Chapter 8 Summary

Strategic Management:
It is what managers do to develop an organization’s strategies, a task that involves all the basic managements functions (Planning, Organizing, Leading and Controlling), they are plans that set how a company is going to do things, in order to compete successfully, and how to satisfy customers.
Business model is a term usually used in strategic management and basically what it means is how the company is going to make profit, to achieve that they should focus on two things: 1) are the customers going to value what the company is providing, 2) will the company make money from doing this service or product?
Why do some businesses fail while others succeed, even though they both share the same product and same environmental conditions? That’s because of whether a company uses strategic management or not, studies shows that performance is positively linked to the relation between strategic planning and performance. Strategic planning also minimizes uncertainty when a company is facing continual changing situations, and another reason is that companies are complex and diverse so finding a way for each department to reach the organization’s goal is essential.

The Strategic Management Process:
-Identifying the organization’s current mission, goals and strategies: Mission: A statement of the purpose of an organization. Goal: It sets what the organization should achieve and it sets standards for measuring performance.
-Doing an external analysis: (swOT)
The environmental scanning of specific and general environments, Focuses on identifying opportunities and threats
-Doing and internal analysis: (SWot)
Assessing organizational resources, capabilities, and activities:
-Strengths create value for the customer and strengthen the competitive position of the firm.
-Weaknesses can place the firm at a