There are five steps in the strategic management process which can be described as:
- Environmental Analysis: It is the study of environment of organization to evaluate how environmental factors have influence on activities or operations in organization. It also helps to corelate what all is happening internally as well as externally in any firm undergoing strategic process. It involves three main factors as:
- General Environment – It involves social, political, legal, technology and economic component.
- Operating Environment – This involves supplier, customer, labour, competition and international component. Relation and interaction with suppliers, labour, feedback from customers.
- Internal Environment – This involves planning, organizing, influencing and controlling process with the organization. Planning determines on how an organization can achieve goals. Organizing is the process of establishing the use of resources within organization in an orderly manner, influencing involves making people understand culture (language, needs, attitude). The controlling is done by manager through communication network.
- Differentiated – Aim to make organization more competitive from competitors by production of different products
- Cost Leadership – it tries to make organization ore competitive by production of products cheaper than the competitors.
- Focus – Aims to make the organization more competitive by making focus on a particular customer.
- Interacting skills – which includes the interaction among the team members and with the people
- Allocating skills – includes the proper allocation of the tasks and activities to the concerned person or the employee for the execution process.
- Monitoring skills – the work which is being done is monitored and checked to produce good quality products for the market.
- Organizing skills – It is the process of proper use of resources for various practices, activities and procedure in company or organization in an organized order.
Also, the mission flows in natural direction from information gathered and obtained through environmental analysis. Thus, this process corelates other processes. It Helps individual to direct their efforts in common direction. We can say that it guides, helps members of organization to have better relationship, interaction, coordination with each other, to develop better teamwork and productivity. They become more familiar to goals of organization. As, without guidelines and direction, no employee can gain knowledge regarding mission of organization as well as about the work that he has to perform for accomplishment of goals. Work is completed in time with perfection and efficiency. Neither can all employees can work in coordination, nor altogether they can reach the objectives as planned according to requirement, without guidance. So, this process is most important as support and backbone for the employee.