Benefits and limitations of strategic management

Benefits and limitations of strategic management The overall objective of any strategy is to ensure long-term survival. Strategic management is the process determined by specific persons to establish and implement the integrated concept that has already been described.† (Philip, Roland, & Nils, 2008, p.14). Strategic management emphasizes the strategic positioning and operating system efficiency, and it is generally regarded as the modern enterprise’s success. Each company will take appropriate strategies based on external environment and internal resources. After the implementation of these strategies, some will become potential benefits, while some will be the limitation to restrict development of enterprises instead of promoting. In the report, Tiger Airways Australia was chosen as the object of study. Tiger Airways Australia, a Singapore based subsidiary of Tiger Aviation, is a low cost airline currently servicing the Australian domestic market. Tiger Airways Australia commenced operations on 24 November 2007 as a domestic airline from its principal base at Melbourne, Victoria. Tiger made different strategies to enter the aviation in Australia to gain market share and win customers. Tiger have to face competition from Virgin Blue and Jetstar. The report discussed its strategies and the potential benefits and limitations can be analyzed in such different ways. The understanding of strategic management Strategy and strategic management have long been viewed as the concept and process that link an organization and its competitive environment. The traditional approaches to strategic management are in keeping with Newton’s mechanistic model of the universe and Fayol’s view of the management function. (Thomas, Marius, & Sven, 2006, p.68). The existing strategic management system -including defined purpose (vision, mission, objectives, etc.), organizational structure, planning processes, measurement practices, core competency focus, human resource management, culture norms, and evalua tion and reward systems – is more a source of organizational inertia than a proactive force for dynamic change (Thomas et al., 2006, p.73). Strategic management is necessary to position the firm a way that will assure its long-term survival in a competitive environment. (Paul, Ken, & John, 2004, p.3). Innovation always point to the reformulation of the strategies of a firm, therefore, strategic management is also about innovation. (Manikant ,2008, p.235) Components of strategic management process The various components of the strategic management process are including strategic planning strategy process, strategic decisions, strategy formulation, strategy implementation, and strategy change. The planning, balancing and positioning approaches to strategic management can be grouped as outward-in approaches, i.e. first analyzing the external environment and then analyzing and competitively gearing the internal environment. (Thomas et al., 2006, p.71). The strategic management pr ocess is the full set of commitments, decisions, and actions required for a firm to achieve strategic competitiveness and earn above-average returns. (Michael, R, & Robert, 2009, p.6) Tiger Airways Australia was chosen as the object of study. Australian market continued to be attractive for existing operators based on strong economic growth. Economic growth would benefit to development of the aviation industry (â€Å"Australia in brief†, n.d., 2008).And Tiger chose appropriate time to enter Australian aviation market. From the external transactions, Tiger gains the support of the state, has a very strong financial support and makes good use of economic forces. It took low-cost strategy. The potential benefits and limitations are analyzed as following through the implementation of internal and external strategic management. The ultimate goal of strategy is to create value for the firm, while the role of strategy analysis is to identify and exploit the sources of this value. (G rant, 2010, p.63)