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A more formal definition tells us that the strategic management process “is the
process by which a firm manages the formulation and implementation of its
[1]
strategy.” The strategic management process is “the coordinated means by which
[2]
an organization achieves its goals and objectives.” Others have described strategy
as the pattern of resource allocation choices and organizational arrangements that
[3]
result from managerial decision making. Planning and
strategy formulation sometimes called business planning, or strategic planning, have
much in common, since formulation helps determine what the firm should
do. Strategy implementation tells managers how they should go about putting the
desired strategy into action.
The concept of strategy is relevant to all types of organizations, from large,
public companies like GE, to religious organizations, to political parties.
Strategic Management in the P-O-L-C Framework
If vision and mission are the heart and soul of planning (in the P-O-L-C
framework), then strategy, particularly strategy formulation, would be the brain. The
following figure summarizes where strategy formulation (strategizing) and
implementation fit in the planning and other components of P-O-L-C. We will focus
primarily on the strategy formulation aspects of strategic management because
implementation is essentially organizing, leading, and controlling P-O-L-C
components.

You see that planning starts with vision and mission and concludes with setting
goals and objectives. In-between is the critical role played by strategy. Specifically, a
strategy captures and communicates how vision and mission will be achieved and
which goals and objectives show that the organization is on the right path to
achieving them.
At this point, even in terms of strategy formulation, there are two aspects of
strategizing that you should recognize. The first, corporate strategy answers strategy
questions related to “What business or businesses should we be in?” and “How does
our business X help us compete in business Y, and vice versa?” In many ways,
corporate strategy considers an organization to be a portfolio of businesses, resources,
capabilities, or activities. You are probably familiar with McDonald’s, for instance,
and their ubiquitous golden arches fast-food outlets. However, you may be less likely
to know that McDonald’s owned the slightly upscale burrito vendor Chipotle for
several years as well. The McDonald’s corporate strategy helped its managers
[4]
evaluate and answer questions about whether it made sense for McDonald’s set of

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