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Importance of creating strategy for your organization

Fundamentals that needs to be known in creating strategy

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Importance of creating strategy for your organization

  1. 1. Importance of Creating Strategy for Your OrganizationBY Angela Ihunweze(Mrs) +234 080 33 28 03 53
  2. 2. Table of contents  What exactly is strategy?  Fundamentals of strategy  Strategy at Different Levels of a Business  The impact of strategy in the organization  Key Stakeholders and Participants in the Strategic Process  Key Stakeholders and Participants in the Strategic Process part 2  Exercise for you
  3. 3. What exactly is strategy? According to Johnson and Scholes in their description of strategy in their publication (Exploring Corporate Strategy) it is defined as follows: “The direction and scope of an organisation over the long- term: which achieves advantage for the organisation through its configuration of resources within a challenging environment, to meet the needs of markets and to fulfill stakeholder expectations"
  4. 4. Fundamentals of strategy Strategy addresses the following fundamentals:  Where is the business trying to get to in the long-term (direction)  Which markets should the business compete in and what kind of activities are involved in such markets? (markets; scope)  How can the business perform better than the competition in those markets? (advantage)?  What resources (skills, assets, finance, relationships, technical competence, facilities) are required in order to be able to compete? (resources)?  What external, environmental factors affect the businesses' ability to compete? (environment)?  What are the values and expectations of those who have power in and around the business? (stakeholders)
  5. 5. Strategy at Different Levels of a Business Strategies exist at several levels in any organization - ranging from the overall business (or group of businesses) through to individuals working in it.  Corporate Strategy - is concerned with the overall purpose and scope of the business to meet stakeholder expectations. This is a crucial level since it is heavily influenced by investors in the business and acts to guide strategic decision-making throughout the business. Corporate strategy is often stated explicitly in a "mission statement".  Business Unit Strategy - is concerned more with how a business competes successfully in a particular market. It concerns strategic decisions about choice of products, meeting needs of customers, gaining advantage over competitors, exploiting or creating new opportunities etc.  Operational Strategy - is concerned with how each part of the business is organized to deliver the corporate and business-unit level strategic direction. Operational strategy therefore focuses on issues of resources, processes, people etc.
  6. 6. The impact of strategy in the organization  leads to action  builds a shared vision that is values-based  is an inclusive, participatory process in which board and staff take on a shared ownership  accepts accountability to the community  is externally focused and sensitive to the organization's environment  is based on quality data  requires an openness to questioning the status quo  is a key part of effective management.
  7. 7. Key Stakeholders and Participants in the Strategic Process Strategic planning phase Who should be involved?  Planning the process; The management team of the project or organization.  Understanding the context; All staff and Board members: Administrative staff should be involved if it is important for them to understand the organization's issues and problems.
  8. 8. Key Stakeholders and Participants in the Strategic Process part 2  Vision, values and mission discussion; All staff and Board members. It is very important to involve all staff, including administrative staff in this discussion as it is likely to provide a set of operating principles – in other words, to make it clear why people who work in the project or organization are expected to work and behave in a certain way.  Review of strengths and weaknesses opportunities and threats; Programme or professional staff for the whole of this process; include administrative staff in the discussions around internal strengths and weaknesses. Discussion of strategic options and goals. Professional staff and Board members.  Organizational structure; The management team with input from the rest of the staff
  9. 9. Exercise for you What is your contribution in creating strategy --------------------------- -------------------------- -------------------------- -------------------------- -------------------------- -------------------------- ------------------------ Send it to me