Strategic Management

Introduction

Placing strategy in a historical context

Military antecedents ( strategy v/s tactics ) Traced back to ancient Greeks Business context and applications had to wait till the second industrial revolution

Placing strategy in a historical context

World War II, stimulus to strategic thinking in both military & business context

New OR Techniques (Linear programing) Theory of Games Concept of Learning Curve

Navy and Distinctive Competence

Some early contributors

Chester Barnard (strategic limiting factor) Joseph Schumpeter (role of innovations) Edith Penrose (resources under control of the firm) Kenneth Andrew ( SWOT ) Theodore Levitt (Willingness to gamble) Ansoff ( product / mission matrix )

Academic Origins

Industrial economics Organisational sociology Institutional economics

Learnings from

Exemplary companies Business history

Defining Strategy

Determination of long term goals/objective of an enterprise and adoption of course of action / allocation of resources to achieve these goals. Theory of how to gain competitive advantage.

Thinking Strategies & Schools

Design School Planning School Positioning School Entrepreneurial School Learning School Power / Culture School Configuration School

Thinking Strategies & Schools

Design school Strategy as a process of conception

(Chandler, Andrews, Christensen) SWOT Fit between external environment & internal capabilities

Thinking Strategies & Schools

Planning school Strategy as a formal process

Igor Ansoff, Peter Lorange Emphasis on decomposition (distinct steps) & formalisation (techniques & check-lists) Objective setting, External & Internal audit, evaluation, operationalization, scheduling Scenario building as a tool

Thinking Strategies & Schools

Positioning school strategy as an analytical process

Michael Porter
Five forces model Generic strategies

Borrows from military writings Consulting imperative

Thinking strategies & schools

Entrepreneurial School Strategy as a visionary process

Schumpeter, Pinchot Focused on a leader stressing intuition, judgement, wisdom, experience, insight Vision an inspiration and a guiding idea

Thinking Strategies & Schools

Learning school Strategy formulation as an emergent process

Lindblom, Brian Quinn Strategy emerges as people/ organisations learn Logical incrementalism Knowledge management & learning organisations

Thinking Strategies & Schools

Power school A process of Negotiations

Political games, Stakeholder Analysis & Strategic alliances

Cultural school A collective process

Andrew Pettigrew Shared values, decision making styles, resistance to change

Thinking Strategies & Schools

Configuration school Strategy as a process of transformation

Long periods of stability, interrupted by periods of transformation Change management, Transformational leadership Turnaround management

The strategy beast Areas of agreement

Concerns both organisation & environment The substance of strategy is complex Affects the overall welfare of organisation Involves both content & proces. Are not purely deliberate Exist at different levels Involves various thought processes