What is the primary purpose of the strategic management process?

The primary purpose of the strategic management process is to develop a sustainable competitive advantage. This involves a comprehensive approach to analyzing an organization’s internal capabilities and external environment, allowing it to formulate strategies that position it favorably in the market relative to its competitors.

A sustainable competitive advantage enables an organization to consistently outperform its rivals by leveraging its unique strengths, resources, or capabilities. This might include offering superior products, having lower costs, or possessing better customer relationships. The strategic management process encourages organizations to align their resources and actions with their long-term goals, ensuring that they not only react to changes in the business environment but also proactively shape their market position.

In contrast, creating short-term business plans is more tactical and doesn’t focus on the long-term positioning required for sustainability. Establishing a new company culture, while important, is a component of the overall strategic management process rather than its primary purpose. Enhancing employee satisfaction can contribute to a successful strategy but is not a primary focus of strategic management, which aims at the broader objective of achieving competitive advantage.