The attainment of competitive advantage in order to sustain the market fluctuations is the central focus of the contemporary organisation engaged in globalised businesses. This objective involves not only development of the organisation’s capabilities but also exercising efforts to outweigh its competitors (Raduan, et al., 2009). Strategic management can be defined as the process through which an organisation achieves success or failure. Many scholars have expressed that strategic management of an organisation provides the necessary insight which can be crucial in creating potential opportunities for future success of the organisation. It helps in identifying their capabilities, their objectives and what firm needs to improve in its organisational structure (Rasche, 2007). Therefore, strategic management involves all those managerial decisions that help an organisation in accomplishing long-term objectives (Hunger and Wheelen, 2006). The concept of strategic management has gained importance among public, private and non-profit organisations owing to the increasing competition. The operational planning and strategic planning are two important branches of strategic management which deals with the short-term and long-term issues of a particular firm. The objective of implementing strategic planning is to develop an action plan that will help an organisation to counter future uncertainties with clear analysis of its competencies and capabilities (Pirtea, Nicolescu and Botoc, 2009).
This paper aims at providing a clear depiction of the strategic management of Qatar Islamic Bank (QIB). The financial market and especially the banking sector experiences high volatility due to fluctuations in the macroeconomic variables. Thus, banks need to be prepared with an approach that can help them to maintain stabilised businesses. In the past few decades, Islamic banking and financial sector has witnessed significant development both in size and operation in the Muslim dominated countries. Qatar, has been increasingly working in order to shape its economy through financial liberalisation. In 2014, the economy of Qatar grew at a rate of 6.7% while the banking sectors experienced a growth of more than 11%. Qatar is the sixth-largest nation in terms of Islamic financing with assets worth of $81 billion (Tlemsani, 2015). The increasing regulatory framework and collapse of the Western financial institutions in the event of the financial crisis in 2008 has made the investors and entrepreneurs to seek market opportunities the GCC countries. Qatar has emerged as the most preferred investment option against other Middle Easter countries like the UAE and Bahrain according to the report of the World Economic Forum Competitiveness 2014 (The Economist Intelligence Unit, 2014). This increasing growth in the banking sector has been the result of the progress of banks like, Qatar Islamic Bank. Therefore, the researcher has analysed the strategic management of QIB to investigate the reasons behind its success. The successful implementation of QIB’s strategies can be traced to the mission and vision of the company.
Raduan, et al., (2009) in their paper defined strategic management as the procedure and method to specify the objectives, policies for development and strategies to attain the objectives. There are primarily five theories of strategic management which are described below (David, 2005; Hashim, 2005).
The profit-maximising and competition-based theory refers to the motive of an organization to generate long term profits and attain sustainable development over their market rivals. Contrary to this, the resource-based theory denotes to the knowledge that the ability of a firm to gain competitive advantage is rooted in its internal sources opposite to their market positions (Ainuddin, et al., 2007). On the other hand, the authors suggest that the survival-based theory portrays the need for an organization to be constantly aware and adjust to the competitiveness of the market environment to remain in the market. However, Storey (2007) suggests that this is contrary to the human resource-based theory which highlights the significance of human component in the development process of business strategies. Acoording to Mueller (2011) agency theory specifies the crucial association between the stakeholders and the management body in the business’s path to success. Lastly, in the works of Ghofar and Islam (2014) it has been clearly mentioned that contingency theory opines that there is no single managing approach for an organisation.
Strategic management permits organisations to decipher the market environment and the ways of operating in it. The tools of strategic management sanctions companies to negate potent challenges prevailing in the product market and take privileges of the foreseeable opportunities. There are a number of strategic management tools among which SWOT and PEST are mostly applied by organisations (Afsar, 2011). The SWOT analysis is one of the most important strategic management tools that is used to detect the strengths, opportunities, weaknesses and threats prevalent in the market. This tool is put to use to identify the elements affecting the business to form the appropriate marketing plans for selling the products or services optimally and diminishing the threats (Athapaththu, 2016). On the other hand, PEST analysis assesses the political, economic, social and technological factors related to the functioning of the market. This tool is very useful in cases where the organization plans for taking the business into the international market. In the process of conducting PEST analysis, there are a certain factors to take into account such as political laws and regulations, tariffs, tax rate. The economic factors include the growth rate of economy, rate of interests and inflation rate. On the other hand, the social factors incorporate the demographic issues such as growth in population and the distribution of age. Besides, the technological factors include aspects like the distinctions on the basis of technological advancement prevailing in the market (Mainardes, Ferreira, and Raposo, 2014).
