My Definition of Strategic Management

My impression of what this course was going to be before reading the material for week 1 was based primarily on the course name itself. “Strategic Management” brought to my mind the thoughts of a firm’s organizational structure and how to utilize it to maximize efficiency. Additionally, I assumed this course would involve a large amount of Human Resources material – specifically manager employee interaction once again to maximize efficiency.

After reading the material I was intrigued by the scope of the strategic management field. It would appear that the field can trace its roots to many of the assumptions I had which were “identifying firms’ best practices that contribute to firm success” (Hoskisson, Hitt, Wan, and Yiu 419) The bottom line being that the field began by trying to maximize firms’ efficiency and profits through internal means. However, to my surprise it then integrated economics, specifically Industrial organization economics. Additionally, researchers began to study competitive dynamics and boundary relationships, giving insight into industry competition between firms an going much further than just industrial organization economics. In essence, this refocused the field toward external factors such the organization of the firm’s industry as well as grouping the firm and its competitor’s within the industry. This occurred in the 1970’s and over time the field has come full circle back to its beginnings of internal factors, while at the same time maintaining remnants of all other factors along the way. The textbook references creating value or “value creating strategies.” This is integral to success in the long run. I believe strategic management to boils down to utilizing all processes, decisions, and organizational know how to create a competitive advantage, which in turn will bring about above-average returns and eliminate your competition.

Hoskisson, R. E. "Theory