Before an organisation can choose a strategy, it will need: a mission statement—to provide a sense of strategic purpose and value strategic objectives—to provide a sense of direction strategic options a process for selecting the best option. A mission statement defines an organisation's purpose and distinguishes it from other organisations. It identifies the reason for the organisation's existence and can focus the organisation on the business it is, or should be, in.
The statement of organisational purpose usually describes products, markets and technology. To achieve its fundamental purpose, an organisation needs to specify its available means. This part of the statement should be made so that the organisation is able to differentiate itself from its competitors. Stakeholder promises detail the commitment of the organisation to all persons or groups who have an interest in it. Organisational values and beliefs provide guidelines on the way in which tasks are to be accomplished in the organisation. Public image specifies how the organisation wishes to be seen by the public. The standards and behaviour statement briefly identifies the major policies and procedures the organisation will use in implementing its strategy, which will reinforce the values and beliefs of the organisation.
For an organisation to realise its mission, it will need an appropriate set of strategic objectives. They will form the basis of the organisation's strategy and concomitant action plans. Organisations set objectives, which if achieved make them able to be more competitive or better able to survive. These objectives are short-, medium- and long-term goals and include specific outcomes. They must be defined extremely carefully, and once set, be ranked and prioritised.
Strategic objectives must be based on three areas of analysis: (a) Key issues and trends (opportunities and threats), (b) Internal skills and resources and (c) Constraints
No objectives will be achieved unless the organisation's employees understand them, believe in them and are committed to achieving them (Markides 2000: 163).
Objectives should be: specific; challenging, but attainable; measurable; flexible enough to allow for deviations from the original plan; motivating; consistent with each other.
A useful and simple approach to using the information derived from the external, internal and technology analyses to formulate strategic objectives is to identify what gaps may exist in the capabilities of the organisation.
From: Where are we currently positioned with regard to (external trends, internal resources, technology)
To Where would we like to position the organisation in the future with regard to (external trends, internal resources, technology)
Identifying key result areas (KRAs) can help an organisation prioritise its objectives and the actions necessary to achieve them. Rouse (1992: 107) mentions a 'four goal structure' as a useful example of how to apply generic KRAs as a 'first cut' to a wide range of technology-driven strategies.
1. objectives related to the product or service itself (i.e. the concept, its development, production, delivery and marketing)
2. objectives relating to methods and tools required to support the product or service (e.g. design or manufacturing)
3. objectives relating to establishing the strategic capacity that can facilitate the sale of the product or service, including gaining experience and building relationships within the industry, with suppliers and with customers
4. objectives relating to the knowledge and technology areas required to support the development and delivery of the product or service (i.e. the competency gaps that must be overcome).
The strategy (or combination of strategies) selected must give the organisation the best chance of achieving its objectives in the face of great uncertainty and opposing competitive forces.
Viljoen and Dann (2003) recommend the use of a number of tools to evaluate corporate- level strategies including the Boston Consulting Group (BCG) matrix, McKinsey/General Electric Matrix (market attractiveness/competitive strength matrix or GE matrix) and the directional policy matrix (which compares the competitive position of each of the business units with the maturity of the industry). Use quantitative selection methods with care, recognise all stakeholders' interests, avoid selection traps and make robust and adaptive choices