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Strategy Management Process
Strategy Management Process
Strategy Management Process
Strategy Management Process
Strategy Management Process
Strategy Management Process
Strategy Management Process
Strategy Management Process
Strategy Management Process
Strategy Management Process
Strategy Management Process
Strategy Management Process
Strategy Management Process
Strategy Management Process
Strategy Management Process
Strategy Management Process
Strategy Management Process
Strategy Management Process
Strategy Management Process
Strategy Management Process
Strategy Management Process
Strategy Management Process
Strategy Management Process
Strategy Management Process
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Strategy Management Process

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  • 1. Copyright © 2001 Houghton Mifflin Company. All rights reserved.
    StrategicCharles W. L. HillManagementGareth R. Jones
    PowerPoint Presentation by Charlie Cook
    An Integrated Approach
    Fifth Edition
    Chapter 1The Strategic Management Process
  • 2. Copyright © 2001 Houghton Mifflin Company. All rights reserved.
    1-2
    Overview
    Why do some firms succeed while others fail?
    A central objective of strategic management is to learn why this happens.
    What is strategy?
    An action a company takes to attain superior performance.
    What is the strategic management process?
    The process by which managers choose a set of strategies for the enterprise to pursue its vision.
  • 3. Copyright © 2001 Houghton Mifflin Company. All rights reserved.
    1-3
    Rational planning by top management?
    Basic Strategic Planning Model
    Defining the Mission and Setting Top-Level Goals
    External Analysis of Opportunities and Threats
    Internal Analysis of Strengths and Weaknesses
    Selection of Appropriate Strategies
    Implementation of Chosen Strategies
    Strategic Planning
  • 4. Copyright © 2001 Houghton Mifflin Company. All rights reserved.
    1-4
    The Main Components of the Strategic Planning Process
    FIGURE 1.1
  • 5. Copyright © 2001 Houghton Mifflin Company. All rights reserved.
    1-5
    Mission and Goals
    Mission
    Sets out why the organization exists and what it should be doing.
    Major goals
    Specify what the organization hopesto fulfill in the medium to long term.
    Secondary goals
    Are objectives to be attained that lead to superior performance.
  • 6. Copyright © 2001 Houghton Mifflin Company. All rights reserved.
    1-6
    External Analysis
    Identify strategic opportunities and threats in the operating environment.
    Immediate (Industry)
    Macroenvironment
    National
  • 7. Copyright © 2001 Houghton Mifflin Company. All rights reserved.
    1-7
    Internal Analysis
    Identify strengths
    Quality and quantity of resources available
    Distinctive competencies
    Identify weaknesses
    Inadequate resources
    Managerial and organizational deficiencies
  • 8. Copyright © 2001 Houghton Mifflin Company. All rights reserved.
    1-8
    Strengths and Weaknesses
    Opportunities and Threats(SWOT Analysis)
    Strategic ChoiceBusinessFunctionalGlobalCorporate
    SWOT and Strategic Choice
  • 9. Copyright © 2001 Houghton Mifflin Company. All rights reserved.
    1-9
    Business-Level Strategies
    Cost leadership
    Attaining, then using the lowest total cost basis as a competitive advantage.
    Differentiation
    Using product features or services to distinguish the firm’s offerings from its competitors.
    Market niche focus
    Concentrating competitively on a specific market segment.
  • 10. Copyright © 2001 Houghton Mifflin Company. All rights reserved.
    1-10
    Functional-Level Strategies
    Focus is on improving the effectiveness of operations within a company.
    Manufacturing
    Marketing
    Materials management
    Research and development
    Human resources
  • 11. Copyright © 2001 Houghton Mifflin Company. All rights reserved.
    1-11
    Global-Level Strategies
    Multidomestic
    International
    Global
    Transnational
  • 12. Copyright © 2001 Houghton Mifflin Company. All rights reserved.
    1-12
    Corporate-Level Strategies
    Vertical integration
    Diversification
    Strategic alliances
    Acquisitions
    New ventures
    Business portfolio restructuring
  • 13. Copyright © 2001 Houghton Mifflin Company. All rights reserved.
    1-13
    Strategy Implementation
    Designing organizational structure
    Designing control systems
    Market and output controls
    Bureaucratic controls
    Control through organizational culture
    Rewards and incentives
    Matching strategy, structure, and controls
    Congruence (fit) among strategy, structure, and controls
    Structure
    Controls
    Strategy
  • 14. Copyright © 2001 Houghton Mifflin Company. All rights reserved.
    1-14
    Managing Strategic Change
    The only constant is change.
    Success requires adapting strategy and structure to a changing world.
    The feedback loop in strategic planning.
    Corporate
    Operational
    Business
    Functional
  • 15. Copyright © 2001 Houghton Mifflin Company. All rights reserved.
    1-15
    Strategic Managers
    General managers
    Responsible for the overall (strategic) performance and health of the total organization.
    Operations managers
    Responsible for specific businessfunctions or operations.
  • 16. Copyright © 2001 Houghton Mifflin Company. All rights reserved.
    1-16
    Strategic Managers for All Levels
    FIGURE 1.2
  • 17. Copyright © 2001 Houghton Mifflin Company. All rights reserved.
    1-17
    Strategic Leadership
    Vision, eloquence, and consistency
    Commitment to the vision
    Being well informed
    Willingness to delegate and empower
    Astute use of power
    Emotional intelligence
  • 18. Copyright © 2001 Houghton Mifflin Company. All rights reserved.
    1-18
    Strategy as an Emergent Process
    Strategy making in an unpredictable world
    Creates the necessity for flexible strategic approaches.
    Strategy making by lower-level managers
    Strategy evolves through autonomous action.
    Serendipity and strategy
    Accidental discoveries and happenstances can have dramatic effects on strategic direction.
    Intended and emergent strategies
    Realized strategies are combinations of intended and emergent strategies.
  • 19. Copyright © 2001 Houghton Mifflin Company. All rights reserved.
    1-19
    FIGURE 1.3
    Intended and Emergent Strategies
    Source: Reprinted from “Strategy Formation in an Adhocracy,” by Henry Mintzberg and Alexandra McGugh, published in Administrative Science Quarterly, Vol. 30, No. 2, June 1985, by permission of Administrative Science Quarterly.
  • 20. Copyright © 2001 Houghton Mifflin Company. All rights reserved.
    1-20
    The Strategic Management Process for Intended and Emergent Strategies
    FIGURE 1.4
  • 21. Copyright © 2001 Houghton Mifflin Company. All rights reserved.
    1-21
    Strategic Planning in Practice
    Planning under uncertainty
    Scenario planning for dynamic environmental change
    Ivory tower planning
    Lack of contact with operational realities
    The importance of involving operating managers
    Procedural justice in the decision-making process
    Engagement, explanation, and expectations
    Planning for the present: Strategic Intent
    Recognition of the static nature of the strategic fit model
    Strategic intent in focusing the organization on winning by achieving stretch goals
  • 22. Copyright © 2001 Houghton Mifflin Company. All rights reserved.
    1-22
    Improving Strategic Decision Making
    Cognitive biases systematically influence the rationality of decision makers.
    FIGURE 1.5
  • 23. Copyright © 2001 Houghton Mifflin Company. All rights reserved.
    1-23
    Groupthink and Strategic Decisions
    Pitfalls of groupthink
    Failing to question underlying assumptions.
    Coalescing around a single person or policy.
    Filtering out conflicting information.
    Developing after-the-fact rationalizations.
    Having an emotional (nonobjective) commitment to an action.
  • 24. Copyright © 2001 Houghton Mifflin Company. All rights reserved.
    1-24
    Techniques for Improving Decision Making
    Two decision-making processesthat counteractcognitive biases and groupthink.
    FIGURE 1.6

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