Innovation does not necessarily require advanced technology. Innovation can create an advantage by applying an old technology or the same technology as the competition in an innovative manner that adds more customer-perceived value. Systematic innovation is a purposeful and organised search for ways to change aspects of the organisation in order to gain and/or sustain competitive advantage. It requires a systematic analysis of any opportunities that changes might offer for technological, social, organisational or business process improvement.

Strategic change is more frequently driven by the need to respond to external factors, rather than to internal issues. Although internally it may appear that strategic change is the consequence of a selected strategy, usually the macro factors that have influenced the selected strategy are not given much consideration when managing the strategic change.

Strategy implementation involves:
* articulating the mission, objectives and intent of the strategy to all staff
* planning, acquiring and allocating organisational resources and managing impact on
* staff and external relationships
* creating the right organisational structure
* establishing appropriate organisational systems
* developing a management style that is supportive of organisational culture and takes a
* proactive approach to cultural change
* considering strategy at three organisational levels—corporate, business and functional.

The optimisation process should consider the levels at which the strategies are being set. The level of detail and type of optimisation will vary for the three levels of strategy—corporate, business and functional.

Corporate-level strategy will be optimised on the basis of:
* allocating resources to particular parts of the organisation
* changing broad organisational structures
* changing or introducing new aspects to the organisational culture
* developing a code of ethics and values statements
* detailing short-term goals

Before an organisation can choose a strategy, it will need: a mission statement—to provide a sense of strategic purpose and value strategic objectives—to provide a sense of direction strategic options a process for selecting the best option. A mission statement defines an organisation's purpose and distinguishes it from other organisations. It identifies the reason for the organisation's existence and can focus the organisation on the business it is, or should be, in.

The primary purpose of a strategy is to provide the organisation with a sustainable position of advantage within a competitive environment. In this topic we will examine the general strategic choices an organisation can make, which is the first stage in defining the strategy it will ultimately follow. We will explore a number of different approaches including: (a) using the organisational purpose, vision and mission to make decisions about strategic choices, (b) focusing directly on achieving a competitive advantage, (c) competing by developing the organisation's core competencies.

Organisational success is largely dependent upon the effectiveness (and efficiency) of the interface between the external and internal environments of an organisation.

Before a strategic position for an organisation can be developed, the following is required:
1. an external analysis that identifies opportunities and threats: the external environment
2. an internal analysis that identifies its strengths and weaknesses: the internal environment
3. a match between internal and external factors
4. strategic options that capitalise on strengths and assist with overcoming weaknesses

The external environment of an organisation is the physical and intangible region from which an organisation's resources are drawn and revenue is generated, and in which competitors battle for both of these. Although the external environment can be defined or categorised in different ways, it is

A recent McKinsey survey of executives (September 2006) on strategic planning, strategy implementation and utilisation identified the following:
- Most companies have a formal strategic planning process, but some don't use it to make their most important decisions
- Fewer than half of respondents were satisfied with their company's approach to making strategic decisions, although senior managers were more satisfied than other levels of management

Strategic management may be defined as:

The process of identifying, choosing and implementing activities that will enhance
the long term performance of an organisation by setting direction, utilising
technology and innovation and by creating ongoing compatibility between the
internal skills, resources and capabilities of an organisation and the changing
external environment within which it operates. (Viljoen & Dann 2003: 5)