Strategy formulation is the first crucial step in strategic management, which in turn is the highest among top management priorities. It is admittedly both a science and an art and requires the focusing of management thinking on a simple overriding objective what ever it may be. In order to do this successfully, the business organization must be able to state its mission and vision as concisely and as precisely as possible. A few words or even shorter sentences will have achieved in stating in a clear manner its business objectives.
Strategy Formulation
A very commonly used technique is the SWOT analysis that attempts to situate a firm in relation to its environment and the industry. It is done by stating the organization’s strengths, weaknesses, opportunities and threats in an attempt to encapsulate the strategy needed for success. In essence, this is a bird’s eye view both internally and externally to help capture the essential things needed to be done on the road to success. One strategy that is taking the management world by storm is the “Blue Ocean Strategy” based on the double pursuits of differentiation and low cost. Its key concepts are value innovation, fair process and tipping point leadership. It took almost a decade to formulate this strategy.
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