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Introduction
The health care environment is dynamic, complex, complicated and challenging. Health care organizations are nowadays faced with serious challenges, particularly concerning quality, effectiveness and efficiency (Mosadeghrad, 2005). Accordingly, health care managers and leaders should adopt new approaches to adapt their organizations with the changing internal and external environments and match the complexity of the health care industry. Strategic management is an appropriate response to these challenges and helps managers to take advantage of any changing environment and achieve optimum outcomes.
The English word strategy has a long history in military and politics. It comes from the Greek word strategos, meaning “generalship,” or the person who leads the army. It shows the art and science of a general to plan the destruction of one’s enemies through effective use of resources (Swayne et al., 2012). Strategy shows the long-term direction and scope of an organization in a changing globalized, turbulent and uncertain environment through its configuration of competencies and resources to achieve competitive advantage and meet stakeholders’ expectations (Johnson, 2008).
Strategic management is a course of actions to achieve organization’s vision and long-term strategic goals using rational, logical and systematic approach. It involves analyzing both internal and external environments of an organization to understand organization’s strategic position, specifying its long-term direction, defining a clear vision, establishing realistic long-term goals and objectives, formulating strategies, tactics, policies and action plans to achieve them, allocating necessary resources to implement action plans and finally, evaluating organizational performance (Mosadeghrad, 2015). Managers through strategic management strengthen and mobilize their resources toward a desired defined future.
Strategic management enhances managers’ awareness of external opportunities and threats and internal strengths and weaknesses, improves their understanding of the competitors’ positions and strategies (Mosadeghrad, 2015), promotes communication between managers and employees (David, 2011), increases employees’ productivity (David, 2005), improves organizational competitiveness and profitability (David, 2011) and strengthens its market position (Pearce and Robinson, 2007).
Strategic management is the process of strategy formulation, implementation and evaluation (Mosadeghrad, 2015). Strategy formulation is concerned with determining the organization’s mission, vision, goals and objectives, and formulating appropriate strategies, tactics and action plans to achieve them. Strategy implementation is about allocating resources for implementing action plans, adjusting organizational structure and culture to fit the strategies and leading the changes...