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SM Bramhastra CA Inter New Syllabus
CHAPTER 1 - INTRODUCTION TO STRATEGIC MANAGEMENT
Management Strategy Strategy is no substitute for sound & alert management
1) Key group → in-charge of its Game plan that mgt. uses to- ➢ Strategy can never be perfect, flawless and optimal.
affairs ➢ conduct its operations, MT: C2OMA ➢ It is the very nature of strategy → flexible & pragmatic to
➢ compete successfully, take care of sudden emergencies & avoid failures
➢ Chief Organ → make ➢ achieve organizational objectives ➢ Sound strategy→ allowances are made for miscalculations
organization a purposeful & ➢ take market position, & & unanticipated event
productive entity, by bringing ➢ attract and satisfy customers.
together & integrating Strategy is partly proactive and partly reactive
It is also long-range blueprint of an
disorganised resources → ➢ Strategy is a blend of:
combined into a functioning organization’s MT: 3 D
➢ desired image (what it wants to be) ✓ Proactive actions → managers to improve company’s
whole. market position & financial performance
➢ Direction (what it wants to do &
➢ Survival & success of org. how it wants to do things) ✓ Reactions to unanticipated developments & fresh market
depends on competence & ➢ Destination (where it wants to go). conditions in dynamic business environment. Adapting to
character of its management. Scheme of corporate intent & action- environment.
➢ to mobilise resources, MT: Utilise M2DH Strategic Management
2) Set of inter-related functions ➢ to direct human effort and
& processes behaviour, Strategic management is made up of several distinct
Planning, Organising, Directing, ➢ to handle events and problems, activities:
Staffing & Control. ➢ to perceive and utilise ➢ developing vision & mission;
MT: Control MAD
opportunities, and ➢ strategic analysis;
They range from- Goals ➢ to meet challenges and threats for ➢ developing objectives;
➢ installation of control system corporate survival and success. ➢ creating, choosing, & implementing strategies; and
➢ mobilisation & acquisition of Integrated framework for top mgt.- ➢ measuring & evaluating performance
resources, ➢ to use resources & strengths, MT: ➢ Taking corrective adjustments wherever required
SWOT
➢ allocation of tasks & resources ➢ to offset corporate weaknesses.
➢ design of organization & ➢ to search, evaluate & exploit Join Telegram Channel of MVSIR- @camvsir
➢ determination of the goals. beneficial opportunities, Instagram Channel of MVSIR- @ca_mohnishvora
➢ to perceive & meet threats & crisis, Buy books & classes of MVSIR- www.mvsir.in
CA Mohnish Vora (MVSIR) mvsir.in 1.1
SM Bramhastra CA Inter New Syllabus
CHAPTER 1 - INTRODUCTION TO STRATEGIC MANAGEMENT
Strategic Management
Importance/Benefits of Limitations of Objectives of
Strategic Management Strategic Management Strategic Management
MT: Facebook pe Frame wali DP C2yu Lagate hai ? MT: Costly ETC 1) To create competitive advantage → to
1) SM is a costly process. Expert outperform the competitors.
1) SM prepares organisation to face the future
→ act as pathfinder to various opportunities. strategic planners, efforts for 2) To guide company through all changes in
analysis of environments, devise environment → React in right manner
2) SM provides frameworks for all major & implement strategies.
decisions → on products, businesses, markets, Strategic Intent
etc. (PBM) 2) It is difficult to clearly estimate
the competitive responses. ➢ Refers to purposes of what organisation strives for
3) SM gives a direction → to move ahead. Helps Difficult to know strategies of
define goals & mission. Defining objectives → ➢ Senior managers must define-
competitors → taken within
in line with vision ✓ “what they want to do” and
closed doors. For eg, Apple
✓ “why they want to do”.
4) SM helps org. to be proactive instead of removing 3.5mm audio jack
“Why they want to do” represents strategic intent
reactive. → analyse & take actions → take from iPhones.
control their own destiny ➢ It is the philosophical base of SM.
3) SM is a time-consuming process.
5) SM serves as a corporate defence mechanism Org spend lot of time in→ ➢ Answers the question- what organisation strives
against mistakes & pitfalls. → avoid costly preparing & communicating the or stands for?
mistakes strategies → may impede daily Elements of Strategic Intent
operations
6) SM helps org. to develop core competencies & Strategic intent could be in form of
competitive advantages → fight for survival 4) Environment is highly complex &
and growth turbulent difficult to understand vision & business goals &
environment. The org. estimate mission definition & objectives
7) SM helps to enhance the longevity of about future may go wrong. For statements business at
business. It helps org to take a clear stand → eg, Two-Wheeler Electric at model Functional
not just surviving on luck. Actions over Vehicles → incidents of battery corporate at (Operational)
expectations is what SM ensures. catching fire. level business level level
CA Mohnish Vora (MVSIR) mvsir.in 1.2
SM Bramhastra CA Inter New Syllabus
CHAPTER 1 - INTRODUCTION TO STRATEGIC MANAGEMENT
Vision Mission
Meaning Why should an org. have
Meaning Peter Drucker & Theodore
a mission?
➢ Vision is the blueprint of the Levitt → org should
➢ A mission is an answer to the basic MT: PUT BMW in Focus
company’s future position answer these questions
question-
✓ It shows management’s 1) To specify organisational before starting its business
✓ what business are we in? ; &
aspirations for business, purposes & translation
✓ what we do? MT: PUB4G MSN2
✓ Provides a panoramic view of of purposes into goals.
1) What is our ultimate
“where we want to go” & ➢ It describe an organisations present-
2) To ensure unanimity of purpose?
✓ a rationale for why this makes ✓ activities, MT: ABC
purpose 2) Do we understand our
good business sense. ✓ business makeup,
business correctly?
✓ capability & customer focus 3) To establish a general
3) What do we want to
➢ Vision thus points out- tone or organisational
become?
✓ a particular direction, Components of a good mission statement climate
4) What business are we
✓ charts a strategic path 4) To develop a basis for in?
1) Mission statement should give org its
✓ moulding organisational identity allocating resources. 5) In what business would
own-
Essentials of a Strategic Vision ✓ special identity, we like to be in future?
5) To provide a basis for
MT: CEED ✓ business emphasis & 6) What brings us to this
motivating the use of
1) Challenge → think creatively ✓ path for devp. – one that sets it particular business?
resources.
about how to prepare a co. for apart. 7) What kind of growth do
future. 6) To facilitate translation we seek?
2) Mission should specify-
of objective & goals into 8) What is our mission?
2) Forming vision → exercise in ✓ what needs org is trying to satisfy,
a work structure 9) Whom do we intend to
intelligent entrepreneurship. ✓ which customer groups it is targeting
involving assignment of serve?
3) Well-articulated vision creates &
tasks. 10)What human need do
✓ technologies & competencies it uses &
enthusiasm among members of we intend to serve
✓ activities it performs 7) To serve as a focal point
org. through our offer?
→ who can identify with
3) Unique to the org. 11)What would be nature
4) It illuminates direction in org’s purpose &
which org. is headed 4) Not be to make profit of business in future?
direction.
CA Mohnish Vora (MVSIR) mvsir.in 1.3
SM Bramhastra CA Inter New Syllabus
CHAPTER 1 - INTRODUCTION TO STRATEGIC MANAGEMENT
Goals & Objectives LTO are established in 7 areas Intent vs Values - Which is broader concept?
OR Key areas in which the strategic
Goals ➢ Intent is the purpose of doing business
planner should concentrate his mind
Goals are open-ended attributes that denote the future ➢ Values are principles that guide decision
to achieve desired results.
states or outcomes. making of business.
✓ Profitability MT: 3P 2E CT ➢ They both go hand in hand, while the
Objectives Productivity
✓ intent is driven by values.
➢ Objectives are close-ended attributes → precise & ✓ Public Responsibility ➢ So values more or so is wider than Intent
expressed in specific terms. ✓ Employee Development
➢ They transalate goals to → short-term & long-term ✓ Employee Relations Join Telegram Channel of MVSIR- @camvsir
Competitive Position Instagram Channel of MVSIR- @ca_mohnishvora
perspective ✓
Technological Leadership Buy books & classes of MVSIR- www.mvsir.in
➢ They are performance targets –results org wants to ✓
achieve.
➢ They function as yardsticks (benchmark) for tracking Values Strategic Levels of Org.
an org’s performance. ➢ Values are deep-rooted principles which guides Corporate Level Managers
decisions & actions. ➢ CLM consists of CEO & other
Characteristics of Objectives
MT: S2MART & Challenging Performance ➢ As per Collins & Porras core values → inherent senior executives, BOD, &
1) Concrete & specific. & sacrosanct corporate staff.
2) Provide basis for strategic decision-making. ➢ Values sets tone for how people will think & ➢ Participate in strategic
3) Measurable and controllable. behave, in dilemma. decision making & oversee
devp of strategies & Implementing
MT: Formulating
4) Facilitative towards achievement of mission & ➢ Creates a sense of shared purpose → build strong
MBA Leadership
purpose. foundation and focus on longevity. ➢ Role of CLM includes-
5) Should define organisation’s relationship with its ➢ Employees → work with employers whose values 1) formulating & impl.
environment. resonate with them strategies that span
6) Related to a time frame. ➢ Consumers → buy products from cos. that have a individual businesses,
7) Challenging. purpose that reflects their own value & belief 2) defining mission & goals
8) Provide standards for performance appraisal. system. 3) determining what businesses
9) Should correlate with each other. ➢ Hence, values have both internal as well as it should be in,
10)Set within constraints of organisational resources & external implications. 4) allocating resources
external environment. ➢ For eg- HP Way, etc 5) providing leadership
CA Mohnish Vora (MVSIR) mvsir.in 1.4
SM Bramhastra CA Inter New Syllabus
CHAPTER 1 - INTRODUCTION TO STRATEGIC MANAGEMENT
Business Level Managers (BLM) 3 major types of networks of relationship
➢ Development of strategies for competing in 1) Functional & Divisional Relationship
individual business areas, (like FMCG, hotel, ➢ Independent relationship, where each function or a division is run independently
financial services etc) → responsibility of BLM headed by the function/division head, who is a BLM, reporting to business head, who
is CLM.
➢ The principal general manager at business level, or
BLM, is the head of the division (SBU). 2) Horizontal Relationship (Flat Structure) → More suitable for startups
➢ All positions, from top mgt to employees, are in same hierarchical position.
➢ BLM’s strategic role is to translate general
statements of direction & intent that come from ➢ This leads to- openness & transparency & more idea sharing & innovation.
the corporate level into concrete strategies for 3) Matrix Relationship
individual businesses. ➢ Grid-like structure of levels in an org., with teams formed with people from various
Functional Level Managers (FLM) departments that are built for temporary task-based projects.
➢ Helps to manage huge conglomerates (large org.)→ impossible to track every single
➢ FLMs → responsible for specific business functions team independently.
(HR, sales, etc)→ develop functional strategies ➢ More than one BLMs for each functional teams. (Dual-reporting)
➢ FLM’s sphere of responsibility is confined to one
organizational activity, whereas general managers Top Down Approach or Benefit of proactive strategy over reactive strategy
(BLM) oversee operation of whole Bottom-Up Approach?
MT: BCCE
company/division.
1) Allows for better risk management by identifying
➢ Top-down approach to potential challenges in advance, enabling organizations
➢ FLM provide information → helps BLM & CLM to
formulate realistic & attainable strategies. decision making → to develop contingency plans.
decision made solely by
➢ They are closer to the customers, suppliers & leadership at top 2) Result in cost savings as preventive measures can be
operations than general manager is. (CLM), more efficient than addressing crises retroactively.
➢ FLM themselves may generate important ideas ➢ Bottom-up approach → 3) Organizations can maintain a competitive edge by
that may become major strategies gives all teams across staying ahead of industry trends and changes.
the levels a voice in 4) It enhances organizational strength and responsiveness
➢ Also responsible for → strategy implementation,
decision making in navigating uncertainties.
i.e. execution of CLM & BLM plans.
CA Mohnish Vora (MVSIR) mvsir.in 1.5
SM Bramhastra CA Inter New Syllabus
CHAPTER 1 - INTRODUCTION TO STRATEGIC MANAGEMENT
Mission Vs Vision
1) Mission statement tells fundamental
purpose & concentrates on present. It
defines customer & critical processes & Remaining chapters will be
shared soon !
informs you of desired level of
performance. On the other hand, a
vision statement outlines what the
organization wants to be. It
concentrates on the future. It is a source
of inspiration. It provides clear decision -
making criteria.
2) The vision describes a future identity
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while the mission serves as an on-going @camvsir
and time-independent guide.
3) The vision statement can galvanize the
people to achieve defined objectives. A
mission statement provides a path to
realize the vision in line with its values.
4) A vision statement defines the purpose
or broader goal for being in existence &
can remain the same for decades, while
a mission statement is more specific in
terms of both future state & time frame.
Mission describes what will be achieved
if the organization is successful.
CA Mohnish Vora (MVSIR) mvsir.in 1.6
Connect with MVSIR
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@ca_mohnishvora
@camvsir
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mohnishvora
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Website
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Scan the above QR codes
