Although often misunderstood and under-appreciated, the value that strategy and strategic management brings to the management of a successful organization is immeasurable. Much like an explorer might use the North Star, a company’s strategy is a guiding principle that can direct the actions of the company’s management team. Although strategy may provide a company with “unique competitive positioning” (De Kluyver & Pearce, 2012, p. 5), the more valuable aspect for the successful company is the goal of long-term performance. It is the long-term impact of strategic management that allows the company to weather the storm of a changing environment Without strategy and strategic management, a company is susceptible to mistaking short-term, tactic success with long-term performance (De Kluyver & Pearce, 2012).
The Bosch Group is one company that used strategy to successfully navigate the global recession that began in 2007. Prior to 2007, Bosch had developed a strategy to hedge against downturns in particular industries or regions. While maintaining focus on their engineering background, the company sought to diversify into multiple industries and develop an international client base. This long-term strategy paid off greatly in 2008 when the recession that had begun in the US market in 2007 spread to other parts of the globe. During this time, productivity in Eastern Europe, Asia, and South America helped bolster sagging sales and slowing housing starts in Western Europe and North America. Additionally, although most of the industries Bosch operates in were affected by the downturn, each industry was affected at different times and intensities. Their diversification and globalization strategy not only allowed them to weather the recession, but to grow through acquisition and gain additional market share (The Bosch Group, 2009).
De Kluyver, C. & Pearce, J. (2012). Strategy: A View From the Top (4th ed.). Boston: Prentice Hall.
The Bosch Group. (2009). 2008 Annual Report. Retrieved September 1, 2015.