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LECTURE 05. MGT686. REVIEW OF LECTURE 04. External Audit Chapter 3. Vision & Mission Chapter 2. Long-Term Objectives Chapter 5. Generate, Evaluate, Select Strategies Chapter 6. Implement Strategies: Mgmt Issues Chapter 7. Implement Strategies: Marketing, Fin/Acct,

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Lecture 05

LECTURE 05

MGT686


Review of lecture 04
REVIEW OF LECTURE 04

External

Audit

Chapter 3

Vision

&

Mission

Chapter 2

Long-Term

Objectives

Chapter 5

Generate,

Evaluate,

Select

Strategies

Chapter 6

Implement

Strategies:

Mgmt Issues

Chapter 7

Implement

Strategies:

Marketing,

Fin/Acct,

R&D, CIS

Chapter 8

Measure &

Evaluate

Performance

Chapter 9

Internal

Audit

Chapter 4


Strategic management model
Strategic-Management Model

Strategic-Management Process –

  • Dynamic and Continuous

  • More formal in larger organizations


Strategic management model1
Strategic-Management Model

  • Identify Organization’s existing:

    • Vision

    • Mission

    • Objectives

    • Strategies


Strategic management model2
Strategic-Management Model

  • Perform External Audit

  • Perform Internal Audit

  • Establish long-term objectives

  • Generate, evaluate, select strategies

  • Implement strategies

  • Measure and evaluate performance


Benefits of strategic management
Benefits of Strategic Management

  • Proactive in shaping organization’s future

  • Initiate and influence activities

  • Formulate better strategies

    • Systematic, logical, rational approach


Benefits of strategic management1
Benefits of Strategic Management

  • Financial benefits

    • Improvement in sales

    • Improvement in profitability

    • Improvement in productivity


Benefits of strategic management2
Benefits of Strategic Management

  • Non-Financial benefits

    • Enhanced awareness of xternal threats

    • Improved understanding of competitors’ strategies

    • Increased employee productivity

    • Reduced resistance to change

    • Understanding of performance-reward relationships

    • Enhances problem-prevention capabilities


Benefits of strategic management3
Benefits of Strategic Management

  • Identification of opportunities

  • Objective view of management problems

  • Improved coordination and control

  • Minimizes adverse conditions and changes

  • Decisions to better support objectives

  • Effective allocation of time and resources

  • Internal communication among personnel


Benefits of strategic management4
Benefits of Strategic Management

  • Integration of individual behaviors

  • Clarifies individual responsibilities

  • Encourages forward thinking

  • Encourages favorable attitude toward change

  • Discipline and formality to the management of the business


Why some firms do no strategic planning
Why Some Firms Do No Strategic Planning

  • Poor reward structures

  • Waste of time

  • Too expensive

  • Laziness

  • Content with success


Why some firms do no strategic planning cont d
Why Some Firms Do No Strategic Planning (Cont’d)

  • Fear of failure

  • Overconfidence

  • Prior bad experience

  • Self-interest

  • Fear of the unknown

  • Suspicion


Business ethics and strategic management
Business Ethics and Strategic Management

Business ethics defined:

  • Principles of conduct within organizations that guide decision making and behavior.


Business ethics and strategic management1
Business Ethics and Strategic Management

Good business ethics:

  • prerequisite for good strategic management


Business ethics and strategic management2
Business Ethics and Strategic Management

Code of business ethics:

  • Provides basis on which policies can be devised to guide daily behavior and decisions at the workplace


Business ethics strategic planning
Business Ethics & Strategic Planning

Business actions always unethical include:

  • Misleading advertising

  • Misleading labeling

  • Environmental harm

  • Poor product or service safety

  • Insider trading

  • Dumping flawed products on foreign markets


Nature of global competition
Nature of Global Competition

Companies conduct business across borders

  • International or multinational corporations

    • Parent company

    • Host country

  • Strategy implementation more difficult

    • Cultural differences

      • Norms, values, work ethics


  • Advantages of international operations
    Advantages of International Operations

    • Absorb excess capacity

    • Reduce unit costs

    • Spread economic risks over wider markets

    • Low-cost production facilities

    • Competition may be less intense

    • Reduced tariffs, lower taxes

    • Economies of scale


    Disadvantages of international operations
    Disadvantages of International Operations

    • Different social, cultural demographic, legal forces may create difficult communication

    • Weaknesses of foreign competition may be underestimated

    • Barriers to communication and effective management of personnel

    • Complications from different monetary systems


    THANK

    YOU


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