The document discusses strategic management. It begins by defining strategy and describing the different levels of strategy, including corporate, business, and functional strategies. It then explains strategic management as comprising environmental scanning, strategy formulation, implementation, and evaluation. The key stages of strategic management are identified as strategy formulation, implementation, and evaluation. Strategy formulation involves environmental and organizational appraisal while implementation requires designing structures and processes. Evaluation and control help measure performance. Finally, some common reasons for strategic plans failing and benefits of strategic management are outlined.

1. UNIT-1 STRATEGIC
MANAGEMENT

2. What is strategy
• Strategy is a tactical course of action which is designed to achieve long
term objectives. It is an art and science of planning and marshalling
resources for their most efficient and effective use in a changing
environment.
• Strategy of a business enterprise consists of what management decides
about the future direction and scope of the business. It entails managerial
choice among alternative action programmes, competitive moves and
different business approaches to achieve enterprise objectives.
• Strategy once formulated has long term implications. It is framed by top
management in an organization. In short, it may be called as the ‘game
plan of management’.

3. Definition of Strategy •
As per Glueck, Strategy is
unified, comprehensive and
integrated plan relating the
strategic advantages of the firm
to the challenges of the
environment. It is designed to
ensure that the basic objectives
of the enterprise are achieved.
As per Alfred D. Chandler,
Strategy is “The determination
of basic long-term goals and
objectives of an enterprise and
the adoption of the courses of
action and the allocation of
resources necessary for carrying
out these goals.”

4. Features of Strategy
• Top management responsibility
• Allocation of large amount of resources
• Impact on long term prosperity of the firm
• Future oriented
• Multi-functional or multi-business consequences
• Consideration of factors in the external environment

5. Levels of Strategy
1.Corporate-level Strategy • At this level, strategic decisions relate to
organization-wide policies and are taken care by top-level
management (BOD) with a vision of determining ‘Where the company
wants to be?’
2.• It has two main aspects- Formulation of Strategy (strategic
planning) and Strategy Implementation
3. • The nature of strategy at this level tend to be value-oriented,
conceptual and than other levels.
4. • There is also greater risk, cost and profit potential as well as
greater need of flexibility associated with this level.
5.• Major financial policy decisions involving acquisition,
diversification and structural redesigning belong to this level.

6. • Business-Level Strategy • Business-level strategy is more likely
related to a unit within the whole. It is concerned with
competition in a market.
• The concerns are about what products or services should be
developed and offered to which markets in order to meet
customer needs and organizational objectives. •
• At this level, multifunctional strategies developed at corporate
level are formulated and implemented for specific product
in which the business operates. Thus, managers at this level
translate general directions and intent into concrete functional
objectives.
• Decisions at this level include policies involving new product
development, marketing mix, research & development,
etc.

7. Functional/Operational-Level Strategy • Functional strategy involves
decision-making with respect to specific functional areas- production,
marketing, personnel, finance etc.
• • While corporate and business level strategies are concerned with
“Doing the right things”, functional strategies stress on “Doing things
right”.
• Operating level strategy is concerned with strategic approaches for
managing frontline operating units(like plants, sales, etc) and for
handling day to day tasks of strategic significance(like advertising
campaign, purchasing materials, inventory control, maintenance, etc.).
Thus, it focuses on how the different functions of the enterprise
contribute to the other levels of strategy.
• Thus, functional level strategic management is the management of
relatively narrow areas of activity, which are of vital, pervasive or
continuing importance to the total organization.

8. Strategic Management • Strategic management is a set of management
decisions and actions that determines the long-run performance of a
corporation. It includes environmental scanning, strategy formulation,
strategy implementation and evaluation and control to achieve the
objectives of an organization.
• The study of strategic management emphasizes the monitoring and
evaluating of external opportunities and threats in light of a
strengths and weaknesses. •
• As per Fred R. David, strategic management is an art and science of
formulating, implementing and evaluating cross functional decisions
enable an organization to achieve its objectives.
• As per Channon, strategic management is defined as that set of
decisions and actions that result in formulating of strategy an its
implementation to achieve the objectives of the corporation

9. Stages of Strategic Management
Strategy
formulation
Strategy
implementatio
n
Strategy
evaluation
1-9
Copyright ©2013 Pearson Education, Inc. publishing as Prentice Hall

10. Steps
Step 1: Strategic Intent • Vision- Vision is the statement that expresses
organization’s ultimate long-run objectives. It is what the firm ultimately like
become. Vision once formulated is for forever and long lasting for years to
come. Vision is closely related with strategic intent and is a forward thinking
process. Eg- Microsoft- ’A computer software on every desk and in every
• Mission- It tells who we are and what we do as well as what we’d like to
become. Mission of a business is the fundamental, unique purpose that sets it
apart from other firms of its kind and identifies the scope of its operations in
product and market terms. Eg- Microsoft- ‘Empower every person and every
organization on the planet to achieve more’.
• Objectives- These are the end results of planned activity that state what is to
be accomplished by when and should be quantified if possible and their
achievement should result in the fulfillment of a corporation’s mission.
Objectives state specifically how the goals shall be achieved. Following are the
areas for setting objectives- profit objective, marketing objective, production
objective, etc.

11. 1.Strategy Formulation Strategy formulation refers to the process of
choosing the most appropriate course of action for the realization of
organizational goals and objectives and thereby achieving the
organizational vision. For choosing most appropriate course of action,
appraisal of organization and environmental is done with the help of
analysis.
2.• Environmental Appraisal- The environment of any organization is "the
aggregate of all conditions, events and influences that surround and
it". It is dynamic and consists of External & Internal Environment . The
external environment includes all the factors outside the organization
which provide opportunities or pose threats to the organization. The
internal environment refers to all the factors within an organization which
impart strengths or cause weaknesses of a strategic nature.
3. • Organizational Appraisal- It is the process of observing an
internal environment to identify the strengths and weaknesses that may
influence the organization's ability to achieve goals. The analysis of
corporate capabilities and weaknesses becomes a pre-requisite for
successful formulation and reformulation of corporate strategies. This
analysis can be done at various levels: functional, divisional and

12. Strategy Implementation Strategy implementation is the action stage of strategic
management. It refers to decisions that are made to install new strategy or
reinforce existing strategy.
Designing structure, process & system- Strategy implementation includes the
making of decisions with regard to organizational structure, developing
programs and procedures in order to accomplish certain activities.
Functional Implementation- Functional implementation is carried out through
functional plan and policies in five different areas- marketing, finance,
personnel and Information management.
Behavioral Implementation- It denotes mobilizing employees and managers to
put and formulate strategies into action and require personal discipline,
commitment and sacrifice. It depends upon manager’s ability to motivate
employees.
Operationalizing strategy- It includes establishing annual objectives, devising
policies, and allocating resources.

13. Strategy Evaluation & Control • Strategy evaluation- It is the primary means to
know when and why particular strategies are not working well. It is the process
which corporate activities and performance results are monitored so that actual
performance can be compared with desired performance. Thus strategic
evaluation activities include reviewing external and internal factors that are the
basis for current strategies.
• Strategic control- In this step, organizations Determine what to control i.e.,
which objectives the organization hopes to accomplish, set control standards,
measure performance, Compare the actual with the standard, determine the
reasons for the deviations and finally taking corrective actions and review the
policies and activities if needed.

17. • Important Strategic Management Key Terms
• Strategists.
• Vision & Mission Statement.
• External Opportunities & Threats.
• Internal Strengths & Weaknesses.
• Long Term Objectives.
• Strategies.
• Annual Objectives.
• Policies.

18. • Strategists
• Those people in the organization who are fully responsible for the failure r success
of the organization are referred to as strategists. Strategies are formed by
strategists. Examples of strategists include the chief executive officer, chair of the
board, chief executive officer, president & owner, entrepreneur or dean, etc
• Vision Statement
• A vision statement is quite necessary for the operation of the organization as it
provides an answer to the question of what should be the organization wants to
become. The first step in strategic planning is to develop the vision statement and
after that mission statement is prepared. Most organizations develop single-
sentence vision statements.
• Mission Statement:
• A mission statement is a long-lasting statement that differentiates one organization
from another similar organization. The scope of the operations of the organization
in terms of market & product is identified through the mission statement.

19. • External Opportunities & Threats
• External opportunities and threats are also part of strategic management’s key
terms. All those trends & events that are related to the social, economic,
environmental, cultural, demographic, political, legal, technology & technology &
competition that can harm or benefit an organization constitute external
opportunities & threats.
• Internal Strengths & Weaknesses
• Those activities of the organization that is under the control of the organization, and
may show good and bad impact on the organization are known as internal strengths
& weaknesses of the organization. These are present in the marketing,
management, production/operation, finance/accounting, and information technology
& research & development activities of the organization.
• Long-Term Objectives
• Long-term objectives are also one of the important strategic management key
terms. Long Term Objectives are referred to as particular results that an
organization wants to accomplish in targeting the mission. Expected results by
targeting certain strategies are represented by long-term objectives.

20. • Strategies
• The means through which allow us to achieve long-term objectives.
• The following are included in the business strategies.
• Geographic Expansion
• Diversification
• Product development
• Acquisition
• Retrenchment
• Market penetration
• Liquidation & Joint venture
• A large amount of the resources of the organization are required along with the
decisions of top management for the application of strategies in the form of actions.
Strategies are future-oriented as these will affect the long-term prosperity of the
organization.

21. • Annual Objectives
• Those short-term targets that help achieve the long-term objectives of the
organization are called annual objectives. The annual objectives must be
quantitative, measurable, realistic, challenging, consistent & prioritized. These must
be developed at functional, divisional & corporate levels in large organizations.
• Policies
• Annual objectives are accomplished by the means of policies. Policies contain
rules, guidelines & procedures developed to assist efforts to accomplish stated
objectives. Decision-making is guided through policies & recurring and repetitive
situations are also addressed through policies.

22. Why Do Strategic Plans Fail?
• Here are the top five reasons why your strategy could be creating more wastepaper than actual value.
• 1. Lack of strategic focus
• Many companies set unrealistic goals, and that compromises their focus. Without a strategic focus in place,
it can be tricky to set a clear measure for success. That means losing out on valuable time and wasting
critical resources.
• Poor communication
• What are your organisation’s core goals and objectives?
• If you find that you or any of your team members are unable to communicate those clearly — chances are,
not everyone is on board with what’s going on and are unsure about what you’re trying to achieve.
• Lack of alignment
• More than 60% of organisations do not link their strategic goals and objectives with their budget.
• This is just one of the many areas in which a lack of alignment can make or break the results that you’re
looking to achieve. Another example is alignment between management and teams.
• You’re not setting yourself up for success when 20% of staff members resist implementation initiatives. If
your employees are not 100% on board with your strategic decisions, it is highly unlikely that they’ll be able
to execute your plans effectively.

23. • Having a plan simply for plans sake. Some organizations go through the motions of
developing a plan simply because common sense says every good organization must have a
plan. Don’t do this. Just like most everything in life, you get out of a plan what you put in.
If you’re going to take the time to do it, do it right.
• 2. Not understanding the environment or focusing on results. Planning teams
must pay attention to changes in the business environment, set meaningful priorities, and
understand the need to pursue results.
• 3. Partial commitment. Business owners/CEOs/presidents must be fully committed
and fully understand how a strategic plan can improve their enterprise. Without this
knowledge, it’s tough to stay committed to the process.
• 4. Not having the right people involved. Those charged with executing the plan
should be involved from the onset. Those involved in creating the plan will be committed
to seeing it through execution.
• 5. Writing the plan and putting it on the shelf. This is as bad as not writing a plan at
all. If a plan is to be an effective management tool, it must be used and reviewed
continually. Unlike Twinkies or a fine vino, strategic plans don’t have a good shelf life.

24. • 6. Unwillingness or inability to change. Your company and your strategic plan must
be nimble and able to adapt as market conditions change.
• 7. Having the wrong people in leadership positions. Management must be willing
to make the tough decisions to ensure the right individuals are in the right leadership
positions. The “right” individuals include those who will advocate for and champion the
strategic plan and keep the company on track.
• 8. Ignoring marketplace reality, facts, and assumptions. Don’t bury your head in
the sand when it comes to marketplace realities, and don’t discount potential problems
because they have not had an immediate impact on your business yet. Plan in advance and
you’ll be ready when the tide comes in.
• 9. No accountability or follow through. Be tough once the plan is developed and
resources are committed and ensure there are consequences for not delivering on the
strategy.
• 10. Unrealistic goals or lack of focus and resources. Strategic plans must be focused
and include a manageable number of goals, objectives, and programs. Fewer and focused is
better than numerous and nebulous. Also be prepared to assign adequate resources to
accomplish those goals and objectives outlined in the plan.

25. • Benefits of strategic management
• It provides the organization with consistency of action i.e. helps ensure that all
organizational units are working toward the same objectives (direction).
• The process forces managers to be more proactive and conscious of their
environments i.e. to be future oriented.
• It provides opportunity to involve different levels of management, encourage
the commitment of participating managers and reducing resistance to proposed
chan

26. MOST ANALYSIS
THE MOST ANALYSISTOOL
FACILITATESTHE CREATION
OF AN ACTIONABLE
STRATEGIC PLAN BY
CREATING BUSINESS
MISSIONS, OBJECTIVES,
STRATEGY ANDTACTICS.

27. • PEST Analysis
• PEST is used to assess the external factors that might affect your
company’s profitability. Often used with SWOT. List the potential effects of
these factors:
Political
Economic
Social
Technological.

28. PESTEL
PESTEL ANALYSIS IS A
TOOLTHAT HELPSYOU
TO ANALYSE
ENVIRONMENTAL
FACTORS THAT MIGHT
HAVE A GREAT AFFECT
ONYOUR BUSINESS IN
THE FUTURE.

30. • How to Imitate Nike's Strategy
• Partner with other brands,
influencers, and ambassadors
in your international target
markets. Choose them
carefully. For instance,
Manchester United is a
prominent cultural force in the
U.K., which helped Nike grow
in that country.
• If you sell a consumer product,
why not give the option for
your audience to customize —
and resell — the products as
well? You'll end up capturing a
much larger audience, and
consumers from different
regions will capture their
region's preferences and
tastes much better.

31. McDonald's
• How to Imitate McDonald's Strategy
• Like the other restaurant examples on this
list, opening restaurants in other regions
may be the first and most natural answer.
• If that's not feasible, especially if you run a
regional brand, celebrate the flavors of the
world by hosting an "International Day" and
posting about it on your website.
• This approach will get you on the radar of
those who enjoy those foods daily and help
you spread the word in other markets.
• McDonald's has also introduced macaroons
to its French menu.
• And added McSpaghetti to its menu in the
Philippines.

32. Coca-Cola
Coca-Cola is an excellent example of a brand that's well-
known for its international marketing efforts. Though a
large corporation, Coca-Cola focuses on community
programs and invests in small-scale charity efforts.
• How to Imitate Coca-Cola's Strategy
• Try to promote your values in your marketing efforts by
investing in communities worldwide. You can start
small, such as with a yearly sponsorship or recurring
donation, and then work your way up to launching a
charity effort on the ground.
• Try to appeal to a universal human feeling as well. If
you're a marketer at a hospital, you might appeal to
grief and hope in a 1-minute video about a hospital
visit.
• These are feelings that transcend countries and
languages, automatically helping you reach a global
audience.

33. • How to Imitate Spotify's Strategy
• Spotify's example is a winner because its global marketing
strategy is entirely product-based. It offers music, podcasts, and
media in so many languages. The audiences in those countries
couldn't help but start using the product.
• If your product lends itself to that, try featuring items or products
that appeal to people from different regions and countries.
• Spotify's business model is focused on helping you find
something new.
• It's one thing to select a genre of music to listen to—it's another
thing to choose a "mood" to listen to. On Spotify's "Browse" page,
you can listen to "country" and "hip-hop" but also to the music
that caters to your "workout" or "sleep" preferences

34. • Starbucks
• When the hugely successful coffee chain Starbucks opened in the early 1970s, its
few stores in Seattle only sold coffee beans and coffee-making equipment.
Starbucks director of marketing and retail operations Howard Schultz convinced
the owners of Starbucks to sell it to him and a few investor partners to transform
it. Schultz pivoted the stores into coffeehouses where you could buy prepared
coffee as well as buy beans. The company thrived under Schultz’s leadership,
and he eventually stepped down as its chief executive in 2000. Schultz
then reinvented the company again when he returned as CEO in 2008. In his
second stint as CEO, Schultz pushed Starbucks to embrace technology to
engage customers better. Today, the Starbucks app is the most regularly used
loyalty rewards app among major restaurant chains.

35. • World Wildlife Fun
•
The World Wildlife Fund ensures their campaigns make their
audience rethink their environmental decisions. WWF creates
creates various striking and intense posters that question
your morals. This campaign is a form of social responsibility
marketing. Few of these posters include disintegrating
animals as a part of their “Desertification Campaign” and a
human-fish mutant as a part of their “Stop Climate Change
Before It Changes You” campaign. The agenda of WWF and
their marketing is to spread awareness of the importance of
social responsibility and the issues that affect the people.

36. • Amul
•
The multibillion dairy brand from India is the
India is the country’s largest milk and milk
and milk products producer.The company is
company is known for startingTheWhite
White Revolution in India.Their most
most famous and influential marketing was
marketing was the creation of their mascot,
mascot, the Amul girl.TheAmul girl was
was created as a response to their rival
rival Polson’s butter girl. Regular newspaper
newspaper strips with the Amul girl
highlighting famous international and
and political events have tremendously
tremendously helped Amul in the dairy
dairy business.They fix to a traditional

37. • Vodafone
•
In 2009,Vodafone brought into light an entity
entity that was never seen before in television. In
television. In response to the Indian Premier
Premier League in 2009,Vodafone created the
created the ZooZoos as their advertisement
advertisement character.ZooZoos are white
white creatures having ballooned bodies and
and circular heads.These characters appeared in
appeared in between matches to promote the
promote the company’s services.This creative

38. Company Mission Vision
Google
Our mission is to organize the world’s information and make it universally accessible
and useful
“To provide access to the world’s information in one click”
Apple Inc.
“To bring the best personal computing products and support to students, educators,
designers, scientists, engineers, businesspersons and consumers in over 140
countries around the world.”
“to make the best products on earth, and to leave the world better than we found it.”
Microsoft “To empower every person and every organization on the planet to achieve more.”
“We strive to create local opportunity, growth, and impact in every country around the
world.”
Amazon
“We strive to offer our customers the lowest possible prices, the best available
selection, and the utmost convenience.”
“to be Earth’s most customer-centric company, where customers can find and discover
anything they might want to buy online.”
Facebook “Give People the Power to Build Community and Bring the World Closer Together”
“People use Facebook to stay connected with friends and family, to discover what’s
going on in the world, and to share and express what matters to them.“
Tesla “to accelerate the world’s transition to sustainable energy.”
“to create the most compelling car company of the 21st century by driving the world’s
transition to electric vehicles”
Johnson & Johnson
“Our Credo Stems from a Belief That Consumers, Employees and the Community Are
All Equally Important”
“To help people see better, connect better, live better”
Samsung
“We will devote our human resources and technology to create superior products and
services, thereby contributing to a better global society.”
“To inspire the world with our revolutionary technologies, products, and design that
enrich people’s lives and contribute to social prosperity by creating a new future,”
Walmart “To save people money so they can live better” “Be THE destination for customers to save money, no matter how they want to shop.

39. An organization’s vision and mission combined offer a broad,
overall sense of the organization’s direction. To work toward achieving these overall
aspirations, organizations also need to create —narrower aims that should provide clear and
tangible guidance to employees as they perform their work on a daily basis. The most effective
goals are those that are
Specific,
Measurable,
Achievable,
Realistic, and
Time-bound.