Strategic intent is an aspirational plan which is helpful to achieve the vision of the organization.
It inspires winning: winning of customers, winning against competitors, winning over the broader market.
It focuses on firm’s taking initiatives to change the strategy of the firm that will lead to competitive advantage.
Whatever the case, strategic intent turns strategy from a “fit” exercise to a “stretch” exercise.
Example: An intent retailer does not think about how to match a competitor’s operation, but to create even a better operation.
The specific features of strategic intent can be easily explained with the help of hierarchy or pyramid of the organization from the top-bottom.
Example: “Toyota motors” use quality circle (QC) and Just In Time (JIT) to get competitive advantage.
Example: When “Honda” entered the motorcycle market competitors thought there was no threat as it did not imitate Harley Davidson or Yamaha. But it chose to start with products that were internationally different. Then by carving out new, white space it developed a customer base & strong brand image.
The strategic intent of Reliance is to being a global leader of the lowest cost producer of polyester products by focusing on vertical integration & operational effectiveness.
strategic pyramid or hierarchy of strategy can be broadly categorized in the following manner.
Corporate level
Business level
Functional level
Corporate level strategy is a comprehensive plan which is developed by the top management for the company as a whole whether the firm is a small one product or large multinational corporation. on a continuous basis.
In a large multinational company corporate strategy is also about managing various product lines & business units for value maximization.
For example: corporate headquarters must play the role of “organizational parent” in that it must deal with various product & business unit as “children”. Even though each product line or business unit has its own competitors & it has to obtain its own competitive advantage in the market. The cooperation among different units as a whole succeed the “family”.
Corporation’s directional Strategy is composed of three general orientations towards growth such as: Growth strategy expands the company’s activities.
Stability strategies make no change to company’s current activities.
Retrenchment strategies reduce the company’s level of activities.
Growth strategy is widely pursued by the corporations or industries those are designed to achieve growth in sales, profit & assets.
It can be achieved by both concentration & diversification.
Concentration within one product line or industry & diversification into other product line & industries.
It can use investing for new product or new market development internally or through mergers, acquisitions or strategic alliances.
Concentration strategies are very sensible as they try to compete successfully only within single industry.
Examples: McDonald’s, Starbucks
The document discusses various strategic management concepts including strategy formulation, levels of strategy (corporate, business, functional), types of growth strategies (concentration, diversification), retrenchment strategies (turnaround, divestment, liquidation), and combination strategies. It also discusses Porter's Diamond Model of national competitive advantage and factors that influence a nation's competitiveness such as firm strategy/rivalry, factor conditions, demand conditions, and related/supporting industries. Mergers and acquisitions are defined as ways companies can combine, with mergers integrating two companies and acquisitions involving one company purchasing another.
A growth strategy entails introducing new products, features, or markets in order to expand business and keep up with competitors. There are two main types of growth strategies: internal growth strategies that rely on a company's own resources like product expansion, modernization, and diversification; and external growth strategies that involve acquiring other companies through mergers, acquisitions, joint ventures, or strategic alliances. Internal growth allows slow, planned development while external growth uses other companies' resources to rapidly expand.
The document discusses different types of business growth strategies and factors to consider when pursuing growth. It addresses organic versus inorganic growth and outlines various organic growth options such as expanding product lines, opening new locations, franchising, and global expansion. The document also discusses the importance of aligning growth strategies with a company's core value proposition and competencies. Leaders must evaluate opportunities based on factors like market potential, required skills and resources, costs versus benefits, and impact on the existing business model.
The document discusses various expansion strategies that a company can pursue for growth, including concentration, diversification, integration, cooperation, and internationalization. Concentration involves focusing resources on existing product lines or markets. Diversification means entering new product lines or industries, either related (concentric) or unrelated (conglomerate). Cooperation strategies involve strategic alliances, joint ventures, or equity partnerships with other companies. Internationalization refers to expanding into international markets. The document analyzes the types and approaches within each category of expansion strategy.
Before she became one of the biggest names in Philippines showbiz industry, Maymay Entrata also had her fair share of life struggles.
Before she became one of the biggest names in Philippines showbiz industry, Maymay Entrata also had her fair share of life struggles.
Starting at the age of 14th, Entrata began auditioning for various reality television shows to fulfill her ambition of becoming an actress, but she failed. After being rejected several times, Entrata almost did not audition for Pinoy Big Brother Lucky 7 however, her grandfather got ill, she saw it as a reason to try again. Guess what? Entrata went on to win the competition, finally she did it. I really admire her for being who she is, what she is, and where she became. I am proud to say she is a bisaya and that's our biggest similarities. Her skills are one of a kind, she can act, dance, sing, and model. I really love how she boosts her confidence even though there are a lot of bashers around her, and I want to apply it to myself to be a strong and independent woman. Maymay is a beautiful and multitalented young woman with a wacky personality that’s extremely likable. She’s a dreamer and she never lost sight of them and who she’s dreaming it for.
I always admire people who dream big dreams and work hard to reach them. Watching Maymay everyday has given me inspiration to fight for my dreams and work hard even for those dreams I have let go because it deemed impossible.Before she became one of the biggest names in Philippines showbiz industry, Maymay Entrata also had her fair share of life struggles.
Starting at the age of 14th, Entrata began auditioning for various reality television shows to fulfill her ambition of becoming an actress, but she failed. After being rejected several times, Entrata almost did not audition for Pinoy Big Brother Lucky 7 however, her grandfather got ill, she saw it as a reason to try again. Guess what? Entrata went on to win the competition, finally she did it. I really admire her for being who she is, what she is, and where she became. I am proud to say she is a bisaya and that's our biggest similarities. Her skills are one of a kind, she can act, dance, sing, and model. I really love how she boosts her confidence even though there are a lot of bashers around her, and I want to apply it to myself to be a strong and independent woman. Maymay is a beautiful and multitalented young woman with a wacky personality that’s extremely likable. She’s a dreamer and she never lost sight of them and who she’s dreaming it for.
I always admire people who dream big dreams and work hard to reach them. Watching Maymay everyday has given me inspiration to fight for my dreams and work hard even for those dreams I have let go because it deemed impossible.
Starting at the age of 14th, Entrata began auditioning for various reality television shows to fulfill her ambition of becoming an actress, but she failed. After being rejected several times, Entrata almost did not au
The document discusses various strategic management concepts including strategy formulation, levels of strategy (corporate, business, functional), types of growth strategies (concentration, diversification), retrenchment strategies (turnaround, divestment, liquidation), and combination strategies. It also discusses Porter's Diamond Model of national competitive advantage and factors that influence a nation's competitiveness such as firm strategy/rivalry, factor conditions, demand conditions, and related/supporting industries. Mergers and acquisitions are defined as ways companies can combine, with mergers integrating two companies and acquisitions involving one company purchasing another.
A growth strategy entails introducing new products, features, or markets in order to expand business and keep up with competitors. There are two main types of growth strategies: internal growth strategies that rely on a company's own resources like product expansion, modernization, and diversification; and external growth strategies that involve acquiring other companies through mergers, acquisitions, joint ventures, or strategic alliances. Internal growth allows slow, planned development while external growth uses other companies' resources to rapidly expand.
The document discusses different types of business growth strategies and factors to consider when pursuing growth. It addresses organic versus inorganic growth and outlines various organic growth options such as expanding product lines, opening new locations, franchising, and global expansion. The document also discusses the importance of aligning growth strategies with a company's core value proposition and competencies. Leaders must evaluate opportunities based on factors like market potential, required skills and resources, costs versus benefits, and impact on the existing business model.
The document discusses various expansion strategies that a company can pursue for growth, including concentration, diversification, integration, cooperation, and internationalization. Concentration involves focusing resources on existing product lines or markets. Diversification means entering new product lines or industries, either related (concentric) or unrelated (conglomerate). Cooperation strategies involve strategic alliances, joint ventures, or equity partnerships with other companies. Internationalization refers to expanding into international markets. The document analyzes the types and approaches within each category of expansion strategy.
Before she became one of the biggest names in Philippines showbiz industry, Maymay Entrata also had her fair share of life struggles.
Before she became one of the biggest names in Philippines showbiz industry, Maymay Entrata also had her fair share of life struggles.
Starting at the age of 14th, Entrata began auditioning for various reality television shows to fulfill her ambition of becoming an actress, but she failed. After being rejected several times, Entrata almost did not audition for Pinoy Big Brother Lucky 7 however, her grandfather got ill, she saw it as a reason to try again. Guess what? Entrata went on to win the competition, finally she did it. I really admire her for being who she is, what she is, and where she became. I am proud to say she is a bisaya and that's our biggest similarities. Her skills are one of a kind, she can act, dance, sing, and model. I really love how she boosts her confidence even though there are a lot of bashers around her, and I want to apply it to myself to be a strong and independent woman. Maymay is a beautiful and multitalented young woman with a wacky personality that’s extremely likable. She’s a dreamer and she never lost sight of them and who she’s dreaming it for.
I always admire people who dream big dreams and work hard to reach them. Watching Maymay everyday has given me inspiration to fight for my dreams and work hard even for those dreams I have let go because it deemed impossible.Before she became one of the biggest names in Philippines showbiz industry, Maymay Entrata also had her fair share of life struggles.
Starting at the age of 14th, Entrata began auditioning for various reality television shows to fulfill her ambition of becoming an actress, but she failed. After being rejected several times, Entrata almost did not audition for Pinoy Big Brother Lucky 7 however, her grandfather got ill, she saw it as a reason to try again. Guess what? Entrata went on to win the competition, finally she did it. I really admire her for being who she is, what she is, and where she became. I am proud to say she is a bisaya and that's our biggest similarities. Her skills are one of a kind, she can act, dance, sing, and model. I really love how she boosts her confidence even though there are a lot of bashers around her, and I want to apply it to myself to be a strong and independent woman. Maymay is a beautiful and multitalented young woman with a wacky personality that’s extremely likable. She’s a dreamer and she never lost sight of them and who she’s dreaming it for.
I always admire people who dream big dreams and work hard to reach them. Watching Maymay everyday has given me inspiration to fight for my dreams and work hard even for those dreams I have let go because it deemed impossible.
Starting at the age of 14th, Entrata began auditioning for various reality television shows to fulfill her ambition of becoming an actress, but she failed. After being rejected several times, Entrata almost did not au
Before she became one of the biggest names in Philippines showbiz industry, Maymay Entrata also had her fair share of life struggles. Before she became one of the biggest names in Philippines showbiz industry, Maymay Entrata also had her fair share of life struggles.
Starting at the age of 14th, Entrata began auditioning for various reality television shows to fulfill her ambition of becoming an actress, but she failed. After being rejected several times, Entrata almost did not audition for Pinoy Big Brother Lucky 7 however, her grandfather got ill, she saw it as a reason to try again. Guess what? Entrata went on to win the competition, finally she did it. I really admire her for being who she is, what she is, and where she became. I am proud to say she is a bisaya and that's our biggest similarities. Her skills are one of a kind, she can act, dance, sing, and model. I really love how she boosts her confidence even though there are a lot of bashers around her, and I want to apply it to myself to be a strong and independent woman. Maymay is a beautiful and multitalented young woman with a wacky personality that’s extremely likable. She’s a dreamer and she never lost sight of them and who she’s dreaming it for.
I always admire people who dream big dreams and work hard to reach them. Watching Maymay everyday has given me inspiration to fight for my dreams and work hard even for those dreams I have let go because it deemed impossible.Before she became one of the biggest names in Philippines showbiz industry, Maymay Entrata also had her fair share of life struggles.
Starting at the age of 14th, Entrata began auditioning for various reality television shows to fulfill her ambition of becoming an actress, but she failed. After being rejected several times, Entrata almost did not audition for Pinoy Big Brother Lucky 7 however, her grandfather got ill, she saw it as a reason to try again. Guess what? Entrata went on to win the competition, finally she did it. I really admire her for being who she is, what she is, and where she became. I am proud to say she is a bisaya and that's our biggest similarities. Her skills are one of a kind, she can act, dance, sing, and model. I really love how she boosts her confidence even though there are a lot of bashers around her, and I want to apply it to myself to be a strong and independent woman. Maymay is a beautiful and multitalented young woman with a wacky personality that’s extremely likable. She’s a dreamer and she never lost sight of them and who she’s dreaming it for.
I always admire people who dream big dreams and work hard to reach them. Watching Maymay everyday has given me inspiration to fight for my dreams and work hard even for those dreams I have let go because it deemed impossible.
Starting at the age of 14th, Entrata began auditioning for various reality television shows to fulfill her ambition of becoming an actress, but she failed. After being rejected several times, Entrata almost did not au
This document discusses different levels and types of corporate strategies. It describes three levels that strategy can be formulated at: corporate, business unit, and functional. For corporate strategy, the document outlines growth, stability, and retrenchment strategies. Growth strategies include concentration strategies like horizontal and vertical growth as well as diversification strategies. Stability strategies involve pausing growth or maintaining the status quo. Retrenchment strategies are for weak competitive positions and include turnaround, becoming a captive company, selling out, or bankruptcy/liquidation. Combination strategies that blend these approaches are also discussed.
Blue Sky Organic Ventures Strategic Alliancesmarksv47
BlueSky Organic Ventures was founded in 2009 to provide business development, advisory, and strategic alliance services to companies in the natural, organic, and gluten-free lifestyle sectors. The company looks to partner with firms that offer unique products or brands and help them develop sustainable revenue channels in emerging markets through strategic partnerships. BlueSky was founded by Mark Vitcov who has over 17 years of experience in finance and private equity and has raised over $125 million for companies. One of BlueSky's core services is helping companies form strategic alliances to leverage growth, reduce costs and risks, and increase competitiveness and brand equity.
Strategy formulation is the process of using available knowledge to document the intended direction of a business and the actionable steps to reach its goals.
This process is used for resource allocation, prioritization, organization-wide alignment, and validation of business goals.
A successful strategy can allow your organization to share one clear vision, catch biases by examining the reasoning behind goals, and track performance with measurable key performance indicators (KPIs).
This document discusses different types of strategies that organizations use. It outlines four main types of strategies:
1. Integration strategies which include vertical and horizontal integration to control suppliers and buyers.
2. Intensive strategies like market penetration, market development, and product development to improve competitive position in existing markets and products.
3. Diversification strategies such as related and unrelated diversification to expand into new product lines and markets to reduce risk.
4. Defensive strategies including retrenchment, divestiture, and liquidation aimed at reducing losses through cost cutting, selling divisions, or fully liquidating assets.
The document provides examples for each type of strategy.
This document provides an overview of strategic management concepts including strategy, strategic management, SWOT analysis, and different types of business-level and corporate-level strategies. It discusses strategy formulation, implementation, and evaluation. Key points covered include the nature of strategic management, types of strategic alternatives like diversification, integration and concentration strategies. Frameworks for analyzing strengths, weaknesses, opportunities and threats are presented. Porter's generic strategies of cost leadership, differentiation and focus are also summarized. The document aims to help students understand the principles of strategic management and strategy planning.
The document discusses strategies for a firm's growth, including internal and external strategies. Internal growth strategies involve expanding within the organization, such as market penetration, market development, product development, and diversification. External growth strategies involve expanding outside the organization through mergers, acquisitions, joint ventures, strategic alliances, franchising, and licensing agreements. Firms must develop growth strategies tailored to their own characteristics and operating environment to most effectively increase objectives, broaden customer reach, and reduce costs.
The company is looking to expand into the apparel and shoes segment. An integrated cost leadership/differentiation strategy is recommended that allows the company to pursue both low cost and product differentiation. This involves efficiently producing apparel and shoes with unique attributes at low prices, providing good value. A focus strategy targeting specific buyer groups, product lines, or geographic markets could also work.
This document provides an overview of mergers and acquisitions (M&A) and common HR challenges. It discusses the basic concepts of M&A, including definitions of mergers and acquisitions. It also outlines reasons for M&A such as gaining synergies through reduced costs and expanded market access. Additionally, it describes the overall M&A process in five phases from pre-acquisition review to post-acquisition integration. HR challenges can arise during M&A from changes in company culture, leadership, and redundancy of roles which must be carefully managed.
The document discusses various strategic management concepts for tourism including strategy formulation, modernization, diversification, integration, takeovers, joint strategies, divestment, liquidation, and strategic choice. It provides definitions and examples of these concepts. The strategy formulation process involves setting objectives, evaluating the environment, setting targets, analyzing performance, and choosing a strategy. Modernization aims to improve current business processes. Diversification expands into new markets or products. A takeover case study examines Kraft's acquisition of Cadbury. Joint strategies and divestment are discussed as options.
This document provides an overview of strategic management concepts including generic strategic alternatives of stability, expansion, retrenchment, and combination strategies. It describes various types of strategies within each alternative such as concentration and diversification for expansion. It also discusses Porter's three generic strategies of cost leadership, differentiation, and focus. Business level strategy is defined as plans to compete within an industry through competitive or cooperative approaches.
Unit 3 Chapter 3 Strategic alternativesravalhimani
This document outlines various corporate level strategies including growth, stability, and retrenchment strategies. It discusses concentration, diversification, pause/proceed with caution, and turnaround strategies. The document also covers business level strategies like cost leadership, differentiation, and focus strategies. Finally, it discusses building and restructuring the corporation through various routes like start-ups, acquisitions, mergers, and divestments.
The document discusses various components of a decision support system that help decision making. It provides three examples:
1. Annual budgets which allocate money to activities/departments and are compared to actual expenditures in a feedback loop.
2. Daily financial statements like income, cash flow, and balance sheets that provide up-to-date information, especially on cash flow.
3. Daily ratios reports that analyze dozens of important company aspects like profits, returns, costs, and compare to history, competitors, and industry to identify deviations requiring intervention. Ratios help rationalize policies and warn of impending issues.
This document discusses corporate level strategy. It defines corporate strategy as strategic decisions that affect the entire organization, including financial performance, mergers and acquisitions, human resources, and resource allocation. The document discusses different growth strategies like market penetration, market development, product development, and diversification. It also discusses portfolio analysis tools like the BCG matrix and GE-McKinsey matrix that help evaluate different business units. Mergers, acquisitions, joint ventures, and strategic alliances are identified as ways to implement growth strategies.
Growth Strategies or Expansion Strategies
There are several ways for a business to grow or expand, including developing new products, entering new markets, increasing marketing, mergers and acquisitions, franchising, licensing, and initial public offerings. Ansoff's Growth Matrix is a common framework that considers growth through new and existing products and markets. Effective strategies require understanding customer needs, competitors, and having a clear vision and sales process. Examples demonstrate techniques like product diversification, market penetration, and market or product development.
The document discusses various growth strategies for organizations, including internal strategies like expansion, modernization, and diversification as well as external strategies like mergers, acquisitions, and joint ventures. Internal strategies relate to developing new products and services, expanding existing lines, and reaching new markets. External strategies involve combining with or purchasing other companies in order to enter new sectors, gain economies of scale, or access new technologies and markets. The document provides examples and definitions of different strategies.
The essay defines strategic management concepts like mission, vision, objectives, goals, and core competencies. It explains that a mission statement outlines an organization's purpose and priorities, while the vision statement describes the desired future state. Objectives and goals are measurable targets to work towards the vision. Core competencies refer to an organization's strengths that provide a competitive advantage. The essay distinguishes between these concepts and discusses their importance in strategic planning and business operations.
This series constitutes co-branding and corporate branding, where student will study how the brand partnership and corporate branding can result in making an image in the mind of customers.
The document discusses strategic alliances between companies. It defines a strategic alliance as when two or more independent organizations join together to pursue mutually agreed upon objectives. Companies form strategic alliances for reasons such as product development, market expansion, and improving existing product lines. Both companies benefit from bringing together their complementary resources, expertise, and skills. Strategic alliances allow partners to increase manufacturing capacity, access new markets, and develop innovative solutions beyond what either could achieve alone. The document provides examples of different types of strategic alliances across various industries.
Management by Objectives (MBO) is a strategic approach to enhance the performance of an organization.
It is a process where the goals of the organization are defined and conveyed by the management to the members of the organization with the intention to achieve each objective.
Management by exception is a business management strategy that states that managers and supervisors should examine, investigate and develop solutions for only those issues where there is a deviation from
set standards,
norms,
business practices,
or any other financial goals like profits deviation, quality issues, infrastructure issues, etc. instead of examining and dealing with each routine business activities.
This document discusses different forms of business organizations including sole proprietorship, joint Hindu family business, partnership, joint stock company, cooperative societies, holding and subsidiary companies, and international organizations. It provides details on the key features, advantages, and disadvantages of each form. Sole proprietorship is owned by an individual, while partnership involves two or more owners. A joint stock company has a separate legal identity from its owners. Cooperative societies are formed by individuals with common interests.
Before she became one of the biggest names in Philippines showbiz industry, Maymay Entrata also had her fair share of life struggles. Before she became one of the biggest names in Philippines showbiz industry, Maymay Entrata also had her fair share of life struggles.
Starting at the age of 14th, Entrata began auditioning for various reality television shows to fulfill her ambition of becoming an actress, but she failed. After being rejected several times, Entrata almost did not audition for Pinoy Big Brother Lucky 7 however, her grandfather got ill, she saw it as a reason to try again. Guess what? Entrata went on to win the competition, finally she did it. I really admire her for being who she is, what she is, and where she became. I am proud to say she is a bisaya and that's our biggest similarities. Her skills are one of a kind, she can act, dance, sing, and model. I really love how she boosts her confidence even though there are a lot of bashers around her, and I want to apply it to myself to be a strong and independent woman. Maymay is a beautiful and multitalented young woman with a wacky personality that’s extremely likable. She’s a dreamer and she never lost sight of them and who she’s dreaming it for.
I always admire people who dream big dreams and work hard to reach them. Watching Maymay everyday has given me inspiration to fight for my dreams and work hard even for those dreams I have let go because it deemed impossible.Before she became one of the biggest names in Philippines showbiz industry, Maymay Entrata also had her fair share of life struggles.
Starting at the age of 14th, Entrata began auditioning for various reality television shows to fulfill her ambition of becoming an actress, but she failed. After being rejected several times, Entrata almost did not audition for Pinoy Big Brother Lucky 7 however, her grandfather got ill, she saw it as a reason to try again. Guess what? Entrata went on to win the competition, finally she did it. I really admire her for being who she is, what she is, and where she became. I am proud to say she is a bisaya and that's our biggest similarities. Her skills are one of a kind, she can act, dance, sing, and model. I really love how she boosts her confidence even though there are a lot of bashers around her, and I want to apply it to myself to be a strong and independent woman. Maymay is a beautiful and multitalented young woman with a wacky personality that’s extremely likable. She’s a dreamer and she never lost sight of them and who she’s dreaming it for.
I always admire people who dream big dreams and work hard to reach them. Watching Maymay everyday has given me inspiration to fight for my dreams and work hard even for those dreams I have let go because it deemed impossible.
Starting at the age of 14th, Entrata began auditioning for various reality television shows to fulfill her ambition of becoming an actress, but she failed. After being rejected several times, Entrata almost did not au
This document discusses different levels and types of corporate strategies. It describes three levels that strategy can be formulated at: corporate, business unit, and functional. For corporate strategy, the document outlines growth, stability, and retrenchment strategies. Growth strategies include concentration strategies like horizontal and vertical growth as well as diversification strategies. Stability strategies involve pausing growth or maintaining the status quo. Retrenchment strategies are for weak competitive positions and include turnaround, becoming a captive company, selling out, or bankruptcy/liquidation. Combination strategies that blend these approaches are also discussed.
Blue Sky Organic Ventures Strategic Alliancesmarksv47
BlueSky Organic Ventures was founded in 2009 to provide business development, advisory, and strategic alliance services to companies in the natural, organic, and gluten-free lifestyle sectors. The company looks to partner with firms that offer unique products or brands and help them develop sustainable revenue channels in emerging markets through strategic partnerships. BlueSky was founded by Mark Vitcov who has over 17 years of experience in finance and private equity and has raised over $125 million for companies. One of BlueSky's core services is helping companies form strategic alliances to leverage growth, reduce costs and risks, and increase competitiveness and brand equity.
Strategy formulation is the process of using available knowledge to document the intended direction of a business and the actionable steps to reach its goals.
This process is used for resource allocation, prioritization, organization-wide alignment, and validation of business goals.
A successful strategy can allow your organization to share one clear vision, catch biases by examining the reasoning behind goals, and track performance with measurable key performance indicators (KPIs).
This document discusses different types of strategies that organizations use. It outlines four main types of strategies:
1. Integration strategies which include vertical and horizontal integration to control suppliers and buyers.
2. Intensive strategies like market penetration, market development, and product development to improve competitive position in existing markets and products.
3. Diversification strategies such as related and unrelated diversification to expand into new product lines and markets to reduce risk.
4. Defensive strategies including retrenchment, divestiture, and liquidation aimed at reducing losses through cost cutting, selling divisions, or fully liquidating assets.
The document provides examples for each type of strategy.
This document provides an overview of strategic management concepts including strategy, strategic management, SWOT analysis, and different types of business-level and corporate-level strategies. It discusses strategy formulation, implementation, and evaluation. Key points covered include the nature of strategic management, types of strategic alternatives like diversification, integration and concentration strategies. Frameworks for analyzing strengths, weaknesses, opportunities and threats are presented. Porter's generic strategies of cost leadership, differentiation and focus are also summarized. The document aims to help students understand the principles of strategic management and strategy planning.
The document discusses strategies for a firm's growth, including internal and external strategies. Internal growth strategies involve expanding within the organization, such as market penetration, market development, product development, and diversification. External growth strategies involve expanding outside the organization through mergers, acquisitions, joint ventures, strategic alliances, franchising, and licensing agreements. Firms must develop growth strategies tailored to their own characteristics and operating environment to most effectively increase objectives, broaden customer reach, and reduce costs.
The company is looking to expand into the apparel and shoes segment. An integrated cost leadership/differentiation strategy is recommended that allows the company to pursue both low cost and product differentiation. This involves efficiently producing apparel and shoes with unique attributes at low prices, providing good value. A focus strategy targeting specific buyer groups, product lines, or geographic markets could also work.
This document provides an overview of mergers and acquisitions (M&A) and common HR challenges. It discusses the basic concepts of M&A, including definitions of mergers and acquisitions. It also outlines reasons for M&A such as gaining synergies through reduced costs and expanded market access. Additionally, it describes the overall M&A process in five phases from pre-acquisition review to post-acquisition integration. HR challenges can arise during M&A from changes in company culture, leadership, and redundancy of roles which must be carefully managed.
The document discusses various strategic management concepts for tourism including strategy formulation, modernization, diversification, integration, takeovers, joint strategies, divestment, liquidation, and strategic choice. It provides definitions and examples of these concepts. The strategy formulation process involves setting objectives, evaluating the environment, setting targets, analyzing performance, and choosing a strategy. Modernization aims to improve current business processes. Diversification expands into new markets or products. A takeover case study examines Kraft's acquisition of Cadbury. Joint strategies and divestment are discussed as options.
This document provides an overview of strategic management concepts including generic strategic alternatives of stability, expansion, retrenchment, and combination strategies. It describes various types of strategies within each alternative such as concentration and diversification for expansion. It also discusses Porter's three generic strategies of cost leadership, differentiation, and focus. Business level strategy is defined as plans to compete within an industry through competitive or cooperative approaches.
Unit 3 Chapter 3 Strategic alternativesravalhimani
This document outlines various corporate level strategies including growth, stability, and retrenchment strategies. It discusses concentration, diversification, pause/proceed with caution, and turnaround strategies. The document also covers business level strategies like cost leadership, differentiation, and focus strategies. Finally, it discusses building and restructuring the corporation through various routes like start-ups, acquisitions, mergers, and divestments.
The document discusses various components of a decision support system that help decision making. It provides three examples:
1. Annual budgets which allocate money to activities/departments and are compared to actual expenditures in a feedback loop.
2. Daily financial statements like income, cash flow, and balance sheets that provide up-to-date information, especially on cash flow.
3. Daily ratios reports that analyze dozens of important company aspects like profits, returns, costs, and compare to history, competitors, and industry to identify deviations requiring intervention. Ratios help rationalize policies and warn of impending issues.
This document discusses corporate level strategy. It defines corporate strategy as strategic decisions that affect the entire organization, including financial performance, mergers and acquisitions, human resources, and resource allocation. The document discusses different growth strategies like market penetration, market development, product development, and diversification. It also discusses portfolio analysis tools like the BCG matrix and GE-McKinsey matrix that help evaluate different business units. Mergers, acquisitions, joint ventures, and strategic alliances are identified as ways to implement growth strategies.
Growth Strategies or Expansion Strategies
There are several ways for a business to grow or expand, including developing new products, entering new markets, increasing marketing, mergers and acquisitions, franchising, licensing, and initial public offerings. Ansoff's Growth Matrix is a common framework that considers growth through new and existing products and markets. Effective strategies require understanding customer needs, competitors, and having a clear vision and sales process. Examples demonstrate techniques like product diversification, market penetration, and market or product development.
The document discusses various growth strategies for organizations, including internal strategies like expansion, modernization, and diversification as well as external strategies like mergers, acquisitions, and joint ventures. Internal strategies relate to developing new products and services, expanding existing lines, and reaching new markets. External strategies involve combining with or purchasing other companies in order to enter new sectors, gain economies of scale, or access new technologies and markets. The document provides examples and definitions of different strategies.
The essay defines strategic management concepts like mission, vision, objectives, goals, and core competencies. It explains that a mission statement outlines an organization's purpose and priorities, while the vision statement describes the desired future state. Objectives and goals are measurable targets to work towards the vision. Core competencies refer to an organization's strengths that provide a competitive advantage. The essay distinguishes between these concepts and discusses their importance in strategic planning and business operations.
This series constitutes co-branding and corporate branding, where student will study how the brand partnership and corporate branding can result in making an image in the mind of customers.
The document discusses strategic alliances between companies. It defines a strategic alliance as when two or more independent organizations join together to pursue mutually agreed upon objectives. Companies form strategic alliances for reasons such as product development, market expansion, and improving existing product lines. Both companies benefit from bringing together their complementary resources, expertise, and skills. Strategic alliances allow partners to increase manufacturing capacity, access new markets, and develop innovative solutions beyond what either could achieve alone. The document provides examples of different types of strategic alliances across various industries.
Management by Objectives (MBO) is a strategic approach to enhance the performance of an organization.
It is a process where the goals of the organization are defined and conveyed by the management to the members of the organization with the intention to achieve each objective.
Management by exception is a business management strategy that states that managers and supervisors should examine, investigate and develop solutions for only those issues where there is a deviation from
set standards,
norms,
business practices,
or any other financial goals like profits deviation, quality issues, infrastructure issues, etc. instead of examining and dealing with each routine business activities.
This document discusses different forms of business organizations including sole proprietorship, joint Hindu family business, partnership, joint stock company, cooperative societies, holding and subsidiary companies, and international organizations. It provides details on the key features, advantages, and disadvantages of each form. Sole proprietorship is owned by an individual, while partnership involves two or more owners. A joint stock company has a separate legal identity from its owners. Cooperative societies are formed by individuals with common interests.
1. Sole proprietorship
2. Joint Hindu family business
3. Partnership
4. Joint-stock Company
5. Cooperative Societies
Sole Proprietorship
It is a form of organisation owned, managed and controlled by an individual (also known as a sole proprietor) who is responsible for bearing all the risk and receiving all the profit.
Features
• The sole proprietor can establish and close the business without any legal formalities.
• The liability of the sole proprietor is unlimited.
• Being the sole owner, the sole proprietor bears all the risk and receives all the profits.
• All the decisions are taken and implemented in the organisation by the owner.
• Owners and businesses have no separate entity and are considered one in the eyes of the law.
• Even in case of a lack of business continuity, the business can continue until the owner wants.
Advantages
• Prompt decision-making as all the decisions are to be taken by the owner.
• Being a sole owner, it is easy to maintain business secrecy.
• The owner enjoys all the profits as there is no one to share profits.
• A successful business provides satisfaction to the owner and a sense of achievement.
• No legal formalities are required for a business’s formation and closure, making it easy to start and end the business.
Disadvantages
• Due to limited resources, a business can be funded from the owner’s savings or money borrowed from friends or relatives.
• The business’s continuity depends on the owner’s health and state of mind.
• If the business fails to repay debts, the sole proprietor’s personal assets are at risk.
• One person may not possess the ability to manage all the functions.
Joint Hindu Family Business
In this form of business organisation, the business is owned and managed by the members of an undivided Hindu family, with the possibility of three successive generations as members of the business.
Features
• The business is formed with at least two members of a Hindu Undivided Family having ancestral property. The Hindu Succession Act, 1956, governs it.
• Except for Karta, all the family members have limited liability up to their share in the business property.
• Karta has the right to control all the activities in the business organisation.
• The business can be discontinued based on the consent of all the members of the family.
• Membership in the organisation is by birth.
Advantages
• Karta has complete control of the business, thus effective decision-making is ensured.
• The business continues till all the members wish to continue, and control is transferred to the next elder member in case of the death of ‘Karta’.
• Members of the family enjoy liability limited to their share in the business party.
• All the work is done with the common objective of growth as the family members have a sense of belongingness and loyalty.
Limitations
• Due to limited financial resources, businesses can be funded mainly from ancestral property.
Organization is the backbone of management. Sound organization contributes greatly towards continuity & success of the organization.
Organizing is the process of integrating the physical, financial & human resources & establishing the productive relationship across them to accomplish the pre-determined goals.
It is concerned with the building up a stable framework or structure of various inter-related parts of the enterprise; each part having its own function & being centrally regulated.
Basic principles of organizing: Achievement of Goal
Division of work
Well defined jobs & Authority
Discipline
Co-ordination
Security & support
Better Human Relation
Adaptability
Formal organization consists of pre defined goal & well defined structure of the jobs having clear cut authority & responsibility.
It is based on basic rules, regulations, principles & practices where employees accomplish their task & achieve the goal of the organization.
In formal organization each & every employee is responsible for his/her own task & performance.
Examples: Production house & Service sectors
Informal organization values both personal & social relationship which is spontaneously established within the formal set up.
There is not any strict rules & regulations, but there is high scope of liberty & feelings.
The relationships are voluntary based on emotional set up. Therefore, no conscious effort is required to hold the relations.
Examples: friendship group.
Both formal & informal organizations play very vital role in organizational set up. Formal organizations work independently & informal organizations depend upon formal organizations.
Line organization is the most oldest & simplest form of administrative organization.
Line organization is also known as scalar organization as authority flows from top to bottom.
There is the line officer who has unified control and independent decision making power in their field.
Specialized or supportive services do not take place in line organizations.
There is also inadequate communication & some times lack of proper co-ordination due to one way communication.
Example: President, Vice President, Supervisor & Employees.
Line & Staff organization is a modification of the line organization & it is more complex than the pure line organization.
In this kind of organization, line officers & staff officers (Generalists & Specialists) work together. Line officers plan & execute the work whereas staff officers play advisory role.
Power of command remains with the line executives & staff serves only as counselors who reduce the burden of the line managers & help to take quick decision.
Centralization refers to the process in which organizations take decisions & plan. The decision making power is retained in the hand of the head of the organization & all other employees have to obey this.
Decentralization is just the opposite of centralization. It refers to delegation of decision making authority through out an organization.
Henry Fayol is known as the Father of “Administrative Management”. He contributed fourteen management principles on the basis of his experience.
According to Fayol, the business operations of an organization can be divided into six activities: Technical, Commercial, Financial, Security, Accounting & Managerial.
These fourteen principles are: Specialisation of Labour, Authority, Discipline, Unity of Command, Unity of Direction, Subordination of Individual Interests, Remuneration, Centralization, Scalar Chain, Order, Equity, Personal Tenure, Initiative & Esprit de corps (SADUSRCSOEPIE).
Weber believed that bureaucracy was the most efficient way to set up & manage an organization, and absolutely necessary for larger companies to achieve maximum productivity with many employees & tasks.
The idea of Bureaucracy Favors efficiency, uniformity & a clear distribution of power.
Weber argued that bureaucracy constitutes the most efficient & rational way in which human activity can be organised.
Hierarchies are necessary to maintain order, to maximise efficiency & to eliminate favouritism.
The Hawthorne Studies (Experiments) were conducted from 1927-1932 at Western Electric Hawthorne Workers in Chicago ; which was engaged in producing bells & other electrical equipment for telephone industry.
George Elton Mayo (1880-1949) was born on 26th December, 1880 in Adelaide, Australia. He is known for his research including the “Hawthorne Studies”, & his book “The human problems of an Industrialised civilization”.
The conclusion of the study is the work performance of people is dependent on both social issues & job content. He suggested a tension between workers’ “logic of sentiment” & managers “logic of cost & efficiency” which could lead to conflict within organizations.
Mayo has conducted a series of experimental observations in plant & interview of employees. These are:
Illumination Experiment (1924-27)
Relay Assembly Test Room Experiments (1927)
Mass Interviewing Programme (1928-31)
Bank Wiring Observation Room Experiments (1931-32)
Chester Irving Barnard was a telecommunication executive looked at systems of the organization.
The author focused on two basic theories: the theory of Authority & theory of initiatives. Both are seen in the context of a communication system.
Everyone should know the channels of communication.
Everyone should have access to the formal channels of communication.
Lines of communication should be a short & as direct as possible.
Mary Parker Follett has focused on dynamics of the organization & groups. She has advocated “Pull” rather than “Push” approach for employee motivation.
She has differentiated between “Power Over” & “Power With” and given ideas on negotiation, conflict resolution, power sharing etc.
Conflict resolution through integration often results in a win-win situation. Integration refers to identifying & meeting each party’s underlying & often compatible need.
In Pre-classical theory the structure of the organization is mechanical.
Its main focus is on work.
It emphasizes on order, rules & regulations.
The practice of leadership is authoritarian.
It focuses on 5Ps: Power, Position, Production, Profit & Punishment.
It results workers’ dis satisfaction.
As a result Industrial Revolution got its root
Classical Theory emphasizes on both orders & rationality. It consists of basic rules & regulations for smooth running of the organizations.
Classical approaches can be explained in the following manner.
Scientific Management by F.W. Tayler, Frank & Gilbreth & Henry Gantt.
Administrative Management by Henri Fayol.
Bureaucratic Management by Max Weber
Frederick Winslow Taylor was an American engineer who is known as the Father of “Scientific Management” which studies the application of science in management.
According to Taylor there is “One Best Way” to do each thing.
He stressed on involvement of science for each element of man’s work to replace the old rule-of-thumb method.
Scientific training & development helped workers to perform in a better manner than allowing them to choose their own task & perform.
There was the development of spirit of hearty cooperation between workers & management.
Each group was assigned the task for which it was best fitted.
The father of “Motion Study” are Frank & Gilbreth which involves finding the best sequence & minimum number of motions needed to complete a task.
Both were mainly involved in exploring new ways for eliminating unnecessary motions & reducing work fatigue.
They introduced the concept of “Therbligs” which consists of different basic motions like: Search, Select, Position & Hold.
Both are very famous for their experiment of reducing the number of motions in “Bricklaying”, by analyzing brick layers jobs & reducing the number of motions in bricklaying from 18.5-4.
Henry Laurence Gantt was a mechanical engineer & management consultant who is the most famous personality for developing “Gantt Chart” in 1910.
He is one of the associate of F.W. Taylor & his contribution is very helpful in project management task.
Gantt Chart is used for scheduling multiple overlapping tasks over a time period.
He focused on leadership qualities along with motivational schemes & emphasized the greater effectiveness of rewards for good work rather than penalties for poor performance.
He developed a “Pay Incentive System” with a guaranteed minimum wage & bonus for workers. If the workers completed their task before the standard time they would receive bonus definitely.
Henry Fayol is known as the Father of “Administrative Management”. He contributed fourteen management principles on the basis of his experience.
According to Fayol, the business operations of an organization can be divided into six activities: Technical, Commercial, Financial, Security, Accounting & Managerial.
These fourteen principles are: Specialisation of Labour, Authority, Discipline, Unity of Command, Unity
In Pre-classical theory the structure of the organization is mechanical.
Its main focus is on work.
It emphasizes on order, rules & regulations.
The practice of leadership is authoritarian.
It focuses on 5Ps: Power, Position, Production, Profit & Punishment.
It results workers’ dis satisfaction.
As a result Industrial Revolution got its root
Classical Theory emphasizes on both orders & rationality. It consists of basic rules & regulations for smooth running of the organizations.
Classical approaches can be explained in the following manner.
Scientific Management by F.W. Tayler, Frank & Gilbreth & Henry Gantt.
Administrative Management by Henri Fayol.
Bureaucratic Management by Max Weber
Frederick Winslow Taylor was an American engineer who is known as the Father of “Scientific Management” which studies the application of science in management.
According to Taylor there is “One Best Way” to do each thing.
He stressed on involvement of science for each element of man’s work to replace the old rule-of-thumb method.
Scientific training & development helped workers to perform in a better manner than allowing them to choose their own task & perform.
There was the development of spirit of hearty cooperation between workers & management.
Each group was assigned the task for which it was best fitted.
His studies helped to improve the working conditions of industrial workers & were instrumental in enhancing the productivity of the organization.
He propounded sound management practices by stressing on division of labor, scientific selection, placement & training of workers.
Taylor was also instrumental in introducing the differential piece rate system in organization.
His studies helped to improve the working conditions of industrial workers & were instrumental in enhancing the productivity of the organization.
He propounded sound management practices by stressing on division of labor, scientific selection, placement & training of workers.
Taylor was also instrumental in introducing the differential piece rate system in organization.
Piece Rate-Incentive System: Incentives are being received according to the maximum pieces produced.
Time-&-Motion Study: Jobs are broken down into various small tasks or motions & unnecessary motions are removed to find out the best way of doing a job.
Scientifically performing the job with proper selection & training.
Harmony between management & employees to perform the task.
Mental revolution towards the thought of workers who are not the mere wage earners. They are the assets.
The father of “Motion Study” are Frank & Gilbreth which involves finding the best sequence & minimum number of motions needed to complete a task.
Both were mainly involved in exploring new ways for eliminating unnecessary motions & reducing work fatigue.
They introduced the concept of “Therbligs” which consists of different basic motions like: Search, Select, Position & Hold.
Nature & characteristics of Management.pptxdebajanipalai
Management is goal oriented as every organization has to achieve some specific predetermined goals.
To achieve goals managers have to formulate, implement & control plans & programs.
Goals can be further divided into objectives & then tasks can be assigned.
To achieve goals & objectives organizations are connected with group of people.
Every organization focuses on team work. In a team there are different types of personnel who have different knowledge, skill & ability along with diversified age, gender & religion.
Organizations maintain unity in diversity and act as a group to accomplish the tasks.
Management makes different rules & imposes authority for the smooth run of the organization.
It has to maintain proper superior-subordinate & peers relationship.
It clearly indicates who is accountable towards whom, who will perform what activity etc.
Management states getting things done by others. It involves delegation of authority.
In order to achieve goals & objectives management has to direct, coordinate & regulate personnel.
To get optimum output management makes proper allocation & utilization of resources which can be done through social process.
Management is applicable to all-over the world.
The organization may be big or small, private or public undertaking management plays very vital role.
As a dynamic function management has to change policies & processes according to change in environment.
Organization consists of three levels to be managed. These are:
Top level
Middle level
Lower level
Management is different from activities, processes & techniques.
It has to achieve goals & objectives of the organization by preparing strategy.
It has to make planning, organizing, staffing, leading & controlling
Management means manage men tactically & getting things done through others which act can not be seen, but felt only.
The manager is tangible, but skill of management is intangible.
Management integrates different functional areas such as: marketing, finance, production, operation, human resource, research & development etc.
It also focuses on different divisions such as: customer, product, geographic etc.
It co-ordinates individual efforts into teams.
Management means proper allocation & utilization of resources to achieve the goals of the organization.
Our resources are 6Ms, 2Is & T.
6Ms are: Man, Money, Material, Method & Market.
2 Is are: Idea & Information.
T stands for Time.
Mary Parker Follett : Management is an art of getting things done through others.
Peter Drucker: Management is doing the things right & Leadership is doing the right things.
Peter Drucker: Management is a multi-purpose organ that manages business & manages managers & manages workers & work.
Henry Fayol: Management is the systematic process of five functions; Planning, Organizing, Commanding, Coordinating & Controlling.
According to Fayol, to manage is to forecast & to plan, to organize, to command, to coordinate & to control.
Harold Koontz: Management is the art of getting things done by others & with people in formally organized groups.
The concept of management consists of four following points.
Management as an activity
Management as a group
Management as a discipline
Management as a process
Management as both Science & Art
Nature & characteristics of Management.pptxdebajanipalai
Goal oriented
Group activity
System of authority
Social process
Universal
Levels of management
Dynamic concept
Distinct feature
Intangible
Integrated
Multi disciplinary
Science-Art-Profession
Henry Mintzberg has identified ten common roles of all managers.
The roles are divided into three groups:
Interpersonal
Informational
Decisional
Under interpersonal role management involves managers to act as:
Figurehead
Leader
Liaison manager
Figurehead performs ceremonial & symbolic duties such as greeting visitors, signing legal documents, attaining social functions etc. on behalf of the organization.
As a Leader managers have to direct & motivate subordinates, provide training & counselling etc.
As a Liaison manager maintains information, links both inside & outside organizations through mail, phone, meeting etc.
Under informational role managers have to play as:
Monitor
Disseminator
Spokes person
The main role of a Monitor is to seek & receive information, scan periodic reports & maintain personal contacts.
Disseminator has to forward information to other members of the organization through memos, reports, phones etc.
Spokes Person transmits information to outsiders through speeches, reports etc.
Under decisional role managers have to act as:
Entrepreneur
Disturbance handler
Resource allocator
Negotiator
Entrepreneur has to indicate projects, identify new ideas, focus on creativity, take risk & exploit opportunities.
As a Disturbance Handler manager takes corrective action during disputes or crises. Managers have to resolve conflicts among subordinates & remain adaptive to face environmental changes & challenges.
As a Resource Allocator manager decides allocation of resources on priority basis & prepares budget.
A Negotiator represents department during negotiation of union contracts, sales, purchases etc.
Robert Katz has suggested three managerial skills that are essential to the success of management.
These skills are:
Technical
Human
Conceptual
Technical skill involves process or technical knowledge & proficiency.
It belongs to the lower level of the hierarchy.
Managers use the processes, techniques & tools of a specific area.
It is the ability & knowledge needed to accomplish complex action actions, tasks & processes.
Human skill involves the ability to interact effectively with people.
Middle level managers should have strong human skill.
Managers interact & cooperate with employees. Human relations skills are directly related to a manager’s leadership abilities.
It focuses on the ability to get things done by understanding & working through others outside of formally prescribed organizational mechanisms is crucial for managerial success.
Conceptual skill involves the formulation of ideas.
It is associated with top level management.
Managers understand abstract relationships, develop ideas & solve problems creatively.
Conceptual skill focuses on the ability to see the enterprise as a whole & recognise how various functions of the organization are interrelated & how changes in one part affect all the others.
It helps to visualize internal & external relationship.
Example: Articulating a vision for the organization
The levels of management refers to a line of action between various managerial positions in the organization.
It determines a chain of command, the elasticity of authority & status enjoyed by each managerial position.
The levels of management can be broadly categorized into three parts such as:
Top Level
Middle Level
Lower Level
Top level management consists of directors, CEO & MD.
The top level sets the vision & formulates the strategy to achieve it.
It is responsible for strategy implementation & evaluation.
It devotes maximum time on planning. Co-ordinating, directing & controlling.
Top management lays down the objectives & broader policies of the organization.
It issues necessary instructions for preparation of departmental budgets, different procedures & schedules.
It prepares strategic plans & policies for the enterprise.
It appoints executives or divisional heads for middle level.
It deals with both internal & external environment of the organization.
The divisional managers, departmental or branch managers constitute middle level.
They are accountable to the top management for the functioning of their department.
They devote more time to organizational & directional functions.
In small organizations, there is only one layer of middle level of management, but in large organizations, there may be senior & junior middle level management.
Middle level managers execute plans of organization in accordance with the policies & directives of the top management.
They make plans for the sub-units of the organization.
They participate in employment & training of lower level management.
They interpret & explain policies from top level management to lower level.
The middle level managers are responsible for coordinating the activities within the division or department.
It sends important reports & other important data to top level management.
They evaluate performance of junior managers.
They are responsible for inspiring lower level managers towards better performance.
Lowe level is also known as supervisory or operative level of management.
It consists of supervisors, foreman, section officer & superintendent.
The managers direct operative employees.
They are concerned with direction & controlling function of management
Assigning of jobs & tasks to various workers.
Guide & instruct workers for day-to-day activities.
They are responsible for the quality as well as quantity of production.
They are entrusted with the responsibility of maintaining good relation in the organization.
They communicate workers problems, suggestions & recommendatory appeals etc. to the middle level.
Lower level management helps to solve the grievances of the workers.
They supervise & guide the sub-ordinates.
They are responsible for providing training to the workers.
They arrange necessary materials, machines, tools etc. for getting the things done.
They prepare periodical reports about the performance of the workers.
They ensure discipline in the enterprise.
They mot
Management means proper allocation & utilization of resources to achieve the goals of the organization.
Our resources are 6Ms, 2Is & T.
6Ms are: Man, Money, Material, Method & Market.
2 Is are: Idea & Information.
T stands for Time.
Management also means manage men tactfully to fulfill the vision of the organization.
Management is the application of knowledge & skill of managers to achieve the goals & objectives of the organization.
Mary Parker Follett : Management is an art of getting things done through others.
Peter Drucker: Management is doing the things right & Leadership is doing the right things.
Peter Drucker: Management is a multi-purpose organ that manages business & manages managers & manages workers & work.
Henry Fayol: Management is the process of five functions; Planning, Organizing, Commanding, Coordinating & Controlling.
Henry Fayol: Management is the systematic process of five functions; Planning, Organizing, Commanding, Coordinating & Controlling.
According to Fayol, to manage is to forecast & to plan, to organize, to command, to coordinate & to control.
Harold Koontz: Management is the art of getting things done by others & with people in formally organized groups.
The concept of management consists of four following points.
Management as an activity
Management as a group
Management as a discipline
Management as a process
As an activity management plans & controls human efforts to achieve common goals of an organization.
Management has to play different roles like:
Interpersonal
Informational
Decisional
Under interpersonal role management involves managers to act as:
Figurehead
Leader
Liaison manager
Under informational role managers have to play as:
Monitor
Disseminator
Spokes person
Under decisional role managers have to act as:
Entrepreneur
Disturbance handler
Resource allocator
Negotiator
As a group management consists of personnel from top level to bottom level such as : BOD, CEO, Departmental Heads, Functional Heads & many others.
There are several types of managers such as:
Family managers
Professional managers
Civil managers
Management as a discipline deals with specific areas such as:
Production
Marketing
Sales
Finance
Research & Development
HR etc
Management as a discipline focuses on different principles & theories.
HRA is the systematic process of identifying, measuring & communicating data about human resources.
According to Flamhoitz HRA involves measuring the costs incurred by business firms & other organizations to recruit, select, hire, train & develop human assets.
HRA therefore, shows how the organization makes investment in its people & how the value of the people change over time. Value of the employees increases by training (the core HRD activity ) & experience over a time period.
With the help of HRIS (personal profile, career profile, benefits profile ) organizations collect basic information while doing HRA.
Personal profile – name, age, gender, address, phone number, service date.
Career profile – education, training, certificate, license, degrees, skills, hobbies, requisite training etc.
Benefits profile – insurance coverage, disability provisions, pension, profit sharing, vacation, holidays, sick leave etc.
HRIS consists of
Number of employees
Categories
Grades
Total value of HRs
Value per employee
Number of employees acquired during the year
Cost of acquisition
Levels for which they were acquired
HR development
HR maintenance
Cost related to HR maintenance
HR separation
Cost related to HR separation
Detail of benefits provided to the employee
Methods of evaluation can be non-monetary & monetary
Non- monetary measures – It involves the classification of human resources in terms of skills, performance evaluation, potentiality for development & promotion, attitude surveys & subjective values
Skill is coordinated series of actions to attain some goal. Skills are defined widely as overt responses & controlled stimulation.
Overt responses may either be verbal, motor or perceptual.
Verbal responses typically stress on speaking.
Motor responses stress on movements of limbs & body.
Perceptual responses stress on understanding of sensory responses.
Controlled stimulation are energy inputs to the workers which we express in units of frequency, length, time & weight.
Monetary measures are
Capitalization of historical costs method
Replacement cost method
Opportunity cost method
Economic value method
Present value method
Historical cost method was developed by Likert.
It capitalizes all costs of recruitment, hiring, training & other initial costs involved in the development of HRs.
The amount which is capitalized is written off over the period of an employee remains with the organization.
If he leaves before the expected service period, the amount remaining as an asset is written off in the year of leaving.
Replacement cost method measures the cost to replace an organization’s existing human resources.
It indicates what it would cost the concern to recruit, hire, train & develop human resources to match the present level of efficiency.
Under opportunity cost method, the value of HRs is determined on the basis of the value of an individual employee in an alternative use.
If an employee can be hired externally, there is no opportunity cost for him.
Internal Factors consist of
JOB ANALYSIS – It is a basic exercise of HRM which provides the necessary inputs for both Job Description & Job Specification. Job description consists of information related to jobs ( job characteristics, location, physical setting, hazards & discomforts of a job, responsibility related, materials, tools & equipments required, nature of operation etc). Job specification specification focuses on the information related to the employee who will perform that job ( personal attributes like – experience, training, physical strength, mental capabilities , education required for efficient performance of the job etc ).
MGT POLICIES – Policies related to vision, mission, goals & objectives. Under management policies we can also discuss about production operation such as – what products are produced in terms of quantity & quality. To achieve that particular level, employees are required.
.HR POLICIES – A policy is a pre determined established guideline towards the attainment of accepted goals & objectives. So HR policies are basic guidelines related to recruitment, selection, placement, induction, performance appraisal, remuneration & reward, training, labor relations, QWL etc. All these policies influence HR Planning.
COMPANY STRATEGIES – Different companies follow different strategies such as expansion, diversification etc & on these basis HRP will be designed.
COMPETITIVE STRATEGIES – Cost leadership, differentiation, focus etc. are competitive strategies which influence HRP
External factors are also known as Environmental factors which are beyond direct control of any organization. So environmental feed back plays very important role in strategy formulation & implementation. Those who are always active towards environmental changes appoint knowledgeable employees, who help to collect accurate information & prepare strategy.
POLITICAL FACTORS – Political & legal factors such as GOVT. rules & regulations influence HRP. For example – policies related to industrial relation, quota & reservation system, different Acts related to factory, mines, disputes, compensation, etc.
ECONOMIC FACTORS – The country which is economically developed have high employment rate, high standard of living & low poverty. It basically focuses on selection of HRs qualitatively & takes steps for training & developmental needs of employees.
SOCIAL FACTORS – Rapid changes in social conditions influence HRP. For example – nuclear family, employment of women, elementary education, community development programs & other welfare activities etc. similarly there is rapid change in our traditions , false beliefs & old thoughts which influence HRP.
TECHNOLOGICAL FACTORS – Due to globalization MNCs can easily operate in every country. MNCs bring developed technology. Technology determines the HRs required in the organization. To run large scale industries heavy machineries are required & to run those efficient HRs are required.
A career is defined as a sequence of related jobs and work activities over a person's lifetime. It involves progression to roles with increasing responsibility, status, and rewards within an organization. Career development is the systematic process of planning one's career path and developing necessary skills. It involves different stages - exploratory, establishment, maintenance, and decline. The goals of career development programs are to attract, retain, and motivate employees while allowing them to advance their skills and roles over time.
MRA has been developed by Youdi in 1985. It is one of the dominant model of MPP.
It establishes linear relationship between manpower category in different industry groups & their output.
Example – This model is used by our country for the educational planning at the national level.
This model consists of 3 steps. These are
(a) Assessing the demand for manpower,
(b)Assessing the supply of manpower,
( c)Balancing the supply & demand.
Demand side consists of some basic aspects such as –
Estimation of future level of GDP.
Estimation of distribution of output by economic sectors.
Estimation of labor productivity by economic sector.
Estimation of occupational structure of labor force within economic sectors.
Estimation of educational structure of the labor force in given occupations within economic sectors over time.
Supply side consists of Estimation of population & categorization on the basis of age, gender & educational level.
Estimation of number of graduates.
Distribution of labor force & participation rates to the number of graduates.
Estimation of occupational supply based on the labor supply by education level.
While developing a MPP if the planner is too optimistic about labor productivity, his forecasting may fall short of actual labor demand & labor force participation rate can increase the actual supply of labor.
So it is very important to maintain a balance in between demand for & supply of man power.
Sometimes due to poor data quality it then tends to use an ad hoc adjustment mechanism which is helpful to revise one or more of the key assumptions.
RRA is also known as cost-benefit analysis of human capital.
It is applied to decide the aggregate investment requirement for different skill development.
Cost & earnings of an individual over his productive life cycle is computed first & then their discounted value is estimated to assess the rate of return.
PORTFOLIO RESTRUCTURING/BUSINESS PORTFOLIO ANALYSIS:
Large diversified organizations basically use combination strategy. For example: an organization may simultaneously seek growth through the acquisition of new businesses, employ a stability strategy for some of it existing businesses and divest of any other business which runs in loss.
It is very complicated to identify a consistent strategy for large diversified organizations, because a number of different business-level strategies need to be coordinated to achieve overall organizational objectives.
Business portfolio models are tools for analyzing: the relative position of each of an organization’s businesses in its industry & the relationships among all the businesses of the organization.
The well-known approaches to develop business portfolio include: BCG Matrix, GE 9 Cell, 7s Framework & Balance Score Card.
BCG Matrix is also known as BCG Growth-Share Matrix.
It states that the organization should have a balanced portfolio of businesses such that some generate more cash than they use and can support other businesses that need cash to develop & become profitable.
The role of each business is determined on the basis of two factors: the growth rate & market share
The vertical axis indicates the market growth rate which is the annual growth percentage of the market (current or forecasted) in which the business operates.
The horizontal axis indicates the market share dominance or relative market share. It is computed by dividing the firm’s market share (in units) by the market share of the largest competitor.
The matrix is the combination of rows & columns. The growth-share matrix has four cells.
A star is the market leader in a high growth market (HMS & HMG). They are question mark business that become successful.
The organization has to spend a great deal of money keeping up with the market’s growth rate & fighting off competitor’s attack.
Stars are often cash using category rather than cash generating. They are profitable units and provide high ROI as compared to others.
Hold strategy is maintained for this success and benefit from market growth by means of a Star.
Question mark is also known as problem child as it operates in high growth market, but low relative market share (LMS & HGR).
The term question mark or problem child is well chosen, because the organization has to think hard about whether to keep investing funds to become a star or it comes down to dog category.
Most business start off as question marks, in that they enter in a high growth market in which there is already a leader.
A question mark generally requires the infusion of a lot of funds to keep adding plant, equipment, personnel to keep up with fast growing market & it wants to overtake the leader.
Build strategy is appropriate for question mark as it increases share inorder to become a star by creating a new brand and a new target audience.
Question mark is also known as problem child as it operates in high growth.
STRATEGY FORMULATION, IMPLEMENTATION, EVALUATION & CONTROL:
Strategy formulation includes planning & decision-making and developing plans to achieve organizational goals & objectives.
It is an entrepreneurial activity based on strategic decision making to reach at vision.
It demands co-ordination of personnel of each and every level of organizational hierarchy.
It requires strong analytical and conceptual skill.
Choice of strategy involves understanding and choosing the best formulated strategy across different strategic alternatives.
Its first step is SWOT analysis.
Management needs to seek to identify & evaluate alternative courses of action to ensure that the business reaches the objectives they have set.
It is a creative process of generating alternatives, building on the strengths of the business & allowing it to tackle new products or markets to improve its competitive position.
STEPS IN STRATEGIC CHOICE
Strategy formulation
Focusing on strategic alternatives
Evaluating strategic alternatives
Considering decision factors
Choice of strategy.
Strategy implementation involves all those means related to executing the strategic plans.
It is mainly a administrative task based on strategic & operational decisions.
It is an operational process which requires co-ordination among all employees.
It requires specific leadership & motivational traits
Evaluation of strategy is as significant as strategy formulation because it throws light on the efficiency & effectiveness of comprehensive plans in achieving the desired results.
The managers can also assess the appropriateness of the current strategy in today’s dynamic world which is influenced by PEST (Political, Economic, Social & Technological )
It is very significant because of various factors such as: developing inputs for new strategic planning, the urge for feedback, appraisal & reward, development of strategic management process, judging the validity of strategic choice etc.
PROCESS/ STEPS OF STRATEGIC EVALUATION
Setting standard performance or expected performance or benchmarking performance.
Measure the actual performance.
Analyzing the variance by comparing standard and actual performance.
Taking corrective action to achieve the target
LECT-8-Global Environment In Corporate Strategy.pptxdebajanipalai
Global Environment:
Global environment is the most vital component of macro environment.
It refers to operating in more than one country in the world & gain its R & D, production, marketing & financial advantages in terms of cost & reputations that are not available to domestic competitors.
Globalization of markets refers to the process of integrating & merging of world markets into a single market. This process involves the identification of some common norm, value, taste, preference & cultural shift towards the use of common product or services.
The Example of products having global acceptance are: Coca-Cola, Pepsi, Mc Donald’s, Citicorp Credit cards etc.
Characteristics of Global Environment:
Global Environment treats the whole world as a common village focuses on how organizations are related to each other.
It consists of a set of fresh beliefs, working methods, economic, political and socio-cultural relatives in business.
It integrates the world economy & opens scope for new potential of huge market.
It intends to remove all global barriers among countries.
Global Company:
Global company is a firm which having multiple units that are located in different parts of the world, but all are being linked by common ownership of umbrella.
Global multiple units draw a common pool of resources like: money, credit, information, patent, trade name & control system.
Its shareholders & human capital are of different nations. The company follows common strategy to sell its products in most of the countries.
Reasons For Globalization:
The large scale industries have mass production. So they focus on foreign market.
They try to reduce the risk of diversity of portfolio of countries.
Companies globalize markets in order to increase their profits & achieve goals.
The adverse business environment in the home country pushes the companies to globalize their market.
The failure of domestic companies in catering the needs of their customers pulled the foreign countries to market their products.
It is particularly important to industries which are directly depending on imports & exports.
Advantages Of Globalization:
Free flow of capital & increase in the total capital employed.
Free flow of technology from developed countries to developing countries.
Increase in industrialization.
Spread production facilities throughout the globe.
Balanced development of world economies.
Increased in production & consumption of outputs.
Commodities available at lower price with high quality.
Cultural exchange & demand for a variety of products in foreign market.
Increase in job opportunities & income for the country along with welfare & prosperity.
Disadvantage Of Globalization:
Globalization kills domestic small business firms.
It exploits human resources in global firms.
It leads to unemployment & underemployment in developing countries.
It declines income & standard of living due to unemployment & increases high gap between rich & poor.
12 steps to transform your organization into the agile org you deservePierre E. NEIS
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Originally presented at XP2024 Bolzano
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In this talk we'll have a look to the cumulative effect of the constraints of a remote working environment and of the common countermeasures.
A presentation on mastering key management concepts across projects, products, programs, and portfolios. Whether you're an aspiring manager or looking to enhance your skills, this session will provide you with the knowledge and tools to succeed in various management roles. Learn about the distinct lifecycles, methodologies, and essential skillsets needed to thrive in today's dynamic business environment.
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2. STRATEGIC INTENT
Strategic intent is an aspirational plan which is helpful to achieve the
vision of the organization.
It inspires winning: winning of customers, winning against competitors,
winning over the broader market.
It focuses on firm’s taking initiatives to change the strategy of the firm
that will lead to competitive advantage.
Whatever the case, strategic intent turns strategy from a “fit” exercise to
a “stretch” exercise.
Example: An intent retailer does not think about how to match a
competitor’s operation, but to create even a better operation.
3. EXAMPLES OF SI
The specific features of strategic intent can be easily explained with the
help of hierarchy or pyramid of the organization from the top-bottom.
Example: “Toyota motors” use quality circle (QC) and Just In Time (JIT) to
get competitive advantage.
Example: When “Honda” entered the motorcycle market competitors
thought there was no threat as it did not imitate Harley Davidson or
Yamaha. But it chose to start with products that were internationally
different. Then by carving out new, white space it developed a customer
base & strong brand image.
The strategic intent of Reliance is to being a global leader of the lowest
cost producer of polyester products by focusing on vertical integration &
operational effectiveness.
4. HIERARCHY OF STRATEGY
strategic pyramid or hierarchy of strategy can be broadly categorized
in the following manner.
Corporate level
Business level
Functional level
5. CLS
Corporate level strategy is a comprehensive plan which is developed by
the top management for the company as a whole whether the firm is a
small one product or large multinational corporation. on a continuous
basis.
In a large multinational company corporate strategy is also about
managing various product lines & business units for value maximization.
For example: corporate headquarters must play the role of “organizational
parent” in that it must deal with various product & business unit as
“children”. Even though each product line or business unit has its own
competitors & it has to obtain its own competitive advantage in the
market. The cooperation among different units as a whole succeed the
“family”.
6. CLS CONT…
It is concerned with the selection of business in which the company should compete
and develop synergy by sharing & coordinating staff & resources across business
units.
It can be defined as the continuous process of making entrepreneurial decisions
systematically by forecasting future possibilities with environmental scanning &
keeping the company’s eye open.
It is long-term by nature & designed with an objective to gain competitive
advantage over other market participants while delivering both on customer/client
& other stakeholder promises.
The purpose of it is to identify new areas of investment & marketing by formulating
the organization’s vision, mission, goal & objective along with action plans to
achieve the objectives.
EG: Growth strategy, Stability & Retrenchment.
7. FOCUS: RCM2
Corporate level strategy is concerned with: reach, competitive contact, managing activities
with business interrelationship & management practices.
Reach: The CLS focuses on achieving the overall goals of the organization and in which
business the corporation should be involved itself. It reaches the ways by which the
corporate achieves its goals and objectives & visionary towards the development.
Competitive Contact: The CLS identifies its competitors & prepares strategies to beat
them. EG: Fair & Handsome
Managing Activities & Business Interrelationship: It seeks to develop synergies by sharing
& coordinating staff & other resources across business units, investing financial resources,
technical-know-how can be shared with the help of interrelationship.
Managing Practices: It decides how business units to be governed with proper plans &
policies. It focuses on both direct corporate innervation is required or less autonomous
Government is preferred .
8. CORPORATION’S DIRECTIONAL
STRATEGY CONT…
Corporation’s directional strategy decides its orientation towards growth by asking
three basic questions.
Should we expand, cut back, or continue our operations unchanged?
Should we concentrate our activities within our current industry or should we
diversify into other business?
If we want to grow & expand, should we do so through internal development or
through external acquisitions, mergers or joint venture?
The directional strategy is composed of three general orientations towards growth
such as: Growth strategy expands the company’s activities.
Stability strategies make no change to company’s current activities.
Retrenchment strategies reduce the company’s level of activities.
9. GROWTH STRATEGIES-CONCENTRATION &
INTEGRATION & M-A, S-A, J-V
Growth strategy is widely pursued by the corporations or industries
those are designed to achieve growth in sales, profit & assets.
It can be achieved by both concentration & diversification.
Concentration within one product line or industry & diversification into
other product line & industries.
It can use investing for new product or new market development
internally or through mergers, acquisitions or strategic alliances.
10. CONCENTRATION
Concentration strategies are very sensible as they try to compete
successfully only within single industry.
Examples: McDonald’s, Starbucks & Subway are three firms that have
relied heavily on concentration strategies to become dominant players.
Concentration strategies can be of three types: Market Penetration,
Market Development & Product Development.
11. GROWTH STRATEGY: CONCENTRATION:
MARKET PENETRATION
Market Penetration involves trying to gain additional share of a firm’s
existing markets by using existing products.
Firms take the weapon of advertisement to attract “new customers”
with existing markets.
Examples: Nike shoes attracts new customers with the ad of presenting
as famous athletic shoes from other rivals like Adidas.
McDonald’s has perused market penetration by using Spanish-language
website which is written its slogan “I’m lovin’ it”.
12. CONCENTRATION-MARKET
DEVELOPMENT STRATEGY
Market development involves taking existing products & trying to sell
them in “new markets”.
The best way to reach in the new market can be trough the retail
channels.
For example’ Starbucks has stepped beyond selling coffee beans only in
its stores & now sell beans in grocery stores. This enables Starbucks to
reach consumers that do not visit its coffeehouse.
Entering new geographic area is another way to market development
13. CONCENTRATION-PRODUCT
DEVELOPMENT
Product development involves creating new products to serve in existing
market.
For example, in1940s Disney expanded its offerings within the film business
by going beyond cartoons & creating movies featuring real actors.
Similarly, McDonald’s has gradually moved more and more of its menu
toward healthy items to appeal to customers who are concerned about
nutrition.
The soft drink industry like: Coca-Cola & Pepsi regularly introduce new
varieties- such as: Coke Zero & Pepsi Cherry Vanilla in an attempt to take
market share from each other & from their smaller rivals.
14. GROWTH: INTEGRATION
The growth strategy can be achieved by Integration. Integration can be
horizontal & vertical.
Horizontal Integration is the degree to which a firm operates in
multiple geographic locations at a time and increases the range of
product & services offering to the current customers.
15. HORIZONTAL INTEGRATION
Rather than rely on their own efforts, some firms try to expand their
presence in an industry by merger & acquisition. This strategic move is
known as Horizontal Integration.
An acquisition takes pace when one company purchases another. The
acquired company is smaller than the firm that purchases it.
Example: Disney was much bigger than the Miramax & Pixar when it joined
with these firms in 1993 & 2006, respectively, thus these two horizontal
integration moves are considered to be acquisition.
A merger joins two companies into one. Mergers typically involve similarly
sized companies.
Example: Exxon & Mobil in 1999
16. VERTICAL INTEGRATION
Vertical Integration is a logical strategy for a corporation or business unit
with a strong competitive position in a highly attractive industry.
It can be of two types:
Backward Integration: It is possible by taking over a function previously
provided by the supplier. It acts to minimize resource acquisition costs &
insufficient operations.
Foreword Integration: It can be possible by taking over a function
previously provided by the distributor.
The organization is benefited to gain more control over quality & product
distribution through forward integration.
17. MERGER
Merger: is a transaction involving two or more corporations in which stock
is exchanged.
It usually occurs between firms of somewhat similar size & are usually
friendly. The resulting firm is likely to have a name derived from its
composite firms. EG: Hero Honda
It is a strategic process where two or more companies mutually form a new
single legal venture.
Examples: In 1998 Exxon & Mobil have merged as they were already first &
second largest oil produces in the United States.
In 2016 the Kraft Heinz Company has got its name from the merger of H.J.
Heinz Co & Kraft Food Groups
18. ACQUISITION
Acquisition: is the acquire or purchase of a company that is completely absorbed as
an operating subsidiary or division of the acquiring corporation.
It occurs between firms of different sizes & can be either friendly or hostile.
Hostile acquisitions are often called takeovers.
Examples: In 2014, Verizon acquires Vodafone’s 45% stake in a deal that it
completely owns Verizon Wireless venture. Verizon Wireless first came to the market
jointly by Verizon Communication & Vodafone.
In 2000, Pfizer acquired Warner Lambert which is the example of hostile acquisition.
Both are pharmaceutical drug industries. The acquisition placed the company on the
second largest drug company in United States.
Google acquired Android in 2005. The acquisition gave google the tools it needed
too compete in a market dominated by Microsoft & Apple.
Disney acquired Pixar in 2006
19. STRATEGIC ALLIANCE
Strategic Alliance is a partnership of two or more corporations or business units to
achieve strategically significant objectives that are mutually beneficial.
It is an agreement between two parties for the mutual benefit of both by expanding
new market, new product line & develop an edge over a competitor.
It is an arrangement between two companies to undertake a mutually beneficial
project which each retains its independence.
Example: the deal between Starbucks & Barnes & Noble. The Starbucks brews the
coffee. Barnes & Noble stocks the books. Both companies are benefited while
sharing the cost and resources.
Spotify & Uber, Master Card & Apple Pay, Chevrolet & Disney, Vodafone India &
ICICI Bank are some other examples of strategic alliance.
20. JOINT VENTURE (JV)
Strategic alliance is less complex & less binding than a joint venture, in which two businesses pool
resources to create a separate business entity.
JV is a business arrangement in which two or more companies combine resources on a project or
service. The length of the agreement & what resources it will include will vary.
It is helpful for the companies who need to expand resources with minimum capital.
Examples: Vodafone & Telefonica agreed to share their mobile network.
BMW & Toyota co-operate on research into hydrogen fuel cells & ultra lightweight materials.
Google & NASA have developed Google Earth.
To develop bioelectric medicine Verily, the life sciences unit of Alphabet Inc. entered into JV agreement
with the British Pharmaceutical company GlaxoSmithKline.
21. CORPORATE STRATEGY: STABILITY
STRATEGY
The corporation may choose Stability Strategy over growth strategy by continuing its
current activities without any significant change in direction.
It offers the same product/service to the customers without introducing any new product
& its main object is to maintain the current market share of the company.
It can be appropriate for a successful corporation operating in a reasonably predictable
environment & if it is satisfied with the current market position & market share.
It can be very successful in short run , but can be dangerous if followed in long run.
Example: Dell follows the stability strategy after having strong growth in E-Retailing. The
company is operating its business in more than 95 countries & approximately 6000
employees are working for the company with a total sale of 2 billion dollars. Therefore,
the company has slowed down its operation in order to restructure & be ready for
growth.
22. STABILITY STRATEGY: TYPES
Different types of Stability Strategies are: no change strategy, profit strategy, pause
strategy, sustainable growth strategy & modest growth strategy.
No change strategy focus that continuing the work or strategy without introducing
new segment.
Profit strategy states to maintain the existing profit level in the volatile environment
which is very challenging.
Pause strategy is that when a company has had a rapid growth and now it wants to
have some rest before implementing the growth again.
Sustainable growth strategy can be used when the external environment is
unpredictable & unfavorable.
Modest growth strategy is required when a business wants to achieve the same
target that it had in last year.
23. CORPORATE STRATEGY: RETRENCHMENT
STRATEGY
Retrenchment strategy is a corporate-level strategy that involves
reducing the size & scope of the company’s operation.
It aims to improve the financial position of the organization by cost
cutting & streamlining its operations by focusing on the core business
activities.
The company reduces its workforce, close some of its unprofitable
stores & divests some of its non-core assets.
Example: A retail company with multiple stores in different locations
may choose to close some of its unprofitable stores & focus on the
ones that generates profit.
24. TYPES OF RETRENCHMENT
Retrenchment strategies can be of different types such as: turnaround, divestment,
liquidation & captive.
Turnaround Strategy is used when a company is experiencing financial difficulties & needs
to make significant changes to its operations in order to return to profitability. It may
involve restructuring the company, reducing costs & selling non-core assets.
Divestment Strategy involves selling off a department or division or a section of the
department or any asset which are not profitable for the organization in order to focus on
core competency of the company. This helps the company to improve its overall
performance by reducing complexity.
Liquidation strategy entails selling off its resource & ceasing all commercial operations
together which is the most painful for any organization.
Captive company strategy is used when a company depends on another company for its
survival. In the weak situation if the company does not opt for turn around strategy it
looks for a biggest client or an angel who helps it.
25. BLS
SBU: The corporations are responsible for creating value through their
business. They do so by managing their portfolio of business, ensuring
that the businesses are successful over long-term by developing
Business Units & focusing on the compatibility of those.
The SBU can be a division, product line or the profit center which is
planned independently from other business units of the industry.
At the business unit level the main challenge is to develop & sustain a
competitive advantage for the goods & services that are produced
26. PHASES OF BLS & GENERIC STRATEGIES
At business level the strategy formulation phase deals with:
Positioning the business against rivals.
Anticipating changes in demand & adjusting the strategy to
accommodate them.
Influencing the nature of competition through strategic actions such as:
vertical integration & through political action: lobbying.
Michael Porter identifies three generic strategies: cost leadership,
differentiation & focus.
27. COST LEADERSHIP: BLS
Cost leadership is the strategy of low cost of production by using
economies of scale.
A low cost producer can be a market leader by focusing on bulk
purchase of raw materials, developed technology etc.
If a firm achieves low cost leadership and sustains then it will be an
above average performer in its industry, provided it can command its
price at or near the industry average.
28. DIFFERENTIATION: BLS
In a Differentiation strategy a firm seeks to be unique in its industry
along some dimensions that are widely valued by buyers.
It selects one or more attributes that many buyers in an industry
perceive as important & uniquely positions itself to meet those needs.
It is rewarded for its uniqueness with a premium price.
29. FOCUS: BLS
The generic strategy of Focus rests on choice of a narrow competitive
scope within an industry.
The focuser selects a segment or group of segment in the industry &
tailors its strategy to serve them & exclusion of others.
It can be of two types: cost focus & differentiation focus
In cost focus a firm seeks a cost advantage in its target segment, while
in differentiation focus a firm seeks differentiation in its target segment
30. FLS
Functional level strategies are made for operating functions.
The strategic issues at the functional level are related to business processes & value chain.
Functional level strategies in marketing, finance, operations, HR & R&D involve the development &
coordination of resources through which business level strategies can be executed efficiently &
effectively.
Functional units of an organization are involved higher level strategies by providing input into the
business unit level & corporate level strategy, such as providing information on resources &
capabilities on which the higher level strategies can be based.
Once the higher-level strategy is developed, the functional units translate it into discrete action-plans
that each department or division must accomplish for the strategy to succeed.
Operational strategies are set at departmental level & set periodic short-term targets for
accomplishment of corporate-business & functional level in terms oof resources, process & people.