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Strategic management is a common term used in current management; this term refers to the set of managerial actions and decisions that establish the long-run performance of an organization. This involves the process of conducting environmental scanning within both internal and external environment, formulation of strategy, implementing this strategy as well as evaluation and control. Therefore, strategic management deals with the process of evaluating and monitoring external opportunities as well as threats with regard to the strengths and weaknesses of an organization (Hitt & Ireland, 2011).
Strategic management can also be perceived as the process through which managers identify and continue realizing outstanding performance in an organization and gaining a competitive advantage over its competitors on the market. An organization can be regarded as having a competitive advantage if its profit levels are greater that the average profit levels of all other organizations in the industry.
Strategic management can also be described as a bundle of acts and decisions undertaken by a manager that determine the outcome of organization’s performance. Strategic management plays an essential role in incorporating different functional areas of an organization entirely, and ensures that all the functional areas get together and harmonize well. Also, strategic management is concerned with monitoring organizational goals and objectives.
In order to ensure proper strategic management practice for an organization, a manager should possess a broad scope of knowledge and analysis of competitive and general organizational environment in order to make appropriate decisions. The management of an organization should carryout SWOT Analysis, which involves the process of identifying strengths and weaknesses, as well as possible opportunities and threats present within the external environment. To ensure organizational success, managers should ensure best utilization of strengths of the organization and minimize its weaknesses so as to become competitive in business environment. Additionally, managers should seek for arising opportunities in the business environment and avoid threats as much as possible. This is because threats can produce adverse effects on the performance of an organization.
Strategic management is just a process of planning for anticipated and unfeasible contingencies. It applies to both small and large organizations. This is because small organizations also experience competition of well established firms within the business environment. Therefore, through formulating and implementing proper strategies, they can achieve a sustainable competitive edge within the business environment. Through strategic management, strategists set organizational objectives and work towards the attainment of those objectives. They deal with the process of making and implementing various decisions concerning the future course of action within the organization. This implies that, strategic management helps in determining the direction towards which a firm is moving.
Strategic management is a constant process that assesses and controls the business as well as the industry where an organization operates. It evaluates various competitors, sets goals and strategies that enable an organization to meet both existing and prospective competitors. Additionally, through strategic management, a manager re-evaluates strategies regularly in order to determine how various strategies were implemented and whether they were successful or require a replacement.
Moreover, strategic management provides wider perspectives to the organization’s employees, and helps them to comprehend how their respective job fits within the whole organizational plan as well as how it relates to other members of organization. This implies that strategic management can simply be a skill of managing employees within the organization in a manner which can help to maximize their ability of attaining business objectives. Proper strategic management ensures that employees become more committed, satisfied and trustworthy as they are able to co-relate themselves well with each task within the organization. Through strategic management, employees are able to comprehend the reactions of various changes within the organizational environment and likely organizational responses. Therefore, employees are in a position to judge the effects of such changes in relation to their job and are able to face the changes more effectively. This is imperative as managers and employees are supposed to be effective and efficient at all times so as to ensure organizational success.
Strategic Management Practices in the United Arab Emirates Business Environment
The United Arab Emirates has a unique market potential, business environment, legal structures of business, and procedures as well as opportunities for investors on the local and the worldwide market. As a result of their strategic location, the United Arab Emirates has been hosting and offering appropriate business routes for quite a long period of time. It provides an easy access to consumer markets worth approximately 1.5 billion. These markets are located in Western Asia, Africa, Eastern Europe, the CIS countries as well as in the areas surrounding the Gulf and the Red Sea. The United Arab Emirates has 6 airports, 11 state-of-the-art ports and satellite links with about 230 nations. This has enabled the United Arab Emirates to become one of the top enter port centers globally. It competes with the growing tigers of the South East Asia, and it has for a longtime strengthened its position amongst the top oil-producing nations. Currently, the United Arab Emirates leadership is focusing on the industrial development within the country (Al-Ima%u0304ra%u0304t, 2002)(al-Ima%u0304ra%u0304t, 2002).
Despite the fact that the United Arab Emirates has plentiful oil reserves, it endeavors to expand its economic stability and minimize its exposure to unpredictable fluctuations in oil prices. From the beginning, the United Arab Emirates has undergone a constant and sustained transformation process from a small and poor state to a modern nation having high living standards. As a result of establishment of effective and efficient economic policies, the United Arab Emirates has reduced its reliance on natural gas and oil incomes. Additionally, it recognized the potential of the private sector, as well as the fact that the country’s business environment attracts both domestic and foreign investors to invest. This has been the core aspect that has enabled business of the United Arab Emirates to grow at a remarkably fast rate (Bains, 2011). Moreover, the government offers all industrials facilities, and in addition, it has enacted numerous commercial laws and regulations so as to achieve global protection and obligations for investors. This has enabled the state to attract more investors from different parts of the globe, and this has facilitated the growth of the United Arab Emirates business environment (Young, 1999).
In addition, the United Arab Emirates economy is performing well, and it has risen by more than six times for the last 26 years. This has enabled the United Arab Emirates to emerge as the fourth largest economy in the Arab world. In the current years, the United Arab Emirates has experienced rising of pioneer industries as a result of more generous advantages as well as trade incentives granted by the government to investors. The government has also ensured the simplicity of procedures and formalities for operating business in the United Arab Emirates. This has enabled the government to attract many investors, and as a result, investments have increased. For instance, in the last decade, the United Arab Emirates government increased its investments in the domestic market from about $3.47 billion to approximately $4.93 billion. On the other hand, investment within the business sector amounted to about $5.41 billion from approximately $2.89 billion.
The United Arab Emirates provides profitable investment opportunities and investments to both domestic and foreign investors that are extremely rare on the global market. Additionally, free trade zones that have many incentives also play a key role in attracting numerous investors to do business in the United Arab Emirates (Terterov & Tija%u0304rat, 2006).
In general, establishing a business in the United Arab Emirates can be extremely trouble-free and straightforward. Foreign investors are free to participate in many business activities available on the United Arab Emirates market. Since many entrepreneurs across the globe are searching for a favorable business environment to establish and expand their businesses, then the United Arab Emirates can be the best destination. This is because the country provides an open economy and attractive incentives so as to meet the requirements of all investors.
Currently, the development of real estate investment in both Middle East region and the United Arab Emirates has rapidly increased. This is due to the high concentration of abundant opportunities and capitals for business development in the region. One of the driving forces that have made different investors concentrate on the region is growing economy and increasing local government’s efforts to improve the market economy. Currently, establishment of a business in the region is remarkably easier compared to some decades ago. With regard to the real estate industry, it is worth noting that this industry attracts investors as both the United Arab Emirates and Middle East attract many tourists. This makes the real estate industry as well as the development of local infrastructure relatively profitable (Elbanna, 2010).
As a result of profitability associated with the real estate industry, many companies endeavor to join this industry. However, entering this industry may be associated with many difficulties due to the state’s strong influence. On the other hand, companies that are owned or supported by the government have ample opportunities and can expand their investments successfully. This paper focuses on Sama Dubai, which is a state owned company and it operates in the United Arab Emirates. Recently, Sama Dubai implemented a strategy that will enable the company to expand its operations on the global market. Through this strategy, the company will manage to enter new markets and gain enormous market share of various countries, especially in the Arab world. In a situation like this, it is imperative to the company’s strategic development as well as its management to ensure that all their operations conform to the strategies of the company. It is also crucial to assess the company’s strengths and weaknesses with regard to current market conditions. Additionally, it is vital to analyze the available opportunities as well as possible threats that the company may face in the future.
The Background Information on Sama Dubai
Sama Dubai can be regarded as among the leading regional companies within its market segment. The company’s headquarters are located in Dubai, but the company has branches in different countries where it carries out its operations. The company has well established plants in the neighboring countries in North Africa, and the Gulf region. However, all its affiliate units from different parts are subordinated and coordinated to the company’s headquarters located in Dubai. Sama Dubai has mechanistic bureaucracy that tends to dominate its organizational structure. This implies that Sama Dubai develops firm control in all its production processes such as development of projects and practical realization. This is the main reason as to why control officers in the company are vital in the operations of the company. This is because control officers monitor the quality of company’s products and services. High quality is the basic concept in the functioning of Sama Dubai.
Sama Dubai is subordinate and a member company of Dubai Holding. This is a holding company established by the Dubai government. However, unlike subsidiaries of Dubai Holding, Sama Dubai concentrates not only on domestic projects, but this company collaborates with Dubai Holding, and it is generally concerned with international projects. Its main work is the development of international projects that are deal with Dubai Holding.
Some of the most thriving projects that Sama Dubai has accomplished or is still working on, include a highly famous building known as Dubai Towers. This was a remarkably tall and high-class building, mixed-use skyscrapers. Dubai Towers have been developed or will be established in three countries. They will contain offices, businesses, entertainment and residential sections. They are built or will be established in Doha (Qatar), Istanbul (Turkey), and Dubai (the UAE).
Sama Dubai has already accomplished the latter project and functions successfully in the United Arab Emirates. Therefore, Sama Dubai can be perceived as reliable and successful company in all its operations. It can also be regarded as having a competitive edge in the business environment compared to other real estate companies which originate from the United Arab Emirates.
In addition, Sama Dubai initiated the construction of Spas and Salam Resort, which comprise of a chain of spa hospitality and resort. Sama Dubai aims at establishing these projects in Bahrain and Oman. Sama Dubai established Lagoons, a comfortable real estate development in Dubai Creek district. It contains business, residential and retail sections. The company has also built Rabat Morocco and Mediterranean Gate, as well as Century City established in the Tunisian capital, Tunis.
Obviously, participation in the development of such projects is clear evidence that the company is committed to its strategic goals and objectives that will enable it to become the regional leader as far as construction of luxurious real estates is concerned. In this respect, it is essential to emphasize that Sama Dubai can be regarded as a global real estate company since it deals with international projects. However, the company uses the development projects which have already established in Dubai as a method of demonstrating the essence of such projects.
The company also aims at demonstrating their potentials and skills to the world as far as development of such projects is concerned. This enables the company to convince prospective customers about the company’s reliability and its capability to develop and implement extremely complicated and stylish projects. In this respect, current projects and recent achievements involving Sama Dubai are truly vital for the company’s international market promotion. As through such projects, the company is able to earn recognition on the foreign markets. A strategy like this facilitates the company’s entry into the new markets as well as being able to counter existing barriers of entry in the overseas countries.
Although Sama Dubai Company is located in the United Arab Emirates, it operates in countries of Middle East and North Africa. This implies that Sama Dubai can currently be described as a regional company as its progress in other parts of the globe is not significant. Although Sama Dubai concentrates more on its traditional markets, this acts as a concrete basis that will enable the company to develop into a global real estate company.