Strategic Management Vs. Strategy
There are different ways to view business planning and implementation in everyday business operations. From a strategy perspective, you take the time to create a plan because you want employees to act with intention towards specific targets. Using a strategic management perspective, you and your management team make routine and strategic decisions to effectively implement a central plan.
When you hear the term "strategy," you might think of a plan addressing a question like this: How can the business achieve a certain level of profits this year? A strategy is not a plan, nor is it a way of aligning resources toward specific goals. A major difference between a strategy and a plan is that a business needs just one strategy, a single, targeted combination of business operations that will produce a profit. The strategy may not always be effective during ebbs and flows in the business cycle, but it defines a business.
A business can have a strategic plan with clear goals to guide business operations over a period of one to 10 years. The company leadership can align budget dollars toward a body of strategic goals. Strategic management is how leaders implement the business' strategy and the current strategic plan. Leaders must monitor employees, teams and other organizational units for achievement of specific targets along the way. They must direct employee activities and expenditures according to the plan.
If you've ever written a business plan, somewhere you defined exactly how you planned to achieve a profit after recovering your startup expenses. Your strategy could also evolve over time if you redirect your business focus to different markets or change offerings of products or services. Learn how to explain your business strategy to potential investors, lenders and customers. You can build their interest in your business by explaining how your company turns a profit by fulfilling a specific consumer need.
As a small-business owner, you enjoy the advantage of running your business strategically because of the scale of the business. Get closer to day-to-day operations and influence what employees do according to your business expertise. Being close to customers and the line workers who serve them in your company permits you to make changes every day that will make customers more satisfied. You want to make it easy for customers to buy more of what you sell. For help with strategic management, you might need to hire people with vast experience in your industry and familiarity with your business model.