STRATEGIC MANAGEMENT IN A BANI ENVIRONMENT

Abstract

This article aims to present a critical perspective on strategic management, which fundamentally serves as the heart of all business operations through a relevant literature review. The formulation of an appropriate strategy must intricately align with the global context. In the past, the business environment was largely stable and predictable. Consequently, organizational strategy formulation could confidently focus on creating a sustainable competitive advantage. Organizations traditionally utilized the five forces model to rigorously examine industry conditions. Furthermore, organizations built internal advantages by accumulating strategic resources that were valuable, rare, and inimitable, managing these assets efficiently in accordance with the Resource-Based View (RBV) theory. Recently, however, global circumstances have undergone unprecedented and massive transformations. As a result, the current environment has become highly brittle, anxious, non-linear, and incomprehensible. Then, relying on traditional strategies aimed at permanent, sustainable growth is increasingly difficult. Strategies in this era must instead prioritize extreme agility. Organizations must be capable of capturing short-term benefits rapidly and willing to disengage and pivot to new initiatives, according to the Transient Advantage theory. Additionally, any formulated strategy must actively secure legitimacy from society. This involves delivering pragmatic utility, demonstrating the responsibility to the public, and establishing widely accepted new norms, firmly grounded in Legitimacy Theory. Therefore, the most appropriate strategic approach for era’s context is a dynamic battle for survival and relevance within a volatile and challenging environment. This article is then beneficial for executives and businesses in navigating fragile situations and mitigating risks in business strategy formulation