Sample About Strategic Management

Introduction to Strategic Management

Strategy is an action that is required to take for the purpose of organizational goals. It is a general direction set with various components to accomplish desired actions of future. It is all about integrating organizational activities and utilizing and allocating resources within the organizational environment for the purpose of achieving organizational goals. It is significant as it determines future course of action that helps the organization in long term sustainability. It is created to take into account the probable behaviour of customers and competitors. Strategies dealing with employees will predict the employee behaviour. The management is required to have a deep and intense knowledge and understanding so that to take appropriate decisions and this will also be helpful in achieving competitive environment (Crossan and et. al., 2011).


Strategies and its implementation are required as in a business for the purpose of achieving organizational goals and objectives. With the help of effective strategies, business can achieve the policy of differentiation by which it can create competitive edge over others. Strategies can help the business to set a particular direction so that all the employees can follow those aspects. With the help of strategies, business can achieve certain advantages such as:

  • Customer retention (Graham, 2008)
  • Effective utilization of resources
  • Opportunities of diversification and expansion

Strategies help the business to set a desired direction and this is also assists in effective decision making process. With the help of effective decision making process, business can achieve competitive advantage as departments can make effective decisions regarding different facets. There are so many kinds of strategies that can be put into use for resolving conflicts, for effective leadership and for managing strategic aspects of a business. Companies are being forced to compete for competitive advantage so that to sustain for long time at the marketplace (Haines and Bandt, 2002).

Strategic management process

In order to make strategic aspects more successful, it is requisite for the business to implement it in a proper way. Strategic management process defines or assists the organization to frame effective strategies for business purposes. It has basically four steps:

Environmental scanning: It refers to the process of collecting, scrutinizing and providing information for strategic purposes. It helps the company to analyse external as well as internal factors that influences business environment (Henry, 2008).

Strategy formulation: It is the process that determines best course of action for the purpose of achieving organizational goals and it also facilitates corporate and business function strategies.

Strategy implementation: The process implies making strategies or putting it into action. It comprises of different aspects such as designing organizational structure, allocation of resources, developing decision making process and management of human resources (McDonald, 1996).

Strategy evaluation: This is the final and last step of strategy management process. This includes various activities such as root factors of current strategies, performance measurement, and remedial actions. It facilitates suitability of the desired strategies that have been adopted by organization (Lowenthal, 1994).

The general and competitive environment

Environment is the main factor that influences the work conditions of organization and that may also lead alterations in the work processes. External environment considerably affects the competitive environment of an organization as it consists of industry and markets in which it has to compete. There are various competitors of baby care products in the external environment that probably can affect global market (Nijssen and Frambach, 2000). As the industry fulfils demand of around 4 million babies all along in a year and this thereby helps the company to generate revenues of around $ 7 billion. The market can be segmented into varied parts of because the demand for innovation in products has been increased. With the help of technological advancements and greater marketing approaches, retailers have to widen the market as demand is increasing at the market place due to huge increment in number of babies. Consequently, there are many competitors such as Johnson & Johnson, Procter and Gamble, Novartis that are providing several baby care products with several effective strategies for the purpose of achieving market share and competitive advantage (Partington, 1996).

Structure conduct performance

The structure conduct performance model is a strategy that predicts that market structure would help the company to determine firm’s conduct and employee performance. The SCP model basically focuses on three steps i.e. at the initial steps it focuses on segregating and segmenting the market on the basis of number of competitor’s present in the market. At the second level, this model comprises of certain prices and output decisions that is firm conduct which predictably arises from market power (Power, 2004). This also comprises of framing varied strategies so that to get competitive advantage that ensures the opportunities of success. Finally at the last step, it defines the performance of the company that suggest equilibrium prices of any of the company. Consequently, it can be said that in order to get high competitive advantage, it is required for baby care Products Company to opt three major steps of structure conduct performance model. Initially it is required to analyse the number of competitors that are prevailing in the market such as Johnson & Johnson, First cry etc and this also facilitates the company to build effective and strong strategies so that to target adults as well (Komoche, 2006). It is essential for the company to make products of standardized quality as it is targeting the kids section so the product should be mild and gentle. The company is required to set low cost at the initial stage as there are lots of competitors in the market and the barrier to entry will be relatively high (Khandekar and Sharma, 2005).

Furthermore, the company is required to frame strategies so as to achieve competitive advantage and also for the purpose of achieving position in the market. Strategies are required to be designed in such a way that it can easily attract children and adult section. At the last step, the firm is required to analyse the performance with focus on several factors like productivity and efficiency level (Freeman and Ceriello, 2011).


There are various tools that can be used to analyse external as well as internal environment of a business. In order to achieve competitive advantage, it is quite essential for the business to use porter’s five forces model as this will help in identifying the strategic development of industries. This is the best appropriate tool that can help to identify the power and current position of the business. Conventionally, the tool is used to identify whether new products, services or businesses have the potential to be profitable. It comprises of five important factors that determine competitive power in a business situation and these are as follows:

Supplier power: In order to get high advantages from the business, it is required to have efficient suppliers so that they may not switch over to another business. The business is required to have powerful suppliers so as to make unique products that will help the company to get high attention from the customers. If a firm’s supplier’s have bargaining power they will exercise their power, sell their products at higher products and they can squeeze industry profits (Best Practice Vs. Best Fit Approach to Strategic Human Resource Management assignment, 2013).

Buyer power: At the other stage, businesses areca also required to give certain offers and benefits to its customers so that they may not switch over to another industry. In order to create a competitive edge over the competitors, business is required to identify its customer’s interest so that to produce products as per their wishes.

Competitive rivalry: The main competitors of my business is Johnson and Johnson that is producing range of baby care products and that has targeted adult females for the purpose of effective marketing. My business may face competition many competitors and if they offer better and effective products then at that situation I will be facing high level of customer switchover.

Threat of substitution: This has been identified that there are range of products for baby care items and Johnson and Johnson has been providing best and appropriate products and along with this, it also has some substitutes. All those substitutes are satisfying the needs and demands of the customers and this is making weak my business aspects. The availability of substitutes hinders the growth of the company (Functions of Human Resource Management, 2013).

Threat of new entry: There are various barriers that have been identified by the industry because they are having investment cost and that can be used while establishing new firms. The legal restrictions can also act as a barrier to entry because of goods needs to be high standard quality especially for kids. Hence, in order to get customer loyalty, it is essential to have strong brand image. In order to differentiate the products in the markets, it is required to have strong brand recognition and unique selling pricing (Strategic management, 2009).

With the help of such analysis, my company would be able to analyze the strengths and weaknesses of its competitors within the market. This is also helpful in analyzing the mindset and views of the customers regarding the services. This also assists in identifying the competitive ability of the business (Suitability Feasibility Acceptability (SFA) analysis, 2012).

SWOT analysis

swot analysis

In order to analyze strengths, weaknesses, opportunities and threats of a business organization, it is required to make structured planning for the process of SWOT analysis. It is a significant tool that can help the company to make suitable decisions at different levels. With the help of strengths and weaknesses, the internal environment of an organization can be evaluated whereas, the opportunities and threats represent the external environment of an organization (Supply Chain Performance: Achieving Strategic Fit and Scope, 2011).

The major strengths that a company could make are that it can design effective and efficient strategies so that companies can successfully differentiate its products in the market for the purpose of targeting existing customers. Weaknesses are those factors that are hinder the performance of workforce and management. The major weakness in the present case is the pressure to reduce price and availability of efficient workforces. Opportunities are those factors that represent the external environment. Subsequently, the opportunities in the present case can help the company to increase market share through product development and innovations and this will also assist in widening and expanding the operations all around the world. The threats are the situations that act as a barrier and issues for the company. The major threat for the current organization would be the availability of number of competitors and their sturdy brand image at the market place (The General Environment, 2012).

Game theory

(Source: Freeman and Ceriello, 2011)

Game theory being a part of strategic decision making theory comprises of inter-reliant issues and problems. It includes number of participants and each of them has individual functions related to common system. The problems and issues are refereed as players of games and participants as it arises from competitive scenarios. The theory has basically some assumptions such as:

  1. Each decision maker has more than two or well specified choice.
  2. Every probable combination of plays available to the players leads to well defined end state that terminates the game (Characteristics of an effective strategic control system, 2012).
  3. A specified payoff for each player is associated with each end state.
  4. Each decision maker has perfect knowledge of the game and of his opposition.
  5. All decision makers are rational (Elements of Strategic Management, 2011).

Game theory deals with number of issues in which every player’s strategy depends of factors what the players do. The model of game theory depicts different four situations in which two players need to participate and for that strong decisions are required to take. The two basic situations that come under it are compromise and don’t compromise. In the present case of baby care products, the company is required to compare its situations from its competitors and at the first matrix, both the parties need to compromise or cooperate with each other. The second matrix indicates that compromise can be done by any one party. In the third matrix, it needs not to negotiate for the first firm and compromise to the other. At the final stage, both the firms need not to compromise and face any challenge and issues (Ingram, 2012).


The revolutionary approach of change modifies the management structure and processes. There are various tools and techniques that can be used by the company for the purpose of long term sustainability in the market. In order to achieve competitive advantage, it is quite essential for the organization to look forward for productive and efficient methods so as to accomplish organizational needs. Efficiency is required while framing efficient strategies so as to reach towards desired goals. In order to frame corporate strategies, businesses are required to make effective decisions that are concerned with significant matters. This influences the overall size and composition of various business portfolios (Competitive Analysis, 2006).

Through business strategy, business can compete efficiently within the business sector. Business level strategies are required so as to take strategic decisions such as pricing, manufacturing and distribution of goods. With the help of business strategies, a firm can acquire competitive advantage in a market.

Generic competitive strategies

(Source: Ingram, 2012)

Strategies under generic competitive have been developed by Michael Porter in which an organization’s current positions reveal its financial positions. Company can achieve sustainable competitive advantage with the help of average profit in long run. This model says that there are two types of competitive advantage that can be achieved such as low cost or differentiation strategy. The three main aspects of generic competitive strategies are cost leadership, differentiation and focus strategy. The cost leadership strategy helps the firm to become leader in the market by producing low cost among different products. Focus strategy does not focus mainly on achieving competitive advantage (Generic Competitive Strategies, 2012). It is quite suitable for the baby care products to make use of differentiation strategy through which it can seek attention of valuable customers through differentiation and product innovation. There are various dimensions that attract the customers and baby care Products Company is largely required to focus on such facets. It is also essential to produce the goods with premium price so that they can easily meet customer’s requirements (Barnat, 2012).

Blue ocean strategy

Blue ocean strategies comprise of set of tools and techniques that can be used for framing effective strategies so that to make competition irrelevant and this also develops the opportunities of high profits. The main idea behind this approach is that to increase the value of organization with low cost trade off or with differentiation. It is required for the baby care firm to develop and frame efficient strategies so that they can achieve competitive advantage in the market place. As, this would assist baby care firm to attract range of customers and this there makes the competition more irrelevant (Competitive Analysis, 2006).

Organization strategies

Organizational strategies are those strategies that act as a direction within which the firm can take subsequent actions and decisions for the purpose of achieving long term goals. It specifies the company’s vision, missions and objectives that frame suitable and appropriate strategies so as to achieve long term vision (Barnat, 2012). In the present case of baby care products, firm is required to frame feasible and suitable strategies for the purpose of managing competition as this will help it in accomplishing market share. While reviewing the strategies, feasibility and suitability factors can be represented as that requires further practices in an organization. Suitability represents that proposed strategy will be able to fulfill to business requirements. Consequently, feasibility looks towards enforcing strategies and evaluation of likelihood of success provided in the current resources (Competitive Analysis, 2006). It is sternly recommended to baby care products to adopt product differentiation strategy as this would be suitable and feasible enough to manage intense competition. The organizational strategy should be framed after considering the feasibility of strategy as how much it provides maximum amount of profit in proportion of cost indulged in investments.

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Balance score card

Balance score card is required so that to measure performance as it is a strategic tool that produces semi structured report supported by varied tools and techniques. These tools and techniques can be used by the mangers as this can assist him to control and monitor the performance of workforces like how efficient they are in executing the activities (Barnat, 2012). This model facilitates financial perspective, customer perspective, learning & growth perspective and business process perspective. It is probably not a strategic making tool; it is just a description and interpretation of the strategy. It assists in strategic evaluation as it provided suitable and best relevant information that helps in achieving organizational visions and missions. With the help of this technique, baby care firm can take the strategy as per the requirements and then it evaluates whether strategy is contributing in achieving organizational goals or not (Generic Competitive Strategies, 2012).


Strategic drift is the situation that depicts how an organization responds to change after considering its cultural and fundamental aspects. As the time changes, the parameters of environment changes and this helps the firm to meet the cultural aspects. The main focus is paid on culture facet that considers innovation and changes in the strategy so that to produce optimum results and this ultimately leads to strategic drift. In order to implement change in the business environment, firm is required to consider cultural aspects. Increment in business competition forces the firms to focus on business dynamics so that to achieve competitive advantage. In this context, the organization is requisite to focus on effective organizational efficiency. In organizational processes, it comprise of different activities that pursue an organization to work together cordially and move towards same direction (Barnat, 2012).

The process of organization needs to opt innovative methods so that efficient services can be offered to customers. Differentiation can be adopted by several methods such as innovation in terms of features, authority and complexity of tasks. The opportunities of innovation and success can help the company to diversify and expand the business at varied stages. Innovation and organizational processes are interrelated to each other with the fact that large diversity among workforces leads to high potential of towards innovation. In the present case of baby care products, organization is required to design and frame suitable strategic control system through which the work can be managed. The strategic control and reward system should be appropriate, easy, discerning, cost-effective, stretchy, sound, sensible, forward looking, objective oriented and tolerable by every workforce of the firm (Baby Products Industry: Market Research Reports, Statistics and Analysis, 2013).


In order to execute the strategy more effectively, the organizational personnel members are required to develop competency and efficiency. The top priority of the management is to implement the strategy in the most suitable manner (Baby Care Products Market Will Reach USD 66.8 Billion Globally in 2017, 2011). Increasing an internal structure which is approachable enough and skills and competencies through which strategy could be ashore and has the managerial and mechanical proficiency the firm need to select workforces as leaders for significant positions. There are various factors that require high attention for the purpose of increasing organizational effectiveness are as under:

  1. Emphasize the major functions and activities that can assist in successful execution of strategies (The Structure-Conduct-Performance Paradigm, 2011).
  2. Imitate the functions and factors that are required for the purpose of providing support to the personnel and staff members.
  3. Analyze the critical factors that restricts effective implementation of strategies.
  4. Identify the level of authority delegation that are required to manage entire workforces.
  5. Identify the usefulness of coordination and discipline among different organizational units (The Relationship between an Organization and Its Environment. 2010).


Attributing the entire report of baby care products firm, it can be confronted that in order to manage work force of an organization, capability and efficiency of team management should be enhanced. Effective strategic implementation requires the workforces to be more proactive rather than reactive as it can help the organization in shaping the culture with organizational strategies. Strategies are generally framed so as to provide clear and accurate direction to all business units in order to meet the expectations of shareholders and present value to customers along with all the workforces (The Importance of Strategic Management, 2012).


  • Crossan, M. M., and et. al., 2011. Strategic Analysis and Action. 8th ed. Pearson Education Canada.
  • Freeman, C. and Ceriello, V. R., 2011. Human resource management systems: strategies, tactics, and techniques. 2nd ed. Jossey-Bass Publishers.
  • Graham, H., 2008. Marketing Strategy and Competitive Positioning. 4thed. Pearson Education India.
  • Haines, S. G. and Bandt, A., 2002. Successful Strategic Human Resource Planning: Creating Your People as a Competitive Advantage. Systems Thinking Press.
  • Henry, A., 2008. Understanding Strategic Management. Oxford University Press.

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