Market Factors, Training Programs, Strategic Management and Performance: An Empirical Study of the Iranian Insurance Companies

2.1. Environmental Factors: Strategic Management

Initially, the concept of strategy was meant to refer to the leading role of a general in command of an army as well as for military purpose. Modern organizations have mainly adopted and modified the principles of the military strategies to suit the specific business environment. There appears to be much agreement in the strategies management literature on the important role of strategy in organizations (Valmohammadi, 2010).Market forces are effective in strategy development, its implementation and organizational performance. Regarding the effects of industry attractiveness and organizational strategic performance, evidence shows a rational relationship between them. Grewal & Tansuhaj (2001) emphasize that industry attractiveness is effective in organizational strategic performance, since forces organizations to analyze their environments more efficiently. Thus they can develop desired organizational strategies more properly. On the other hand, researchers believe that industry attractiveness has an indirect effect on organizational performance through strategic management. Therefore we can say that industry attractiveness has direct and indirect effects on performance. Nevertheless, some studies, e.g. Tsai, 2002, indicate that organizations affected by environmental factors, do not change strategic planning and the tendency to its development.

Therefore, the first and second hypothesis is posited as follows:

• H1: There is a significant relationship between the competitive intensity and strategic management;

• H2: There is a significant relationship between the industry attractiveness and strategic management.