Creating Strategic Direction: Benefits and Steps - Paper Example

Introduction

Strategic direction is a short statement that outlines the actions to be taken to achieve organizational goals and state where the firm wants to be in the future (Ng'anga et al., n.d). Strategic direction is necessary for an organization as it presents a broadly shared sense of direction and purpose for the firm (Olk et al., n.d). The advantages of strategic direction include reducing employee confusion and identifying the resources gap to pursue and acquire the necessary resources.

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Process

According to Brady and Walsh (2008), setting up a company’s direction with strategy is a process that involves five crucial steps to achieve. First, the process requires that an individual understands the organizational context and determines its vision statements that coincide with the company direction. It provides the answer concerning what the organization intends to become in the future. The vision statement focusses on uniting the taskforce towards one common goal and aligning various activities across the organization towards a specific direction. Therefore, a clear, straightforward, and understandable vision statement is likely to guide a company's strategy as it enables people to decide if their work is moving the company forward.

The second step involves considering a company's mission statement, which describes what the firm does and making the vision a tangible reality (Ng'anga et al., n.d). The procedure enables a company to distinguish itself from others, provide the firm's operations' scope, and describe the firm's values on how employees should conduct themselves. The third step in setting up a company’s direction relates to selecting periodic goals and objectives. Long term goals enable a company to make short term plans that focus on leading the company to the defined path. On the other end, setting short term objectives enhances breaking down long-term goals into manageable and achievable goals. The fourth and fifth steps in establishing a company’s direction involve selecting and implementing the strategy. These steps are critical in the process since they link the destination, which is the vision of the firm's current reality.

Advantage of Strategic Thinking

The concept of strategic thinking entails defining how individuals think about, assess, view, and develop the future for themselves, company, and others. The idea enhances one’s ability to define company objectives, focus on organizational vision, and design plans that are flexible enough to anticipate changes rather than reactive after the alterations have occurred. Rumelt (2011) holds that the second natural advantage of various right strategies originates from insight into new sources of strength and weakness. He argues that viewing things from a different angle enables an individual to realize new realms of merits and the threats, liabilities, and opportunities.

Therefore, strategic thinking helps companies develop innovative business models, which helps them gain a competitive advantage over others in the market. The benefit arises because these models help the companies reshape the people's outlook and behaviors to favor their operations. Since a good strategy is unexpected, rival organizations do not expect you to possess the idea. However, Rumelt explains that a good plan is coherent, coordinates activities, and steps with one another and resources to support a particular goal (Rumelt, 2011). In doing so, a coherent and good strategy acts as a critical source of competitive advantage.

Decision Model

The use of different decision models is becoming rampant among various organizations in the modern world. The models are crucial in setting a company’s direction and vision since they can provide accurate predictions. Today, organizations face unprecedented external pressure concerning the consideration of alternative viewpoints, which forces them to apply the multi-perspective strategic decision-making models (Wainfan, 2010). This type of decision model focuses on making long term strategic decisions that impact the company’s operation but takin into account diverse perspectives, including their beliefs, values, and expectations (Wainfan, 2010). The model recognizes the possibilities of people having different views and, therefore, it helps groups agree on specific strategic actions.

Conclusion

A combination of strategic thinking and appropriate decision-making models can positively influence the long-term performances of a company. The multi-perspective decision-making model considers the opinions of key stakeholders in an organization, facilitating the process of making strategic and visionary decisions.

Annotated Bibliography

Brady, M., & Walsh, A. (2008). Setting strategic direction: a top-down or bottom-up process?

Business Strategy Series, 9(1): 5-11. http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.556.5016&rep=rep1&type=pdfThe primary objective of the article is to examine the process of setting a company’s strategic direction. In the study, the authors argue that leadership plays a critical role in linin up staff members of a company towards one particular order per the firm’s goals. They also found that the formulation of organizational directions has no formal protocols and some strategic recommendations come from the junior staff members to the top managers (bottom-up process). The argument presented in the journal article fits perfectly for my discussion as it provides the necessary guidelines for the setting of the company’s strategic direction.

Ng'ang'a, L.W., Waiganjo, E.W., & Njeru, A.W. (n.d.). Influence of strategic direction on

organizational performance in tourism government agencies in Kenya. International Journal of Business and Commerce, 6(4), 18-36. https://www.ijbcnet.com/6-4/IJBC-17-6403.pdfThe article focuses on determining the impact of strategic direction on organizations' performance within Kenya's tourism sector. The investigation found that in most companies, senior managers agree on the strategies and then communicates them to the junior staff. However, the study revealed that all the stakeholders of the government agencies were involved in the implementation of the set strategies. The information reported in this article fits in my discussion since it highlights the usefulness of a multi-perspective decision-making model and all staff members' involvement in making strategic decisions. The journal article is a credible and quality source of information since professors and lecturers have written it for academic purposes.

References

Brady, M., & Walsh, A. (2008). Setting strategic direction: a top-down or bottom-up process?

Business Strategy Series, 9(1): 5-11. http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.556.5016&rep=rep1&type=pdf

Ng’ang’a, L.W., Waiganjo, E.W., & Njeru, A.W. (n.d.). Influence of strategic direction on organizational performance in tourism government agencies in Kenya. International Journal of Business and Commerce, 6(4), 18-36. https://www.ijbcnet.com/6-4/IJBC-17-6403.pdf

Olk, P., Rainsford, P., & Chung, T. (n.d.). Creating Strategic Direction Visions and Values. https://www.sagepub.com/sites/default/files/upm-binaries/35210_Part1.pdf

Rumelt, R. (2011). Good Strategy/Bad Strategy: The difference and why it matters. Crown Publishing.

Wainfan, L. (2010). Multi-perspective strategic decision making: Principles, methods, and tools. Www.Rand.Org. https://www.rand.org/pubs/rgs_dissertations/RGSD260.html‌