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Strategic Management Process Overview With Examples

Kevin Toole, Rob Wengrzyn
  • Author
    Kevin Toole

    Kevin M. Toole has taught college level courses for over twenty-two years. He has a Bachelor’s degree in Business Management from Stevenson University, Maryland and a Master’s degree in Curriculum and Instructional Design from Western Governors University, Utah. He has developed curriculum for both residential and online courses for over five years and holds a position in both academic and business management as a college-level education manager for the past twelve years.

  • Instructor
    Rob Wengrzyn

    Rob has an MBA in management, a BS in marketing, and is a doctoral candidate in organizational theory and design.

Understand what a strategic management process is. Know the steps in the strategic management process and the types of strategic management processes with examples. Updated: 04/26/2022

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What Is Strategic Management Process?

The strategic management process is essentially a set of steps a leader can use to help achieve better business outcomes. The process hinges on the philosophical approach that if a leader "thinks" strategically, they can better position themselves and the company for continued success. The strategic management process planning begins with environmental scanning and then continues systematically through the steps examining political, economic, sociocultural, technological, environmental, and legal factors.

Strategic Management Processes

The main components of the strategic management process are environmental scanning, assembling a strategy, implementing the strategy, and monitoring and evaluating the strategy beginning with environmental scanning, then continue examining political, economic, sociocultural, technological, environmental, and legal factors. Each step must be followed in order, from start to finish, for the process to be effective. If a step is skipped or missed, the results may not be as successful.


Strategic Management Process Flow Chart

Strategic Management Process Flow Chart


Benefits of Strategic Management Processes

The benefit of the strategic management process is the process helps prioritize the identification of strengths, weaknesses, threats, and opportunities. As each step is started, that step becomes the priority, and the leader will continue to focus their efforts and attention on that step until completion. Once the step is completed, the leader will then move on to the next step, focus all their attention on what that step needs, and then, once completed, move on to the next until all steps have been completed.

There are also financial benefits that accompany the strategic management process. Companies tend to be more profitable and successful as the leadership is engaged in forward-thinking and planning which helps with profitability as the company is always looking forward. In addition, the non-financial benefit of strategic management is the leader is more aware of external threats as they are in a constant state of evaluating and assessing strengths, weaknesses, opportunities, and threats. Leaders will have a heightened awareness of their competitors and more awareness of their own employee's stability and productivity. Employees also tend to be less resistant to change as strategic management sets clear goals and objectives and establishes clear links between performance and rewards.

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  • 0:06 The Planning Process
  • 0:54 Environmental Scanning
  • 2:38 Assemble a Strategy
  • 3:42 Implement the Strategy
  • 4:29 Monitor and Evaluate…
  • 5:54 Lesson Summary
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Steps In Strategic Management Processes

The steps in the strategic management process are to start with environmental scanning, progress to assemble a strategy, implement the strategy, and conclude with monitoring and evaluating the strategy. In order to accomplish this, the leader must first identify the primary goal by clarifying the vision for the project

Clarifying Vision

To begin the strategic management process, the leader must first identify their clarifying vision of the goal or result they want for the project. They can begin identifying the goal by conducting the environmental scanning and all subsequent steps in order.

Environmental Scanning

The first step, especially if a small company or one that is beginning the strategic management process, is to start with environmental scanning. Environmental scanning is when a leader looks at all the factors systematically, such as the political, economic, sociocultural, technological, environmental, and legal factors they and the company are facing, and helps with clarifying the vision for the leader.

The following are the key environmental factors a leader must assess.

  • Political Factors: Political factors that affect the company, such as Taxes, governmental requirements, and employment and unemployment factors
  • Economical Factors: Economic factors such as inflation rate, spending power, and disposable income for customers must be assessed
  • Sociocultural Factors: The sociocultural factors such as the age of the customer base, education levels in the area, and income levels must be assessed
  • Technological factors: The technological factors such as the internet, E-commerce, and social media must be assessed
  • Environmental Factors: The environmental factors such as their competitive advantage, what waste disposal requirements are needed, and what pollution monitoring needs are.
  • Legal Factors: The legal factors such as unemployment laws, health, and safety requirements, and any product safety requirements must be assessed.

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Frequently Asked Questions

What are the five steps in the strategic management process?

The five steps in the strategic management process are environmental scanning, assembling a strategy, implementing the strategy, and then monitoring and evaluating the strategy. Environmental scanning looks at political, economic, sociocultural, technological, environmental, and legal factors. Strategy formulation uses environmental factors to formulate a strategy. Strategy implementation is when the strategy is executed. Strategy evaluation and control are when key deliverables are checked to ensure they are on track per the strategy and constantly monitored.

What is strategic management process with example?

An example of the strategic management process is when a company decides when and where to open a new branch office. The company must first conduct environmental scanning to see what factors the company should anticipate. Strategy formulation uses the environmental factors analyzed to formulate a strategy for the branch move. Strategy implementation is executing the strategy decided upon, such as the location, moving arrangements, and grand opening target date. Strategy evaluation and control is when the company sets key deliverable dates throughout the process to ensure the move progresses on schedule and stays on schedule.

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