Strategic Planning and Strategy

This chapter provides an understanding of why strategies are important to businesses. It begins with defining strategy, what it was before and what it is now, and the steps that it consists of that can be taken to realize that future desired state for the business. The direct relationship between competition and strategy is described to emphasize to businesses how competitive forces shape strategy. An overview of strategic planning, as well as the process of managing it, is presented to explain why businesses need to plan, what stages are there in the strategic management process, and how businesses can achieve their goal through adopting a formalized strategic management process. The two main categories of strategy—business and corporate strategies—are described to explain that the actions to be taken by businesses in order to gain competitive advantages from them are different in scope and purpose. In the context of the construction industry, the nature of business activities that take place during a cycle of economic expansion and contraction is explained. The topic of strategy is discussed further, making reference to its application as business strategies, as well as corporate strategies, by construction companies. Focusing on the global construction market, the business and corporate strategies practiced by some international construction companies are described in the form of case studies. The chapter concludes with a summary of the main points covered on strategic planning and strategy.