The Strategic Management Process in the Construction business
What is Strategic Management?
Strategic Management can simply be defined as a systematic approach to the general management application, initiation, and execution. Strategic Management spells out a company’s rules of engagement as well as the steps it plans to take to ensure continued success.
Elements of Strategic Management
This management process defined organizational strategy and plans how the strategy will be set in motion. The elements of strategic management are:
- Strategic analysis: This has to do with understanding by evaluation. Managers critically analyze the company strategy and how it affect its fortunes
- Strategic choice: Many construction companies make a decision by picking a course of action from among a list of alternatives; this is what is called a strategic choice. A course of action is formulated after evaluating several options.
- Strategy implementation: Under implementation, managers decide on how the desired strategy will be implemented
These three elements play a key role in the strategic management process of any construction company; however, one must note that they may or may not stand alone. In some cases, they overlap each other for goal congruence.
Why is Strategic Management necessary for Construction Project Managers?
Strategic Management is necessary because companies operate and interact with other agencies and stakeholders in a dynamic business environment that is ever-changing.
Stability: Managers need to ensure that their companies are stable and will not be negatively impacted by changes within or outside the agencies.
Appraisal: This process helps managers appraise the strength and weakness of their companies as well as their approved strategy and how it affect them in an ultra-competitive market.
The effect of change: Change may be necessary but not easily implementable in large construction organizations. So, therefore, there is always a need to anticipate the effect of change and to develop a suitable response.
Harmony within the organization: With a clear strategy, the activity or performances of one department will not be completed by the actions by another department within the organization.
Who should implement a Strategic Management process?
When should strategic management be implemented?
Timing is crucial if you want to achieve success. Finding a perfect time to implement it requires careful planning and observation.
There really isn’t the best kind of strategy as every organization is different, so are the ever-changing dynamics in the construction industry. However, organizations should utilize a strategy that guarantees them the best possible outcomes with the least resources based on their goals and objectives.
Have a strategy you’d like to share? Let us know in the comments section below!