Introduction
Starting any business project, one should be aware of the specificity of the business world, its rules and laws, and its peculiarities. Knowing beforehand, what will happen to your business, how it will develop, and what challenges it might face are all the tasks for a business person that tries to succeed. Accordingly, the issues of management on the whole, and strategic management, in particular, come into play here as the most important bases on which your business project can be founded. Thus, strategic management, and strategic planning as its integral part, become vital for large and small business entities in their pursuit of success and further development.
The definition of strategic management
As defined by Joyce and Woods (2001), strategic management is “the pursuit of superior performance by using a strategy that ensures a better or stronger matching of corporate strengths to customer needs than is provided by competitors” (p. 8). Further on, All Business (2010) speaks of strategic management as the set of steps taken to answer the basic questions surrounding the conduct of business. These questions touch upon the objectives of a business, the best ways to reach those objectives, and the factors that would facilitate the latter process (Joyce and Woods, 2001, p. 12). Accordingly, strategic management is the basis for any business, and if, for example, a small bakery is launched, strategic planning will be necessary to set up its development directions, main challenges and opportunities, and ways to deal with both.
The importance of strategic planning
Further on, Joyce and Woods (2001) attribute great importance to strategic planning as a means to forecast and prepare for any risks or opportunities the industry might present (p. 6). Accordingly, the roles of both strategic management and strategic planning in the development of a small bakery will be crucial. More specifically, the task of the strategic planning will be to monitor the market environment in respect of competition conditions, prices, and any peculiarities, and to carry out a SWOT (strengths, weaknesses, opportunities, and threats) analysis for the bakery. The task of strategic management, in this case, will be to analyze the data retrieved during the planning stage and define, on their basis, the developmental goals and means of their achievement for the bakery (All Business, 2010).
Moreover, strategic planning is directly connected with the four functions of management, i. e. organizing, staffing, directing, and controlling. The process of creating and implementing a strategic plan is the complex of those functions (Joyce and Woods, 2001, p. 15). In particular, the hypothetical small bakery should first of all be legally established and organized. After this, staffing can take place and be followed by directing and controlling processes. This is the order of steps that shape up a traditional strategic plan in which a business is first organized and then developed, not vice versa (All Business, 2010).
Conclusion
So, it is obvious from the above discussion that strategic management and strategic planning are vital for establishing and developing any kind of business. The point is that strategic management is the function of the business leader, according to which he/she defines the business’ goals and ways to achieve those. Thus, strategic planning is aimed at the long-term goals of the business, while strategic planning is carried out at every management stage and pursues short-term results in business development.
References
All Business. (2010). What is Strategic Management? Web.
Joyce, P. and Woods, A. (2001). Strategic management: a fresh approach to developing skills, knowledge and creativity. London: Kogan Page Publishers.