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Ch 5 -1
Chapter 5
Strategies in Action
Strategic Management:
Concepts & Cases
13th
Edition
Fred David
BY:MADDY.KALEEM
Ch 5 -2
BY:MADDY.KALEEM
Ch 5 -3
Long Term Objectives
 Quantitative
 Measurable
 Realistic
 Understandable
 Challenging
 Hierarchical
 Obtainable
BY:MADDY.KALEEM
Ch 5 -4
BY:MADDY.KALEEM
Ch 5 -5
Financial vs. Strategic Objectives
Financial Objectives
Growth in revenues
Growth in earnings
Higher dividends
Larger profit margins
Greater ROI
Higher earnings per share
Rising stock price
Improved cash flow
BY:MADDY.KALEEM
Ch 5 -6
The Balanced Scorecard
Robert Kaplan & David Norton –
Strategy evaluation & control technique
Balance financial measures with
nonfinancial measures
Balance shareholder objectives with
customer & operational objectives
BY:MADDY.KALEEM
Ch 5 -7
Levels of Strategies –
Large Company
BY:MADDY.KALEEM
Ch 5 -8
Levels of Strategies –
Small Company
BY:MADDY.KALEEM
Ch 5 -9
Types of Strategies
Vertical
Integration
Strategies
Forward
Integration
Backward
Integration
BY:MADDY.KALEEM
Ch 5 -10
Vertical Integration Strategies
Forward
Integration
Gaining ownership or increased
control over distributors or retailers
Backward
Integration
Seeking ownership or increased
control of a firm’s suppliers
BY:MADDY.KALEEM
Ch 5 -11
Types of Strategies
Intensive
Strategies
Market
Penetration
Market
Development
Product
Development
BY:MADDY.KALEEM
Ch 5 -12
Intensive Strategies
Market
Penetration
Seeking increased market share for
present products or services in
present markets through greater
marketing efforts
Market
Development
Introducing present products or
services into new geographic areas
Product
Development
Seeking increased sales by
improving present products or
services or developing new ones
BY:MADDY.KALEEM
Ch 5 -13
Types of Strategies
Diversification
Strategies
Related
Diversification
Unrelated
Diversification
BY:MADDY.KALEEM
Ch 5 -14
Diversification Strategies
Related
Diversification
Adding new but related products or
services
Unrelated
Diversification
Adding new, unrelated products or
services
BY:MADDY.KALEEM
Ch 5 -15
Types of Strategies
Defensive
Strategies
Retrenchment
Divestiture
Liquidation
BY:MADDY.KALEEM
Ch 5 -16
Defensive Strategies
Retrenchment
Regrouping through cost and asset
reduction to reverse declining sales
and profit
Divestiture Selling a division or part of an
organization
Liquidation
Selling all of a company’s assets, in
parts, for their tangible worth
BY:MADDY.KALEEM

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Strategic Management: Concepts & Cases Chapter 05

  • 1. Ch 5 -1 Chapter 5 Strategies in Action Strategic Management: Concepts & Cases 13th Edition Fred David BY:MADDY.KALEEM
  • 3. Ch 5 -3 Long Term Objectives  Quantitative  Measurable  Realistic  Understandable  Challenging  Hierarchical  Obtainable BY:MADDY.KALEEM
  • 5. Ch 5 -5 Financial vs. Strategic Objectives Financial Objectives Growth in revenues Growth in earnings Higher dividends Larger profit margins Greater ROI Higher earnings per share Rising stock price Improved cash flow BY:MADDY.KALEEM
  • 6. Ch 5 -6 The Balanced Scorecard Robert Kaplan & David Norton – Strategy evaluation & control technique Balance financial measures with nonfinancial measures Balance shareholder objectives with customer & operational objectives BY:MADDY.KALEEM
  • 7. Ch 5 -7 Levels of Strategies – Large Company BY:MADDY.KALEEM
  • 8. Ch 5 -8 Levels of Strategies – Small Company BY:MADDY.KALEEM
  • 9. Ch 5 -9 Types of Strategies Vertical Integration Strategies Forward Integration Backward Integration BY:MADDY.KALEEM
  • 10. Ch 5 -10 Vertical Integration Strategies Forward Integration Gaining ownership or increased control over distributors or retailers Backward Integration Seeking ownership or increased control of a firm’s suppliers BY:MADDY.KALEEM
  • 11. Ch 5 -11 Types of Strategies Intensive Strategies Market Penetration Market Development Product Development BY:MADDY.KALEEM
  • 12. Ch 5 -12 Intensive Strategies Market Penetration Seeking increased market share for present products or services in present markets through greater marketing efforts Market Development Introducing present products or services into new geographic areas Product Development Seeking increased sales by improving present products or services or developing new ones BY:MADDY.KALEEM
  • 13. Ch 5 -13 Types of Strategies Diversification Strategies Related Diversification Unrelated Diversification BY:MADDY.KALEEM
  • 14. Ch 5 -14 Diversification Strategies Related Diversification Adding new but related products or services Unrelated Diversification Adding new, unrelated products or services BY:MADDY.KALEEM
  • 15. Ch 5 -15 Types of Strategies Defensive Strategies Retrenchment Divestiture Liquidation BY:MADDY.KALEEM
  • 16. Ch 5 -16 Defensive Strategies Retrenchment Regrouping through cost and asset reduction to reverse declining sales and profit Divestiture Selling a division or part of an organization Liquidation Selling all of a company’s assets, in parts, for their tangible worth BY:MADDY.KALEEM