Chapter 3 - Planning And Strategic Management

Question 1

Discuss the components of strategy and types of strategic alternatives.

Answer 1

A strategy is a comprehensive plan for accomplishing the organizations goals.
Effective strategies address 3 organizational issues: Distinctive Competence, Scope and Resource Deployment.

Question 2

Describe how to use SWOT analysis in formulating a strategy.

Answer 2

Consider an organizations Strengths, Weaknesses, Opportunities and Threats.
1. Support The Mission, 2. Exploit the Opportunities and Strengths, 3. Neutralize its Threats and Avoid its Weaknesses.

Question 3

Summarize the planning process and describe organizational goals.

Answer 3

The planning process: 1. Understand the environment. 2. Formulate a Mission. 3. Create Goals and Plans.
Goals> Guidance and Direction>facilitates plans>inspires motivation and commitment>promotes evaluation and control.
Develop types of goals and plans: Strategic, Tactical and Operational

Question 4

Identify and Describe various alternative approaches to business-level Strategy Formulation.

Answer 4

Business-Level Strategy: Plan to conduct business in a particular Industry or Market:
Per Porter: 1. Differentiation Strategy. 2. Overall cost leadership strategy or 3. Focus Strategy.
Consider also the stages of products life cycles.

Question 5

Identify and describe the various alternative approaches to corporate -level strategy formulation.

Answer 5

1. Corporate level plan is for managing operations across several businesses.
2. No Diversification = Single Product Strategy
3. Related Diversification = A Set of Businesses that are somehow linked.
4. Unrelated Diversification = A Set of businesses that are not logically associated with one another.

Note BCG Matrix and GE Business Screen.

Question 6

Discuss how business tactical plans are developed and executed.

Answer 6

Tactical Plans = At Middle of Organization = intermediate time horizon = moderate in scope.

Tactical plans are developed to implement specific parts of a strategic plan.

Tactical Plans Must> Flow from the strategy>Specify Resource and Time Issues and commit Human Resources.

Question 7

Describe the basic types of Operational Plans Used by Organizations.

Answer 7

Organizational Plan = Lower Level of the Organization = Shorter Time Horizon = Narrower in scope. Derived from a Tactical Plan and aimed at achieving Organizational Goal(s).

Organizational Plans’ may be Single Use or Standing Plans.

Single use plan = One time projects or programs.

Standing Plans = Policies, Rules and Regulations, Operating Procedures.

Contingency Planning and Crises Management are important forms of operational planning.