Handout 1 Flashcards
is sometimes used as a synonym for “Strategy,” but the two terms are not the same.
“Strategic Management”
refers to a unique plan designed to achieve a competitive position in the market. It is also an interpretative plan that guides the organization to reach its goals and objectives.
strategy
it consists of analyses, decisions, and actions, an organization undertakes to create, implement, and sustain competitive advantages.
Strategic Management
Strategic Management is concerned with the analysis of strategic goals (mission, vision, and strategic objectives) along with the internal and external environments of the organization.
Analyses
address two (2) basic questions: What industries should we compete in? And how should we compete in those industries?
Decisions
require leaders to allocate necessary resources and to bring the intended strategies to reality.
Actions
This perspective refers to how efforts must be directed at what is best for the total organization, not just a single functional area.
Directs the organization toward overall goals and objectives.
those individuals, groups, and organizations interested in the organization’s success, including owners, employees, customers, suppliers, the community at large, and so on.
Includes multiple stakeholders in decision-making.
Managers must maintain both a vision for the future of the organization and a focus on its present operating needs.
Needs to incorporate short-term and long-term perspectives.
It is the difference between doing the right thing and doing things right.
Recognizes trade-offs between efficiency and effectiveness.
During this phase, organizations emphasize preparing and meeting annual budgets. Financial targets are established, revenues are measured, and costs are carefully monitored.
Phase 1: Basic financial planning.
During this phase, organizations usually extend time frames covered by the budgeting process (3-5 years).
Phase 2: Forecast-based planning.
During this phase, organizations attempt to understand basic marketplace phenomena. Organizations begin to search for new ways to define, meet, and satisfy customer’s needs and wants.
Phase 3: Externally oriented planning.
During this phase, the top management organizes planning groups of managers and key employees from various departments and workgroups.
Phase 4: Strategic management
This strategy defines the markets and business in which a company will operate. It also entails a clearly defined, long-term vision that organizations set to create corporate value and motivate the workforce to implement proper actions to achieve customer satisfaction.
Corporate-level strategy.
This strategy emphasizes strengthening the company’s competitive position of products or services.
Business level strategy.
This strategy is formulated to achieve some objectives of a business unit by maximizing resource productivity.
Functional level strategy
This strategy is usually created at the field level to achieve immediate objectives.
Operating level strategy.
It pertains to the value offered by a product or service to the market.
Benefit
It pertains to a selected group of customers within a business’ available market at which a business aims its marketing efforts and resources.
Target market.
It pertains to the rivalry between companies that sell similar goods and services.
Competition.
This pertains to the strategy of a company that involves producing a product or providing a service at a lower cost than its competitors.
Cost advantage.
This pertains to a company’s strategy that involves marketing the qualities of a product that sets it apart from other similar products and uses that difference to drive consumer choice.
Differentiation strategy
