What does strategy formulation involve in the strategic management process?

Strategy formulation is a critical phase in the strategic management process that focuses on setting organizational goals and defining the methods and actions needed to achieve these goals. This entails analyzing the current position of the organization, understanding the market dynamics, and envisioning the future direction of the organization.

In this context, the first aspect—setting organizational goals—includes identifying what the organization aims to accomplish, whether it’s increasing market share, launching new products, or enhancing customer satisfaction. The second aspect involves defining how those goals will be achieved, which requires developing strategies, allocating resources effectively, and establishing a plan of action to guide the organization toward its objectives.

The other options, while important in their own right, do not directly represent the core activities involved in strategy formulation. For instance, employee training programs are typically part of operational or tactical implementation rather than the strategic formulation itself. Similarly, revamping financial accounting practices and implementing technology across departments are operational activities that may support overall strategy but do not constitute the strategic formulation process.