Strategic Management: The Role in Business

Every manager in a corporation is faced with one principle aim; increasing the shareholders wealth by improving on the bottom line. To attain these objectives, a firm has to develop strategic management approaches. Whereas there are many reasons behind the development of strategic management in an organization, the two most common reasons are; the need for proper planning and the desire for growth.

The success of a business organization rests on its ability to plan ahead and align its practices in a manner that exploits both current and future opportunities and smoke away competition and future threats. This can only be best achieved through strategic management. According to Dess, Lumpkin and Eisner (2009), “strategic management actually gives the organization direction, a sense of identity and unity towards what the business goal is that therein lies the continued importance of strategic management towards business success.”

In addition to the above, all types of organizations have both the vision and mission statements that they aim to achieve. Strategic management assists in the alignment of organizational practices in a manner that enables it to achieve its goals and objectives easily. This fact is buttressed by Dess, Lumpkin and Eisner (2009) in stating that “every business has a vision and a mission and strategic management takes into consideration both of these by helping the in achievement of the organizational goals in an effective and efficient manner.” This implies that strategic management remains critical in the achievement of organizational goals and objectives.

One company I discovered failed to take advantage of the opportunity they had in time and thus failed to neutralize the threats from the competitors was Starbucks Coffee. Starbucks coffee company is a well established coffee brewing company with several store around the global. Gattorna, (1998) states that, “The Company is one of the premier roaster and retailer of coffee in the world”. “The company is known for selling whole bean coffees in supermarkets, produce and sells the bottled Frappuccino® coffee drink, a line of premium ice creams, a specialty liqueur, EthosTM water, and a line of premium Tazo® teas” (Gattorna, 1998).

In the operation of Starbucks Company, effective and efficient managerial interventions are widely applied. The company has over the years experienced continuous development in the coffee industry. Despite all the above efforts to remain competitive, Starbucks failed to attach the greatest value and importance on its employees. Human resource management forms the bloodline of organization – a fact that was sadly ignored by Starbucks. The levels of satisfaction among the employees dipped to the lowest levels and Starbucks failed to not only attract the best human resource but also failed to retain the ones it had. This opened the doors for aggressive campaign buy other competitors in the coffee industry thus threatening the position of Starbucks in the market.

To ensure continuous success in this competitive world, Starbucks Company spends a considerable amount of resources in its innovation and its unique entrepreneurship endeavors which have set distant a part from its competitors while shoots itself on the other foot by ignoring the plight of its employees. Employee motivational strategies such as reward management, reward policies and wellness programs have had a poor traditional run that fails to meet the expectations of the industry standards. This underlines its inability to take advantage of its strength and thus precipitate its weaknesses.

SWOT analysis involves a critical and comprehensive examination of the internal and external factors that affect the business in its quest to achieve its objectives (Barney, 1991). In the coffee brewing industry, Caffe Nero has failed to take the external advantage of aggressive branding in the coffee market. One of the strategies that have been soundly embraced by a multitude of companies is the extensive analysis of companies’ opportunities and threats with the strategic aim of achieving higher competitive advantage. The realizations of these objectives have been attained through the successful initiation, development and management of brands in most instances which has not been exploited by Caffe Nero coffee house. The inefficient management of brands has presented challenges to Caffe Nero managers because of the inability to accurately evaluate and assess their brands particular strengths and weaknesses.

The decision on whether to pursue a cost leadership strategy and a differentiation strategy simultaneously primarily depends on the type of organization under examination. However, there is a general belief that simultaneous application of the above strategies is a recipe for disaster. This fact is buttressed by Dostale and Flouris (2003) in succinctly stating that “being stuck in the middle is a recipe for strategic mediocrity and below-average performance because pursuing all the strategies simultaneously means that a firm is not able to achieve any of them because of their inherent contradictions.” A good example is the case of British Airways in the 1970s. Through offers of no frill/low fare services, the airline began to increase the number of its flight destinations and fancier in flight services. To attain profitability, they had to raise fare till passengers felt they could get a better value for money by flying traditional carriers. As a manager of a firm, the most important controls that I would review to make sure that my organization is moving towards the right direction are budgets, available resources and strengths and weaknesses of the organization. The tope three items I would want to see is a sense of direction, capacity for measurement and collective responsibility and teamwork.


Barney, J. (1991). Firm Resources and Sustained Competitive Advantage. Journal of Management. Vol.17. no.1: 99.

Dess, G.G., Lumpkin, G.T. and Eisner, A. (2009). Strategic Management: Creating Competitive Advantages. New York: McGraw-Hill.

Dostale, I. and Flouris, T. (2003). Business Strategy and Competition for the Future in the Airline Industry. Web.

Gattorna, J. (1998). Strategic supply chain alignment: best practice in supply chain management. London: Gower Publishing, Ltd.

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