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Dr.S.Sakthivel Sr. Professor / Hallmark Business School: Good Morning Best Wishes For Bright Career

The document discusses concepts related to strategic management including defining strategy, the strategy formation process, stakeholders, vision and mission, and strategic planning and strategic management. It also provides examples of strategic management concepts like analyzing the external environment, conducting internal analysis of resources and capabilities, and developing corporate, business, and functional strategies.

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Apoorva Sinha
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50 views

Dr.S.Sakthivel Sr. Professor / Hallmark Business School: Good Morning Best Wishes For Bright Career

The document discusses concepts related to strategic management including defining strategy, the strategy formation process, stakeholders, vision and mission, and strategic planning and strategic management. It also provides examples of strategic management concepts like analyzing the external environment, conducting internal analysis of resources and capabilities, and developing corporate, business, and functional strategies.

Uploaded by

Apoorva Sinha
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPT, PDF, TXT or read online on Scribd
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Good Morning

Best Wishes for Bright Career

Dr.S.Sakthivel
A.M.I.I.M.,P.G.D.B.A.,M.M.M.,M.Phil.,Ph.D

Sr. Professor / Hallmark Business School


 Conceptual Framework for Strategic
Management,
 the Concept of Strategy and
 the Strategy Formation Process –
 Stakeholders in Business –
 Vision, Mission and Purpose –
 Business Definition, Objectives and Goals –
Case Study.
Managers Old Concept :
“To-days decisions for To-days Business”

 “Latter Managers have to prepare to face the


challenges by introducing new methodology for
survival ,which turnout Strategic Planning
and subsequently Strategic Management to
excel ”.
 Importantly, the realised
strategy of the organisation
was not directly related to
the intended, deliberate
strategy, the precise and
explicit plan of the
organisation, but more an
outworking of the non
deliberate and hugely
variable strategies of the
work force; emergent
strategy.
It’s success mainly depends on

 Industry Contest
 National Contest
 Self Resources , Capabilities and Strategies.
 Strategic Planning is a critical, evolving, and
ongoing process for setting the future
direction of the Department.
 In addition to shaping its future, it directly
supports the effectiveness of the Department
in accomplishing its mission of providing and
maintaining the excellent transportation
system Georgians have come to expect.
 Strategic Management is the effort to
transform the high level directions of
Strategic Planning into well aligned actions
of the working units of the Department, using
performance measurements and performance
based management as a business process.
 Performance measurement supports the
decision making process to continually
improve transportation services for our
customers.
1. BHEL is Planning to expand its range of supercritical
power projects to cater the need of the country.
2. LG Electronics India Limited signed a MOU with
Maharashtra Government to expand its manufacturing
facility at Pune for Rs. 900 Crores
3. Maruti Udyog slashed the price of Maruti-800 in small
car segment (Rs. 160000)
4. Lenova a computer giant in china acquired IBM in
China.
5. Tata Steel entered Joint Venture agreement with
Iranian Mines and Mining Industries
6. Developments and Renovation Organization.
 “The prime task is to think through the
overall mission of a business”.
Peter Drucker

 “Imagination is more important than


knowledge, because knowledge is limited,
whereas imagination embraces the entire
world.”
. . . . Albert Einstein.
What is strategic management?
Strategic Management can be defined as
“the art and science of formulating,
implementing and evaluating cross-functional
decisions that enable an organization to
achieve its objective.”
“The on-going process of formulating,
implementing and controlling broad plans
guide the organizational in achieving the
strategic goods given its internal and external
environment”.
1. Globalization is the survival for business
2. E-Commerce becomes a business tool
3. Earth environment has become a major
strategic issue
 "Strategy is the direction and scope of an
organisation over the long-term, which
achieves advantage for the organisation
through its configuration of resources within a
challenging environment,
 to meet the needs of markets and to
fulfil stakeholder expectations".
1. Corporate Strategy
2. Business Strategy
3. Functional Strategy
 Corporate Strategy - is concerned with the overall purpose and
scope of the business to meet stakeholder expectations. This is a
crucial level since it is heavily influenced by investors in the
business and acts to guide strategic decision-making throughout
the business. Corporate strategy is often stated explicitly in a
"mission statement".

 Corporate strategy refers to the overarching strategy of the


diversified firm. Such a corporate strategy answers the
questions of "which businesses should we be in?" and "how
does being in these businesses create synergy and/or add to the
competitive advantage of the corporation as a whole?
 Business Unit Strategy - is concerned more
with how a business competes successfully in
a particular market. It concerns strategic
decisions about choice of products, meeting
needs of customers, gaining advantage over
competitors, exploiting or creating new
opportunities etc.
The Greek Word “Strategos”
Strategy in English and Chinese
• Strategy in Management, Administration, and
National Defense
• Also named Business Policy, Corporate
Management, Corporate Strategy, Business
Strategy, Strategic Management
 Top level, Long Term Plan/Intent, regarding
 Overall Corporate Direction
 Defines Scope, and focus, of activities
 Often about winning, out-performing
Competitors
 Building on resources
 Affected by values, expectations & power
 Sustainable – not casually changed.
 Basic Financial Planning
 Forecasting-based Planning
 Externally Oriented Planning
 Strategic Management

- Meeting annual budgets


- Incorporating predictions beyond next year
- Thinking strategically, Strategic Planning
- Considering also the implementation & control
aspects when formulating strategies
 1960s Design School
 1970s BCG Portfolio Management
 1980s Porter Positioning School
 Early 1990s Resource-based View
(Core Competence), & Learning Organization
 Mid 1990s Stretching ambition, not just
positioning/Fit
 Getting Things Done Through People
 Corporate level: Purpose and scope,
 Long Term Survival
 Business Level: Competition
 Operations Level: Action plans and implemen-
tation for human resources, financing, R&D,
manufacturing, etc.
 Mission – purpose, scope
 Vision/Intent, desired future state Goal
 Strategies - long term direction, plans
 Policies – Clear guidelines for decisions and actions
 Objectives – end results of planned activities,
 Should be compatible with Mission, probably
quantified:
– To achieve 10% annual growth in earnings per share
– To achieve 20% return on equity.
– To achieve 27% return on capital employed.
– To capture 45% market share within three years.
Programmes
 Strategic Analysis
 External Analysis:
 Environmental Scanning, Industry Analysis, ..
 Internal Analysis:
 Competences, Competitive Advantages,
Culture, Portfolio,
 Identify Structural Drivers of Change
 PEST Framework (PESTEL)

 Political, Economic, Social, Technological,

Environmental, Legal, ….
– Political-Legal
– Economic-Global
– Social-Cultural
– Technological
• Legal Scenarios Planning
Political–Legal (Governments’ Positions)
– Possible trade protection / customs measures ?
– Lobby-able consumer protection, environment ?
– Usable Export Promotion ?
Economic Trend
– Demographics: younger / older population
– People’s disposable income
– Exchange rate stability
– Those of e.g. neighbouring countries
Social-Cultural
– Lifestyle
– Fascination
– Attitudes towards foreign products, pollution,
wastages, ..
Technological
– Flexibility in product changes
– Flexibility in packaging changes
– New food and drug laws, environmental laws, local
and overseas
1. Threat of New Entrants vs. Barrier to Entry:
economies of scale; capital requirement; access to
distribution channels; experience; expected
retaliation; government action; differentiation
(customer preference)
2. Threat of Substitutes
– Product-for-product substitution (letter-email)
– Substitution of need (scissors-sharpening service)
– Generic substitution (competing for disposable
income)
3. Power of Buyers
– Concentrated Buyers
– Large number of small vendors
– Undifferentiated alternative sources of supply
– Constitute significant portion of total cost
– Low cost of switching
– Threat of backward integration by the buyer
4. Power of Suppliers
– Concentrated suppliers
– High switching cost
– Powerful brand of supplier
– Threat of forward integration by supplier
– Fragmented buyers
5. Competitive Rivalry
– Balance of power, market growth rates, fixed costs,
increments of extra capacity, differentiation, exit barriers
• Strategic Groups and Organizational Fields
(Supply Chain, Distribution Chain, Clusters)
• Markets, market segments, new markets
• Consumer needs:
– brand reputation,
– after-sales service,
– delivery reliability,
– quality, ..
– Plus taken-for-granted factors
• Any other S.W.O.T. ?
• Portfolio
• Culture
• Competence

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