Strategy Formulation and Implementation
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This document discusses strategic management and the strategic management process. It defines key concepts like corporate strategy, business strategy, and functional strategy. It also outlines the steps in the strategic management process as assessing the external and internal environment, formulating strategy, and executing strategy. Strengths, weaknesses, opportunities, and threats are identified as important to analyze. Different levels of strategy and types of competitive strategies are also defined.
Strategy Formulation and Implementation
- 1. Management by Richard L Daft 9th Edition
- 2. Proverbs 16:3 “Commit to the LORD whatever you do, and your plans will succeed.”
- 3. The plan of action that prescribes reserve allocation and other activities for dealing with the environment, achieving competitive advantage and attaining organizational goals. Competitive advantage- what set the organization apart from others and provides it with a distinctive edge in the market place.
- 4. To take the long term view and to take and to see the big picture, including the organization and the competitive environment and, conside how they fit together.
- 5. Set of decisions and actions used to formulate and execute strategies that will provides competitively superior fit between the organization and environment so as to achieve organizational goals.
- 6. Core competence- is something the organization does especially well in comparison to its competitors. Build synergy- when organizational parts interact to produce a joint effect that is greater than the sum of the parts acting alone synergy occurs. Deliver Value- combination of benefits received and cost paid.
- 7. Corporate level strategy(what business are we in?) Organization as a whole Business units and product lines that make up the corporate entity. Business level strategy (how do we compete?) Pertains to each business unit or product line. Concern amount of advertising,direction and extent of research and development,product changes etc. Functional level strategy (how do we support the business level strategy?) Pertains to the major functional department within business units
- 8. Three Levels of Strategy in Organizations
- 9. The Strategic Management Process
- 10. Strategy formulation Include assessing the external and internal problems and integrating the results into goals and strategy. Strategy execution Use of managerial and organizational tools to direct resources toward accomplishing strategic results Administration and implementation of the strategic plan.
- 11. Includes a search for strengths, weakness, opportunities and threat that affect organizational performance.
- 12. Strengths – positive internal characteristics that the organization can exploit to achieve its strategic performance goals. Weakness – internal characteristics that might inhibit or restrict the organization performance
- 13. Threats – are the characteristics of the external environment that may prevent the organization on achieving its strategic goals. Opportunities- are characteristics of the external environment that have the potential to help the organization achieve or exceed its strategic goals.
- 14. Checklist for Analyzing Organizational Strengths and Weakness
- 17. The organization’s mix of strategic business units and product lines that fit together in such a way as to provide the corporation with synergy and competitive advantage. A division of the organization that has a unique business mission, product line, competitors, and markets relative to other SBUs in the same corporation. A concept developed by the Boston Consulting Group that evaluates strategic business units with respect to the dimensions of business growth rate and market share.
- 20. Moving into a new business that is related to the company’s existing business activities. A strategy of moving into new lines of business. Expanding into a totally new line of business. Expanding into businesses that either produce the supplies needed to make products or that distribute and sell those products.
- 24. A type of competitive strategy with which the organization aggressively seeks efficient facilities, cuts costs, and employs tight cost controls to be more efficient than competitors. A type of competitive strategy with which the organization seeks to distinguish its products or services from that of competitors. A type of competitive strategy that emphasizes concentration on a specific regional market or buyer group.
- 28. managers focus on ◦ leveraging and developing more from the firm’s existing assets, capabilities, and core competencies ◦ The idea is that getting growth out of existing businesses is cheaper and more effective than trying to buy it from outside
- 30. Collaboration with other organizations (competitors) is an important part of how today’s successful companies enter new areas of business
- 34. Standardization of product design and advertising strategies throughout the world Can help the organization reap efficiencies by product standardization people everywhere want to buy the same products and live the same way
- 36. Modification of product design and advertising strategies to suit the specific needs of individual countries Some companies reject the idea of single global market
- 38. Combines global coordination to attain efficiency with flexibility to meet specific needs in various countries Global integration and national responsiveness World market operations
- 44. According to Porter (1996) companies must be adapt and flexible when it comes to responding to the drastic changes in the business industry. Strategic positions are based on customer’s requirements Strategy needs to be expand as a horizon and should not be of a single, planning cycle