The Five Characteristics Of Strategic Management

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1. How is "strategic management" defined in the text, and what are its five key attributes?

• Strategic management is the continuous planning, monitoring, analysis and assessment of all that is necessary for an organization to meet its goals and objectives.
• Strategic management is the analysis, decisions, and actions an organization undertakes in order to create and sustain competitive advantages. The four key attributes of strategic management are that it:
1. Directs the organization toward overall goals and objectives
2. Includes multiple stakeholders in decision-making
3. Needs to incorporate short-term and long-term objectives
4. Recognizes trade-offs between efficiency and effectiveness
5. Identifying opportunities

2. Briefly discuss the three key activities in the strategic management process. Why is it important for managers to recognize the
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What is meant by a "hierarchy of goals"? What are the main components of it, and why must consistency be achieved among them?

An organization's hierarchy of goals refers to goals ranging from, at the top, those that are less specific yet able to evoke powerful and compelling mental images, to, at the bottom, those that are more specific and measurable. The main components are, at the top, the organizational vision, which evokes powerful and compelling mental images, the mission statement, which includes both the purpose of the organization, its scope of operations, and the basis of its competitive advantage, and the strategic objectives, which are used to operationalize the mission statement and that are specific and cover a well-defined time frame.

There must be consistency among these goals in order to maximize employee motivation and a sense of equity and fairness when rewards are allocated. Inconsistency among the goals between any level can result in confusion among employees as to what the firm values, and subsequently to loss of identification with the firm, loss of motivation, and

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