What are the five major steps for a company to follow when developing a strategy?

The strategic management process is more than just a set of rules to follow. It is a philosophical approach to business. Upper management must think strategically first, then apply that thought to a process. The strategic management process is best implemented when everyone within the business understands the strategy. The five stages of the process are goal-setting, analysis, strategy formation, strategy implementation and strategy monitoring.

The purpose of goal-setting is to clarify the vision for your business. This stage consists of identifying three key facets: First, define both short- and long-term objectives. Second, identify the process of how to accomplish your objective. Finally, customize the process for your staff, give each person a task with which he can succeed. Keep in mind during this process your goals to be detailed, realistic and match the values of your vision. Typically, the final step in this stage is to write a mission statement that succinctly communicates your goals to both your shareholders and your staff.

Analysis is a key stage because the information gained in this stage will shape the next two stages. In this stage, gather as much information and data relevant to accomplishing your vision. The focus of the analysis should be on understanding the needs of the business as a sustainable entity, its strategic direction and identifying initiatives that will help your business grow. Examine any external or internal issues that can affect your goals and objectives. Make sure to identify both the strengths and weaknesses of your organization as well as any threats and opportunities that may arise along the path.

The first step in forming a strategy is to review the information gleaned from completing the analysis. Determine what resources the business currently has that can help reach the defined goals and objectives. Identify any areas of which the business must seek external resources. The issues facing the company should be prioritized by their importance to your success. Once prioritized, begin formulating the strategy. Because business and economic situations are fluid, it is critical in this stage to develop alternative approaches that target each step of the plan.

Successful strategy implementation is critical to the success of the business venture. This is the action stage of the strategic management process. If the overall strategy does not work with the business' current structure, a new structure should be installed at the beginning of this stage. Everyone within the organization must be made clear of their responsibilities and duties, and how that fits in with the overall goal. Additionally, any resources or funding for the venture must be secured at this point. Once the funding is in place and the employees are ready, execute the plan.

Strategy evaluation and control actions include performance measurements, consistent review of internal and external issues and making corrective actions when necessary. Any successful evaluation of the strategy begins with defining the parameters to be measured. These parameters should mirror the goals set in Stage1. Determine your progress by measuring the actual results versus the plan. Monitoring internal and external issues will also enable you to react to any substantial change in your business environment. If you determine that the strategy is not moving the company toward its goal, take corrective actions. If those actions are not successful, then repeat the strategic management process. Because internal and external issues are constantly evolving, any data gained in this stage should be retained to help with any future strategies.

There are three vital questions:

Where Are We Now?

Where Do we Want to Go?

How Will We Get There?

 The five steps of strategic planning are:

Developing a Vision and a Mission: the purpose of the organization (mission)  and its desired dream (Vision)

Setting Objectives: SMART objectives

 Market, Competitors, and the organizational analyses: to best match the organization strength with the emerging opportunities.

Implementing and Executing Strategy: the strategy formulation and functional implementation

Evaluating Performance, Reviewing the Situation and Initiating Corrective Action: comparison between targets and results, tracking market changes or new trends, ..etc.

Following points which remain the outline while devising a Strategy:

1. Determine where you are.

2. Identify what’s important.

3. Define what you must achieve.

4. Determine who is accountable.

5.Define your Budget.

I agreed with diff definitions. As "Farrukh" mentioned reviewing your strategies always a good procedure.

1 . The strategy should have a justification

2. Make a clear study about  the chances for which it would fail.

3.  Make Sure  that the Strategy can affordable with the Existing Resources.

4. The Strategy should feel as simple and humble  to all but should be something result oriented.

5  Implementing a strategy  cannot be done freaquently.

Prayer

Truth and Honest

Quality of Work

Satisfaction of the customers

Success

There are many documented approaches to strategic planning. Typical strategic planning processes examine an organization’s current environment and abilities (the present situation), considerations about how it would like to grow or evolve (the desired future), its aspirations as an organization (what it will strive to do), and its intentions for moving forward (how it will move forward). The following are the5 steps I beleive are required for strategic planning:

1.      Define the organization (Mission, Vision, & values)

2.      Define the Corporate strategic mission, it’s key success factors, & KPIs for each KSF.

This involves performing analysis of external factors to understand the impact of the macro- and industry-level trends on the company’s operations. This includes PESTEL (Political, Economic, Social, Technological, Environmental, & Legal components) analysis and industry level examination of industry economics using a framework such as Michel Porter’s five forces.

3.      Define the business level (and the functional level) initiatives and actions (tactics) required to achieve the corporate strategic mission while creating a sustainable competitive advantage. Define Success factor(s), performance indicator(s), and result indicators for each department or function.

This involves performing analysis of internal factors to examine the organization’s own performance and capabilities. A widely used analytic tool for this purpose is value chain analysis also introduced by M. Porter and the SWAT analysis.

4.      Implement the defined business level (and functional level) initiatives and actions.

5.      Monitor the implementation using balanced score cards if available and the PIs and KPIs and take corrective actions are required.

This is a repetitive process which takes place once or twice a year.

1- Indntification of current situation

2- External Analysis

3- Internal Analysis

4- Formulation

5- strategy implemenation and control