Strategic Management
STRATEGY FORMULATION Existing Business Model
Mission, Vision,
Values, and Goals
Chapter 1
External Analysis: SWOT Strategic Choice Internal Analysis:
Opportunities and Strengths and
Threats Weaknesses
Chapter 2 Chapter 3
Functional-Level Strategies
Chapter 4
FEEDBACK
Business-Level Strategies
Chapter 5,6,7
Global Strategies
Chapter 8
Corporate Level Strategies
Chapter 9, 10
STRATEGY IMPLEMENTATION
Governance and Ethics
Chapter 11
Designing Organization Designing Organization Designing Organization
Structure Culture Controls
Chapter 12 & 13 Chapter 12 & 13 Chapter 12 & 13
,Chapter 1: Strategic Leadership: Managing the Strategy-Making Process for
Competitive Advantages
- Strategy: a set of related actions that managers take to increase their company’s performance.
The main challenge is to achieving superior performance over its competitors to have
competitive advantages ( lower price, gain market share, etc).
- Strategic leadership: creating competitive advantage through effective management of the
strategy-making process.
- Strategy-making process: the process in which managers selects and implement a set of
strategies that aim to achieve competitive advantages.
- Four main categories of strategy:
o Functional-level strategies: improving the effectiveness of operations within companies
such as manufacturing, marketing, material management, etc
o Business-level strategies: encompass the business’s overall competitive theme, how it
positions in the industry to gain competitive advantages such as cost-leadership,
differentiation, niche market segment, etc.
o Global- level strategies: how to expand outside home country and grow.
o Corporate-level strategies: what business to maximize long-run profitability and profit
growth of the business.
- Strategy formulation: task of selecting strategies
- Strategy implementation: task of putting strategies into action, which includes designing,
delivering and supporting products; improving the efficiency and effectiveness of operations;
designing company’s organizational structure, control systems and culture.
- Competitive advantages: the achieved advantage over rivals when a company’s profitability is
greater than average profitability of firms in its industry.
- Sustained competitive advantages: a company’s strategy enables it to maintain above-average
profitability for a number of years.
- Business model: the conception of how strategies should work together as a whole to enable
the company to achieve competitive advantages.
- Level of strategic Management:
o Corporate Level: CEO, senior executives and corporate staff: defining business goals,
allocating resources, formulating and implementing strategies and providing leadership
for the entire organization to make sure they can maximize profitability and profit
growth
o Business level: head of division ( business level manager) for each business unit.:
translate the general statement of direction and intent that co from the corporate level
into concrete strategies for individual business, concerning strategies for particular
business to be the first in every business in which the corporation competes.
o Functional level : managers that responsible for specific business function and
operations: to develop functional strategy in areas to fulfill the strategic objectives set
by higher level general managers.
- Strategic planning process:
, Select strategies
built on strengths,
Analyze external
Analyze internal corrects weaknesses,
environment to
Select corporate environment to take advanatges of Implement the
identify
mission and goals identify strengths opportunity and strategies.
opportunities and
and weaknesses counter threats,
threats
consisting with
mission and goal.
- Mission: the purpose of the company, or a statement of what the company strives to do and the
basis of its competitive advantages. Ex: Google : to organize the world information and make it
universally accessible and useful.
o Customer-oriented: which kinds of customer needs the products are satisfying
o Product-oriented: focus on characteristics of products and markets.
- Vision: defines desired future state, what the company want to achieve. A powerful vision
statement can:
o attract commitment and energize employees and stakeholders
o Create meaning in worker’s lives
o Establish a standard of excellence
o Bridges the present and the future.
- Value: a statement of how employees should conduct themselves and their business to help
achieve the company mission. The set of values, norms and standards which create
organizational culture will control how employees work to achieve an organization’s mission and
goal.
- Goals: precise and measurable desired future state that a company attempts to realize. Well-
constructed goal have four main characteristics:
o precise and measurable
o address crucial issues
o challenging but realistic
o specify time period which the goals should be achieved.
- External analysis: identify opportunities and threats in the environment which would affect how
it pursues its mission. Including: the industry environment, the country or national environment
and wider socioeconomic or macro environment.
, - Internal analysis: reviewing the resources, capabilities and competencies of the company to
identify strengths and weaknesses.
- Strategy implementation: taking actions at the functional, business, corporate levels to execute
the strategic plan. Ex: putting quality improvement program into place, positioning products
differently, implementing price increase/decrease expansion through mergers and acquisition,
etc.
- Strategic leadership characteristics:
o Vision, eloquence and consistency: clear vision of where organization should go,
communicating the vision to others and articulating the vision until it becomes
organizational culture.
o Articulation of business model: ability to identify and articulate the business model
o Commitment: doing things with strong commitment and in serious manners
o Being well informed: develop a network of formal and informal sources who keep them
well informed about what going on within the company.
o Willingness to delegate and empower: skilled to delegate effectively.
o Astute use of power: using skills to build consensus for their ideas instead of using
authority
o Emotional intelligence: self-awareness, self-regulation, motivation, empathy and social
skills with friendliness.
Chapter 2: External Analysis : The Identification of Opportunities and
Threats
- Opportunities: Elements and conditions in a company’s environment that allow it to formulate
and implement strategies that enable it to become more profitable
- Threats: elements in the external environment that could endanger the integrity and
profitability of the company’s business.
- Industry: a group of companies offering products or services that are close substitutes for each
other
- Environment: refers to those aspects outside the organization that affect the business strategy
of an organization. The changes in the environment generate opportunities and threats, the
opportunities and threats present challenges to which organization must respond in order to
survive and prospects. Organization needs to scan its environment, monitor it and collect
competitive intelligence, predict how environment will be changed and understand its
implications. It can be broken into two levels for analytical convenience:
o Macro-environment ( those aspects outside the industry)
o Industry environment: those factors within the industry which affect both its
profitability and the competitive position of organizations within it.
STRATEGY FORMULATION Existing Business Model
Mission, Vision,
Values, and Goals
Chapter 1
External Analysis: SWOT Strategic Choice Internal Analysis:
Opportunities and Strengths and
Threats Weaknesses
Chapter 2 Chapter 3
Functional-Level Strategies
Chapter 4
FEEDBACK
Business-Level Strategies
Chapter 5,6,7
Global Strategies
Chapter 8
Corporate Level Strategies
Chapter 9, 10
STRATEGY IMPLEMENTATION
Governance and Ethics
Chapter 11
Designing Organization Designing Organization Designing Organization
Structure Culture Controls
Chapter 12 & 13 Chapter 12 & 13 Chapter 12 & 13
,Chapter 1: Strategic Leadership: Managing the Strategy-Making Process for
Competitive Advantages
- Strategy: a set of related actions that managers take to increase their company’s performance.
The main challenge is to achieving superior performance over its competitors to have
competitive advantages ( lower price, gain market share, etc).
- Strategic leadership: creating competitive advantage through effective management of the
strategy-making process.
- Strategy-making process: the process in which managers selects and implement a set of
strategies that aim to achieve competitive advantages.
- Four main categories of strategy:
o Functional-level strategies: improving the effectiveness of operations within companies
such as manufacturing, marketing, material management, etc
o Business-level strategies: encompass the business’s overall competitive theme, how it
positions in the industry to gain competitive advantages such as cost-leadership,
differentiation, niche market segment, etc.
o Global- level strategies: how to expand outside home country and grow.
o Corporate-level strategies: what business to maximize long-run profitability and profit
growth of the business.
- Strategy formulation: task of selecting strategies
- Strategy implementation: task of putting strategies into action, which includes designing,
delivering and supporting products; improving the efficiency and effectiveness of operations;
designing company’s organizational structure, control systems and culture.
- Competitive advantages: the achieved advantage over rivals when a company’s profitability is
greater than average profitability of firms in its industry.
- Sustained competitive advantages: a company’s strategy enables it to maintain above-average
profitability for a number of years.
- Business model: the conception of how strategies should work together as a whole to enable
the company to achieve competitive advantages.
- Level of strategic Management:
o Corporate Level: CEO, senior executives and corporate staff: defining business goals,
allocating resources, formulating and implementing strategies and providing leadership
for the entire organization to make sure they can maximize profitability and profit
growth
o Business level: head of division ( business level manager) for each business unit.:
translate the general statement of direction and intent that co from the corporate level
into concrete strategies for individual business, concerning strategies for particular
business to be the first in every business in which the corporation competes.
o Functional level : managers that responsible for specific business function and
operations: to develop functional strategy in areas to fulfill the strategic objectives set
by higher level general managers.
- Strategic planning process:
, Select strategies
built on strengths,
Analyze external
Analyze internal corrects weaknesses,
environment to
Select corporate environment to take advanatges of Implement the
identify
mission and goals identify strengths opportunity and strategies.
opportunities and
and weaknesses counter threats,
threats
consisting with
mission and goal.
- Mission: the purpose of the company, or a statement of what the company strives to do and the
basis of its competitive advantages. Ex: Google : to organize the world information and make it
universally accessible and useful.
o Customer-oriented: which kinds of customer needs the products are satisfying
o Product-oriented: focus on characteristics of products and markets.
- Vision: defines desired future state, what the company want to achieve. A powerful vision
statement can:
o attract commitment and energize employees and stakeholders
o Create meaning in worker’s lives
o Establish a standard of excellence
o Bridges the present and the future.
- Value: a statement of how employees should conduct themselves and their business to help
achieve the company mission. The set of values, norms and standards which create
organizational culture will control how employees work to achieve an organization’s mission and
goal.
- Goals: precise and measurable desired future state that a company attempts to realize. Well-
constructed goal have four main characteristics:
o precise and measurable
o address crucial issues
o challenging but realistic
o specify time period which the goals should be achieved.
- External analysis: identify opportunities and threats in the environment which would affect how
it pursues its mission. Including: the industry environment, the country or national environment
and wider socioeconomic or macro environment.
, - Internal analysis: reviewing the resources, capabilities and competencies of the company to
identify strengths and weaknesses.
- Strategy implementation: taking actions at the functional, business, corporate levels to execute
the strategic plan. Ex: putting quality improvement program into place, positioning products
differently, implementing price increase/decrease expansion through mergers and acquisition,
etc.
- Strategic leadership characteristics:
o Vision, eloquence and consistency: clear vision of where organization should go,
communicating the vision to others and articulating the vision until it becomes
organizational culture.
o Articulation of business model: ability to identify and articulate the business model
o Commitment: doing things with strong commitment and in serious manners
o Being well informed: develop a network of formal and informal sources who keep them
well informed about what going on within the company.
o Willingness to delegate and empower: skilled to delegate effectively.
o Astute use of power: using skills to build consensus for their ideas instead of using
authority
o Emotional intelligence: self-awareness, self-regulation, motivation, empathy and social
skills with friendliness.
Chapter 2: External Analysis : The Identification of Opportunities and
Threats
- Opportunities: Elements and conditions in a company’s environment that allow it to formulate
and implement strategies that enable it to become more profitable
- Threats: elements in the external environment that could endanger the integrity and
profitability of the company’s business.
- Industry: a group of companies offering products or services that are close substitutes for each
other
- Environment: refers to those aspects outside the organization that affect the business strategy
of an organization. The changes in the environment generate opportunities and threats, the
opportunities and threats present challenges to which organization must respond in order to
survive and prospects. Organization needs to scan its environment, monitor it and collect
competitive intelligence, predict how environment will be changed and understand its
implications. It can be broken into two levels for analytical convenience:
o Macro-environment ( those aspects outside the industry)
o Industry environment: those factors within the industry which affect both its
profitability and the competitive position of organizations within it.
