AGENDA 09/09 & 09/10

1. AGENDA 09/09 & 09/10 • Nature of Strategic Challenge & • Strategic Management • The Strategy Concept and Process • Strategic Plan - Team Meetings

2. Strategic Challenge • To survive • To grow • To die

3. In order to survive and to prosper (meet the strategic challenge) every organization must: • Develop and maintain an alignment with the environment • Create the future • Define and grow • Internal Competencies AND

4. Meeting the Strategic Challenge

5. 1950s • Finding a profit-producing match between products/services of the organization and the needs of the market.

6. 1960s • Transforming the internal structure and competencies of the organization.

7. 1970s & 1980s • Planning interfaces with suppliers because of limited resources. • Acknowledging power of society/environment to impact an organization. • Recognizing the global nature of competition.

8. 1990s • Realizing that the speed of change is often greater than the speed of strategic response. • Focusing competitive advantage on information.

9. 2000s

10. Arenas that need to be addressed if the organization is to meet the strategic challenge • Products/Services • Competencies • Inputs • Society • Globalization • Change • Information • Future

11. What isStrategic Management?

12. Early Definition • Determination of basic long-term goals and objectives • Adoption of courses of action • Allocation of resources necessary for carrying out these goals • Chandler, A. 1962. Strategy & Structure: Chapters in the History of the Industrial Enterprise, Cambridge: M.I.T. Press, p.13

13. Another way of saying it • Art and Science • Formulating, Implementing, and Evaluating • Cross-Functional Decisions • Enabling an Organization • To set and achieve its Mission and Objectives Environmental Scanning Mission Objectives Decisions Actions Evaluation

14. Art and Science • Intuition (art) • past experiences, judgment, feelings • particularly useful for making decisions in situations of great uncertainty or little precedent. • Analysis (science) • logical, systematic approach • organization of quantitative information/data to be used for decision making.

15. Emphasis of Strategic Management • VALUE CREATION • What is Value? • CONFIGURATION • Multimarket scope • product, geographic, and vertical boundaries • COORDINATION • Management of activities and businesses within company

16. Strategic Management is a Process • Process: flow through interrelated stages toward the achievement of an aim • The flow of information involves historical, current, and forecasted data on the environment and operations of an organization. • Never finished.

17. Implications of viewing Strategic Management as a Process • Inter-relatedness • A change in one part affects several others • Formulation and Implementation are often interwoven • Allowance for continuous feedback and updates • Communication & Commitment

18. Strategic Management • involves long-term, future-oriented, complex decision making • requires considerable resources • participation at all levels of an organization • Top management is essential

19. Specifics

20. I. Strategy Formulation • 1. Developing a business vision/mission • Mission = enduring statements of purpose that distinguish one business from other firms. • 2. Establishing long-term objectives • Specific results - more than one year. • Challenging, measurable, reasonable, clear. • Established for overall corporation and each division

21. 3. Identifying external opportunities and threats...could benefit or harm an organization in the future. • Macro Environment • economic, social, cultural, demographic, environmental, political, legal, governmental, and technological • largely beyond the control of the organization • Micro Environment • Industry • Competitive trends & events

22. 4. Determining internal strengths and weaknesses • Controllable activities within an organization that are performed especially well or poorly. • Competencies (skills) • Functional activities are areas where strengths or weaknesses arise.

23. Strategy Formulation Con’t • 5. Generate and choose corporate strategies • Means by which long-term objectives will be achieved.

24. II. Strategy Implementation • Establish annual objectives • Short-term milestones that organizations must achieve to reach long-term objectives. • Measurable and established at corporate, business, and functional levels. • Devise policies • Guidelines, rules, procedures • Structure alignment • Mobilizing all functions to put formulated strategies into action.

25. III. Strategy Evaluation • Assess the outcomes of formulation and implementation. • Three fundamental activities • reviewing external and internal factors • measuring performance • taking corrective actions

26. Who usesStrategic Management • Profit • Big Corporations • Medium Size Corporations • Small Businesses • Government • Nonprofit • Individual Career Management Levels of FORMALITY will vary

27. Whenis Corporate Strategy Practiced? • Real Time • Always

28. Wherein Larger Organizations isStrategic Management Practiced? • Corporate Level • Board of Directors; CEO; Administrative Officers • Determine mission; set objectives and strategies • Business Level • How Firm will compete in selected product/market arenas • Functional Level • Execute the plans