SBM Chapter-01.ppt

7/24/2019 SBM Chapter-01.ppt

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Ch. 1-1

Chapter 1Chapter 1

The Nature of StrategicThe Nature of Strategic

ManagementManagement

Strategic Managemet


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Ch. 1-2

Strategic Management AchievesStrategic Management Achieves

Organizational SuccessOrganizational Success

Process of Integrating:

management mareting

finance!accounting

pro"uction!operations research an" "evelopment

computer information s#stems


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Ch. 1-3

Three$Stage ProcessThree$Stage Process

Strategy Formulation

Strategy

Implementation

Strategy Evaluation


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Ch. 1-4

Strategy Formulation

Vision & Mission

Alternative Strategies

Long-Term Objectives

Strengths & Weaknesses

Opportunities & Threats

Strategy Selection


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Ch. 1-5

Strateg# %ormulationStrateg# %ormulation

Issues inclu"e: &hat ne' (usinesses to enter

&hat (usinesses to a(an"on )o' to allocate resources

*+pan" operations or "iversif#

*nter international marets Merge or form ,oint venture

Avoi"ance of hostile taeover


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Ch. 1-6

Strategy Implementation

mployee Motivation

!olicies

Annual Objectives

"esource Allocation


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Ch. 1-7

Strateg# ImplementationStrateg# Implementation

Action Stage of strategic management: Most "ifficult stage

Mo(ilizing emplo#ees an" managers


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Ch. 1-8

Strategy Evaluation

!er#ormance Measurement

$ternal "evie%

nternal "evie%

'orrective Action


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Ch. 1-9

Strateg# *valuationStrateg# *valuation

%inal stage of strategic management:All strategies su(,ect to future mo"ification Success to"a# is no guarantee of success

tomorro' Success creates ne' an" "ifferent pro(lems


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Ch. 1-10

Integrating Intuition an" Anal#sisIntegrating Intuition an" Anal#sis

The strategic management process

attempts to organize -uantitative an"-ualitative information un"er

con"itions of uncertaint#.


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Ch. 1-12

Integrating Intuition an" Anal#sisIntegrating Intuition an" Anal#sis

Intuition an" ,u"gment

Management at all levels

Anal#ses are influence"

Anal#tical thining an" intuitive thining Complement each other


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Ch. 1-13

A"aptation to ChangeA"aptation to Change

Organizations must monitor events

On$going process

Internal an" e+ternal events

Timel# changes


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Ch. 1-14


ate an" magnitu"e of changes Increasing "ramaticall#

2 *$commerce2 3emographics

2 Technolog#

2 Merger$mania *ffective A"aptation

2 4ong$run focus


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Ch. 1-15


5e# strategic$management -uestions:

What kind of business should we become?

Are we in the right fields? Should we reshape our business?

What new competitors are entering our

industry? What strategies should we pursue?

How are our customers changing?


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Ch. 1-16

5e# Terms5e# Terms

Strategists Most responsible for success or failure of an

organization Various job titles2 !hief e"ecuti#e officer

2 $resident

2 %wner2 !hair of the &oard

2 '"ecuti#e (irector

2 'ntrepreneur


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Ch. 1-17

5e# Terms5e# Terms

6ision Statement

What do we want to become?

Mission Statement What is our business?


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Ch. 1-19

5e# Terms5e# Terms

*+ternal Opportunities an" Threats

*argely beyond the control of a single

organization)

8asic tenet of strategic management

2 Strateg# formulation to:

Tae a"vantage of e+ternal opportunities

Avoi" or re"uce impact of e+ternal threats


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Ch. 1-20

5e# Terms5e# Terms

*nvironmental Scanning

In"ustr# Anal#sis

2 Process of con"ucting research an"

gathering an" assimilating e+ternalinformation


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Ch. 1-21

5e# Terms5e# Terms

Internal Strengths an" &eanesses !ontrollable acti#ities performed especially well

or poorly)

Arise in functional areas of the (usiness2 Management2 Mareting

2 %inance!accounting2 Pro"uction!operations2 esearch 9 "evelopment2 Computer Information S#stems


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Ch. 1-22

5e# Terms5e# Terms

3etermining Internal %actors:

%inancial ratios

Measuring performance

In"ustr# averages

Surve# "ata


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Ch. 1-23

5e# Terms5e# Terms

4ong$term o(,ectives:

Mission$"riven pursuit of specific results morethan one$#ear out.

*ssential for organizational success2 State "irection

2 Ai" in evaluation2 Create s#nerg#

2 %ocus coor"ination

2 8asis for planning7 motivating an" controlling


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Ch. 1-24

5e# Terms5e# Terms

Strategies: Means by which long+term objecti#es will be

achie#ed.

Ma# inclu"e:2 eographic e+pansion7 "iversification2 Ac-uisition2 Pro"uct "evelopment7 maret penetration2 etrenchment7 "ivestiture2 4i-ui"ation7 ,oint venture


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Ch. 1-25

5e# Terms5e# Terms

Annual O(,ectives:

Short+term milestones that organizations mustachie#e to reach long+term objecti#es)


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' h i St t i M t M ( l' h i St t i M t M ( l


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Ch. 1-27

'omprehensive Strategic Management Mo(el'omprehensive Strategic Management Mo(el

ExternalAudit

Chapter 3

InternalAudit

Chapter 4

Long-TermObjectives

Chapter 5

Generate,Evaluate,

SelectStrategies

Chapter 6

ImplementStrategies:

Mgmt Issues

Chapter 7

ImplementStrategies:

Mar!eting,"in#Acct,$%&, 'IS

Chapter 8

Measure %Evaluate

(er)ormance

Chapter 9

*ision%

Mission

Chapter 2


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Ch. 1-28

Strategic$Management Mo"elStrategic$Management Mo"el

Strategic$Management Process

2 3#namic an" Continuous2 More formal in larger organizations


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Ch. 1-29


1.I"entif# Organization;s e+isting:

2 6ision2 Mission

2 O(,ectives2 Strategies


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Ch. 1-30


.*sta(lish long$term o(,ectives

?.enerate7 evaluate7 select strategies

@.Implement strategies

.Measure an" evaluate performance


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Ch. 1-31

8enefits of Strategic8enefits of Strategic


2 Proactive in shaping organization;s future

2 Initiate an" influence activities2 %ormulate (etter strategies

S#stematic7 logical7 rational approach


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Ch. 1-32



2 %inancial (enefits

Improvement in sales Improvement in profita(ilit# Improvement in pro"uctivit#


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Ch. 1-33



2 Non$%inancial (enefits *nhance" a'areness of +ternal threats

Improve" un"erstan"ing of competitors;strategies Increase" emplo#ee pro"uctivit# e"uce" resistance to change

0n"erstan"ing of performance$re'ar"relationships *nhances pro(lem$prevention capa(ilities


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Ch. 1-34



1.I"entification of opportunities


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Ch. 1-35



B.Integration of in"ivi"ual (ehaviors

.Clarifies in"ivi"ual responsi(ilities

1D.*ncourages for'ar" thining

11.*ncourages favora(le attitu"e to'ar"change

1


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Ch. 1-36

2 Poor re'ar" structures

2 %ire$fighting2 &aste of time

2 Too e+pensive

2 4aziness2 Content 'ith success

&h# Some %irms 3o&h# Some %irms 3o NoNoStrategic PlanningStrategic Planning


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Ch. 1-37

2 %ear of failure

2 Overconfi"ence

2 Prior (a" e+perience

2 Self$interest

2 %ear of the unno'n

2 Suspicion

&h# Some %irms 3o&h# Some %irms 3o NoNoStrategic Planning ECont;"FStrategic Planning ECont;"F


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Ch. 1-38

8usiness ethics "efine":

$rinciples of conduct within

organizations that guide decision

making and beha#ior)

8usiness *thics an" Strategic8usiness *thics an" StrategicManagementManagement


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Ch. 1-39

oo" (usiness ethics:

prere-uisite for goo" strategic

management



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Ch. 1-40

Co"e of (usiness ethics:

Provi"es (asis on 'hich policies can

(e "evise" to gui"e "ail# (ehavior

an" "ecisions at the 'orplace



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Ch. 1-41

Internet privac#

*merging ethical issue of immense

proportion



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Ch. 1-42

Internet an" (usiness ethics $$

=BG of companies store an" revie'

emplo#ees email messages

0p from 1?G in 1

?>G of companies monitor

emplo#ees; Internet connections



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Ch. 1-43

8usiness actions alwaysunethical inclu"e:

2 Mislea"ing a"vertising

2 Mislea"ing la(eling

2 *nvironmental harm

2 Poor pro"uct or service safet#

2 Pa""ing e+pense accounts2 Insi"er tra"ing

2 3umping fla'e" pro"ucts on foreign marets

8usiness *thics 9 Strategic8usiness *thics 9 StrategicPlanningPlanning


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Ch. 1-44

Nature of lo(al CompetitionNature of lo(al Competition

Companies con"uct (usiness across(or"ers

International or multinational corporations Parent compan#

)ost countr#

2 Strateg# implementation more "ifficultCultural "ifferences

Norms7 values7 'or ethics


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Ch. 1-45

2 A(sor( e+cess capacit#

2 e"uce unit costs

2 Sprea" economic riss over 'i"ermarets

2 4o'$cost pro"uction facilities

2Competition ma# (e less intense2 e"uce" tariffs7 lo'er ta+es

2 *conomies of scale

A"vantages of InternationalA"vantages of InternationalOperationsOperations


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Ch. 1-46

2 3ifferent social7 cultural "emographic7legal forces ma# create "ifficultcommunication

2 &eanesses of foreign competition ma#(e un"erestimate"

2 8arriers to communication an" effective

management of personnel

3isa"vantages of International3isa"vantages of InternationalOperationsOperations

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SBM Chapter-01.ppt