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Strategic formulation in Strategic management

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Levels of Strategy
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Strategic formulation in Strategic management

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This presentation is on Strategy formulation(of subject strategic management) and it covers following points :-
Define strategy formulation
Need of strategy formulation
Steps of strategy formulation
Problems in strategy formulation
Levels of strategy

This presentation is on Strategy formulation(of subject strategic management) and it covers following points :-
Define strategy formulation
Need of strategy formulation
Steps of strategy formulation
Problems in strategy formulation
Levels of strategy

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Strategic formulation in Strategic management

  1. 1. Define strategy formulation Need of strategy formulation Steps of strategy formulation Problems in strategy formulation Levels of strategy Content
  2. 2. Need of strategy formulation To achieve the organisational goals effectively and efficiently. To become more competitive. To maximizing the profit. To make a large market share. And so on....
  3. 3. Steps of strategy formulation i. Establishing objectives :- The main element of corporate strategy is the objectives of the firm. Objectives of the firm act as a foundation or base. ii. Analysing the Environment :- In this stage general environment is analyzed from different angles. This involves assessment of internal and external business environment. This will help the firm to appraise its strengths and weaknesses and identify the major strengths and weaknesses of their competitors. iii. Fixing quantitative targets :- In this state a firm may set quantitative target for some of its objectives iv. Relating targets to divisional plans :- This step of strategy formulation identifies the contribution that can be made by each division or product group within the corporation and for this purpose, a provisional strategic plan must be developed for each sub-unit. v. GapAnalysis :- Gap Analysis is the identification and analysis of a gap between planned or desired Performance.
  4. 4. Establishing objectives Analysingthe environment Fixing quantitative advantage Relatingtargets to divisional plans Gap analysis
  5. 5. Problems of strategy formulation a. Lack of awareness (no proper information) b. Kidding themselves syndrome (no flow of any new information) c. Vested interests of the managers (personal interest affects professional interest) d. Excessive involvement in everyday operational problem(no time for studying information) e. Resistance to change f. Inability on the part of the top management
  6. 6. Levels of strategy Corporate level strategy Business level strategy Functional level strategy
  7. 7. Corporate level strategy This strategy formulated at corporate level by top management. To oversee the interests and operation of organizations. Dealing with the objectives of firm, acquisition and allocation of resources, and coordination of strategy of various units. It applies to the enterprise as a whole. It explains the business in which a firm will compete and how it should utilize its resources. It occupies the highest level of strategic decision making.
  8. 8. Business level strategy This strategy formulated at business level by managers. It concerned with managing the interests and operations of a particular line of business. A managerial game plan for a single business. Here strategy is about which product or services should be developed and offered to which market and to which customers.
  9. 9. Functional level strategy A functional strategy is a short term game plan for a key functional area within a company. Functional strategies help in implementing grand strategy. Its focus on external environment. Types of functional strategies :- i. Marketing strategy. ii. Operations strategy iii. R & D (Research & Development Strategy) iv. Information system strategy v. HR strategy (Human Resource) vi. Financial Strategy
  10. 10. Presented by:- Yamini kahaliya BBA (Honor’s)

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