Lecture 1 - Introduction Flashcards
(!) Describe strategy in general
Definition:
- “Strategy is a pattern”: “Consistency in behavior over time”
General:
- Include complex tradeoffs: Cannot do it all
- Not always realized as intended or planned
- Affects firm welfare
- Concerns both organization & environment: Fit
- Forms on different levels: Top-down or bottom-up
- Issues of both content & process: Eg. Consistency vs. flexibility
___________
Strategies:
Corporate strategy:
- Business to operate in, acquire, divest, structure & finance
- Where to compete
Business unit strategy:
- How SBU´s compete
- How SBU´s are positioned
Operational strategy:
- How functions contribute to business strategy & competitiveness
(!) Describe intended, realized & unrealized strategies & deliberate vs. emergent strategies
Intended:
- Forward looking
- Formal plan
Realized:
- Backward looking
- Show pattern
Unrealized:
- Not realized strategy intentions.
- If unrealistic expectations
- If misjudged environment
- If change in plans
Deliberate:
- Strict plan
Emergent:
- Actions create pattern over time
- Realized pattern maybe not intended
- More open
- Depend on other actors
Umbrella:
- More strategies
(!) Describe the difference between strategy formulation & implementation
General:
- Timing depend on schools
- Both part of formation
- MCS part of both
- Sometimes black box in between
Strategy formulation:
- Managerial activity
- Often cognitive nature
Strategy management:
- Rational progression from formulation to implementation
- Most likely include feedback loops
Strategy implementation:
- Translate strategy into actions
- Eg. Resource allocation & design of MCS
(!) Describe different roles of strategy & their advantages & disadvantages
General:
- Vital in both absence or presence
___________
Sets direction:
Advantage:
- Create & maintain cohesion
Disadvantage:
- Blind potential dangers: Especially if unknown territory
- Wrong direction
- More directions: Keep options open
___________
Focus effort:
Advantage:
- Coordinate activities
- Reduce disorder
Disadvantage:
- Groupthink: Keep options open
___________
Define organization:
Advantage:
- Shared identity
- Understand organization
Disadvantage:
- Lose richness
- Stereotyping: No diversity
- Lose complexity if too sharp
___________
Provide consistency:
Advantage:
- Reduce ambiguity: Dansk: Tvetydighed
- Explain world
- Provide order
Disadvantage:
- Reduce creativity
- Too simple
(!!) Why does we use different strategy schools?
General:
- No one size fits all
- Firms vary widely
- Situations change
- Firm never do one thing
- Firms are complex & dynamic
- Contingency important: Many IV´s simultaneous
- Different lenses
- Dynamic systems often too simple or too complex
(!!) Describe the difference between predictive & descriptive schools
General:
Prescriptive:
- First four schools: Earliest
- How strategies should be formulated > How strategies do form
- What to do in situation
- Promote control
- Still good frameworks
- Eg. Porter
- Ref. Deliberate
Descriptive:
- Last four schools: Latest
- How strategies are made > Ideal strategic behavior
- Ref. Emergent
(!) Describe the five P´s
Plan & Pattern:
Plan:
- Planning school
- Made in advance
- Specify future choices
- Achieve objectives
- Ref. Diagnostic control
Pattern:
- “Stream of decisions or actions over time”
- “Consistency in behavior over time”
- Actiondriven > Designdriven
- Eg. VRIO
- Reveal strategy
- Ref. Interactive control
__________
Position & Perspective:
General:
- 2x2 matrice
- Old vs. new position & perspective
- Change of position within perspective easier than opposite
Position:
- Positioning school
- Unique place in environment
- Match organization & context
- Eg. Porters five forces
- Ref. Boundary system
Perspective:
- Entrepreneural school
- Where are we going?
- Intensely shared
- “Character” of organization
- Broader than position
- (Collective concept)
- (World view)
- Ref. Belief system
__________
Ploy:
- Manoeuvre to outwit opponent or competitor
- Ref. Power school & game theory
- Political
(Kilde mangler) Describe the four basic approaches to strategy formation
General:
- 2x2 matrice
- X-axis: Strategy content. Tangible position vs. broad perspective
- Y-axis: Deliberate vs. emergent pattern
__________
Approaches:
Strategic planning:
- Tangible position + Deliberate pattern
- Planning, design & positioning school
Strategic venturing:
- Tangible position + Emergent pattern
- Learning, power & cognitive school
Strategic visioning:
- Broad perspective + Deliberate pattern
- Entrepreneurial, design, cultural & cognitive school
Strategic learning:
- Broad perspective + Emergent pattern
- Learning & entrepreneurial school
(!) Describe the prospector & defender strategy & its relation to MCS
General:
- Change-rate in product or market
- Configurations/archetypes
_____________
Defenders:
General:
- Internal efficiency
- Keep market position
- Control, stability & routines
- Formal
- Centralized
- Quality or price
- Core competencies
- Narrow product range
- Little product/market development
- Functional departments
- Less control systems
Relation to MCS
- Efficiency focus
- Objective performance evaluation & reward systems: Financial measures
- If certainty / stable environment
- If accurate measures
Critical functions:
- Finance
- Production
- Engineering
____________
Prospectors:
General:
- Product & market development
- Informal
- Decentralized
- Product & market development
- Innovation: First-mover
- More control systems
Relation to MCS:
- Idea generation focus
- Subjective performance evaluation & reward systems: Non-financial measures
- If uncertainty / unstable environment
- If not accurate measures
Critical functions:
- Marketing
- R&D
____________
Analyzers:
- Strongest characteristics of defenders & prospectors
- Dual technological core: Stable & flexible
- (Steady growth through market penetration)
- (Engineering is highly influential)
- (Loose matrix structure)
- (Balance new & old business)
_____________
Reactors:
- Adjust to environment
- No clear strategy
- No fully developed structure to fit strategy
- Only good in regulated environments
(.) Describe Porters generic strategies & the value chain
General:
- Basis for sustaining competitive advantage within industry
- Define context for action in each area of organization
- Must avoid “stuck in the middle”
Cost leadership:
- Broad scope
- Lowest cost in industry
- Economies of scale
Differentiation:
- Broad scope
- Attribute highly valued by customers: Quality, flexibility, availability, after sales service
- More subjective measures
Focus:
- Narrow scope
- Dedication to segment
- Either cost leadership or differentiation
____________
Value chain:
- Systematic way of examining firms activities & their interactions
- Basis for identifying source of competitive advantage
(!) Describe the strategic missions; build, hold, harvest
General:
- Classify variations in strategic missions
- Market share growth vs. Short term earning
- Ref. Life cycle?
Build:
- Improve market share & competitive position
- May decrease cashflow or short term earning
- Require competitive superiority in industry
- More subjective measures
- More long term focused
- Ref. Prospector
Hold:
- Protect market share, competitive position & reasonable ROI
- Often if high market share & high growth industry
- Ref. Defender
Harvest:
- Maximize short term profit and cashflow
- May decrease market share
- Ref. Defender
(.) Describe the eight different types of strategies
General:
- From most deliberate to emergent
Planned:
- Stable environment
- Often unrealized strategy
- Precise intention but surprise at implementation
- ? Ref. Planning + Design
Entrepreneurial:
- Vision
- Based on individual strategy
- Personal vision –> Opportunistic emergence or deliberate actualization
- ? Ref. Entrepreneurial
Ideological:
- Values or identity
- Collective vision –> Share values –> Intended to be deliberate
- ? Ref. Cultural
Umbrella:
- Strategy within specific area
- Less control of strategy
- Eg. Only go to market if possible market leader position
- Leadership in partial control –> Target and or limits –> partly deliberate, partly emergent –> Deliberately emergent (Within borders)
- ? Ref. Positioning
Process:
- Has boundaries
- Structured way
- Controlled process
- Content from participants: Quite open
- Process of decision making at top –> Content of decisions below –> Deliberately emergent
- ? Ref. Cognition
Disconnected/Unconnected:
- When deviating from strategy
- Do what has always been done
- Strategy unconnected
- Subunit deliberate patterns –> Convergence for the whole –> Collective patterns (May not be achieved)
- ? Ref Learning
Consensus:
- Spontaneous
- Through negotiation
- Ongoing adaption
- Mutual adjustments –> Emergence
- ? Ref. Power
Imposed:
- Within boundaries
- Comes from outside
- Eg. Regulated industry
- Firm react to environment change for survival
- Adaptive response –> Organizationally emergent
- ? Ref. Environmental + Configuration
(.) Describe case study research
General:
- To study relationship between MCS, strategy formulation & implementation
Benefits:
- Show how MCS influence & assist strategic formulation, implementation & change
Critiques:
- Lack generalizability
- No evidence on specific controls for particular strategies
- (Inability to provide body of accumulated knowledge)
(!) Describe the eight strategic issues
Change issue:
- Stability vs. change
- Occasional vs. incremental change
- Learning, planning or analyzing?
- Ref. Innovation types
Choice issue:
- Free will vs. pure determination
- Conscious vs. unconscious choice
- Ref. Environmental & culture school
Collective issue:
- Strategist: CEO, people or environment?
- Ref. Entrepreneur, learning, culture & environmental school
Complexity issue:
- Understandability vs. complexity
- KISS = Keep it simple, stupid
- Ref. Learning & culture school
Control issue:
- Deliberate vs. emergent: Control vs. learning
- Never entirely chosen irl
- Ref. Prescriptive vs. learning schools
Integration issue:
- Loose vs. fully integration
- Loose: Portfolio perspective
- Fully: Entrepreneurial & cultural school
Generic issue:
- Generic vs. unique:
- Top down vs. bottom up
- Ref. Prescriptive, learning + cultural schools
Thinking issue:
- Deliberate control vs. learning school
- Thinking too much vs. thinking too little
(!!) Describe how the schools build on each other
General:
- Not two periods, just extremes
One extreme:
- Outside-in: P5F
- Positioning school
- Closely related to planning
- More deliberate
- Design school foundation to prescriptive schools
Another extreme:
- Newer
- Inside-out: Resource based view. VRIO
- Learning & cultural school
- Learning criticize cognition school: Sometimes we just try things
- MCS as package
- More emergent
(!!) Relate the schools
(!!) Describe the different categories in the curriculum
+ concious & unconcious
