need report on chapter one and chapter 13
Suresh-
CHAPTER1.pptxSTRATEGIC MANAGEMENT: CREATING COMPETITIVE ADVANTAGES
CHAPTER -1
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STRATEGIC MANAGEMENT PROCESS
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MAP OF THE STRATEGIC MANAGEMENT PROCESS, LISTING ALL CHAPTERS AND THEIR TITLES
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Chapter 1, Introduction and Analyzing Goals and Objectives.
Chapter 2, Analyzing the External Environment.
Chapter 3, Analyzing the Internal Environment.
Chapter 4, Assessing Intellectual Capital.
The chapters concerning Strategy Formulation are
Chapter 5, Formulating Business-level Strategies.
Chapter 6, Formulating Corporate-Level Strategies.
Chapter 7, Formulating International Strategies.
Chapter 8, Entrepreneurial Strategy and Competitive Dynamics.
Strategy Implementation chapters are
Chapter 9, Strategic Control and Corporate Governance.
Chapter 10, Creating Effective Organizational Designs.
Chapter 11, Strategic Leadership Excellence, Ethics, and Change.
Chapter 12, Fostering Corporate Entrepreneurship.
and Chapter 13 concerns Case Analysis.
Arthur Martinez, Sears’s former chairman: “Today’s peacock is tomorrow’s feather duster”
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Meaning of Strategy
In ancient Greece, the term Strategos was used in military science and implied the plan to win a battle. However, in business, strategies are more about understanding the competition and preparing a plan to surpass the potential of the rivals. It is defined as:
“Strategy is the direction and scope of an organization over the long-term”
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Strategies at Different Levels of Business
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Corporate Strategies – These are explicitly mentioned in the organization’s Mission Statement. It describes overall direction towards growth e.g British airlines alliance with American airlines.
Business Unit Strategies – These are more about how a business competes successfully in a market. They involve strategic decisions about: Choosing products, Meeting the needs of the consumers e.g Apple computer.
Operational or functional Strategies –These strategies focus on the issues of resources, people, processes, etc e.g P & G’s
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STRATEGIC PLAN
Strategic Plan – a plan that includes the major goals, objectives, and action steps of the organization into a comprehensive document.
This plan is a long-term plan that may be for a period of three to five years.
There are different parts of a strategic plan, which includes vision, mission, goals, objectives, and strategies, which may be referred to as action steps.
Strategic – in uncertain environment; long term plan
Operational – in more certain environment, Medium term plan
Tactical – No plan, but out of experience spontaneous action
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WHAT IS STRATEGIC MANAGEMENT
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DEFINING STRATEGIC MANAGEMENT
Strategic management involves:
Analysis
Strategic goals (vision, mission, strategic objectives)
Internal and external environment
Decisions - Formulation
What industries should we compete in?
How should we compete in those industries?
Actions – Implementation of strategy
Allocate necessary resources.
Design the organization to bring intended strategies to reality.
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TWO PERSPECTIVES OF LEADERSHIP
External control perspective:
External forces determine the organization’s success.
Economic downturns
OR
Romantic view:
A leader is the key force in the organization’s success.
Steve Jobs
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KEY ATTRIBUTES OF STRATEGY
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CHALLENGES OF STRATEGIC MANAGERS
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STRATEGIC MANAGEMENT TRADE-OFFS
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Managers need to be ambidextrous.
Focus on long-term effectiveness.
Expand product-market scope by proactively exploring new opportunities.
At the same time:
Focus on short-term efficiency.
Align resources to take advantage of existing product markets.
INTENDED VS. REALIZED STRATEGIES
The business environment is far from predictable.
Intended strategy
Organizational decisions are determined only by scrutiny.
VERSUS
Realized or Emergent strategy
Decisions are determined by both analysis (deliberate) and unforeseen environmental developments, unanticipated resource constraints, and/or changes in managerial preferences (emergent).
Peter Drucker’s management book, whose words Zhang [ CEO of Haier, world no 1- home alliance company] took to heart: “There is only one valid definition of business purpose: to create a customer.”
https://www.youtube.com/channel/UCUliTFMtrGzTamS3gB2tdAg
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PLEASE HAVE A THOUGHT
Intended versus Emergent Strategies: While you may have planned your career trajectory carefully, don’t be too tied to it. Strive to take advantage of new opportunities as they arise. Many promising career opportunities may “emerge” that were not part of your intended career strategy or your specific job assignment. Take initiative by pursuing opportunities to get additional training (e.g., learn a software or a statistical package), volunteering for a short-term overseas assignment, etc. You may be in a better position to take advantage of such emergent opportunities if you make the effort to prepare for them. For example, learning a foreign language may position you better for an overseas opportunity.
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STRATEGIC MANAGEMENT PROCESS
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STRATEGIC MANAGEMENT PROCESS
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ANALYSIS : MISSION , OBJECTIVE, VISION, GOAL
Vision – This is a future view of the organization or what the organization will look like when it successfully completes its strategic plan.
Mission – describes what the organization does. The mission articulates the fundamental purpose of the organization. It also provides a clear statement of the organization’s values. The mission answers the question, “What is our business?”
Goals – what the organization wishes to accomplish. Goals are open-ended and general in nature.
Objectives – what will the organization accomplish, by what means, and by what date. Objectives are specific, measurable, attainable, realistic, and time bound (SMART). They tell what the organization will accomplish and by what date. They are of much shorter range than goals.
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EFFECTIVENESS VS. EFFICIENCY
Being effective is about doing the right things , while being efficient is about doing things right(way).
Toyota – Great Strategy
Entry of Japanese car makers, led by Toyota into the US market in the 1970’s.
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ANALYSIS EXTERNAL AND INTERNAL
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STRATEGY ANALYSIS
Analyzing organizational goals & objectives
Establish a hierarchy of goals.
Vision
Mission
Strategic Objectives
Analyzing the external environment of the firm
Managers must monitor and scan the environment as well as analyze competitors.
General environment
Industry environment
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STRATEGY ANALYSIS
Analyzing Organization Goals and Objectives (Chapter 1)
Analyzing the External Environment (Chapter 2)
Assessing the Internal Environment (Chapter 3)
Assessing a Firm's Intellectual Assets (Chapter 4)
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DECISIONS (STRATEGIC CHOICE)
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STRATEGY FORMULATION
Formulating business-level strategy
Successful firms develop bases for sustainable competitive advantage through:
Cost leadership and/or
Differentiation, as well as
Focusing on a narrow or industrywide market segment.
Formulating corporate-level strategy
Addresses a firm’s portfolio (or group) of businesses
What business or businesses should we compete in?
How can we manage this portfolio of businesses to create synergies?
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STRATEGY FORMULATION
Formulating international strategy
What is the appropriate entry strategy?
How do we go about attaining competitive advantage in international markets?
Entrepreneurial strategy and competitive dynamics
How do we recognize viable opportunities?
How do we formulate effective strategies?
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STRATEGY FORMULATION
Formulating Business Level Strategies (Chapter 5)
Formulating Corporate Level Strategies (Chapter 6)
Formulating International Level Strategies (Chapter 7)
Entrepreneurial Strategy and Competitive Dynamics (Chapter 8)
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ACTIONS (STRATEGY IMPLEMENTATION)
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STRATEGY IMPLEMENTATION
Strategic Control and Corporate Governance (Chapter 9)
Creating Effective Organizational Designs (Chapter 10)
Strategic Leadership: Excellence, Ethics and Change (Chapter 11)
Fostering Corporate Entrepreneurship (Chapter 12)
Analyzing Strategic Management Cases (Chapter 13)
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CORPORATE GOVERNANCE (detail in ch 9) & STAKEHOLDER MANAGEMENT
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Appropriate strategic management requires an effective & appropriate corporate structure.
Corporate governance is the relationship among various participants in determining the direction and performance of corporations.
Primary participants:
Shareholders
Management (led by the Chief Executive Officer)
The Board of Directors (BOD)
BOARD OF DIRECTORS
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Elected representatives of the owners
Ensure interests & motives of management are aligned with those of the owners:
Create an effective and engaged board.
Address shareholder activism.
Provide proper managerial rewards & incentives.
Establish external control mechanisms.
THE KEY ELEMENTS OF CORPORATE GOVERNANCE
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WHAT ARE SOME OTHER RECENT EXAMPLES OF POOR CORPORATE GOVERNANCE?[ WALMART]
References
Barnett, M. L. (2014). Why stakeholders ignore firm misconduct a cognitive view. Journal of Management, 40(3), 676-702.
Dodds, F. (2015). Multi-stakeholder partnerships: Making them work for the Post-2015 Development Agenda. United Nations.
Ghemawat, P., & Mark, K. A. (2006). The Real Wal-Mart Effect. Harvard Business School.
Jensen, M. C. (2000). Value Maximization and Stakeholder Theory. Harvard Business School.
Kampf, C. (2007). Corporate social responsibility: WalMart, Maersk and the cultural bounds of representation in corporate web sites. Corporate Communications: An International Journal, 12(1), 41-57.
The World Bank (2015). What is Stakeholder Analysis?
U.S. Department of Commerce. The Retail Services Industry in the United States.
Wal-Mart Stores, Inc. (2014). Walmart CEO Outlines Growth Strategy at Annual Meeting for the Investment Community.
Wal-Mart Stores, Inc. Walmart Form 10-K.
Wal-Mart Stores, Inc. Walmart Human Resources.
Walmart’s Official E-commerce Website.
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STAKEHOLDERS A shareholder can be an individual, company, or institution that owns at least one share of a company and therefore has a financial interest in its profitability.
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SOCIAL RESPONSIBILITY
Firms have multiple stakeholders and must go beyond a focus solely on financial results.
Social responsibility is the expectation that businesses or individuals will strive to improve the overall welfare of society.
Many young professionals expect their employers to be active in social issues. Membership in Netimpact.org, a network of socially-conscious MBA graduates, jumped from 4,000 in 2002 to 10,000 in 2004.
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STRATEGIC OBJECTIVES
Strategic objectives
Used to operationalize the mission statement
Provide guidance on how to fulfill mission & vision
Measurable, specific, appropriate, realistic & timely
Channel all employees’ efforts toward common goals
Can be both financial and nonfinancial
Should be challenging, yet help resolve conflicts
Provide a yardstick for rewards & incentives
BUT too many objectives can result in lack of focus
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COHERENCE IN STRATEGIC DIRECTION
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COHERENCE IN STRATEGIC DIRECTION
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The graphic depicts the hierarchy of goals as a triangle on the left, with vision at the top, mission statement in the middle, and strategic objectives at the base. To the right of the triangle is a graphic showing an arrow going both ways between general (vision) and specific (strategic objectives) and another arrow going both ways between long time horizon (vision) and short time horizon (strategic objectives).
Visions might be a general message, lacking specifics, whereas strategic objectives would be more specific, containing details. Visions have longer time horizons than would strategic objectives.
LET US DISCUSS
The attributes of strategic management described in this chapter are applicable to your personal careers as well. What are your overall goals and objectives? Who are the stakeholders you must consider in making your career decisions (family, community, etc.)? What tradeoffs do you see between your long-term and short-term goals?
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PLEASE HAVE A THOUGHT
Ambidexterity:
The four most important traits of ambidextrous individuals.
Looking for opportunities beyond the description of one’s job
Seeking out opportunities to collaborate with others,
Building internal networks, and
Multitasking.
Evaluate yourself along each of these criteria. If you score low, think of ways in which you can improve your ambidexterity.
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THANK YOU
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