module 1 sm
TRANSCRIPT
-
7/27/2019 MODULE 1 SM
1/22
Chapter 1
The Nature of Strategic Management
MOD 1
Strategic Management
-
7/27/2019 MODULE 1 SM
2/22
Opening case
Wal-mart
-
7/27/2019 MODULE 1 SM
3/22
Strategy is
A plan / course of action leading to a
direction.
It is related to companys activities.
It deals with uncertain future.
It depends on vision / mission of the
company to reach its current position.
-
7/27/2019 MODULE 1 SM
4/22
A Company's strategy is management
action plan for running the business and
conducting operations. It consists of the competitive moves
And business approaches that mangers are
employing to grow the business,
Attract and please customers,
Compete successfully,
Conduct operations and
Achieve the targeted levels of
organizational performance.
-
7/27/2019 MODULE 1 SM
5/22
BUSINESS STRATEGY
Business level strategy is lower-level than
corporate strategy that applies to a single
division or business unit.
strategic issues include pricing and
marketing strategies. Business-level
strategies are normally decided by mid-level managers who are responsible for the
business unit or division.
-
7/27/2019 MODULE 1 SM
6/22
Corporate-Level Strategy
Corporate strategy refers to all strategic
decisions that affect the firm as a whole.
Often, corporate-level strategies will have
an affect on several business units.
Corporate strategic issues include the
financial structure of the firm, mergers andacquisitions, and the allocation of
resources to individual business units.
-
7/27/2019 MODULE 1 SM
7/22
-
7/27/2019 MODULE 1 SM
8/22
Why is strategic management
important?
Gives everyone a role
Makes a difference in performance levels
Provides systematic approach to
uncertainties
Coordinates and focuses employees
-
7/27/2019 MODULE 1 SM
9/22
Characteristics of Strategic
Management Co-ordinate and integrate business
activities.
Strengthens the competitive position.
Satisfies customers
Works towards achieving performance
targets.
Adaptive
-
7/27/2019 MODULE 1 SM
10/22
Aishah radiyullahu anha narrets that
rasulullah sallallahu alaihi wasallam
ordered us to treat people according to
their status.
-
7/27/2019 MODULE 1 SM
11/22
Strategic Management Process
-
7/27/2019 MODULE 1 SM
12/22
Missions vs. Strategic Visions A missionstatement
focuses on current
business activities --
who we are and whatwe do
Current product and
service offerings
Customer needs being
served
Technological and
business capabilities
Astrategic vision
concerns a firmsfuture
business path -- where we
are going Markets to be pursued
Future technology-
product-customer focus
Kind of company that
management is
trying to create
-
7/27/2019 MODULE 1 SM
13/22
Examples: Mission and Vision Statements
Ourv is ion: Getting to a billion connected computers
worldwide, millions of servers, and trillions of dollars ofe-commerce. Intels core miss ionis being the building
block supplier to the Internet economy and spurring
efforts to make the Internet more useful. Being
connected is now at the center of peoples computing
experience. We are helping to expand the capabilities
of the PC platform and the Internet.
Intel
-
7/27/2019 MODULE 1 SM
14/22
Strategic Management Process (Cont..)
Step 1: Identifying the organization's currentmission, objectives, and strategies
Mission: the firms reason for being
Who we are,
What we do, and
Where we are now
Goals: the foundation for further planning Measurable performance targets
-
7/27/2019 MODULE 1 SM
15/22
Strategic Management Process (Cont..)
Step 2: Conducting an external analysis
The environmental scanning of specific and generalenvironments
Focuses on identifying opportunities and threats
Step 3: Conducting an internal analysis
Assessing organizational resources, capabilities,activities and culture:
Strengths (core competencies) create value for thecustomerand strengthen the competitive positionof the firm.
Weaknesses (things done poorly or not at all) canplace the firm at a competitive disadvantage.
-
7/27/2019 MODULE 1 SM
16/22
Strategic Management Process (Cont..)
Step 4: Formulating strategies
Develop and evaluate strategicalternatives
Select appropriate strategies for alllevels in the organisation that
provide relative advantage overcompetitors
Match organizational strengths toenvironmental opportunities
Correct weaknesses and guardagainst threats
-
7/27/2019 MODULE 1 SM
17/22
Strategic Management Process (Cont..)
Step 5: Implementing strategies
Implementation: effectively fittingorganizational structure and activities
to the environmentEffective strategy implementationrequires an organizational structurematched to its requirements.
Step 6: Evaluating results
How effective have strategies been?
What adjustments, if any, arenecessary?
-
7/27/2019 MODULE 1 SM
18/22
Relationship between companys
strategy and business models.
1st Assignment
Submission date 26-08-2013
-
7/27/2019 MODULE 1 SM
19/22
What kind of business shouldwe become?
Are we in the r ight f ields
Are there new competi tors
What strategies should we
pursue? How are our customerschanging?
Adapting to Change Key
Strategic Management
Questions
-
7/27/2019 MODULE 1 SM
20/22
Three levels of Strategy
Corporate Level Strategies
by CEO and Board of Directors
Horizon: long term
Focus on domain selection:
What business sectors to enter/invest ?
How should the resources be allocated across the
businesses ?
Corporate
Business
Functional
-
7/27/2019 MODULE 1 SM
21/22
-
7/27/2019 MODULE 1 SM
22/22
Three levels of Strategy
Functional Level Strategies
By functional managers, e.g. marketing
managerShort Term
Focus on functional efficiency
Annual objectives & decisions within functional
areas
Improving efficiency within functional areas
Corporate
Business
Functional