Process of strategic management 2a


Published on

Published in: Business
  • Be the first to comment

  • Be the first to like this

No Downloads
Total views
On SlideShare
From Embeds
Number of Embeds
Embeds 0
No embeds

No notes for slide

Process of strategic management 2a

  1. 1. The summary model Elements of strategic Management The process consists of- : Strategic position Strategic choices Strategy into action
  2. 2. Strategic position: Scanning the environment Culture and stakeholder expectations Aligning resources and strategic capability.
  3. 3. Strategic Choice : Identifying the strategic options Evaluating Options Selecting strategy
  4. 4. Strategy Implementation Organization structure and design Planning and allocating resources Managing strategic change
  5. 5. The components of strategic management: Broadly the components are subparts in the process of strategic management. Strategic position 1. Assessing the company’s external environment, including both the competitive and general contextual factors.( scanning the environment) 2. Formulating the company’s mission, vision, philosophy and goals.( meeting cultural and stake holder expectations) 3. Developing a company profile that reflects its internal conditions and capabilities.( aligning resources and strategic capability)
  6. 6. Strategic Choice 4. Identifying the most desirable options by evaluating each option in light of the company’s mission. ( identifying the options) 5. Analyzing the company’s options by matching its resources with the external environment. (evaluating the options) 6.Selecting a set of long-term objectives and grand strategies that will achieve the most desirable options. (selecting the options)
  7. 7. Strategy implementation 7.Implementing the strategic choices by means of budgeted resource allocations in which the matching of tasks, people, structures, technologies and reward systems is emphasized. (organization structure and design) (planning and allocating resources) 8.Developing annual objectives and short-term strategies that are compatible with the selected set of long-term objectives and grand strategies. 9.Evaluating the success of the strategic process as an input for future decision- making. (managing strategic change)
  8. 8. e.g. General Electric Vision: to be no 1 or no 2 in any market that they operate. Strategic position: to scout the landscape for any acquisition, merger, divesture to improve its competitive positioning in line with its resources and strategic capability.
  9. 9. Strategic Choice : Having identified the possible acquisition , move at break neck speed to pre-empt competition and acquire the same. This will give a better competitive advantage. Strategy Implementation : 1. Complete the acquisition. 2. Work for the successful integration of the merged company and manage the strategic change
  10. 10. Levels of strategy planning In the hierarchy the three levels areCorporate level, the business level and functional level. Corporate level : Strategies are devised in an attempt to exploit the firm’s distinctive competencies, by developing long-term plans for business operations.
  11. 11. Corporate level strategy deals basically with- the selection of the areas of business in which the company is going to operate, - the ways in which business will be integrated and managed, - the development of synergies by coordinating and sharing different resources, - and investment of financial resources across units.
  12. 12. Business Level: Business level strategy involves decisions about the competitive position of a single business unit. The managers at this level translate the general statements of corporate strategic planners into exact, concrete functional objectives and strategies for individual business divisions,
  13. 13. The goal of business level managers is to select, enter and grow in the most profitable market segment with the highest potential for growth. This strategy is concerned with using generic strategies such as cost leadership, differentiation and focus to create competitive advantage.
  14. 14. Functional level : This level consists of managers from geographic, product and functional areas. They design short-term strategies and fix annual objectives in different areas. Functional level strategies address problems related to the efficiency and effectiveness of production, success of particular products and services in increasing their market share, quality of customer service. They are quantifiable and operational in nature.