Strategic mgt. chap. 1

CHAPTER 1

Set of rules that guides the decisions andactions of the members.

Set of rules that guides the conduct ofthe business in pursuit for profit andother objectives.

More often, its coming from the minds ofthe founders, leaders and managers.

It maybe informal or in writing in the form of:

a. Operational manual

b. Personnel handbook

c. Memoranda issued from time to time and

as the need arises

d. Minutes of the meetings

e. Documentation – workshops, year-end

activities

The top management’s plan to attain the outcomes consistent with the organization’s mission and goals. (Wright, Kroll & Parnell <1996>)

Categories of Strategy:

a. Intended Strategy – Original Strategy that

management plans and intends to implement

b. Realized Strategy – Actual/Eventual Strategy

that management actually implements

A set of competitive moves and business approaches that management is employing to run the company. (Thompson & Strickland <1999>)

Management’s Game Plan:

a. Attract and please the customer

b. Stake out a market position

c. Conduct operations

d. Compete successfully

Strategy – originated from the greek word stratego referring to a general w/c traces its root from the words army & lead.

Stratego – means to plan a distruction of one’s enemies through effective use of resources

In Management: Business strategy could mean

the application of Military

strategy

Business policies exist amidst absence of strategy – Business strategies may exist w/o established policy

Business policies generally directional in nature – strategy more operational in context

Business policies – formal/written –Strategies maybe informal, not necessary in written and often confidential

Strategic Management – strategic decision-making that relates to its environment, guides internal activities & determines long-term performance of the organization. (Stahl & Grigsby <1992>)

Strategic Management- Set of managerial decisions and actions that determine the long-run performance. It includes environmental scanning, strategy formulation & implementation, evaluation and control. (Wheelen & Hunger <2004>

Strategic Management- framework that evolves around the idea of shaping the destiny of an organization. (Williamson, Jenkins, et al <2004>)

Answer the questions:

a. Where is the organization going?

b. What options are open to the organization?

c. What is the best way forward for the organization?

d. How can this be done?

Strategic Management- determining the mission and goals of an organization w/in the context of external & internal environment. Wright, Kroll & Parnell <1996>

- It involves continuous and dynamic process that is externally-oriented and driven by macro & micro environmental conditions.

1. Clearer sense of strategic vision for the firm;

2. Sharper focus on what is strategically important; and

3. Improved understanding of a rapidly changing environment.

1. Defenders-companies w/ limited product line that focus on improving the effeciency of their existing operations.

2. Prospectors-firms with fairly broad product lines that focus on product innovation and market opportunities.

3. Analyzers-Business operates in at least two different type product-market areas, one stable & one variable.

4. Reactors-companies lack of consistent strategy-structure-culture relationship.

Tactics-more operational and done in context with or as a support activity or operation to achieve a strategy.

1. Legal Mandate – statutory, articles of incorporation, by-laws of the organization

2. Vision and mission statement- direction of the organization

3. Specific Objectives – desire of the organization

4. Programs and policies – activities and targets to achieve its short & long-term goals

1. Classical Approach – rational planning method - supreme goal is profitability

2. Evolutionary – law of the jungle – only the best performers survive

3. Processual – imperfect nature of all human life – accept the world as it is

4. Systemic – relativistic – strategies are linked to cultures and powers of the local systems which it takes place.

1. Top-bottom approach

2. Bottom-top approach

3. Top-bottom-top

1. Rare – unusual & typically have no precedent to follow

2. Consequential- top management commit substantial resources & demand a great deal of commitment from people at all levels

3. Directive – set precedents for lesser decisions and future actions

1. Entrepreneurial mode-strategy is focus on opportunities, problems are secondary

2. Adaptive Mode-reactive to problems rather than proactive to search for opportunities

3. Planning mode-rational selection of strategy;both proactive (opportunities) & reactive to problems

4. Logical mode-synthesis of all the mode of strategy

1. Monitor

2. Evaluate and influence

3. Initiate and determine