Final exam Assignment Example | Topics and Well Written Essays - 1000 words

Final exam - Assignment Example Strategic management also assumes the responsibility of determining whether the strategy requires any modification due the change in the external environment of the entity. Thus, it can be inferred strategic management system is highly important for an organization’s survival in a competitive industry. In order to increase its share in the overall market, an organization needs to increase its customer base. Consumers are highly important for an organization because it is the end consumer that determines the success of an organization. If the organization manages to maintain goodwill among the consumers, it would be successful in acquiring the market share otherwise the organization might not be able to face the threats posed by its competitors. Strategic management system helps an organization conduct periodic evaluation of the external factors that affect the organization’s strategy and one of those factors is the consumer’s demand. Thus, by using strategic mana gement system, an organization can assess the social trends and the demand for its products among consumers. An organization can also receive feedback from consumers with regard to its products. In this manner, an organization can provide better public services by using strategic management system and designing its strategy in accordance with the consumer demand. Thus, it can be concluded that strategic management system is very important for an organization because it helps the organization formulate strategies after assessing the external environment of the organization. Therefore, the strategy determined by the organization would be in conformity with the consumer trends and the organization would be able to provide better public services. This would in turn help the organization in building its goodwill among the consumers as well. Question 2 Please identify and describe five (5) key environmental changes that can influence strategic management. An organization is always affecte d by the environment it operates in. It can never be isolated from its environment therefore it needs to continuously adapt to its external environment. There are certain external factors that affect the strategic management of an organization. The environmental changes that can influence the strategic management are; Political, Economic, Social, Technological and Legal. Political changes depend upon extent to which the governmental authorities take part in the economy of the country. The political changes that may influence an organization’s strategic management are changes in tax policy, corporate laws related to social responsibility, changes in environmental laws, restrictions upon trade and tariffs. All these factors can affect the organization in accordance with the business of the organization. If the organization is a trading company and it imports goods in bulk quantities, it can be highly affected by import restrictions and tariffs on imports imposed by the governme nt. Therefore, the organization may have to modify its strategy accordingly. Economic changes may be changes in interest rates, inflation rate and the exchange rates. If the organization conducts business in international market, any change in exchange rates can influence its business transactions. Social changes that may