Strategic Management 101. The Overarching Goals and Objectives of the Organization

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Strategic Management 101. The Overarching Goals and Objectives of the Organization

Every organization is formed on some overarching goal & objective, such as building a profitable business by satisfying a need or a not-for-profit organization dedicated toward a charitable focus that guides its actions.  To quote Warren Buffett: “Someone’s sitting in the shade today because someone planted a tree a long time ago.”

To illustrate with a common example, retirement planning involves deciding on the personal lifestyle during retirement (goal) and determining what steps & savings (objectives) will be required to fund this plan.

Strategic Management Overview

Strategic Management is fundamentally focused on maximizing the organization’s resources through effective management to achieve the overall goals & objectives through key stages (see illustration).

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Continuing the retirement planning example, there are many approaches to achieve the savings plan, such as: investing in higher risk and return portfolios; or, more conservative risk and return portfolios.  Strategic Management is comparable to a sound personal financial plan that incorporates your values, resources, timeframe and comfort for risk exposure.

In your business, you may have already completed some or all of these steps at least once.  The key is to repeat this cycle regularly due to changing economic conditions, technological disruption, shifting markets and increasing competition emphasize the need to adapt & evolve – as maintaining the “status quo” results in falling behind your competitors.

A number of common examples illustrate the rapidly changing environment and impact to businesses:

  • Kodak’s market-leading position in photography drastically declined by the change in consumer needs & functionality of smartphones;
  • Blockbuster chain was materially displaced by online streaming; and,
  • Netflix evolved its mail rental business by introducing online streaming.

We will explore each of these steps to create discussion toward helping you achieve your goals, starting with Goals & Objectives.

Goals & Objectives

For an existing business… What was the purpose or intent of starting this business? Or, why does your business exist?  For a new entrepreneur…Why are you starting this business? What do you want to get out of this business?

Strategic Management is fundamentally focused on maximizing the organization’s resources through effective management to achieve the overall goals & objectives through key stages (see illustration).

The answers to these questions help identify the business owners’ & investors’ motivation and goals & objectives of investing in the business.

“Lack of direction, not lack of time, is the problem. We all have twenty-four-hour days.” (Zig Ziglar)

All too often, many business owners and management teams become inundated with day-to-day tasks, client requests and human resource management; or, overall goals & objectives become faded or unclear. In for-profit businesses, the sale goods or services satisfy a need in the marketplace – profit being a key objective to help achieve the business owners’ goals, such as earning a consistent wage or return on investment.  Succession planning is an increasing topic of discussion and maybe the top objective for some businesses and business owners.

We understand that there is never the right time or right set of circumstances to start this process, so we work with our valued clients to facilitate this process efficiently & effectively.

Engage your trusted advisors to assess your current strategy & strategic processes and determine if you are fully maximizing your resources in achieving your goals & objectives.

Stay tuned for the next topic … Defining your Vision, Mission and Values and exploring your guiding principles.

PKF Antares with a head office in Calgary and branches across Canada offers a wide range of accounting services at competitive rates to fast growing companies in Canada. Our team provides a one-stop solution on Risk Management, Corporate Finance, Assurance, Accounting, Taxation and Internal Controls advisory.

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