their intuition & judgement.
3)Key factor approach- key factor approach or strategic factor approach. This approach
consists of determining significant factors that are important in the success of a particular
business & concentrating on major decision.
4) Integrated approach-This approach provide framework which consist of following
part:
a)Analysing the present internal & external conditions.
b) Identifying & evaluating the present strategy, the major objectives, policies ,plan&
currently guiding the form.
c) Generating alternatives to resolve the problems & look for opportunity.
d) Developing alternatives unified strategies by combining the various alternatives in
each of the problem opportunity area & evaluation of each unified. Strategy in term of
enterprise objective & choosing the strategy the best satisfy the objective.
5)Enterpreneurial approach-In this, the entrepreneur is defined as a creative thinker ,
an individual who combine in himself the role of innovation & risk taker.He is tough in
this position & is motivated by a powerful deed for achievement & independence.This
mode of strategy making reflect the following characteristics:
a) It is dominated by active search for opportunities. The focus in this mode is on
opportunities rather than problem solving.
b) In this mode power rest with one man.
c) The bold decision taken in the face of uncertainity , strategy in the organisation moves
forward by unusual way with corresponding gains.
d) The most dominant role in this mode consist of gowth & expansion in terms of an
asset, market , share & turnover.
Briefly speaking, strategy in this mode characteristics pushes ahead in the face of
environmental orders.the vision & direction are typically provided by young entrepreneur
& the heads of family owned enterprises.
The planning mode essentialy involves decision making in anticipation of
a future state that the company wants to be in strategy making in this mode is ideally
based on study of –
a) Fundamental socio-economic , purpose of the organisation
b) Values of top management