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Ba 508 Strategic Management

The document discusses strategic management and provides definitions of strategy, characteristics of strategic decisions, levels of strategy, and phases and benefits of strategic management. It also covers topics like the impact of globalization, environmental sustainability, and strategic flexibility.

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Mojgan Amirforoughi
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59 views32 pages

Ba 508 Strategic Management

The document discusses strategic management and provides definitions of strategy, characteristics of strategic decisions, levels of strategy, and phases and benefits of strategic management. It also covers topics like the impact of globalization, environmental sustainability, and strategic flexibility.

Uploaded by

Mojgan Amirforoughi
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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BA 508 STRATEGIC MANAGEMENT

STRATEGIC MANAGEMENT & BUSINESS POLICY


13TH EDITION
THOMAS L. WHEELEN J. DAVID HUNGER

EXPLORING CORPORATE STRATEGY

GARRY JOHNSON
KEVAN SCHOLES
RICHARD WHITTINGTON
Definitions of strategy (1)
“Strategy is the direction and scope of an organization over
the long term: which achieves advantage for the
organization through its configuration of resources within
a changing environment, to meet the needs of markets
and to fulfill stakeholder expectations.”

Johnson, Scholes & Whittington 2008


Definitions of Strategy (2)
“Strategy becomes a fundamental framework through which an
organization can assert its vital continuity, while at the same time
purposefully managing its adaptation to the changing environment to
gain competitive advantage. Strategy includes the formal
recognition that the recipients of the results of a firm’s actions are
the wide constituency of its stakeholders. Therefore the ultimate
objective of strategy is to address stakeholder benefits – to provide
a base for establishing the host of transactions and social contracts
that link a firm to its stakeholders.”
Hax 1990
Definitions of Strategy (3)

“Strategy is the name we give to our future mistakes”


Allen
Characteristics of Strategic Decisions
• Long term direction
• Creating advantage
• Scope of activities
• Matching to the environment
• Building and changing resources and competences
• Impact upon operational decisions
• Values and expectations
The Levels of Strategy

Corporate-
level
strategy

Business-level
strategy

Operational strategy
STRATEGIC MANAGEMENT & BUSINESS POLICY
13TH EDITION
THOMAS L. WHEELEN J. DAVID HUNGER
The 1950 ler Amerikan Motorsiklet Pazarı

Marlon Brando
The Wild Ones (1953)
Triumph 650cc
“You Meet the Nicest People on a Honda”

The Honda 50cc


Super Cub
A World Beater!
https://www.youtube.c
om/watch?v=zGn_od9
owp8
Strategic Management: a set of managerial decisions
and actions that determines the long-run performance
of a corporation.

Includes:
• Internal and external environment scanning
• Strategy formulation
• Strategy implementation
• Evaluation and control
Phases of Strategic Management:

• Phase 1: Basic financial planning


• Phase 2: Forecast-based planning
• Phase 3: Externally oriented strategic planning
• Phase 4: Strategic management
Benefits of Strategic Management:

• Clearer sense of strategic vision for the


firm
• Sharper focus on what is strategically
important
• Improved understanding of a rapidly
changing environment

Prentice Hall, Inc. ©2012 1-14


Additional Benefits of Strategic Management:

• Improved organizational • Strategic thinking


performance • Organizational learning
• Achieves a match
between the
organization’s
environment and its
strategy, structure and
processes
• Important in unstable
environments

Prentice Hall, Inc. ©2012 1-15


Questions to start :

• Where is the firm now?


• If no strategy of change, where will the
company be in 1 year, 2 years and 10
years ?
• If not happy with above, what specific
actions need to be taken with what
payoffs and risks ?
Impact of Globalization:

Globalization: the integration and internationalization of


markets and corporations
Impact of Environmental Sustainability:

Environmental Sustainability: the use of business


practices to reduce a company’s impact on the natural,
physical environment
Population ecology: established organizations are
unable to adapt to change

Institution theory: organizations adapt by imitating


successful organizations
Strategic choice perspective: organizations adapt to
change and have the ability to reshape their
environment

Organizational learning theory: organizations adapt


defensively and use knowledge to improve their
relationship with the environment
Strategic flexibility: the ability to shift from one
dominant strategy to another and requires:

• Long-term commitment to the development and


nurturing of critical resources
• Learning organization
Learning organization: an organization skilled at
creating, acquiring, and transferring knowledge and at
modifying its behavior to reflect new knowledge and
insights
Main activities of a learning organization include:

• Solving problems • Learning from past


systematically experience, history and
experiences of others
• Experimenting with new
approaches • Transferring knowledge
quickly and easily
throughout the
organization
Basic Elements of Strategic Management

1. Environmental scanning
2. Strategy formulation
3. Strategy implementation
4. Evaluation and control
External Environment-Internal Environment
Mission Statement

▪ Objectives
results of planned activity

% x increase of sales or

% y increase of profit or

% z growth increase or

ROI ( return of investment )


Strategy Implementation

▪ Programs
statement of steps needed to achieve objectives

outsourcing 59 % of manufacturing

delivery from order by 10 days

reducing turnover employee by 40 %

production efficiency increase by 25 %

product development time from 1 year to 8 months


Strategy Implementation

▪ Budgets
statement of firm’s programs in dollars

3 new products to increase market share as $ 1 mios

$ 3 mios to increase capacity of R&D


What Makes a Strategic Decision?

Strategic decision making focuses on the long-run


future of the organization

Characteristics of strategic decision making include:


• Rare
• Consequential
• Directive
1. Why has strategic management become so important
to today’s corporations?
2. How does strategic management typically evolve
in a corporation?
3. What is a learning organization? Is this approach to
strategic management better than the more traditional
top-down approach in which strategic planning is primarily
done by top management?
4. Why are strategic decisions different from other kinds
of decisions?

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