1 WELCOME to the class of Advanced Strategic Management Dr. H. Rahman
You and me in Class … !!
How I will Teach?
Follow the book
Multimedia presentation
Handouts of class lectures
What I expect from you? Be regular and participative
Start your work on your Project from Today
Prescribed Text Book:
Strategic Management -- (3th Edition)
Creating competitive advantages
Authors- Dess / Limpkin / Eisner
Syllabus:
Chapters = 1,2,5,6,7,8,9,13,14
Total = 9 Chapters
Principles of Management
Marks Distribution
Sessional Marks 50
Project/Presentation 20
Class participation/ Attendance 05
Midterm test 25
End Term Exam 50 Total 100
Pass Percentage 60%
Common Characteristics of Organizations
Copyright © 2004 Prentice Hall, Inc. All rights reserved.
EXHIBIT 1.1
Break Time
The break is only for 15 Min
All the students are advised to come to class
on time
The class after break is very important
PRODUCTIVITY ?
EFFECTIVENESS ?
EFFICIENCY ?
Amin of Management
Effectiveness – Efficiency –Productivity
PRODUCTIVITY
Productivity = Output / Input (within time & quality)
Productivity – Effectiveness - Efficiency
PRODUCTIVITY
Productivity = Output / Input (within time & quality)
EFFECTIVENESS
To achieve objectives within the available resources
Productivity – Effectiveness - Efficiency
PRODUCTIVITY
Productivity = Output / Input (within time & quality)
EFFECTIVENESS
To achieve objectives within the available resources
EFFICIENCY
To achieve objectives at the least cost of resources.
Productivity – Effectiveness - Efficiency
Managerial Roles Approach
By Mintzberg of McGill Uni
Based on:
What Managers actually do?
Research of 05 CEOs
Conclusion: Managers fill series
of 10 Roles:
Managerial Roles Approach
Interpersonal roles
Figurehead
Leader
Liaison
Informational roles
Recipient
Disseminator
Spokesperson
Decisional roles
Entrepreneurial
Disturbance handler,
Resource allocator
Negotiator
© 2008 Weihrich and
Cannice
Definition of Strategy and Policies
Strategy is the determination of the mission
(or the fundamental purpose) and the basic
long-term objectives of an enterprise, and the
adoption of courses of action and allocation of
resources necessary to achieve these aims.
Policies are general statements or
understandings that guide managers' thinking
in decision making.
Two Perspectives of Leadership
Romantic view
Leader is the key
force in organization’s
success
External control
perspective
Focus is on external
factors that may affect
an organization’s
success
QUESTION
A CEO made a lot of mistakes such as committing
errors in assessing the market and competitive
conditions and improperly redesigning the
organization into numerous business units. Such
errors led to significant performance declines. This
illustrates the __________ perspective of leadership.
A. External control
B. Romantic
C. Internal mechanism
D. Operational
What is Strategic Management?
Strategic
management must
become both a
process and a way of
thinking throughout
the organization
Leaders must be
proactive, anticipate
change, and
continually refine
changes to their
strategies
Defining Strategic Management
Strategic management
Analyses, decisions, and actions an organization
undertakes in order to create and sustain
competitive advantages
Defining Strategic Management
Analysis
Strategic goals
Internal and external environment of the firm
Strategic decisions
What industries should we compete in?
How should we compete in those industries?
Defining Strategic Management
Actions
Allocate necessary resources
Design the organization to bring intended strategies
to reality
Two Fundamental Questions
1. How should we
compete in order to
create competitive
advantages in the
marketplace?
2. How can we create
competitive
advantages in the
marketplace that are
unique, valuable,
and difficult for rivals
to copy or
substitute?
Key Attributes of Strategic
Management
Stakeholders
those individuals, groups, and organizations who
have a “stake” in the success of the organization,
including owners (shareholders in a publicly held
corporation), employees, customers, suppliers, the
community at large,
1-34
Key Attributes of Strategic
Management
Ambidexterity
The challenge managers face of both aligning
resources to take advantage of existing product
markets as well
as proactively
exploring new
opportunities
Ambidextrous Behaviors in
Individuals
They take time and
are alert to
opportunities beyond
the confines of their
own jobs
They are brokers,
always looking to
build internal networks
They are cooperative
and seek out
opportunities to
combine their efforts
with others
They are multitaskers
who are comfortable
wearing more than
one hat
Strategic Management Process
Intended strategy
Decisions are determined only by analysis
Realized strategy
Decisions are determined by both analysis and
unforeseen environmental developments,
unanticipated resource constraints, and/or changes
in managerial preferences
Strategic Analysis
Consists of “advance work” that must be done in
order to effectively formulate and implement
strategies
Starting point
Strategy Formulation
A firm’s strategy formulation is developed at several
levels:
Business-level
Corporate level
International
Entrepreneurial
Strategy Implementation
Ensuring proper
strategic controls and
organizational designs
Establishing effective
means to coordinate
and integrate activities
within the firm as well
as with suppliers,
customers, and
alliance partners
Corporate Governance and
Stakeholder Management
Corporate governance
The relationship among various participants in
determining the direction and performance of
corporations
Shareholders
management
board of directors
Corporate Governance and
Stakeholder Management (cont.)
Board of Directors
Elected representatives
of the owners
Ensure interests and
motives of management
are aligned with those
of the owners
Exhibit 1.4
Corporate Governance
Three mechanisms ensure effective corporate
governance:
An effective and engaged board of directors
Shared activism
Proper managerial rewards and incentives
Stakeholder Management
Zero sum view
Stakeholders compete for attention and resources
of the organization
Gain of one is a loss to the other
Rooted in the traditional conflict between workers
and management
Stakeholder Management
Stakeholder symbiosis view
Stakeholders are dependent upon each other for
their success and well-being
Mutual benefits
1-47
QUESTION
Outback Steakhouse has developed a
sophisticated quantitative model and found that
there were positive relationships between
employee satisfaction, customer satisfaction, and
financial results. This is an example of
__________.
A. Zero-sum relationship among stakeholders
B. Stakeholder symbiosis
C. Rewarding stakeholders
D. Emphasizing financial returns
Social Responsibility
Social responsibility
The expectation that businesses or individuals will
strive to improve the overall welfare of society
Social Responsibility
Triple bottom line
Assessment of a company’s performance in
financial, social, and environmental dimensions
Example: Social Responsibility
Starbucks Coffee Company defines CSR
as:
Conducting business in ways that produce social,
environmental and economic benefits for the
communities in which we operate and for the
company’s stakeholders, including shareholders.
Some tangible benefits include attracting and
retaining our partners, customer loyalty, reducing
operating costs, and creating a sustainable supply
chain.
Strategic Management
Perspective
All managers and employees must:
Take an integrative, strategic perspective
of issues facing the organization
Assess how functional areas and activities
“fit together” to achieve goals and
objectives
Three Types of Leaders
Local line leaders
Have significant profit-and-loss responsibility
Executive leaders
Champion and guide ideas, create a learning
infrastructure, establish a domain for taking
action
Three Types of Leaders (cont.)
Internal networkers
Generate power
through the conviction
and clarity of their
ideas
Coherence in Strategic Direction
Hierarchy of goals
organizational goals ranging from, at the top, those
that are less specific yet able to evoke powerful and
compelling mental images, to, at the bottom, those
that are more specific and measurable.
Vision, mission statement, strategic objectives
Coherence in Strategic Direction
Organizational
vision
Goal that is “massively
inspiring, overarching,
and long term”
Represents a
destination that is driven
by and evokes passion
Why Do Visions Fail?
The walk doesn’t
match the talk
Irrelevance
Too much focus leads
to missed
opportunities
Not the holy grail
An ideal future
irreconciled with the
present
Coherence in Strategic Direction
Mission statement Set of goals that include both the purpose of the
organization, its scope of operations, and the basis
of its competitive advantage
Has the greatest impact when it reflects an
organization’s enduring, overarching strategic
priorities and competitive positioning
Coherence in Strategic Direction
Strategic objectives
A set of organizational goals that are used to
operationalize the mission statement and that are
specific and cover a well-defined time frame.