The term strategy is derived from the Greek word “Strategos” means a plan or process or a set of decision rules or an arrangement to create a common thread. It is the path or the way to achieve the goals of the organization or corporate. It helps the manager proactively to direct or run the organization in a volatile environment. It consists of WH questions. Mintzberg has defined the strategy which consists of “5Ps” such as: plan, pattern, position, ploy and perspective. A Plan “how to achieve the target”. A Pattern “to take consistent actions over time”. A Position “to be achieved by offering goods and services in particular market”. A Ploy “how to beat the competitors by using tactics and tricks with proper allocation and utilization of resources”. A Perspective “it is the vision of the organization what it want to be”. Characteristics: Strategy is concerned with to achieve the broad goals of the organization. It establishes unique value proposition compared to its competitors. It provides tailored value to its customers. It clearly identifies and clarifies what not to do. It empowers the organization to move towards its vision. It creates environmental scanning to gain competitive advantage. External environment is the environment outside of the organization which influences the business. It can broadly be categorised into two parts: Micro Environment & Macro Environment. Micro Environment studies the small area of business or immediate periphery of the organization. It directly influence and regulate the business. E.g.: customers, suppliers, creditors, vendors, competitors and local community. Macro Environment: It studies overall business activity in a broad manner. It influences business on the basis of “PEST”: Political, Economic, Socio-cultural and Technology. Political Factors consists of employment laws, tax policy, policies regarding trade & tariffs, environmental regulation and political stability. Economic Factors consists of economic growth, interest rate, exchange rate and inflation rate. Socio-Cultural Factors consists of health consciousness, population growth rate, age, career attitude, emphasis on safety etc. Technological Factor consists of R & D activity, automation, technology incentives and change in technology. Internal Environment is a component of the business environment, which is composed of various elements present inside the organization that can affect and be affected by the decision of the organization and its activities. The internal environment of the organization consists of employees, management, owner, shareholders, investors and all other resources. Factors influencing external environment are: value system, vision, structure, culture, human resource, physical resource, technical-know-how etc. The internal environment environmental analysis generates long list of resources and capabilities which play vital role in strategy formulation. It determines the strength and weakness of the organization.