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What is Strategy

What is Strategy

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Published by: Rohan Kulkarni on Oct 04, 2012
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Case Journal Review
Journal : - Harvard Business Review Case Title : - What is Strategy?
- by Michael E. Porter

Case Reviewer : - Bharti Punjabi

Lata Thakur Rohan Kulkarni

Father of the Modern Strategy Michael Eugene Porter .

• And a Ph.Overview • B.S.B. . • Porter was an outstanding intercollegiate golfer while at Princeton. in Business Economics from Harvard University in 1973.D.E.A. in 1971 from the Harvard Business School. in aerospace and mechanical engineering from Princeton University. • He received an M.

• He is also a Fellow Member of the Strategic Management Society. Competitive Advantage. Competitive Advantage of Nations. • His main academic objectives focus on how a firm or a region can build a competitive advantage and develop competitive strategy. • In 2009.Continued … • Michael Porter is the author of 18 books and numerous articles including Competitive Strategy. Professor Porter is the most cited author in business and economics. . he was awarded an honorary degree from McGill University. and On Competition. • A six-time winner of the McKinsey Award for the best Harvard Business Review article of the year.

Some Concepts • Competitive advantage • Operational activities • Strategic positioning .

allowing it to generate greater sales or margins and/or retain more customers than its competition. distribution network and customer support. . producing. product offerings. selling and delivering a product or service are the basis of competitive advantage. • The myriad of activities that go into creating.Competitive advantage • An advantage that a firm has over its competitors. There can be many types of competitive advantages including the firm's cost structure.

producing. selling and delivering a product or service) better – that is faster .Operational effectiveness • Operational effectiveness means performing these activities (creating. or with fewer inputs and defects – than rivals .

It means performing different activities from rivals.Strategic positioning • Strategic positioning attempts to achieve sustainable competitive advantage by preserving what is distinctive about a company. or performing similar activities into different ways. .

outsourcing and change management. • Operational effectiveness have been able to bring improvements. • The root cause of problem sustainable profitability. benchmarking.Operational effectiveness is not strategy • Quest for productivity. • Management tools and technique such as TQM. quality. . and speed has. time-based competition.

. for Sustainable Profitability.Necessary but not sufficient • Operational effectiveness and strategy are both essential to superior performance.Operational effectiveness -.

• Enjoyed substantial cost and quality advantages for many years.Japanese company rarely have Strategies • Triggered Global Revolution in Operational Effectiveness. • Pioneered in 1970’s and 1980’s TQM and continuous improvement. .

g. • • • • . Canon. But as the gap in operational effectiveness narrows. Japanese companies are increasingly caught in a trap of their own making If now they escape the mutually destructive battles ravaging their performance. Japanese companies will have to learn strategy.Continued … • Many Japanese companies rarely developed distinct strategic position Some exceptions were e. Most Japanese companies imitate and emulate one another.: Sony. and Sega.

Mapping Activity Models For  IKEA  Vanguard  Southwest Airlines .

IKEA Furniture .

.

.

Southwest Airlines .

 Aggressive Outsourcing & Partnering. Sustainable Competitive Advantage  Unique Competitive position for the company.  Clear trade-offs & choices.  Operational effectiveness a given. core competencies etc.  Sustainability comes from the activity system.  Benchmarking Of All Activities.  Competitive advantage arises from fit across activities.Alternative Views Of Strategy Strategy Model of the Past Decade  One ideal Competitive position in the Industry. not the parts. .  Advantages rest on few key success factors.  Activities tailored to strategy.  Flexibility & Quick responses to competitive and market changes.

Rediscovering Strategy  Failure • • • • Confusion Pressure Hyper competition Operational Effectiveness  The Growth Trap .

Reconnecting with Strategy .

Emerging industries & Technologies .

Continued …  Profitable Growth  The Role Of Leadership .

Conclusion .

Bibliography • Harvard Business Review (November – December 1996) What is strategy? – by Michael E. Porter • www.google.com .

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