Strategic Formulation Flashcards
What are the 4 basic elements of strategic management
Environmental scanning
Strategy formulation
Strategy implementation
Evaluation and control
What is strategy formulation
Development of values/vision/mission statement and identification of goals/objectives
External analysis (PEST) and internal analysis (SWOT)
Generating/evaluating/selecting strategies
What is a core value statement
Organizations tend to use “commitment to” for examples such as; integrity, fairness, discipline, equal employment opportunity, teamwork, accountability, continuous improvement
What is a vision statement
The desired state or aspiration of an organization
Statement of strategic intent
Short, wide management engagement/input in its development
Identifies the type of business the firm engages
What is a mission statement
Declaration of an organizations ‘reason for being’
Identifies what their business is and who they serve
It’s necessary to establish objectives/goals ➡️ formulate strategies ➡️ implement and evaluate strategy
What are the components of a mission statement
Customers
Products/services
Markets
Technology
Concern for survival, growth & profitability
Philosophy
Distinctive competence
Concern for public image
Concern for employees
What are the characteristics of a mission statement
Broad in scope
Fewer than 150 words in length
Inspiring
Identifies the utility of a firm’s product
Reveals that the firm is socially responsible
Reveals that the firm is environmentally responsible
Includes the 9 components
Reconciliatory
Enduring
Functions of a mission statement
Defines the role of the business in society; satisfies employees human needs for meaning and purpose; guides the development of objectives and strategies; conveys a sense of corporate identity
Focus of a mission statement
No consensus as to what mission statements should/shouldn’tinclude
Form of a mission statement
Poor quality in development and content of a mission statement; ‘piece of corporate window dressing’; company reality vs mission statement
10 benefits of a clear mission and vision
Achieve clarity of purpose among all managers and employees
Provide a basis for all other strategic planning activities, including internal and external assessment, establishing objectives, developing strategies, choosing among alternative strategies, devising policies, establishing organizational structure, allocating resources, and evaluating performance
Provide direction
Provide a focal point for all stakeholders of the firm
Resolve divergent views among managers
Promote a sense of shared expectations among all managers and employees
Project a sense of worth and intent to all stakeholders
Project an organized, motivated organization worthy of support
Achieve higher organizational performance
Achieve synergy among all managers and employees
What is the difference between goals and objectives
Goals:
General
Intangible
Broad
Abstract
Strategic
Objectives:
Specific
Measurable
Narrow
Concrete
Tactical
Examples of goals/objectives setting areas
Profitability
Market standing
Innovation/R&D
Productivity
Worker Performance & attitudes
Physical & financial resources
Manager performance & development
Social responsibility
