strategic management unit 1.ppt

8/9/2019 Strategic Management unit 1.ppt

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IndrajitCh 1 -1

Unit 1

The Nature of Strategic Management

Strategic Management: by

Indrajit C


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Art & science of formulating,

implementing, and evaluating,cross-functional decisions that

enable an organization to achieve its

objectives

Strategic Management efined


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!urpo"e of Strategic Management

To exploit and create new and different

opportunities for tomorrow


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Strategic Management

In essence, the "trategic planis a

companys game plan


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! "tages of the "trategic

#anagement $rocess

"trategy formulation

"trategy implementation

"trategy evaluation


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#i"ion$Mi""ion

Strategy%ormulation

&'ternal(pportunitie"$Threat"

InternalStrength"$)ea*ne""e"

+ong,Term(bjective"

-lternativeStrategie"

StrategySelection


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I""ue" in Strategy

%ormulation

.u"ine""e" to enter.u"ine""e" to abandon-llocation of re"ource"&'pan"ion or

diver"ificationInternational mar*et"Merger" or joint

venture"

-voidance of ho"tileta*eover

.u"ine""e" to enter.u"ine""e" to abandon-llocation of re"ource"&'pan"ion or

diver"ificationInternational mar*et"Merger" or joint

venture"-voidance of ho"tile

ta*eover


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StrategyImplementation

-nnual (bjective"

!olicie"

&mployee Motivation

/e"ource -llocation


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I""ue" in Strategy

Implementation

-ction Stage of Strategic

Management

Mobili0ation of

employee" $ manager"

Mo"t difficult "tage

Interper"onal "*ill"

critical

-ction Stage of Strategic

Management

Mobili0ation of

employee" $ manager"

Mo"t difficult "tage

Interper"onal "*ill"

critical


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Strategy &valuation

Internal /evie

&'ternal /evie

!erformance Mea"urement

Corrective -ction


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$eter %rucer' Thin through the

overall mission of a business( Asthe ey )uestion'

*)hat i" our .u"ine""23

!rime Ta"* of

Strategic Management


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(rgani0ation" "hould continually

monitor internal and e'ternalevent" and trend" "o that timely

change" can be made a" needed

-dapting to Change


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+ey Terms in "trategic #anagement

ompetitive advantage

"trategists

ision and mission statements

.xternal opportunities and threats Internal strengths and weanesses

/ong-term objectives

"trategies Annual objectives

$olicies


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Anything that a firm does especially

well compared to rival firms

Strategic Management i"

4aining and Maintaining

Competitive -dvantage


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"trategic #anagement #odel

Strategy%ormulation

StrategyImplementation

&valuationand Control

Mi""ion

(bjective"

Strategie"

!olicie"

0eedbac1/earning

&nvironmentalScanning

"ocietal

.nvironment

2eneral 0orces

Tas.nvironment

Industry Analysis

"tructure

hain of ommand

3esources

Assets, "ills

ompetencies,

+nowledge

ulture

4eliefs, .xpectations,

alues

3eason for

existence

5hat results

to

accomplish

by when $lan to

achieve the

mission &

objectives 4road

guidelines for

decision

maing

!rogram"

Activities

needed to

accomplish

a plan

.udget"

ost of the

programs!rocedure"

"e)uence

of steps

needed to

do the job

$rocess to monitor performance

and tae corrective

action

!erformance

&'ternal

Internal


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Strategi"t"

4ather Information

-naly0e Information

(rgani0e Information


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#i"ion Statement

)hat do e ant to become2

Mi""ion Statement

)hat i" our bu"ine""2

#i"ion and Mi""ion Statement"


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&'ternal (pportunitie" and Threat"

Analysis of Trends .conomic

"ocial

ultural %emographic1.nvironmental

$olitical, /egal, 2overnmental

Technological ompetitors


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.a"ic Tenet of Strategic Management

&'ternal (pportunitie" and Threat"

Strategy %ormulation

Ta*e advantage of&'ternal (pportunitie"

Ta*e advantage of&'ternal (pportunitie"

-void5minimi0e impact of

&'ternal Threat"

-void5minimi0e impact of

&'ternal Threat"


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ontrollable activities performedespecially well or poorly

%etermined relative to competitors

Internal Strength" and )ea*ne""e"


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-""e""ing the Internal &nvironment

Internal Strength" and )ea*ne""e"

Internal %actor"

!erformance Mea"ure"

/atio"

Indu"try -verage"

Survey ata


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+ong,Term (bjective"

&""ential for en"uring the firm6" "ucce""

!rovide direction

-id in evaluation

Create "ynergy

/eveal prioritie"

%ocu" coordination

!rovide ba"i" for planning7 organi0ing7motivating7 and controlling


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#eans by which long-term objectivesare achieved

Strategie"


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Strategie"

.xamples 2eographic expansion

%iversification

Ac)uisition

$roduct development

#aret penetration

3etrenchment

%ivestiture /i)uidation

6oint venture


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"hort-term milestones that firms mustachieve to reach long-term objectives

-nnual (bjective"


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#eans by which annual objectives willbe achieved

!olicie"


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"trategic #anagement $rocess

%ynamic & continuous#ore formal in larger

organizations

Strategic Management Model


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.valuation and ontrol

The process of monitoring corporate activities

and performance results so that actual

performance can be compared with desired

performance

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"trategic #anagement

ommunicationis a ey tosuccessful strategic management


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7ierarchy of "trategy

0unctional"trategy

4usiness8%ivision/evel9

"trategy

orporate"trategy

#anufacturing 0inance #areting3esearch

and%evelopment

7uman3esources

"trategic4usiness

:nit

"trategic4usiness

:nit

"trategic4usiness

:nit

orporate7ead)uarters


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"trategic %ecision-#aing $rocess

3eview and3evise as;ecessary' #ission


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.enefit" of Strategic Management


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.enefit" of Strategic Management

;onfinancial 4enefits .nhanced awareness of threats Improved understanding of competitors strategies Increased employee productivity 3educed resistance to change learer understanding of performance-reward

relationship .nhanced problem-prevention capabilities


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Types of Taeovers

Ta*eover

The transfer of control from one ownership group to another(

-c;ui"ition

The purchase of one firm by another

Merger

The combination of two firms into a new legal entity

A new company is created

4oth sets of shareholders have to approve the transaction(

-malgamation

A genuine merger in which both sets of shareholders must approve the transaction

3e)uires a opinion by an independent expert on the true value of the firms shareswhen a public minority exists

Conglomerate

A merger in which two firms in unrelated businesses combine(

Indrajit

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strategic management unit 1.ppt

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