This document provides an overview of business strategy. It defines strategic management as the set of decisions and actions that result in plans to achieve company objectives. Objectives include gaining competitive advantage and outperforming competitors. Characteristics of business strategy are that it is large-scale, future-oriented, provides a framework for decisions, and reflects awareness of competition. The document then discusses different schools of thought in strategic management and provides examples of company visions and missions. It also outlines the strategic management process of environmental scanning, strategy formulation, implementation, and evaluation.

1. Business Strategy

2. Introduction
• Success
(Darwin’s Theory )
• What is BS

3. • Strategic management:
The set of decisions and actions that result
in the formulation and implementation of
plans designed to achieve a company’s
objectives

4. Objectives
• To gain competitive advantage
• To out perform the competitors
• To act as a guide to survive changes

5. Characteristics
• Large-scale, future-oriented plan
• Used to interact within competitive
environment to achieve company goals
• Provides a framework for managerial
decisions
• Reflects a company’s awareness of the main
elements of competition

6. Importance
• It guides the company to move in a specific direction.
• It assists the firm in becoming proactive, rather than reactive.
• It acts as a foundation for all key decisions of the firm.
• It attempts to prepare the organization for future challenges
and play the role of pioneer in exploring opportunities and
also helps in identifying ways to reach those opportunities.
• It ensures the long-term survival of the firm while coping with
competition and surviving the dynamic environment.
• It assists in the development of core competencies and
competitive advantage.

7. • The term ‘strategic management/Business
Strategy’ is used to denote a branch of
management that is concerned with the
development of strategic vision, setting out
objectives, formulating and implementing
strategies and introducing corrective
measures for the deviations (if any) to reach
the organization’s strategic intent.

8. Schools of thought in SM
• Design school
• Planning school
• Positioning school
• Entrepreneurial school
• Cognitive school
• Learning school
• Power school
• Cultural school
• Environmental school
• Configuration school

9. The design school
• The focus is on conception of ideas and to design
new ideas.
• The company does an internal analysis with the
help of SWOT analysis
• The company then tries to match its internal
strength with the market strength which is
required.
• This works well in a stable environment, where
competitors might not disrupt the market
suddenly & it gives time to the firm to adapt.

10. The planning school
• In this case, the thought process runs
towards planning the entire strategy in a rigorous
manner, so that the firm advances forward.
• The complete process and the plan which the
company will implement is documented from the
start to finish.
• At all times the plan is referred to whenever the
management wants to take new decisions.
• With the plan in hand, the management gets a
clear direction to move in, helping the company
to move forward unanimously.

11. The positioning school
• In this process of strategy formulation, the
management decides that they want to position
the product at the top of the mind and makes decisions
accordingly.
• The management has to determine the competition
already present in the market, and where is their own
company positioned
• It can use tools like Five forcess, Value chain, BCG and
others to position its products.
• Once the market has been analysed, the right strategy
is needed to improve the positioning of the product.

12. The entrepreneurial school
• This school of thought puts all the focus on
the CEO of the company.
• In this case, the CEO needs to be visionary,
needs strong leadership skill, and has to have
the right judgment and direction.
• This strategy has been proven right in very few
cases over the years where the leaders were
legendary by themselves.

13. The cognitive school
• In this thought process, people’s perception
and information is studied.
• It is a mental and psychological process to find
out what is in the minds of the consumer and
how do we improve on that or use that
information.
• Once you know customers perception and
thought process about you, you can change
the same with strategy.

14. The learning school
• In this thought process, the management
keeps a watch over what has already
happened and then forms the future strategy
looking at the past.
• The company looks at things that worked and
tries to implement the same thing over time
with the assumption that it will work again.
• The company also looks at things that did not
work in its favor

15. The power school
• In this school of thought, the people who are
in power take the decisions.
• Anyone who is known to have power over the
company, can drive the company forward.
• This ensures that there is lesser resistance for
the strategy to be implemented

16. The cultural school
• A positive culture in the firm can give a proper
direction to the firm.
• The cultural school tries to involve many
different departments within a company.
• It is most useful during mergers and
acquisitions.
• It emphasizes the role of social values, beliefs
and culture in decision making.

17. The environmental school
• More of a situational school of thought, the
environmental school gives most of the
importance to the environment.
• Situational analysis is the most used tool in
the environmental school.

18. The Configuration school
• As per the configuration school, strategy needs to
consider a lot of thing which can go wrong, and
cannot be derived from simple set of values.
• Over a period of time, an organization forms
various sets of values which have to be
transformed so that the organization reaches the
point that it desires.
• To do this, the organizations stable business
might need to be disrupted, and the organization
has to be configured so that it reaches the
success it was looking for.

19. Strategic Intent
• Strategic Intent can be understood as the
philosophical base of the strategic
management process. It implies the purpose,
which an organization endeavor of achieving.
It is a statement, that provides a perspective
of the means, which will lead the organization,
reach the vision in the long run.

20. Hierarchy of Strategic Intent
• Vision
• Mission
• Objectives
• Plans

21. Vision
• vision as “ a realistic, credible and attractive future for an
organization”.
• It should be idealistic( should be realistic)
• Good vision clarifies the direction
• Good vision encourages the org. members commitment
from them
• Good vision reflects uniqueness of org. ,its distinct
competence, what it stands for and what it is able to
achieve.
• Good vision is consistent with org values and culture
• Good vision is easily understood by those who are
responsible to convert it into reality

22. Developing a vision
• Its like converting dream into reality
• Conducting vision audit-To asses current direction
• Targeting the vision- What are the boundaries
and constraints to the vision?
• What vision must accomplish?
• Setting vision context: how org. should look in
future
• Developing future scenarios
• Generating the alternative visions
• Choosing the final vision

23. • Examples of vision
• Infosys- To be globally respected company that
provides best of breed software solutions by
best-in-class people
• Tata tea- to be India’s foremost tea based
beverage company

24. Mission
• Is defined a fundamental unique purpose that sets a
business apart from other firms of its type and
identifies its scope of its operations in product and
market terms.
Its is a statement which defines the role that org. plays in
society
Difference b/w Vision and mission
• Vision is forward looking and mission states what org. is
and why it exists
• Vision emphasis on long term concept with very high
level of achievement and mission deals with products ,
services offers, way these are offered.

25. Mission Statement
• It is the description of org. mission. Explicit
mission statement is desirable as it serves the
purpose of communicating to the organization’s
members about the corporate philosophy ,
character and image of the org. which govern
their behavior in org.
• Following pints should be kept in mind while
formulating mission statement:
• It should be feasible
• It should be precise
• It should be clear

26. • It should be motivating
• It should be distinctive
• It should include major components of
strategy
• It should indicate how objectives are to be
accomplished

27. Examples of mission statement
• Infosys: To achieve our objectives in a
environment of fairness, honesty and courtesy
towards our clients, employess, vendors and
society at large
• Tata tea:
o To Achieve market and thought leadership for
branded tea in india
o Drive long term profitable growth
o Co create enhanced value for stakeholders
o Make tata tea a great place for work

28. Objectives
• Objectives are the ends that state specifically
how the goals shall be achieved.
• SMART
S- Specific
M- Measurable
A- Attainable
R- Relevant
T- Time bound

29. Characteristics of objectives
• Objectives should be understandable
• Objectives should be concrete and specific
• Objectives should be related to a timeframe
• Objectives should be measurable and controllable
• Objectives should be challenging
• Different objectives should correlate with each
other
• Objectives should be set within constraints

30. Roles of objectives
• Directions for decision making
• Objectives work as motivating force
• Performance standards
• Defines relationship with environment

31. Balance Score Card

32. BALANCE SCORE CARD
• The balance score card:
• Creating Strategy Map to Drive Corporate Performance
• The Balanced Scorecard is a strategic planning and management system
used to align business activities to the vision and strategy of the
organization by monitoring performance against strategic goals.
• A balanced scorecard is a performance metric used in strategic
management to identify and improve various internal functions of a
business and their resulting external outcomes.
• It is used to measure and provide feedback to organizations. Data collection
is crucial to providing quantitative results, as the information gathered is
interpreted by managers and executives, and used to make better
decisions for the organization.
• The balanced scorecard is used to analyze four separate areas. These four
areas, involve learning and growth, business processes, customers, and
finance. Traditional performance measurement only focused on external
accounting data.

33. Why Use a Balanced Scorecard?
• Improve organizational performance by
measuring what matters
• Increase focus on strategy and results
• Align organization strategy with workers on a day-
to- day basis
• Focus on the drivers key to future performance
• Improve communication of the organization’s
Vision and Strategy
• Prioritize Projects / Initiatives Compiled by Roshan
pant-MBM Nepal Commerce Campus

34. Four balanced scorecard perspectives
• The balanced scorecard approach examines
performance from four perspectives.
• Financial analysis, which includes measures such as
operating income, sales growth and return on
investment.
• Customer analysis, which looks at customer satisfaction
and retention.
• Internal analysis, which looks at how business processes
are linked to strategic goals.
• Learning and growth analysis, which assesses employee
satisfaction and retention, as well as information
system performance.

35. Balance Score Card for a Jewellery
Shop

36. Process of SM
The strategic management process means defining
the organization’s strategy. It is also defined as
the process by which managers make a choice of
a set of strategies for the organization that will
enable it to achieve better performance.
• Environmental scanning
• Strategy formulation
• Strategy implementation
• Strategy evaluation

37. Environmental scanning
• Environmental scanning refers to a process of
collecting, scrutinizing and providing
information for strategic purposes. It helps in
analyzing the internal and external factors
influencing an organization. After executing
the environmental analysis process,
management should evaluate it on a
continuous basis and strive to improve it.

38. Strategy formulation
• Strategy formulation is the process of deciding
best course of action for accomplishing
organizational objectives and hence achieving
organizational purpose. After conducting
environment scanning, managers formulate
corporate, business and functional strategies.

39. Strategy implementation
• Strategy implementation implies making the
strategy work as intended or putting the
organization’s chosen strategy into action.
Strategy implementation includes designing
the organization’s structure, distributing
resources, developing decision making
process, and managing human resources.

40. Strategy evaluation
• Strategy evaluation is the final step of
strategy management process. The key
strategy evaluation activities are: appraising
internal and external factors that are the root
of present strategies, measuring performance,
and taking remedial / corrective actions.
Evaluation makes sure that the organizational
strategy as well as it’s implementation meets
the organizational objectives.

41. ENVIRONMENTALSCANNING

45. Process of Environmental Analysis
• Understand all the environmental factors
before moving to the next step.
• Collect all the relevant information.
• Identify the opportunities for your
organization.
• Recognize the threats your company faces.
• The final step is to take action.

46. Environmental Analysis
PEST/PESTLE Analysis
• Political factors
• Economic factors
• Social factors
• Technological factors
• Legal factors
• Environmental factor

47. P FOR POLITICAL FACTORS
• Government policies
• Taxes laws and tariff
• Stability of government
• Entry mode regulations

48. E FOR ECONOMIC FACTORS
• Economic Structure
• Sector wise Differences
• Economic Policies
• Stability or instability and opportunities or
threat of economy

49. S FOR SOCIAL FACTORS
• Some of the social factors you should study
are:
• The cultural implications
• The gender and connected demographics
• The social lifestyles
• The domestic structures
• Educational levels
• Distribution of Wealth

50. T FOR TECHNOLOGICAL FACTORS
• New discoveries
• Rate of technological obsolescence
• Rate of technological advances
• Innovative technological platforms

51. L FOR LEGAL FACTORS
• Product regulations
• Employment regulations
• Competitive regulations
• Patent infringements
• Health and safety regulations

52. E FOR ENVIRONMENTAL FACTORS
• Geographical location
• The climate and weather
• Waste disposal laws
• Energy consumption regulation
• People’s attitude towards the environment

54. Internal Analysis
• It is an objective audit of the characteristics of
your enterprise that lead to identifying
strength and weaknesses, relative to rivals in
the context of different market.

55. THREE CIRCLE ANALYSIS

57. Competitive Strategies
• SWOT Analysis
• Value Chain

58. Value Chain Analysis
Value chain analysis is a strategy tool used
to analyze internal firm activities. Its goal is to
recognize, which activities are the most
valuable (i.e. are the source of cost or
differentiation advantage) to the firm and
which ones could be improved to provide
competitive advantage.

59. Value Chain Analysis

60. SWOT Analysis
• Strengths: characteristics of the business or
project that give it an advantage over others.
• Weaknesses: characteristics of the business that
place the business or project at a disadvantage
relative to others.
• Opportunities: elements in the environment that
the business or project could exploit to its
advantage.
• Threats: elements in the environment that could
cause trouble for the business or project.

64. FORMULATION OF STRATEGY

65. 65
Strategy Formulation
Environmental Analysis
Internal Analysis
Competitor
Customer
Supplier
Regulatory
Social/ Political
Technology Know-How
Manufacturing Know-How
Marketing Know-How
Distribution Know-How
Logistics
Strength & Weaknesses
Identity Core Competencies
Opportunities & Threats
Identify opportunity
Fit internal Competencies with external opportunities
Firm Strategies

70. Poter’s Five Forces Model
• Bargaining Power of Buyer
• Bargaining Power of Supplier
• Market Competition/ Revelry among firms
• Threat of New Entrant
• Threat of Substitute Products

73. Strategy
• Exit Barrier High/ Entry Barrier High – Risky
Return
• Exit Barrier High/ Entry Barrier Low – Risky
Return
• Exit Barrier Low / Entry Barrier Low – Stable
Return
• Exit Barrier Low / Entry Barrier High – Stable
Return
73

74. THANK YOU