MAC2602-Exam Pack

Exam pack consists of: Study notes Exam papers+Solutions Assignments & solutions. Study Guide One Part 1 : Strategy and strategic planning Topic 1 : Development of the organisation’s strategy Study Unit 1 : Defining concepts – mission,core values,vision,strategy and strategic objectives  Mission - core purpose Effective mission statement :  Inspire change ,but does not change  Long-term in nature  Easy to understand and easy to communicate  Core values - principles that guide the organisation  Vision - defines direction for the future  Strategy – choosing long-term strategies to achieve purpose set out in mission statement Three generally accepted competitive strategies :  Cost leadership strategy  Pricing strategy :  Price skimming  Selective pricing  Market pricing  Predatory (penetration) pricing  Differentiation Elements of strategy :  Choice of activities which provide a competitive advantage  Trade-offs made to choose specific actions  Activities chosen must fit one another  Major structural changes can change strategies,however cannot be constantly reinvented  Formulation should display a broad conceptual knowledge of the operating environment of the organisation  Core values are taken into account  Strategic objectives – measures to progress and targets to achieve in a specific time frame Characteristics :  Precise formulation of goals to be achieved  Contains a measure of progress  Contains a target to be achieved  Contains a time frame for target to be achieved SMART criteria :  Specific  Measurable  Attainable  Relevant  Time-bound Study Unit 2 : Key stakeholders : roles,conflict and influences  Stakeholders – those persons and organisations that are affected by the organisation's activities and who have an interest in the strategy of the organisation.  Classification of stakeholders :  Primary Stakeholders (have a contractual relationship)  Internal Stakeholders o Managers o Employees  Connected Stakeholders o Shareholders/owners o Banks and lenders o Suppliers o Customers  Secondary Stakeholders (do not have a contractual relationship)  External Stakeholders o Government o Local authorities o Professional bodies o Pressure groups o Community at large  Possible conflicts between the expectations of the different types of stakeholders - shareholders/owners expect a specific return on their investment whilst employees expect security of their jobs and job satisfaction.  Influence of different stakeholders on development of organisation strategy :  Dependency  Degrees of power  Level of interest