Strategic Management

Strategic management is the process of defining and implementing procedures and objectives
that set a company apart from its competition. Strategic management is also a skill that can be
developed as someone gains experience and adopts a strategic mindset. It is considered part of
business acumen, though it can also apply to fields like non-profit, government, and the public
sector.
Importance of Mission Vision in Organizational Strategy
Regardless of whether you’re running a small one-person operation or a large corporation, having a
company mission and vision help to provide employees with a purpose. The mission and vision of an
organization are integral to the company’s strategy because they are used to define future goals and
operational tactics. While mission and vision are terms that are often interchanged, they actually refer to
two separate aspects of the company.

Understanding Mission Statements

The mission statement of the organization outlines the company’s business, its goals and its strategy for
reaching those goals. It focuses more on where the company is at the present time and the tactical steps
it wants to use to achieve its objectives. The mission statement of a company can be used to shape the
culture of the organization.

When establishing a mission statement for your company, outline what it is your business does, who you
serve and how you serve them. Those are the three most critical elements of a business’ mission
statement. For example, Amazon’s mission statement is, “We strive to offer our customers the lowest
possible prices, the best available selection, and the utmost convenience.”

Understanding Vision Statements

While the mission statement focuses on more tactical aspects of the business, the vision statement looks
to the future of the company. The vision statement provides the direction in the which the company
wants to go. Together with the mission statement, it helps to create the organizational strategy for the
business.

When drafting a vision statement for your business, answer questions about what your hopes and
dreams are. What kind of future do you want to see, and how does the company play a part in making
that happen? Are you aspiring to make some kind of change, and how will you make it? Amazon’s vision
statement is “to be Earth’s most customer-centric company, where customers can find and discover
anything they might want to buy online.” It provides a clear direction for employees.

Applying Mission and Vision Statements to Your Organizational Strategy

The mission and vision statements of a company help direct the organizational strategy. Both provide
purpose and goals, which are necessary elements of a strategy. They outline the audience for the
business, and what that audience finds important. By identifying these elements, the business executives
can develop a more step-by-step strategy that helps the company achieve its mission in the short term,
and its vision in the long term.
Mission and vision statements help businesses to outline performance standards and metrics based on
the goals they want to achieve. They also provide employees with a specific goal to attain, promoting
efficiency and productivity.

What Is a Company’s Vision Objective?

According to ClearVoice, a company’s vision is an aspirational idea of what the business wants to
become. It is a grand ideal or goal, something that the organization wishes to achieve. It may include the
founder’s hopes and dreams when starting the business, or it may be about something that the business
wants to change for the greater good.

The purpose of a vision statement is to inspire employees and customers alike. Employees may look at
the vision statement as a call-to-action, something that motivates them to do their best at work each
day. Customers may resonate with the vision statement and choose to support the business to achieve
that aspirational goal. Without a vision statement, the company lacks direction. It is unclear where the
company intends to go in the future or what they are aiming for.

What Is a Mission Statement?

The mission statement is about the core of your business today. BoardEffect notes that it includes
specifically what your company does and who you do it for. It can also include the benefits your business
provides to your customers. To develop a mission statement, consider how you impact the lives of your
customers.

A mission statement helps your employees work together more effectively because it unites them
toward a singular goal. If your business lacks a mission statement, employees may feel lost or confused
because they are not sure what they are doing and who they are doing it for. A mission statement is a
good way to create clear action within the organization.

Differentiating Between Vision and Mission

One of the key differences between a vision and mission statement is the timeline. Vision statements are
forward-looking. They look decades into the future and envision what the company wants to create. On
the other hand, a mission statement is about the present. It looks at the current state of the business,
not the future. The vision describes the “why” of the business, according to BetterHelp. It’s the reason
the business exists. The mission, on the other hand, describes the “how” of the business. It is more
tactical and procedural than inspirational.

Business Strategy

The term "business strategy" describes the methods a business uses achieve its mission and objectives.
A business' mission encompasses its overall purpose, core values and long-term goals. A grocery store
might have the mission of making profit while providing the best food to customers, minimizing its
impact on the environment and promoting strength in the local economy. The company's strategy might
involve buying products from local food producers, encouraging customers to bring their own grocery
bags, advertising in local newspapers and buying recycled product packaging materials. A business’
strategy includes how it deals with the opportunities and threats it faces.

Business Model
A company's business model describes the basic means by which it creates value, delivers value to
consumers and collects revenue from customers to make a profit. Business models can vary greatly from
one company to another. A local grocery store's business model might involve buying food at wholesale
prices and selling it to end consumers at a higher price to make profit. A website might have a business
model based on providing video content to customers and generating revenue through advertisements
placed on the site.

Business Plan

Determining a company's mission, objectives, strategy and business model are all important steps in the
process of creating new business and can help managers form a business plan. A business plan is a
document that acts as a blueprint for how the business plans to operate and achieve profitability.

How to Derive a Coherent Strategy

You have two choices in the operation of your business: take control of your company's direction, or
react to forces beyond your control and hope to land on your feet. Clearly, taking control is the better
choice, and the way to do it is by deriving a coherent strategy. Strategy is the part of the business
planning process that outlines the steps you need to take to effectively compete in your market.

Create a mission statement that defines your core business in a sentence or two. For example, Amazon's
mission statement "is to be earth's most customer centric company; to build a place where people can
come to find and discover anything they might want to buy online."

Define your objectives. List concrete, measurable goals for the company. Examples of goals include a
specific earnings target or capture of a specific market share.

Conduct a SWOT analysis. In other words, assess your company's internal strengths and weaknesses and
its external opportunities and threats. Consider such internal factors as market share, intellectual
property, financial resources and staff. Include such external factors as your customer base, competition,
vendors, economic conditions and emerging technology.

Apply the insights you gain through the SWOT analysis to identify those that will help or hinder your
ability to achieve your objectives.

Create your strategy. Define the specific actions you need to take to achieve your objectives. Note the
steps necessary to overcome threats and challenges and use strengths and opportunities to your
advantage.

Decide what role such stakeholders as employees and vendors will play in the strategy. Communicate
these roles clearly to bring everyone on board. Make the strategy part of your company's culture.

eCommerce Business Strategies

Ecommerce business strategies are similar to the strategies used in any type of business, but the big
benefit is the ability to specifically measure the effectiveness of ecommerce activities. Those choosing to
market their products or service online can take advantage of a variety of tools and techniques that are
cost effective and relatively easy to implement.
Online marketing benefits not only from the use of words, but the use of words, sound and images
combined, making it a wonderful way for businesses to quickly and very inexpensively share information
about their products, services and business activities. Sites that include YouTube have gained enormous
popularity and make it very simple for businesses or individuals to create their own channels and link
those channels through their other online activities--web sites, blogs or social media activities, for
instance.

Shopping Cart Analysis

A big benefit of selling online is the measurability of these activities, including the ability to literally
evaluate the process that occurs from the time a prospective customer enters the site to the time they
press "enter" to place their order. Businesses that use shopping cart analysis effectively to analyze areas
where shoppers may be opting out of the buying process can make important, and sometimes very
simple, changes to their sites to measurably increase the number of people making it through the sales
funnel.

Using Social Media

Social media is a relatively new tool that is rapidly exploding, offering opportunities for ecommerce
companies to reach out to a variety of individuals and to establish connections with groups that have
shared interested. But social media is about more than just buying--it can also provide a way for
businesses to strengthen their service initiatives. Christopher Bucholtz points to a survey conducted in
May 2010 by Forum One in which 22 percent said the most important goal for them in their online
activities was customer service. Fifteen percent said the most important goal was fostering peer-to-peer
customer service.

Objective of a Human Resource Strategy

Human resource strategies are designed to ensure that small businesses have the staff they need to
meet customer demand. Considerations that impact human resource strategy include both internal and
external environmental changes, such as anticipated turnover, the need for new types of skills and
experience, growth or expansion into a new market, changing economic pressure and competitive
pressures.

Key Questions

At the highest level, the objectives of a human resource strategy will require businesses to consider two
key things: the type of staff needed to manage and run the business to meet stated business objectives,
and the pay/benefits and other programs necessary to attract, develop and retain effective staff. These
foundational questions form the basis for the development of a human resource strategy.

Organizational Dimensions

Aspects of the organization will impact the development of strategies related to human resources. The
company's culture has a critical impact and represents the personality of the organization in terms of its
management style and values. This will dictate whether, for instance, the company is one where
employees will be expected to "do more with less," or where they will be overstaffed to fuel a culture of
experimentation and innovation. The organization itself and how it is structured is another key
dimension that will impact strategy. Finally, the human resources systems, policies and practices will
impact the ability of the organization to effectively hire and retain the staff necessary to meet business
objectives.

Role of Mission, Vision and Values

When developing objectives for a human resource strategy, the small business must consider its mission,
vision and values, whether these are explicitly stated or not. The mission of the organization indicates
who the organization serves and why it exists. The vision is an indication of where it hopes to be in the
future. The business's values are the beliefs that guide its actions. Each of these has a direct impact on
the type and numbers of employees that will be needed to achieve organizational goals.

Workforce Analysis

A key part of the human resource strategy is a workforce analysis. This analysis will focus on the culture,
the organization, the people and the systems that are in place. Small businesses need to consider where
they are currently at in terms of each of these elements and where they would like to ideally be.
Identifying these gaps will allow the business to focus on specific objectives designed to narrow or close
the gaps.

Evaluation

Ultimately, human resource strategies will be guided by evaluation based on specific measurable factors.
There are a variety of factors that a small business will consider as it develops, implements and evaluates
the effectiveness of its human resource strategy. Commonly, these may include employee turnover, the
number of vacant positions, the number of employee grievances, customer complaints and the levels of
satisfaction and dissatisfaction of both employees and customers.