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  • Gantt Charts Program Evaluation and Review Technique (PERT) – network planning for large projects 1 Clearly defined project activities 2. Sequencing requirements 3. Sequence relationships diagram- graphicall depicts interrelatioships among activities identify activityor work component (arrow) identity node (circle) in ‘tens’ 4. Time estimates (formula) Expected Time = (time optimistic+4(time most likely)+time pessimistic)/6 5. Calculate critical path – network taking the longest to complete (adding times) 6. Calculate actual activity times
  • Process can be seen on page 206 (similar to overhead) Strategy formulation -process of identifying the mission and strategic goals, competitive analysis, and specific strategies Strategy implementation -process of carrying out the strategic plans and controlling how they are carried out
  • Grand Strategy – provides basic direction at the corporate level Growth – organisational expansion as a major element (acquisitions, mergers, joint ventures) Concentration – focuses on growing a single product or service through market development, product development, horizontal integration (adding 1+ similar businesses usually by purchase) Vertical integration – production of inputs previously supplied by a supplier Diversification- growing through the development of areas that are clearly distinct from current businesses Conglomerate-org. diversifie sinto unrelated main businesses Concentric – org. diversifies into related, but distinct businesses Stability – maintaining the status quo – growing in a methodical, slow manner Defensive – retrenchment strategies – focus on reducing org operations through cost reductions and/or asset reductions Harvest –min. investments and max. short run profits and cash flow w/long-run iintention to leave the market – usually done when doubt of market future Turnaround- designed to reverse a neg trend and restore appropriate profitability Divestiture – selling or divesting a business or part of one Bankruptcy Liquidation- selling or dissolving entire org
  • Porter’s Competitive Strategies Cost Leadership minimise cost in every business aspect to thereby provide products and services at a lower price of the competitiors; quality cannot be compromised Differentiation Strategy Develop products/services viewed as unique in the industry (design, brand, customer service, features, selection) Focus Strategy Positioning for overall cost leadership, differentiation, or both but with a particular portion/segment of an entire market
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    1. 1. DECISION-MAKING PLANNING & Strategic Management
    2. 2. CASE STUDY Personal Planning Techniques From last week, write a strategic plan for your life.
    3. 3. Project Planning & Control Models <ul><li>Gantt Charts </li></ul><ul><li>Program Evaluation and Review Technique (PERT) </li></ul><ul><ul><li>Clearly defined project activities </li></ul></ul><ul><ul><li>Sequencing requirements </li></ul></ul><ul><ul><li>Sequence relationships diagram </li></ul></ul><ul><ul><li>Time estimates (formula) </li></ul></ul><ul><ul><li>Calculate critical path </li></ul></ul><ul><ul><li>Calculate actual activity times </li></ul></ul>
    4. 4. Management by Objectives (MBO) <ul><li>Process by which specific goals are set collaboratively for the whole organisation and every unit and individual within it </li></ul><ul><li>Goals are then used for planning, managing, organisational activities and assessing and rewarding contributions </li></ul>
    5. 5. Management by Objectives (MBO) <ul><li>Steps in the MBO process </li></ul><ul><ul><li>Develop overall organisational goals </li></ul></ul><ul><ul><li>Establish specific goals for depts, SBUs and individuals </li></ul></ul><ul><ul><li>Formulate action plans </li></ul></ul><ul><ul><li>Implement and maintain self-control </li></ul></ul><ul><ul><ul><li>Give latitude in carrying out activities </li></ul></ul></ul><ul><ul><li>Review progress periodically </li></ul></ul><ul><ul><li>Appraise performance </li></ul></ul>
    6. 6. Strategic Management <ul><li>The Process </li></ul><ul><ul><li>Strategic formulation </li></ul></ul><ul><ul><li>Strategy implementation </li></ul></ul>
    7. 7. Levels of Strategy (refer to p. 207) <ul><li>Corporate-level strategy </li></ul><ul><ul><li>Addresses the businesses an organisation will operate </li></ul></ul><ul><ul><li>How strategies of those businesses will be coordinated </li></ul></ul><ul><ul><li>How resources will be allocated </li></ul></ul><ul><ul><li>Typically developed by top management </li></ul></ul><ul><li>Business-level strategy (SBUs) </li></ul><ul><ul><li>How best to compete in particular business while supporting corporate strategy </li></ul></ul><ul><li>Functional level strategy </li></ul><ul><ul><li>Action plans for functional area to support the business-level strategy </li></ul></ul>
    8. 8. Formulating Corporate-Level Strategy <ul><li>Grand Strategy </li></ul><ul><ul><li>Growth </li></ul></ul><ul><ul><ul><li>Concentration </li></ul></ul></ul><ul><ul><ul><li>Vertical integration </li></ul></ul></ul><ul><ul><ul><li>Diversification </li></ul></ul></ul><ul><ul><li>Stability </li></ul></ul><ul><ul><li>Defensive </li></ul></ul><ul><ul><ul><li>Harvest </li></ul></ul></ul><ul><ul><ul><li>Turnaround </li></ul></ul></ul><ul><ul><ul><li>Divestiture </li></ul></ul></ul><ul><ul><ul><li>Bankruptcy </li></ul></ul></ul><ul><ul><ul><li>Liquidation </li></ul></ul></ul>
    9. 9. Portfolio Strategy Approaches <ul><li>BCG growth-share mix </li></ul><ul><li>Product/Market evolution matrix </li></ul>Decline Saturation Maturity Competitive shakeout Growth Development Weak Average Strong Business Unit’s Competitive Position
    10. 10. Formulating Business-Level Strategy <ul><li>Porter’s Competitive Strategies </li></ul><ul><ul><ul><li>Cost Leadership </li></ul></ul></ul><ul><ul><ul><li>Differentiation Strategy </li></ul></ul></ul><ul><ul><ul><li>Focus Strategy </li></ul></ul></ul>Formulating Functional -Level Strategy
    11. 11. Strategy Implementation <ul><li>Carry out strategic plans </li></ul><ul><ul><li>Technology </li></ul></ul><ul><ul><li>Human resources </li></ul></ul><ul><ul><li>Reward systems </li></ul></ul><ul><ul><li>Decision processes </li></ul></ul><ul><ul><li>Structure </li></ul></ul><ul><li>Maintain strategic control </li></ul><ul><ul><li>Strategic control systems </li></ul></ul><ul><ul><li>Adjustments as necessary </li></ul></ul>