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Strategic Management in Action 1 Introducing the Concepts
Learning Objectives 1. Discuss why strategic management is important.  2. Define strategy and strategic management.  3. De...
W HY  I S  S TRATEGIC  M ANAGEMENT  I MPORTANT ? <ul><li>Strategic Management </li></ul><ul><li>• </li></ul><ul><li>• </li...
W HAT  I S  S TRATEGIC  M ANAGEMENT ? Strategy   vs. Strategic Management
T he   B asics   of   S trategy   &   S trategic   M anagement <ul><li>Definition of Strategy </li></ul><ul><li>• </li></u...
T he   B asics   of   S trategy   &   S trategic   M anagement <ul><li>Strategy Involves: </li></ul><ul><li>• </li></ul><u...
T he   B asics   of   S trategy   &   S trategic   M anagement <ul><li>Definition of Strategic Management </li></ul><ul><l...
T he   B asics   of   S trategy   &   S trategic   M anagement <ul><li>Strategic Management entails: </li></ul><ul><li>• <...
<ul><li>Basic </li></ul><ul><li>Activities </li></ul><ul><li>of </li></ul><ul><li>Strategic </li></ul><ul><li>Management <...
T he   B asics   of   S trategy   &   S trategic   M anagement <ul><li>Strategic Management </li></ul><ul><li>“ Big pictur...
The Strategic Management Process <ul><li>Strategic Management in Action  Figure 1-2 </li></ul>Analyzing Current Situation ...
The Strategic Management Process <ul><li>Situation Analysis </li></ul><ul><li>• </li></ul><ul><li>• </li></ul><ul><li>• </...
The Strategic Management Process <ul><li>Strategy Formulation </li></ul><ul><li>Three organizational levels </li></ul><ul>...
The Strategic Management Process <ul><li>Strategy Implementation </li></ul><ul><li>• </li></ul><ul><li>• </li></ul><ul><li...
The Strategic Management Process <ul><li>Continuing Process of </li></ul><ul><li>Strategic Management in Action </li></ul>...
Looking at Strategic Management’s Past <ul><li>Strategy’s Military Roots </li></ul><ul><li>• </li></ul><ul><li>• </li></ul...
Looking at Strategic Management’s Past <ul><li>Strategic Planning & Strategic Management Emerge </li></ul><ul><li>• </li><...
Misconceptions About Strategy and Strategic Management <ul><li>Misconceptions </li></ul><ul><li>• </li></ul><ul><li>• </li...
W HO’S  I NVOLVED WITH  S TRATEGIC  M ANAGEMENT ? <ul><li>The Role of the Board of Directors </li></ul><ul><li>• </li></ul...
The Role of the Board of Directors Table 1-2  Typical Board Responsibilities • • • • • • • • • • Review and approve strate...
The Role of Top Management <ul><li>Top Management </li></ul><ul><li>• </li></ul><ul><li>• </li></ul><ul><li>• </li></ul><u...
The Role of Top Management <ul><li>Effective </li></ul><ul><li>Strategic </li></ul><ul><li>Leadership </li></ul><ul><li>In...
Chapter One ? Questions
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  1. 1. Strategic Management in Action 1 Introducing the Concepts
  2. 2. Learning Objectives 1. Discuss why strategic management is important. 2. Define strategy and strategic management. 3. Describe the strategic management process. 4. Describe the three levels of organizational strategies. 5. Explain the historical evolution of strategic management. 6. Rebut misconceptions about strategy and strategic management. 7. Explain who’s involved with strategic management and their role in managing strategically.
  3. 3. W HY I S S TRATEGIC M ANAGEMENT I MPORTANT ? <ul><li>Strategic Management </li></ul><ul><li>• </li></ul><ul><li>• </li></ul><ul><li>• </li></ul><ul><li>• </li></ul>Gives everyone a role Makes a difference in performance levels Provides systematic approach to uncertainties Coordinates and focuses employees
  4. 4. W HAT I S S TRATEGIC M ANAGEMENT ? Strategy vs. Strategic Management
  5. 5. T he B asics of S trategy & S trategic M anagement <ul><li>Definition of Strategy </li></ul><ul><li>• </li></ul>A series of goal-directed decisions and actions matching an organization's skills and resources with the opportunities and threats in its environment
  6. 6. T he B asics of S trategy & S trategic M anagement <ul><li>Strategy Involves: </li></ul><ul><li>• </li></ul><ul><li>• </li></ul><ul><li>• </li></ul><ul><li>• </li></ul><ul><li>• </li></ul>Organization’s goals Goal-directed action Related decisions and actions Internal strengths External opportunities and threats
  7. 7. T he B asics of S trategy & S trategic M anagement <ul><li>Definition of Strategic Management </li></ul><ul><li>Decisions and actions where organizations </li></ul><ul><li>• </li></ul><ul><li>• </li></ul><ul><li>• </li></ul><ul><li>• </li></ul>Analyze current situation Develop appropriate strategies Put strategies into action Evaluate, modify, or change strategies
  8. 8. T he B asics of S trategy & S trategic M anagement <ul><li>Strategic Management entails: </li></ul><ul><li>• </li></ul><ul><li>• </li></ul><ul><li>• </li></ul><ul><li>• </li></ul><ul><li>• </li></ul>Basic managerial functions Planning Organizing Implementing Controlling
  9. 9. <ul><li>Basic </li></ul><ul><li>Activities </li></ul><ul><li>of </li></ul><ul><li>Strategic </li></ul><ul><li>Management </li></ul><ul><li>Figure 1-1 </li></ul>T he B asics of S trategy & S trategic M anagement Strategy Formulation Strategy Implementation Strategy Evaluation
  10. 10. T he B asics of S trategy & S trategic M anagement <ul><li>Strategic Management </li></ul><ul><li>“ Big picture” view of organization </li></ul><ul><li>influenced by its external environment </li></ul>Four aspects that set apart Strategic Management Interdisciplinary External focus Internal focus Future direction
  11. 11. The Strategic Management Process <ul><li>Strategic Management in Action Figure 1-2 </li></ul>Analyzing Current Situation Deciding on Strategies Putting Strategies in Action Evaluating and Changing Strategies Situation Analysis Strategy Formulation Strategy Implementation Strategy Evaluation Chapter 2 Chapter 3 Chapter 4 External Analysis Internal Analysis Organizational Context Chapter 5 Chapter 6 Chapter 7 Functional Competitive Corporate
  12. 12. The Strategic Management Process <ul><li>Situation Analysis </li></ul><ul><li>• </li></ul><ul><li>• </li></ul><ul><li>• </li></ul>Scanning and evaluating context External environment Organizational environment
  13. 13. The Strategic Management Process <ul><li>Strategy Formulation </li></ul><ul><li>Three organizational levels </li></ul><ul><li>• </li></ul><ul><li>• </li></ul><ul><li>• </li></ul>Functional strategies Competitive strategies Corporate strategies
  14. 14. The Strategic Management Process <ul><li>Strategy Implementation </li></ul><ul><li>• </li></ul><ul><li>• </li></ul><ul><li>• </li></ul>Process of putting strategies into action Strategy Evaluation Process of evaluating : How the strategy has been implemented Outcomes of the strategy
  15. 15. The Strategic Management Process <ul><li>Continuing Process of </li></ul><ul><li>Strategic Management in Action </li></ul><ul><li>Ongoing and continuous cycle of </li></ul><ul><li>• </li></ul><ul><li>• </li></ul><ul><li>• </li></ul> Strategy formulation Strategy implementation Strategy evaluation
  16. 16. Looking at Strategic Management’s Past <ul><li>Strategy’s Military Roots </li></ul><ul><li>• </li></ul><ul><li>• </li></ul><ul><li>• </li></ul><ul><li>• </li></ul>Battlefield strategies to gain an edge Exploit weak spots Academic Origins of Strategic Management Economic theory Early organizational studies
  17. 17. Looking at Strategic Management’s Past <ul><li>Strategic Planning & Strategic Management Emerge </li></ul><ul><li>• </li></ul><ul><li>• </li></ul><ul><li>• </li></ul>Before 1960 Not an area of study During the 1960s Strategy and Structure Corporate Strategy Business Policy: Text and Cases During the 1970s and 1980s Becomes distinct academic field Research focus on strategic decisions vs. performance
  18. 18. Misconceptions About Strategy and Strategic Management <ul><li>Misconceptions </li></ul><ul><li>• </li></ul><ul><li>• </li></ul><ul><li>• </li></ul><ul><li>• </li></ul><ul><li>• </li></ul>Strategy and strategic planning are dead Strategy is strictly for top management Strategy is about planning Strategy is stable and constant Strategic management outlines ultimate destination & route
  19. 19. W HO’S I NVOLVED WITH S TRATEGIC M ANAGEMENT ? <ul><li>The Role of the Board of Directors </li></ul><ul><li>• </li></ul><ul><li>• </li></ul><ul><li>• </li></ul><ul><li>• </li></ul><ul><li>• </li></ul><ul><li>• </li></ul><ul><li>• </li></ul>Elected representatives of the company’s stockholders Legally obligated to represent and protect stockholder’s interest The Role of Top Management Responsible for every decision and action of every employee Providing effective leadership Other Strategic Managers and Organizational Employees Implement— put the strategies into action and monitor performance Evaluate—do the actual evaluations and take necessary actions Open book management
  20. 20. The Role of the Board of Directors Table 1-2 Typical Board Responsibilities • • • • • • • • • • Review and approve strategic goals and plans Review and approve organization's financial standards and policies Ensure integrity of organization's financial controls and reporting systems Approve an organizational philosophy Monitor organizational performance and regularly review performance results Select, evaluate, and compensate top-level managers Develop management succession plans Review and approve capital allocations and expenditures Monitor relations with shareholders and other key stakeholders Other responsibilities may be assigned depending on the unique culture and needs of the organization
  21. 21. The Role of Top Management <ul><li>Top Management </li></ul><ul><li>• </li></ul><ul><li>• </li></ul><ul><li>• </li></ul><ul><li>• </li></ul>CEO Chief Executive Officer COO Chief Operating Officer CFO Chief Financial Officer CIO Chief Information Officer
  22. 22. The Role of Top Management <ul><li>Effective </li></ul><ul><li>Strategic </li></ul><ul><li>Leadership </li></ul><ul><li>Involves </li></ul><ul><li>Figure 1-5 </li></ul>Effective Strategic Leadership Exploiting and Maintaining Core Competencies Developing Human Capital Creating and Sustaining Strong Organizational Culture Emphasizing Ethical Decisions and Practices Establishing Appropriately Balanced Controls Determining Organizational Purpose or Vision
  23. 23. Chapter One ? Questions
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