Strategic management involves the formulation and execution of the major goals and objectives taken on by a company’s top management on behalf of owners, based on consideration of resources and an assessment of the internal and external environments in which the organization competes. Strategic management provides overall direction to the enterprise and involves specifying the organization’s objectives, developing policies and plans designed to achieve these objectives, and then allocating resources to implement the plans.
Academics and practicing managers have developed numerous models and frameworks to assist in strategic decision making in the context of complex environments and competitive dynamics. Strategic management is not static in nature; the models often include a feedback loop to monitor execution and inform the next round of planning.
Harvard Professor Michael Porter identifies three principles underlying strategy: creating a “unique and valuable [market] position”, making trade-offs by choosing “what not to do”, and creating “fit” by aligning company activities to with one another to support the chosen strategy. Dr. Vladimir Kvint defines strategy as “a system of finding, formulating, and developing a doctrine that will ensure long-term success if followed faithfully.”