BUSINESS SOLUTIONS
Strategic management allows an organization or business to keep her competitiveness, her security and her legitimacy by efficiently using the resources in order to create an added value. When we talk about strategic management, we talk about different concepts like strategic choices, strategic analysis and strategic deployment. What form do these concepts take?
Strategic choicesFirst of all, strategic choices take place on three levels in a business: on the level of operational strategy, on the level of Business or competitive strategy and on the level of corporate strategy. The corporate strategy allows to determine the business fields and indicates in which type of activity a business can throw itself and which type of activity it should avoid in order to have a balanced activity selection. The strategy in business activity is the implementation of a competitive strategy in each business activity in order to have a strong position against the competitors in a determined activity sector. The corporate strategy allows to answer the following questions: Which activities should be increased? Which activities should be abandoned? Should we invest in another company? Should we invest in the acquisition of new material?
With the business or activity strategy, we can determine and develop competitive advantages. Should we innovate? Sale more expensive or cheaper? The strategic analysis analyzes the financial resources and skills of a business, but also the economic, social and competitive environment and the strategic intentions of the clients, the government, the creditors and the suppliers. The strategic deployment includes the management of the change, the organizational structures, the control and use of the means. Strategic management leads the strategic segmentation of the business.
Let’s remember to not mix up strategic segmentation and marketing segmentation. The strategic segmentation allows to divide different business activities in homogeneous segmentations and to manage activities on short and long-term, while the marketing segmentation allows to divide the clients in homogeneous segmentations and to ameliorate the coherence of the marketing mix on short and mid-term. Consequently, the segmentation can be per strategic activity sector or per activity composition. The strategic activity sector is a part of the enterprise or the organization to which we can allocate or take away the means and which corresponds to a specific combination of key factors to success.
We can divide or merge the activities or activity sectors by division of the resources (technology, suppliers …), by trade-off (distribution, clientele …) or by the competition. This is what we call strategic management.