sbm - emba - l1 intro
TRANSCRIPT
8/8/2019 Sbm - Emba - l1 Intro
http://slidepdf.com/reader/full/sbm-emba-l1-intro 1/28
SSD ± SBM - 1. 1
Business PolicyBusiness Policy
&&
Strategic Management
8/8/2019 Sbm - Emba - l1 Intro
http://slidepdf.com/reader/full/sbm-emba-l1-intro 2/28
SSD ± SBM - 1. 2
Excz 1 : Dimensions of a BusinessExcz 1 : Dimensions of a Business
What really is a ³Business´?
What does it constitute of ?
8/8/2019 Sbm - Emba - l1 Intro
http://slidepdf.com/reader/full/sbm-emba-l1-intro 3/28
SSD ± SBM - 1. 3
What really is a ³Business´?What really is a ³Business´?
Is it Production? .. TML
Is it Advertising & Marketing? .. Lintas
Is it Distribution? .. DHL
Is it raising & managing money? .. HDFC
Is it a set of skilled people? .. Infosys
8/8/2019 Sbm - Emba - l1 Intro
http://slidepdf.com/reader/full/sbm-emba-l1-intro 4/28
SSD ± SBM - 1. 4
Essence of a BusinessEssence of a Business
At it¶s very core , a Business is a set of Processes which earn a profit
by identifying & retaining customers through
satisfaction of their needs on an ongoing basis
8/8/2019 Sbm - Emba - l1 Intro
http://slidepdf.com/reader/full/sbm-emba-l1-intro 5/28
SSD ± SBM - 1. 5
Main Elements of a BusinessMain Elements of a Business
A Profit oriented entity doing :
Procurement of RM n components / Skill sets ( Operations )
Conversion into Goods or Services ( Production )
Getting Goods to reach consumers ( Distribution)
Satisfying market needs on an ongoing basis ( Innovation )
(Thru Managing people , processes , finances , systems ,technology , etc )
8/8/2019 Sbm - Emba - l1 Intro
http://slidepdf.com/reader/full/sbm-emba-l1-intro 6/28
SSD ± SBM - 1. 6
Excz 2 : Dimensions of a BusinessExcz 2 : Dimensions of a Business
What really is the key element of a
³Successful Business´? (say eg for being the market ± leader)
What is that ONE Thing that a Market Leader
must do most of the time?
8/8/2019 Sbm - Emba - l1 Intro
http://slidepdf.com/reader/full/sbm-emba-l1-intro 7/28
SSD ± SBM - 1. 7
Key Element of a Successful BizKey Element of a Successful Biz
To be successful & to remain a leader ,
a Business must win against the competition
most of the time by acquiring & retainingcustomers through superior product or service
experiences & management skills , on an
ongoing basis.
Therefore , it needs to practice high quality..
8/8/2019 Sbm - Emba - l1 Intro
http://slidepdf.com/reader/full/sbm-emba-l1-intro 8/28
SSD ± SBM - 1. 8
Global Equivalents for SBMGlobal Equivalents for SBM
Corporate StrategyStrategic Management
Business Policy
Organizational Policy
8/8/2019 Sbm - Emba - l1 Intro
http://slidepdf.com/reader/full/sbm-emba-l1-intro 9/28
SSD ± SBM - 1. 9
SBM / BPSM :Broad Learning ObjectivesSBM / BPSM :Broad Learning Objectives
Understanding What Corporate Strategy is
Significance of Strategic Decisions
Analysis & Planning involved in Strategy
Formulation & Implementation of Strategy
Frameworks & Models used in SBM / BPSM
Role of Managers in SBM / BPSM process
8/8/2019 Sbm - Emba - l1 Intro
http://slidepdf.com/reader/full/sbm-emba-l1-intro 10/28
SSD ± SBM - 1.
10
Strategic Business ManagementStrategic Business Management
Before we get into that ,
an understanding of the
Principles
& Practices of Corporate Businesses ,Is relevant for us«.
8/8/2019 Sbm - Emba - l1 Intro
http://slidepdf.com/reader/full/sbm-emba-l1-intro 11/28
SSD ± SBM - 1.
11
Common Forms of BusinessesCommon Forms of Businesses
S ole Proprietorship
Partnership Fir m
Pvt Ltd Co / Public Ltd Co
8/8/2019 Sbm - Emba - l1 Intro
http://slidepdf.com/reader/full/sbm-emba-l1-intro 12/28
SSD ± SBM - 1.
12
Corporate StructuresCorporate Structures
Classical : 7 Layered (a.k.a Pyramid Type)
New Age : 4 Layered (a.k.a Flat Type)
8/8/2019 Sbm - Emba - l1 Intro
http://slidepdf.com/reader/full/sbm-emba-l1-intro 13/28
SSD ± SBM - 1.
13
Managing a CorporationManaging a Corporation
Biggest challenge is how to µManage Change¶
Managing Business is = Managing Market Dynamics
Constant flux in the market thru several influencers Situation compounded by Organizational Change
Organizational Change is driven by complex factors
Both external + internal change needs Managing
Possible thru Strategic Planning & thru
µ Management of Change¶
Both require strong orientation towards S B M
8/8/2019 Sbm - Emba - l1 Intro
http://slidepdf.com/reader/full/sbm-emba-l1-intro 14/28
SSD ± SBM - 1.
14
Excz 3 :Excz 3 : Sectoral Spread of BusinessesSectoral Spread of Businesses
What are the main sectors of any Economy?
What businesses can exist in each ?
8/8/2019 Sbm - Emba - l1 Intro
http://slidepdf.com/reader/full/sbm-emba-l1-intro 15/28
SSD ± SBM - 1.
15
Business & Economy «.Business & Economy «.
All Economies have 3 sectors :
Primary (Agriculture)
Secondary (Manufacturing) Tertiary (Services)
Economic Activity (production) is desirable in ALL
3 Sectors.. Together , they µproduce¶ economic
value for the Country => measured as µG D P¶
8/8/2019 Sbm - Emba - l1 Intro
http://slidepdf.com/reader/full/sbm-emba-l1-intro 16/28
SSD ± SBM - 1.
16
Business Firms & SectorsBusiness Firms & Sectors
Agriculture :
Using Natural resources to µproduce¶
Land or Water Based Resources
Includes Aquaculture , Floriculture, Horticulture ,etc
eg ITC Agro / Century Flowers / Kerala Fisheries
8/8/2019 Sbm - Emba - l1 Intro
http://slidepdf.com/reader/full/sbm-emba-l1-intro 17/28
SSD ± SBM - 1.
17
Business Firms & SectorsBusiness Firms & Sectors
Manufacturing :
Conversion of sets of inputs to useful output
High emphasis on technology , machinery , etc
eg TML , RIL , HUL , etc
A Firm can choose to manufacture :A] Consumer Products ± Colas / Shoes / Cell phones
B] Industrial Products ± Boilers / Engines / Chillers
8/8/2019 Sbm - Emba - l1 Intro
http://slidepdf.com/reader/full/sbm-emba-l1-intro 18/28
SSD ± SBM - 1.
18
Business Firms & SectorsBusiness Firms & Sectors
Services :
Generation of economic activity thru offering
human skills / knowledge / mental ability ,etc
People Powered
eg Infosys / EXL / Apollo Healthcare , etc
8/8/2019 Sbm - Emba - l1 Intro
http://slidepdf.com/reader/full/sbm-emba-l1-intro 19/28
SSD ± SBM - 1.
19
Major Industrial SectorsMajor Industrial Sectors
Heavy Industries : Steel / Alum / Cement Medium Industries : Imaging / PCs / Pharma
Light Industries : Dairy / Leather Shoes
Small Scale : Bread / Footwear / Crackers
8/8/2019 Sbm - Emba - l1 Intro
http://slidepdf.com/reader/full/sbm-emba-l1-intro 20/28
SSD ± SBM - 1.
20
Major Service SectorsMajor Service Sectors
Financial Services ± Banking / Insurance / Advisory
eg HDFC / ICICI / Morgan Stanley
Transportation ± Land / Rail / Water / Air
eg Jet / Konkan Rail / G E Shipping
Logistics ± Land / Sea / Air / Hybrid
eg Fed EX / Ned Loyd
Telecom ± Fixed Line / Mobile
eg Airtel / RIM / BSNL
Media ± T V / Radio / Print
eg NDTV / Radio Mirchi / Eenadu
8/8/2019 Sbm - Emba - l1 Intro
http://slidepdf.com/reader/full/sbm-emba-l1-intro 21/28
SSD ± SBM - 1.
21
Defining Corporate StrategyDefining Corporate Strategy
Strategy is the moulding of direction and
scope of an organization over the long ter m,
designed in such a way so as to deliver competitive
advantage to the said organization, by utilizing
resources & skillsets dynamically in a changing
environment and thereby , meet market needs &fulfill stakeholder expectations.
8/8/2019 Sbm - Emba - l1 Intro
http://slidepdf.com/reader/full/sbm-emba-l1-intro 22/28
SSD ± SBM - 1.
22
Common Examples of StrategyCommon Examples of Strategy
Marketing Strategy
Funding Strategy
Recruitment Strategy
Positioning Strategy
Advertising Strategy
Recovery Strategy
5 Bowler Strategy
Net Rushing Strategy
2 Pit-Stop Strategy
Incitement Strategy
Lightweight Strategy
Military Strategy
8/8/2019 Sbm - Emba - l1 Intro
http://slidepdf.com/reader/full/sbm-emba-l1-intro 23/28
SSD ± SBM - 1.
23
Is all that really Strategy?Is all that really Strategy?
S trategy v/s Tactics
Developing all-rounders => Strategy
Sending Irfan Pathan at # 3 is Tactics
Beefing up Infantry on the Desert Borders But
Attacking via Water Borders => Strategy
Deploying Submarines / Frigates is Tactics
Mittal Steel (before Arcelor) acquiring a string of ailing steel plants => Strategy
Systematically cutting costs (there)requires Tactics
8/8/2019 Sbm - Emba - l1 Intro
http://slidepdf.com/reader/full/sbm-emba-l1-intro 24/28
SSD ± SBM - 1.
24
Imp Dimensions of StrategyImp Dimensions of Strategy
Mostly about the Long-Term actions
Molded by Overall purpose & Mission of the Orgnzn
Should lead to Competitive Advantage
Should help win market battles against competition
Must be backed by Resources & Skill-Sets
Operations (Tactics) must align with Strategy
Must adapt to Environmental Influences Must help to deliver on various expectations
8/8/2019 Sbm - Emba - l1 Intro
http://slidepdf.com/reader/full/sbm-emba-l1-intro 25/28
SSD ± SBM - 1.
25
Quick Quiz on StrategyQuick Quiz on Strategy
What is an µaccretive acquisition¶?
Extra earnings that result from an acquisition of a
more profitable business [than the acquirer¶s] and
thus, add to the profitability rate of the acquiring co
Opposite: Dilutive Acquisition:
What is µblue sky thinking¶?
New [or different] & sometimes radical ways
of looking at & solving business problems.
8/8/2019 Sbm - Emba - l1 Intro
http://slidepdf.com/reader/full/sbm-emba-l1-intro 26/28
SSD ± SBM - 1.
26
3 Levels of Strategy3 Levels of Strategy
L1 : Corporate Strategy :
Overall purpose & scope / Orgnzn¶s Mission
eg Which Businesses / Diversification / Acquisitions
Financing & Structural Shape of Business
Resource allocation to various divisions
Key Foundation of every other strategy
eg RIL¶s decision to enter the Telecom Business (RIM)
8/8/2019 Sbm - Emba - l1 Intro
http://slidepdf.com/reader/full/sbm-emba-l1-intro 27/28
SSD ± SBM - 1.
27
3 Levels of Strategy3 Levels of Strategy
L2 : Business Unit Strategy:
Concept of SBUs
(Distinct Market for it¶s Goods / Services) Competing in a particular , identified market
Focus is on Differentiation / Competing & Winning
Customer / Market Focused Strategy
Potential clash with Corp Strategy eg in Retailing
Eg RIM¶s decision to apply for only 13 Licences initially
8/8/2019 Sbm - Emba - l1 Intro
http://slidepdf.com/reader/full/sbm-emba-l1-intro 28/28
SSD ± SBM - 1.
28
3 Levels of Strategy3 Levels of Strategy
L3 : Operational Strategy :
Putting together Strategic Architecture
Comprising of resources, processes, skills, etc.
Facilitating, Practicing & Delivering on L1 & L2
Seamless Integration of all levels is important
eg RIM¶s high impact promotion µMonsoon Hungama¶