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Power Point Slides - Overview

  1. 1. Teacher Development Course on Successful Strategic Management Dr. Theresa Lau Associate Professor Hong Kong Polytechnic University Dr. K.F. Chan Associate Professor Hong Kong Polytechnic University November 2004 1
  2. 2. Strategic Management Strategic Management The set of managerial decisions and actions that determines the long-run performance of a corporation 2
  3. 3. What is Strategy Strategy is a pattern in a stream of decisions or actions – H. Mintzberg It is a plan: intended course of action It is a pattern: a stream of actions It is a position: a product/market domain; related to environment It is a perspective: a concept; a shared ideology; driving force; the heart beat It is a ploy: a specific manoeuvre to outbeat a competitor 3
  4. 4. Deliberate and Emergent Strategies Unrealized Strategy Realized Strategy 4
  5. 5. Three Key Strategic Questions Where is the organization now? If no changes are made, where will the organization be in one, two, five or ten years? Are the answers acceptable? If the answers are not acceptable, what specific actions should management undertake? What are the risks and payoffs involved? 5
  6. 6. Benefits of Strategic Management Clearer sense of strategic vision Sharper focus on what is strategically important Better coordination, communication and staff commitment Businesses with strategic management are more effective Positive relationship between strategy and financial performance 6
  7. 7. Basic Elements of the Strategic Management Process Evaluation Environmental Strategy Strategy and Scanning Formulation Implementation Control 7
  8. 8. Developing a Strategic Vision Involves thinking strategically about Firm’s future business plans Where to “go” Tasks include Providing long-term direction Giving firm a strong identity 8
  9. 9. Missions vs. Strategic Visions  A mission statement  A strategic vision focuses on current concerns a firm’s business activities -- future business path -- “who we are and “where we are what we do” going”  Current product and  Markets to be pursued service offerings  Future technology-  Customer needs being product-customer focus served  Kind of company that  Technological and management is business capabilities trying to create 9
  10. 10. Environmental Scanning Defined: The monitoring, evaluating, and disseminating of information from the external and internal environments to key people within the firm. 10
  11. 11. Environmental Scanning Identify strategic factors SWOT Analysis • Strengths, Weaknesses • Opportunities, Threats Internal Environment Strengths & Weaknesses • Within the organization but not subject to short-run control of management External Environment Opportunities & Threats • External to the organization but not subject to short-run control of management 11
  12. 12. Environment Scanning Industry Analysis 12
  13. 13. The Value Chain General administration Human resource management Technology development Procurement Inbound Outbound Marketing Operations Service logistics logistics and sales Adapted from Exhibit 3.1 The Value Chain: Primary and Support Activities Source: Adapted with permission of The Free Press, a division of Simon & Schuster, Inc., from Competitive Advantage: Creating and Sustaining Superior Performance by Michael E. Porter. 13
  14. 14. Strategy Formulation Defined: Development of long-range plans for the effective management of environmental opportunities and threats in light of corporate strengths and weaknesses. 14
  15. 15. Hierarchy of Strategy Corporate Corporate Headquarters Strategy Strategic Strategic Strategic Business Business Business Business (Divison Level) Unit Unit Unit Strategy Manufacturing Finance Marketing Research Human and Resources Development Functional Strategy 15
  16. 16. Corporate Strategy I Corporation’s overall direction and the management of its business – Key Issues:  Firm’s directional strategy  Firm’s portfolio strategy 16
  17. 17. Corporate Strategy II Directional Strategy Growth Strategy *Concentration growth *Vertical integration *Diversification Stability Strategy Retrenchment Strategy 17
  18. 18. Corporate Strategy III Portfolio Analysis BCG (Boston Consulting Group) Matrix Product life cycle and funding decisions Question marks Stars Cash cows Dogs 18
  19. 19. BCG Matrix 19
  20. 20. Business Strategy Emphasizes improving the competitive position of a corporation’s products or units 20
  21. 21. Porter’s Competitive Strategies Generic Competitive Strategies: - Lower cost strategy . Design, produce, market more efficiently than competitors - Differentiation strategy . Unique and superior value in terms of product quality, features, service - Niche strategy 21
  22. 22. Functional Strategy Functional Strategy: - The approach a functional area takes to achieve corporate and business unit objectives and strategies by maximizing resource productivity. 22
  23. 23. Functional Strategy Core competency: Something that a corporation can do exceedingly well – a key strength Distinctive competencies: When core competencies or core capabilities are superior to those of the competition. 23
  24. 24. Definition of Strategy Implementation Strategy Implementation The process of putting strategies and policies into action 24
  25. 25. Strategy Implementation Implementation Process Questions: Who are the people to carry out the strategic plan? What must be done to align operations with new direction? How is work going to be coordinated? 25
  26. 26. The Seven S Framework Structure Strategy Systems Superordinate Goals Skills Style Staff 26
  27. 27. Definition of Evaluation and Control Evaluation and Control The process of monitoring corporate activities and performance results so that actual performance can be compared with desired performance 27