The document discusses strategy and defines it as a direction and scope that achieves advantage through resource configuration to meet market needs and stakeholder expectations. Strategy involves gaining a competitive advantage through a blueprint that moves an organization from its current position to its desired future position. Different levels of strategy include corporate, business, and operational strategies.

1. Strategy
 "Strategy is 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 fulfil stakeholder expectations".

2. Strategy
 In other words, strategy is about:
 Where is the business trying to get to in the long-term
(direction)
 Which markets should a 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)

3. Strategy
 A strategy is:
 A solution to move from where you are now (A) to where
you want to be (B)
 It is what you want to happen to achieve an end.
 Strategy is a class of solution that deals with uncertainty –
the possibility that opposing forces may inhibit you
reaching (B) or reaching it in acceptably good form.
 A strategy should raise the probability that its employer
will reach (B) in good form.
 It does so mostly by creating conditions that favour
success.

4. Strategy
 For example, a strategy can be that you will only
support businesses where you can be a first or second
tier player.
 Where your objective is to build a product solutions
portfolio that fits that defined nature.
 Building a portfolio of first or second tier only product
solutions is what you want to do.
 It is a solution to a problem associated with running a
type of business that you determined third or less tier
product solutions will not support.

5. Strategy
 Strategy
 Strategy involves a blueprint for gaining a competitive advantage.
 For example, eyeglasses had glass lenses for more than 400 years.
 A company developed a strategy to design plastic lenses that
would be cheaper, almost unbreakable and lightweight.
 This product gave the company a competitive advantage over
other eyeglass manufacturers.
 Its strategy included all of the complex plans necessary to bring
this project to fruition.
 People use strategies in their personal lives to improve their
competitiveness or financial stability.
 For example, a newly hired college graduate develops a strategy
to climb the corporate hierarchy.
 His strategy includes capitalizing on his strengths and
overcoming objections.

6. Strategy
 Your strategy does not specifically say how you
will arrive at this end.
 That is where your plan comes in.
 A plan is how you will move from (A) to (B).
 As such it should support your strategy by providing a
way to reach (B) that provides an acceptable balance of
risk and reward.
 So your strategy is what you want to do and your plan
is how you will do it.

7. Strategy
 Plans
 Plans are the second-level goals in the hierarchy.
 A complex strategy may contain many plans.
 Using the eyeglass example, the manufacturer had to
identify an appropriate plastic that was hard enough for
daily use but soft enough for grinding to the correct
magnification.
 Locate or design equipment to grind and buff the lenses;
 Contract with suppliers.
 Find outlets to sell the product.
 Advertise its new invention to the public.
 Each part of the strategy has a separate plan to accomplish
its goal.

8. Strategy
 Tactics
 Tactics are the step-by-step methods you use to accomplish
a plan.
 Continuing the eyeglass example, to complete the plan of
identifying an appropriate plastic, the tactics would
include:
 Identify all businesses that produce plastics.
 Buy samples of each type of plastic, test samples.
 Record pros and cons.
 Decide whether one plastic is appropriate or if the
company needs a custom formula.

9. Strategy
 People use strategy, plans, tactics and processes to
accomplish successful outcomes in their business
projects and personal goals.
 The four concepts work together and are, in fact,
interdependent on each other.
 You cannot develop plans without a strategy, or tactics
without a plan or without a process.

10. Strategy
 The History of Strategy and Its Future Prospects
 Strategy, for most of its 2,500-year history, was one-
dimensional.
 Warmongers were largely focused on avoiding wars by not
instigating them.
 Business was mostly focused on building power and
monopolies.
 The past 50 years have more than made up for this one-way
view as strategy hit its prime and spewed out countless new
ideas and solutions
 Strategy is on the verge of reinventing itself and reclaiming
its rightful place at the top of the business food chain.

11. Strategy
 The Early Days:
 The beginnings of strategy can be traced back to The
Art of War by Sun Tzu (5th Century BC).
 The same holds true for On War by Carl von
Clausewitz, a major general in the German Prussian
army ( Between 1816 and 1830)
 The book covers all aspects of waging war and provides
copious amounts of strategic and philosophical advice
still being used as a source of inspiration for politicians
and business leaders.
 Interestingly, both books extensively cover how to
avoid war.

12. Strategy
 Exclusivity Strategies: Up to 1900
 Warmongers have long enjoyed the strategic and tactical
richness of how not to go to war.
 While business strategy through the 1800s mostly revolved
around just creating exclusivity and monopolies.
 Ida Tarbell’s 1904 book, The History of the Standard Oil
Company, signaled the transition to a new strategic era.
 Tarbell depicted John D. Rockefeller as a money-grabber
who was viciously effective at monopolizing the oil trade.
 Rockefeller gradually expanded his control over the
refining business by taking over competitors.
 It is estimated that at one point more than 90 percent of
North American refinery capacity was controlled by
Standard Oil and its 30 wholly and partially owned
subsidiaries

13. Strategy
 Industrial Proficiency Strategies: 1900–1968:
 This focus on pushing the boundaries of
industrialization and operations marked the strategic
space over the next 60 or so years.
 Alfred P. Sloan, who helped make General Motors the
world’s largest industrial corporation for many
decades, was accused of the same narrow focus on
metrics, tasks, and efficiencies.
 In 1952, the MIT School of Industrial Management was
established through a Sloan Foundation grant.

14. Strategy
 The school, designed to educate the “ideal manager,”
was later renamed the Alfred P. Sloan School of
Management and today is one of the world’s premier
business schools.
 As the period progressed, scientific management
made way for more holistic perspectives that pushed
the boundaries of operations by looking at all aspects
of productivity and efficiency.
 By 1969, these perspectives had become input for true
strategic analyses and planning, marking a new period
in strategy development.

15. Strategy
 Strategy Heydays: 1969 to Mid–1990s:
 In the late 1960s and early 1970s, Bruce Henderson,
who later founded the Boston Consulting Group,
published work on the “experience curve,” an idea
that there is a direct relationship between
cumulative production and production costs.
 In other words, the more experience a company has
making a product, the lower its costs.
 This became the basis for strategizing the combination
of price setting, production volumes, and production
costs against competitors.
 It also played to the heart of analyses-driven strategy
development.

16. Strategy
 Soon after publishing this work, Henderson came up
with the growth-share (BCG) matrix, made famous by
its quadrant names: cash cows, dogs, stars, and
question marks.
 The matrix helped companies with multiple
experience curves manage an ongoing portfolio of
activities.
 Harvard professor Michael Porter expanded the
competitiveness concept with yet more strategies.

17. Strategy
 In his 1985 book, Competitive Advantage: Creating and
Sustaining Superior Performance, Porter presents the
notion of differentiating strategies and strategies focused
on specific segments as alternatives to cost leadership
strategies.
 He also creates the five forces model and the value chain
model to help companies formulate more powerful
strategies.
 In their 1990 article, “The Core Competence of the
Corporation,” C. K. Prahalad and Gary Hamel highlight the
importance of gaining competitive advantage by not only
looking at positioning in terms of markets and
competitors, but also by looking inside your own
company.

18. Strategy
 Now inside-out strategies and outside-in strategies -
both mattered.
 During this period, strategy became a proper discipline:
more standalone, more analytical, and more cerebral.
 Strategy shifted from being one of the daily tasks for senior
executives and landed instead in the hands of strategy
professionals and planners.
 This had a rather unwanted side effect as it created a
distinct handover between strategy formulation and
strategy implementation.
 In fact, the more sophisticated and far-sweeping strategies
became, the larger the handover hurdles.

19. Strategy
 With globalization and automation, things got worse;
change management and getting buy-in were much-
discussed topics and strategy implementation
gradually became a self-inflicted major issue.
 Some years earlier, Edgar H. Schein released his
influential works on culture and leadership and their
importance for strategy, and Henry Mintzberg was
talking about designing organizations suitable for
executing specific strategies from the bottom up.

20. Strategy
 Performance metrics were another helpful component
in strategy execution, with several initiatives pushing
the envelope for effective strategic metrics in the early
1990s.
 The most well-known are those of Robert S. Kaplan
and David P. Norton, who wrote articles in 1992 and
1993 and then published The Balanced Scorecard:
Translating Strategy Into Action in 1996.

21. Strategy
 Strategic Proliferation: Mid–1990s to Mid–2010s
 Suddenly, there was a trend so big that it didn’t fit our
strategy frameworks, and the reengineering revolution
hijacked the strategy process.
 By the late 1980s and early 1990s, fundamental shifts
brought about by advances in areas such as technology had
a great impact, as did the shift in the developed world from
industrial-based to service-based.
 But the reengineering revolution did not last long.
 By the late 1990s, the next strategic revolution had
arrived, drawing us all into the big promise of the Internet
and the notion of the new economy.

22. Strategy
 In 1999, Blown to Bits: How the New Economics of
Information Transforms Strategy by Philip Evans and
Thomas S. Wurster of Boston Consulting Group, made
a convincing argument that the Internet changed
everything.
 Suddenly, disintermediation was possible for just
about anything, and it was clear that intermediaries
would be eliminated sooner rather than later.
 It was never a question of which strategic revolution
was the most important; rather, it was the fact that
they were piling up, each one bringing with it plenty of
opportunities to create or lose competitive advantage.

23. Strategy
 Reclaiming Strategy: 2014 and Beyond
 Shifting strategy formulation from current-out to
future-in
 Shifting the strategy process from cascading down to
organizationally inclusive
 Don’t aim for a single strategy but for an ongoing
portfolio of competitive advantages
 Each one is interesting and promising in itself, but the
combination of all three holds the biggest promise for
taking strategy back, using the following logic:
 Coming Full Circle: Strategy as Organizational
Energy

24. DIFFERENT LEVELS OFSTRATEGY
Corporate level
Business level
Operational or functional level

25. CORPORATE LEVEL STRATEGIES
• Top management’s overall plan for the entire
organization and its strategic business units.
• Corporate level strategy occupies the heights level of
DECISION MAKING.
• The nature of the decisions tends to be value oriented,
conceptual than the Business level, and Operational
or Functional level.

26. Types of Corporate Strategies
 Growth: expansion into new products and markets.
 Stability: maintenance of the status of the
organization.
 Renewal: redirection of the firm into new markets.

27. CORPORATE LEVEL STRATERGY
 Growth Strategy
 Seeking to increase the organization’s business by
expansion into new products and markets.
 Types of Growth Strategies
 Concentration
 Vertical integration
 Horizontal integration
 Diversification

28. CORPORATE LEVEL STRATERGY
 Concentration: Focusing on a primary line of business
and increasing the number of products offered or
markets served.
 Vertical Integration:
 Backward vertical integration.
 Forward vertical integration.
 Horizontal Integration:
 Combining operations with another competitor in the
same industry to increase competitive strengths.

29. CORPORATE LEVEL STRATERGY
 Diversification:
 Related Diversification: Expanding by merging
with firms in different, but related industries
 Unrelated Diversification: Growing by merging
with firms in unrelated industries where higher
financial returns are possible.

30. CORPORATE LEVEL STRATERGY
 Stability Strategy: A strategy that seeks to
maintain the status with the uncertainty of the
environment, when the industry is experiencing
slow- or no-growth conditions.
 Renewal Strategy: Developing strategies to
counter organization weaknesses that are leading to
performance declines.

31. Business-Level Strategies
 A strategy that seeks to determine how an
organization should compete in each of its SBUs
(strategic business units).
 At Business-level ALLOCATION of re-sources
among Functional-level an COORDINATE with the
Corporate level to the ACHIEVEMENT of the
Corporate level OBJECTIVES.

32. 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 focus: Concentrating competitively on
a specific market segment.

33. Functional-Level Strategies
 Focus is on improving the effectiveness of
operations within a company.
 Which is done by:
 Manufacturing
 Marketing
 Materials management
 Research and development
 Human resources

50. IT Strategy
 A process, in contrast, is a defined way of doing a task.
 It can be a linear in nature – do A, then do B, then do C – or
it can have branches – do A, then B, and then C or D
depending.
 A process sets strict parameters to the “how” that can, if
misapplied, allow the “how” to take priority over the
“what.”
 Since a process is so anchored in the “how,” it can never be
a strategy.
 If used well, a process can be an essential part of a strategy.

51. IT Strategy
 Technology strategy (Information Technology
strategy or IT strategy) is the overall plan which
consist of objective(s), principles and tactics relating
to use of the technologies within a particular
organization.
 A technology strategy has traditionally been expressed
in a document that explains how technology should be
utilized as part of an organization's overall corporate
strategy and each business strategy.

52. IT Strategy
 IT Strategy is a comprehensive plan that information
technology management professionals use to guide
their organizations.
 An IT strategy should cover all facets of technology
management including:
 Cost management
 Human capital management
 Hardware and software management
 Vendor management
 Risk management

53. IT Strategy
 Executing an IT strategy requires:
 Strong IT leadership
 The chief information officer (CIO)
 Chief technology officer (CTO) need to work closely
with:
 Business, budget and legal departments as well as with
other user groups within the organization.