Strategic Analysis
Welcome
to
Strategic Management
Dr Xueli (Charlie) Huang
School of Management
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Strategic Management
Introduction to the Course
Dr Xueli (Charlie) Huang
School of Management
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RMIT Classification: Trusted
School of Management
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Introduction to the Course
Course aims
Structure and content of the course
Teaching and learning approach/process
Teaching team
Course resources
Assessment
Course expectations
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RMIT Classification: Trusted
Why some organisations perform better over a long run?
---- A comparison of CBA share price with other companies
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This diagram shows the share price of four Australia companies: CSL, which became the largest Australian company, its market value passed CBA, CBA (Commonwealth bank of Australia), Qantas, the Australian airline company, Myer the largest listed department store. This is not the total shareholder return as we did not consider the dividends each year.
ALL Ord: 9.13%
CSL up 228%
Qan: 41.5%
CBA: -17.1%
MYR: -81.75%
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Why Study Strategic Management?
- We are possibly facing the greatest uncertainty in the world after the WWII
The impact of pandemic COVID-19 on the global economy
The Trump era and new nationalism movement
Brexit: How will it impact on the global economy?
The Great Decoupling (between China and USA)
The emergence of China, and potentially India in the next 5-10 year in the world.
Is the new world order coming?
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The impact of COVID-19 on global economy https://www.youtube.com/watch?v=0cGLrSpaf4o
At the macro-level, uncertainty in the macro-env.
How the President Trump era can impact on international trade, regional conflicts?
Class interactive activity (CIA): What is going on in UK now? (asking questions) Do you think which factor is more important to the future economy of Singapore?
After three years of haggling in the British Parliament, Britain closes the book on nearly half a century of close ties with Europe on Jan. 31.
Thucydides – an ancient Greek historian. He believed that when a large country is emerging and competing with the existing dominant large country, often it ended with war.
The phrase "Thucydides Trap" to refer to when a rising power causes fear in an established power which escalates toward war.
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Changes in the external environment offer market opportunities and also impose threats
- Socio-cultural changes: Aging population
- Technologic: AI, IoT, 3D printing, 5G (or 6G?)
- Climate change, global warming Greta Thunberg’s speech on climate change
- Resources and competences needed to compete
Apple
Some “unicorn” corporations
Uber, Twitter, Airbnb. Dropbox
Tencent Holdings Ltd, Baidu, and Didi
Alibaba
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At the industry level??? Telecommunications vs e-commence; at the organisational level: A2M vs Bellamy.
Where do we compete? How do we compete? How doe we execute?
A unicorn is a privately held startup company valued at over $1 billion. The term was coined in 2013 by venture capitalist Aileen Lee, choosing the mythical animal to represent the statistical rarity of such successful ventures.
Unicorn – Unicorns, or companies that have a market value of US$1 billion or more, are being nurtured in China at a rate that eclipses their US counterparts, according to a joint report by Boston Consulting Group, Alibaba Group, Baidu and Didi Chuxing.
The average unicorn in China took four years to develop from scratch, whereas the average unicorn cycle in the US was seven years, according to Boston Consulting. Airbnb, Twitter, Uber.
“software companies started since 2003 and valued at over $1 billion by public or private market investors”.
In many cases unicorns in China were thrust into the big leagues at an ultra-short span of time, with 46 per cent reaching the US$1 billion valuation in as little as two years from launch.
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How Small- and Medium-sized Firms Compete? -- the “Hidden Champions”
- The term "Hidden Champions" was coined by Hermann Simon (2009). He first used the term to describe the small, highly specialized world-market leaders in Germany.
- Hidden champions are relatively small but highly successful companies, most of them are small and medium enterprises (SMEs).
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Herman Simon is a German consultant and business leader. He published a book entitled” Hidden Champions of the Twenty-First Century: The Success Strategies of Unknown World Market Leaders” in 2009.
1. a single product manufacturer;
2. operate in global market to take advantage of economic scale;
3. operate extremely close to their customers, and their customers' needs are an important driver for their innovations;
do business on their own, rather than depend on working in cooperation with others.
4. The corporate culture of hidden champions is distinctive;
A serious problem for hidden champions, as it is for SMEs in general, is to attract international professionals.
"In Germany we have only 28 of the global 500 biggest companies but we have around 48% (1300) of those small world market leaders,“ Germany has 3.7 million SMEs. They are also growing in China and represent a future trend for SMEs.
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What are “Hidden Champions”? How do they compete?
- According to his definition, a company must meet three criteria to be considered a hidden champion:
Top three in the global market,
or number one on the company’s
continent by market share.
Revenue below $4 billion
Low level of public awareness.
- How do these hidden champions compete? What are key success factors for these companies?
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Hardlock Nut, Japan
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companies provide a high vertical integration of manufacture, they focus on niche markets and show willingness and high ability to globalize in those markets. Some examples:
- Koenig & Meyer in Germay: makes music and microphone stands. If you're a musician you have probably used one of them. Today the company employs 280 people in three factories and has a turnover of 38m euros (£34m; $44m). About 60% of sales are exports to 80 countries worldwide, with 70% of their turnover in Europe. Gabriella says customers, "accept that the product can be 15-20% more expensive than a competitive cheaper made item.“
- Universal fishing appliance. 山东环球渔具股份有限公司 Established in 1985, Shandong Weihai HUANQIU FISHING TACKLE INDUSTRIAL CO., Ltd. took the lead in bringing in fishing rods made from fiber glass into China;
- 广州市浩洋电子股份有限公司 Golden Sea Professional lighting provider. Golden Sea (Guang Zhou Hao Yang Electronic Co., Ltd.)is a keyhigh-tech company, in theProfessional Stage, TV, Concert, Theatre and Architectural lighting industry, combining research & development, production engineering, manufacturing, sales, service and creativity. http://www.terbly.com/
- Hardlock Nut Japan, specialised in producing nuts and screws. https://www.youtube.com/watch?v=fDEUA1n97uU
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Course aims
- The course is designed to help you develop the following capabilities:
Understand, analyse and critically evaluate key concepts, theories, analytical tools of strategic management.
Apply these concepts, theories and analytical tools to real-life organisations.
Integrate different components of strategic management into unifying models and link them to an anticipated outcome
Develop and implement strategies creatively under different contexts and with appropriate processes.
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So What is strategic management or strategy as someone calls it in short? A comprehensive view of the subject; am ambition to put that in practices; success in your studies.
Accordingly, the aims of this course are to:
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Main topics in this course
Concepts of strategic management
Part 1 Strategic position/analysis
External environment analysis, Resources and capabilities, stakeholders and governance
Part 2 Strategic choices / strategy formation
Business level, corporate, international strategies, and merger and acquisitions (M&A)
Part 3 Strategy in action/implementation
Organizational structure, managing strategic change, and practicing strategy.
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The difference between SM and other course: Whole organsiation vs functions;
The main questions: why some orgs are doing better than others; What determines the organisation’s performance? What can we do about it.
To answer these questions, we need to know the long-term direction and scope. Where we are competing and what we can do and what we should not do, boundary-setting.
Where do we compete: We need to identify the market opportunities to find attractive or profitable market ones.
How do we compete?
How do we execute?
There are four components in the course. They are
- Introduction to strategic management, covering fundamental concepts in strategic management;
- Strategic position or strategic analysis.
- Strategic choices or Strategy formation. This will cover the topic of business strategy, corporate strategy, international strategy, and M&A.
- Strategy in action or strategy implementation. Topics included in this part are organisational structure, control systems, leadership and change management, and practicing strategy.
I will provide a detailed description on these four components later on in this session.
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Recommended textbook
Whittington, R., P. Regner, D. Angwin, G. Johnson, & K. Scholes. (2020). Exploring Strategy: Text & Cases (12th ed.) Pearson Education.
One of the best textbooks in strategic management
It provides a comprehensive view of strategic management
It offers contemporary strategic management practice;
It is easy to read.
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The textbook we are going to use in this course is Johnson, Whittington and Scholes’s Exploring Strategies (11th edition). It is available at RMIT bookstore already.
This textbook is accompanied by online resources: MystrategyLab.
The online resource contains very good learning resources and activities, and an online simulation program: STRATEGY EXPERIENCE SIMULATION, covering strategic analysis, strategy formation, and strategy implementation.
Go to the weblink of MyStrategyLab to show students.
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Class activities
A schedule of lecture topics and tutorial activities is posted on the Course Canvas
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Teaching and learning approach (1/4)
- Course delivery
The course will be delivered with the following approach:
Three online intensive lectures this week.
One hour pre-recorded lecture
two hour tutorial
Weekly lecture and tutorial for other 9 weeks
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Teaching and learning approach (2/4)
- Lectures are to:
provide a description, explanation, critical analysis, and integration of key theories, concepts, models, analytical tools, and philosophical thoughts in strategic management;
introduce new developments in strategic management, such as new theories, ideas, concepts, business models, and practices.
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Preparatory research and reading to enhance classroom learning activities;
For Lectures, they are to explain and provide a critical analysis of the principles, relevant concepts, model, theories, analytical tools, and philosophical thoughts which form the foundations of strategic management;
Lecturers as learning facilitator, expert, and resource.
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Teaching and learning approach (3/4)
- Weekly lecture and tutorial will be focused on:
reinforcing your knowledge about strategic management learnt from the lectures
applying such knowledge to case studies and strategic issues in real-life organisations
developing your capability in analysing, evaluating and integrating strategic theories and practices through guiding your assignments.
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For the face-to-face tutorials, there will a variety of class activities: such as case studies, group presentation, discussion of review questions, watch videos clips, discussion of newspaper and journal articles, and assignment. These activities are to facilitate the development of your capabilities in analysing, evaluating, and critical thinking, and your ability to diagnose ideas and apply them in the field of strategy.
applying such knowledge to case studies and strategic issues in real-life organisations through conducting
case studies;
analysis and discussion of contemporary strategic issues as reported in TV programs, newspapers, business magazines and Internet; and
group debate and discussion
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Teaching team
Offering coordinator: Dr Charlie Huang
email: charlie.huang@rmit.edu.au
Office location: Melbourne, Australia, Building 80.09.34
Telephone +61 3 9925 1648
- Local lecturers
Dr Thomas Lim: thomas.lim@rmit.edu.au
Ms Jeanette Ng: chiahui.ng@rmit.edu.au
Mr Param Alahakone: param.alahakone@rmit.edu.au
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Course resources
- myRMIT - Course Canvas
PowerPoint slides, additional readings, additional cases, assignment requirements, and topic schedule
Quiz, online discussions.
- RMIT Library
Electronic database, such as Business Source Premium (EBSCO) for journal articles, Factiva for newspapers articles, IBISWorld for industry reports
Recommended textbooks, business magazines, newspapers
Referencing information and software (e.g., Endnote, which can be downloaded from RMIT Library)
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Canvas – A new learning platform
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Assessments
- There are three pieces of assessments
Assignment 1 (A1): Individual Assignment (Strategic analysis) 30%
Assignment 2 (A2): Group Assignment (Strategic capability analysis, Strategy formation and implementation) 40%
A group of 4 students
Final Assessment 30%
Essay questions
Advice on the final assessment will be provided in Week 11
No hurdle assessment
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Assignment 1
- Strategic analysis (External environment analysis) report
It is to:
analyse the external for a real-life firm (if it is not a corporation) or one of its Strategic Business Unit (SBU)
It is based on the contents of Modules 2-3
30%, Due date: Monday Week 6 (See Assignment Guide for details)
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Assignment 2
- Strategic capability analysis, strategy formation and implementation
Group assignment: A group of 4 students from the same local lecture class (by the end of Week 5)
See Assignment 2 Guide for detailed requirements (in Course Canvas)
40%, Due date: Monday Week 12 (See Assignment Guide for details)
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Assignment (cont’d)
- The detailed assignment requirements and guide are posted on the Course Canvas and will be discussed in the tutorials.
- All assignments must comply with RMIT academic referencing requirements
You may consider using Endnote software for this.
- Academic integrity
Evaluate sources of information
Full and accurate referencing is important!
Referencing guides - myRMIT- library
Plagiarism - Turnitin
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Assignment submission
Submit in electronic copy as required by RMIT policy
Submit your e-assignment via the course Canvas.
Sign assignment cover sheet
Include name of your local lecturer and lecture/tutorial time
Keep electronic copy of assignment
Any extension application must be received 1 day before assignment due date.
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Final Assessment
Final Assessment
Integrated Essays
30%
One part: Three essays (30 marks)
Due: Monday, Week 14
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Expectations
Attend all lectures and tutorials in which you enroll
Read the textbook before lecture
READ CASE BEFORE LECTURE/TUTORIAL
Discuss and analyze cases in lecture/tutorial
Participate in class activities, including in-class case study
Complete learning exercises at home to enhance understanding
Working with study group on the assignment for the chosen organisation
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Expectations (cont)
Complete assignment by due dates
Academic integrity and honesty
Link what you learn to strategic issues in organisations
Link theory to contemporary strategic issues in real-life organisations via analysis, evaluation, synthesis, and creation.
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Questions
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