Understanding The Benefits Of Strategic Management

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Most Significant Understanding the benefits of strategic management is one of the key themes of the chapter and strategic management emphasizes long-term performance and operational success of a firm. A firm must rapidly adapt to the changing market and technological environment is another concept that is introduced in the chapter. Strategic management provides a clear sense of strategic vision for the firm, sharper focus, and an improved understanding of a rapidly changing environment. The importance of innovation is another important concept explained in the chapter with respect to an example using the struggling retailer, Sears. Sears succumbed to the lack of innovation, which shows that if a firm stands still, it will be run over by the competition. Strategic planning and innovation should go hand in hand, because innovation is the machine that generates business opportunities in the market and its implementation drives businesses to be remarkable. Theories of organizational adaptation are another important concept, because it helps a company keep track of the changes in technological, economic, and political-legal areas, and the sociocultural trends around the world. The theory of population ecology seems very critical in today’s changing market environment as it explains how inertia (which is unable to adapt to changing conditions once an organization is successfully adapted to a particular environment niche) can badly affects the performance of the firms. For
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