Advantages of Strategic Management

Advantages of Strategic Management

Advantages of strategic management are high profitability, opportunities identification, controlled, direction for decisions, Depth understanding of business, depth understating of competitor, identification of problems, defining the roles & responsibilities.

1.    High Profitability

One of the advantages of Strategic management is to ensure high profitability of the company. Business is done for profit. A Business with structured future direction is likely to earn high profits.

2.    Opportunities Identification

Strategic management helps in identifying the new opportunities for the organization. Modern business is all about en cashing the opportunities. Many organization has failed, which could not identify the available opportunities in the market.

3.    Effective Control

Another advantage of Strategic management is controlling the business effectively. Strategic plans can be used to monitor the performance on timely bases, and required controlled actions may be taken by the management on timely bases to achieve the long terms goals set by the management.

4.    Direction for Decisions

Strategic Management facilitates decision making process for the management in the organization. Everyone has a clear direction for decision making i.e. strategic direction. Therefore decision making process within organization is well defined & directed.

5.    Depth understanding of Business

Strategic Management helps management to understand the business in depth, because without depth analyses, a strategic direction cannot be set for future. Depth understanding of business helps management in performance of its basic functions. (Planning, decision making, directing).

6.    Understanding of Competitor

Strategic management helps in understanding the competitor in the market. During Depth analyses of environment, competitor strengths and competitive advantage is analyzed in detail. Such analyses help management to understand its competitor in a better way.

7.    Identification of Problem

Identification of problem is one of the major advantages of Strategic management. We know that strategic management involves a lot of analyses and information processing. Thus the problems at different level are identified; such identification helps management to adopt an appropriate strategy to resolve those problems.

8.    Resource Allocation

One of the major advantages of strategic management is accurate allocation of resources. We know that resources are scare, and therefore need to be allocated effectively.

9.    Fill Communication Gaps

Strategic management also helps in filling the communication gaps between management & employee, because there is a lot of communication involved during the design and implementation of strategic plans.

10. Defined Roles & Responsibilities

Another advantage of Strategic management is defined roles & responsibilities at every level. Everyone in organization has a role, which will ultimately is going to support the strategic direction. Therefore there is no confusion in the organization about roles & responsibility.

11. Integration & Team Work

One of the main advantages of Strategic management is integration of entity, and creation of a team, because all people in the organization are pursuing one direction i.e strategic direction set by the strategic management.