Goals Of Strategic Management

Strategic goals are the specific financial and non-financial objectives and results a company aims to achieve over a specific period of time, usually the next three to five years. Strategic goals are important because they: Drive priority setting, resource allocation, capability requirements and budgeting activities.

Define the basis for acquisitions, dispositions, joint ventures, or other forms of strategic alliances and partnerships. Help determine how an organization is to be managed, measured and evaluated, and ensure the alignment of corporate management with strategic direction.

Set the stage for the companies’ organizational structure, culture, and control system. Define what business an organization is in, and therefore commit it to any need to enter new, related industries.

Provide a framework for planning to protect the companys’ market share, enhance product differentiation, and attract the right customers. Improve competitive advantage and sustain superior performance.

Measure executive performance, which in turn influences compensation. Strategic goals are the specific financial and non-financial objectives and results a company aims to achieve over a specific period of time, usually the next three to five years. Strategic oals are important because they:

Top Five Strategic Goals (Diamond et al. 2003)

Expand revenue share in existing markets, and gain share in new markets
Increase profitability of units, as well as the company as a whole
Increase cash flow, through increased volume and increased profit-ability
Access and retain global assets
Improve cost structure for long-term maintainable competitive advantage

Types Of Strategic Goals

KPIs: Key Performance Indicators (performance measures) that can be, and are, used to assess and monitor strategic goals. A Short term key performance Indicator, (KPI) is a short term strategy for tracking a strategic goal, and a long term KPI is a medium to longer term strategy for tracking a strategic goal.

For example, a short term KPI for a strategic goal to increase sales volume is the monthly sales target, and a long term KPI is the growth rate to be achieved over the long term
(Refer to the discussion on key performance indicators)

Goals Related T Competitive Strategy

Finding and protecting the keys to profitable growth
Gain/retain market share
Improving productivity
Improve return on investment
Improve the quality of the product
Increase the price of the product
Strengthen advertising to gain market share

Removing Barriers Of Entry

Government regulations
Economic issues
Strength of competition

Goals Related To the Value Chain

Structural Goals

Eliminate in effective parts of the value chain;

Appropriately utilise capabilities within the organization to enhance competitive advantage, and control product cost
Better differentiate products in order to facilitate, and sustain, profitable growth

Goals Related To Capabilities And Resources

Lifecycle stages grow and develop (Cavenez & Butler, 2003)

Develop and exploit core competencies;
Invest in research and development
Invest in new products and new technologies
Develop and exploit core competencies;· Invest in research and development· Invest in new products and new technologies
Short term, high risk projects
Growth phase investments
Expansion into little known product areas
Headcount and capital investment targets
Establishing new strategic relationships, sometimes in different countries and different cultures
Recruiting and training new staff
Acquisition and internal integration of new staff
Taking chances on joint-venture opportunities, and co-operation in new geographic areas
Investment in existing capabilities to deal with new or changing business conditions
Boosting company-wide performance by increasing the capability of the company as a whole.
Optimise internal integration and ensure a strong and cost-effective global organisation
Enhance and optimise management of the local market
Reduce costs of management
Development of highly effective strategic alliances with highly efficient partners.
Acquisition of hyper competencies in all areas of the business.

Goals Related To Learning

Increase in knowledge and learning and continual enhancement of the company’s practical ability
Improvement of the quality of the company’s capabilities, working practices and culture
Development of management capabilities to match a policy of professionalisation
Development and promotion of new staff as a route to advancement in the new company
Development and adaptation of new skills within the organisation.

Goals Related To The Business Model Or Business Strategy

Identify the right business model for profitability, reducing risk and enhancing return on investment
Increase profitability by getting the right mix of products and services
Achieve cost-containment
Identify an appropriate target market for company’s products
Increase sales, via direct marketing
Increasing sales through company customer’s using a third-party distribution network
Improve customer satisfaction
Reduce customers time and delays in dealing with the company
Improve the flow of information to and from the company and its market
Set up firm policies and co-operation with both channel customers and suppliers
Reduce company’s advertising and sales costs

Goals Related To Distribution Or Channels Of Distribution

Consolidate channels
Acquire a previously independent user/distributor
Identify the right channel for sales
Merge distribution channels
Make business specific strategy that will lead to better channel management
Development of stronger relationships with customers in order to increase customer retention
Development of stronger relationships with customers in order to increase customer satisfaction
Increase profitability and lower cost of channels
Ensure consistent products and services across different geographical areas
Ensure good customer service
Get customers to buy products that complement the company’s brand
Provide incentives for channels

Goals Related To Human Resources

Create a highly motivated workforce
Increase employee satisfaction and commitment
Improve the quality of the workforce, to take advantage of increased knowledge level
Educate the workforce
Develop a learning culture in the organisation
Establish a learning network between different organisations
Recruit and train new staff
Professionalise the workforce through high-quality training, development and skills enrichment.
Select staff with adept skills and abilities
Develop skills of staff members to meet the company’s long term talent requirements
Determine training requirements for specific job positions
Use technology to streamline the training and education of staff
Develop and stress the importance of interpersonal skills
Modify working practices and human resource management strategies to take advantage of current technology
Use the latest technologies to reduce company costs.

Goals Related To Technology

Identify, acquire and integrate technology
Develop and adapt leading technology
Continue to develop new technology within the company
Deploy technology to gain competitive advantage, to create new products and services, to provide better customer service
Use the latest technology to reduce costs
Gain leadership in technology within the industry
Develop the company’s technological capabilities
Ensure that the company’s organization is technically effective and capable of adopting new technology.
Break down technology problems into practical components in order to identify solution.

Goals Related To International Expansion

Operationalize strategy for international growth through domestic and overseas assignments
Use established strengths and co-operate with outsiders and new partners
Use established strengths to achieve competitive advantage in the long term
Align the culture, politics and motivation of the firm with local requirements
Identify and target markets
Set aims for entering new markets that will deliver us the best opportunities for growth
Use experience from the past and apply it to the new market
Develop a value-added proposition that shines across borders and countries involved
Develop a ‘sense of place’ that combines local impact and global identity
Choose appropriate entry strategies; create an umbrella or regional brand
Select partners that share its vision and goals
Develop the critical mass in terms of funding, people, infrastructure, strategy and organisation
Establish and manage a localised business which will take advantage of local opportunities.
Manage the transition from old to new markets.
Review and uncover opportunities and potential problems
Revise and monitor strategies on a continual basis
Formulate strategies that take advantage of brand loyalty
Integrate the local market into the international strategy
Determine a strategy which takes advantage of synergies between the organization’s international expansion strategy and the firm’s core business activities
Develop new products or services in line with local preferences
Develop local assets and reputation to ensure smooth transition
Operationalize immigration or entry policies at the start of the new venture, to ensure a smooth transition
Overcome cultural and political barriers
Guiding the firm through the transition
Develop long term strategic plans
Develop a strategic plan for transition that identifies short term and long term actions to be taken
Ensure sustainability and adherence to the plan throughout the transition
Use the original plan as a starting point for the development of a localized version
Clearly identify and define reasons for beginning the transition
Differentiate between short and long term reasons for ending internationalization
Continue to develop new strategies and approaches
Initiate international expansion activities when the company’s core business has developed beyond a particular growth stage or maturity level