PPT CH. 1 Flashcards
two perspectives of leadership
external control perspective and romantic view
According to Henry Mintzberg, the realized strategies of a firm
B. a combination of deliberate and differentiation strategies
intended strategy
- organizational decisions are determined only by analysis.
- Intended strategies rarely survive in the original form
Realized strategy
Decisions are determined by both analysis (deliberate) and unforeseen environmental developments, unanticipated resource constraints, and/or changes in managerial preferences (emergent).
Strategy analysis
is the starting point in the strategic management process.The analysis needs to be done to effectively formulate and implement strategies.It involves careful analysis of the overarching goals of the organization.It requires a thorough analysis of the organization’s external and internal environment
Strategy Analysis - Analyzing organizational goals & objectives
- Establish a hierarchy of goals.
- Vision
- Mission
- Strategic Objectives
Analyzing the external environment of the firm
- Managers must monitor and scan the environment as well as analyze competitors.
- General environment
- Industry environment
Strategy Analysis - Assessing the internal environment of the firm
- Analyze strengths & relationships among activities that constitute a firm’s value chain.
- Analysis can uncover potential sources of competitive advantage
Assessing a firm’s intellectual assets
- Knowledge workers & other intellectual assets drive competitive advantage & wealth creation.
- Networks & relationships plus technology enhance collaboration, accumulates & stores know
Strategy Formulation - Based on strategy analysis, strategy formulation is developed at several levels.
- Business-level strategy how to compete in a given business to attain competitive advantage
- Corporate-level strategy what businesses to compete in; how businesses can be managed to achieve synergy
- International strategy what strategies are needed as the business ventures beyond its national boundaries
- Entrepreneurial initiatives how can businesses create new value
Strategy Formulation - Formulating business-level strategy
- Successful firms develop bases for sustainable competitive advantage through:
- Cost leadership and/or
- Differentiation, as well as
- Focusing on a narrow or industrywide market segment
Formulating corporate-level strategy
- Addresses a firm’s portfolio (or group) of businesses
- What business or businesses should we compete in?
- How can we manage this portfolio of businesses to create synergies?
Strategic Management Trade-offs
Managers need to be ambidextrous.
Focus on long-term effectiveness.
•Expand product-market scope by proactively exploring new opportunities.
At the same time:
•Focus on short-term efficiency.
•Align resources to take advantage of existing product markets.
Strategic Management
Key attributes of strategic management:
- Directs the organization toward overall goals and objectives.
- Includes multiple stakeholders in decision making.•Needs to incorporate short-term and long-term perspectives.
- Recognizes trade-offs between efficiency and effectiveness.
Defining Strategic Management:
Strategic management involves:
- Analysis
- Strategic goals (vision, mission, strategic objectives)
- Internal and external environment
- Decisions - Formulation
- What industries should we compete in?
- How should we compete in those industries?
- Actions – Implementation of strategy
- Allocate necessary resources.
- Design the organization to bring intended strategies to reality
