The basic problem in the strategic management is on how an organization achieves a superior performance and preserves the sustainable competitive advantage (David, Pisano & Shuen, 1997). Sustainable competitive advantage appears as one of the most promising theoretical frameworks in the management literature, especially in the strategic management field (Low, 2010). Sustainable competitive advantage becomes very essential and substantial if the market is highly competitive. However, sustainable competitive advantage is not the final destination of various strategic maneuver developed by the organization, as it is only the main tool to achieve the bigger purposes such as the accomplishment and the safety warranty for the sustainability of the long-term performance achievement. Hence, the organization should focus on the strategic management.
However, not all organizations are success with their strategies, which mean that those organizations already have strategies but not many of them generate superior performance. Such condition relates with strategic quality. There are some approaches to realize strategic quality. The first approach is through strategic process which means that strategic quality is a strategy which is built through strategic formulation quality, strategic implementation quality and strategic evaluation quality (Menon, 1999). A good strategic development process should be started from a basic belief that the strategy should have appropriate strategic content, with high quality of formulation process as well as clarity and firmness of the implementation and evaluation that should be done (Varadarajan, 1999).
The second approach is through strategic asset. The strategic assets are resource and capability that have potential to generate competitive advantage. On the other hand, Amit & Schoemaker (1993) state that strategic assets are resource and capability which are scarce, uneasily traded, inimitable, durable and can be used to convert the value become profit. Those strategic assets can be categorized into larger groups, such as financial assets, physical assets, human assets, technological assets and intangible assets (Grant, 1991). Therefore, the threat faced by the leader should integrate the resource and capability into strategic assets in order to realize the sustainable competitive advantage.
The resource based view emphasizes on knowledge-based resource (Galunic & Rodan, 2008), as knowledge becomes an important component in the new economic arena (Grant, 1991). The emphasis on knowledge triggers the development of Knowledge Management (KM) concept, as the assumption then is that the knowledge resource is important in the production process. KM emphasizes on the organization ability to use and combine various knowledge resources which are able to change the intangible resource into innovation. The study conducted by Hsu (2007) shows that 80% of respondents agreed that knowledge is strategic asset, while 78% business opportunities failed because of inability to exploit the knowledge in the organization. Then, the study conducted by Leticia (2012) explains that knowledge is the most important resource in the competitive advantage, but the relationship between knowledge management and competitive advantage is weak.
Based on the above explanation, it can be concluded that managing an organization is like managing knowledge, as knowledge will not meaningful if it is only used as information. Conversely, knowledge will be meaningful if it is well-implemented. Thus, it acquires knowledge exploitability.
The studies conducted by Menon, Bharadwaj & Roy (1996) explain that the improvement of organizational performance is determined by the strategy used. Strategy is an overall plan which explains the competitive position of an organization. Strategy as a set of methods is used to enhance, produce and sell actual products and services. Organization strategy is a decision pattern dealing with important things used for; (1) being guideline for the organization in facing the environment, (2) affecting the internal matters of the organization either the structure or the process and (3) affecting the organizational performance (Hambrick, 1980). While strategic quality is a strategy which is built by strategic planning quality, strategic implementation quality and strategic evaluation quality (Menon, Bharadwaj & Roy, 1996).
Based on the study conducted by Widodo, the conceptual model of strategic quality enhancement comprehensively appears in Figure 1. The environmental changes will lead into organizational culture and organizational learning changes. Organizational learning needs support and should be developed as organizational culture. Organizational learning will be able to recognize 1) strategic asset prerequisite which has potential to enhance the strategic quality, 2) strategic process which covers strategic planning aspect, strategic implementation and strategic evaluation. A high quality of strategy is reflected in the planning process quality, implementation process quality and evaluation process quality. The strategic quality will trigger an improvement on organizational performance.
One focus of the system management concern is on the process management. If strategic development can be considered as a process, then the high quality process should become a mutual concern in the management. It means that process management is expected to be able to serve a high quality process. Therefore, the strategy appears through the high quality process will generate a high quality strategy as well. Thus, strategic quality is the comprehensiveness and coherence level among the strategic...