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Strategic
Management
Seminar
María Fonseca Paredes
Aug – Dec, 2014
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What is STRATEGY?
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Definition
! Pattern or plan to achieve long-term goals

1.“The goal of strategy is to achieve a “superior long-term
return on investment.” “Economic value is created when
customers are willing to pay a price for a product or service
that exceeds the cost of producing it.” [Porter, 2001]

2.“Competitive strategy is about being different.” [Porter, 1996]

3.“Strategy involves continuity of direction.” [Porter, 2001]

4. “A pattern in a stream of decisions” [Mintzberg, 1972]

5.“An action managers take to achieve one or more of
organization’s goals” [Hill&Jones, 2010]
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Strategic Management
“Process through which
managers select a set of
strategies to reach an
excel l ent and superi or
performance.”
Design and Crafting + Execution = Strategic Management
“The field of STRATEGIC MANAGEMENT deals with the major
intended and emergent initiatives taken by general managers on
behalf of owners, involving utilization of resources, to enhance
the performance of firms in their external environments.”
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Mintzberg's 5 Ps for Strategy
Plan Ploy Pattern Position Perspective
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Why do some organizations
succeed while others fail?
! Competitive
advantage
! A firm’s profitability is
greater than the
average profitability for
all firms in its industry
! Sustained competitive
advantage
! A firm maintains
competitive advantage
for a number of years
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Superior Performance and
Competitive Advantage
! Profitability
! A measure of a company’s
return on its invested
capital
! Superior performance
! One company’s
profitability relative to
that of other companies in
the same or similar
business or industry
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Intended and Emergent Strategies
! Intended strategies
! Strategies an organization plans to put into action
! Emergent strategies
! Unplanned strategies
! Realized strategy
! The product of whatever intended strategies are actually put into
action and of any emergent strategies
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Emergent and Deliberate
Strategies
Source: Adapted from H. Mintzberg and A. McGugh, Administrative Science Quarterly, Vol. 30. No. 2,
June 1985.
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Strategic Managers
! General managers
! Responsible for overall company performance or divisional
performance
! Functional managers
! Responsible for supervising a particular task or operation
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The Strategic Planning Process
1. Select the corporate mission and major corporate
goals
2. Analyze the external competitive environment to
identify opportunities and threats
3. Analyze the organization’s internal environment to
identify its strengths and weaknesses
4. Select strategies that build on the organization’s
strengths and correct its weaknesses in order to take
advantage of external opportunities and counter
external threats
5. Implement the strategy
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" Mission Statement

o Mission – Reason for existence – what an
organization does
o Vision – Some desired future state
o Values – Key values an organization is
committed to
o Major Goals – Measurable desired future
state an organization attempts to realize
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The Vision
What would company like to achieve?
A good vision is meant to stretch a company by articulating an
ambitious but attainable future state.
Nokia is the world’s largest manufacturer of
mobile phones and operates with a simple
but powerful vision: “If it can go mobile, it
will!”
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Values
o How managers and employees should conduct
themselves
o How they should do business
o What kind of organization they need to build to
help achieve company’s mission
o Organizational culture
• Set of values, norms, and standards that control how employees
work to achieve organization’s mission and goals
• Often seen as an important source of competitive advantage
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Well-constructed goals:
1. Precise and measurable– provide yardstick or standard
to judge performance
2. Address crucial issues– a limited number of key goals
helps maintain focus
3. Challenging but realistic– provide employees with
incentive for improving
4. Specify time period– motivates/injects sense of urgency
into goal attainment
Major Goals
Goal - precise/measurable desired future
state a company attempts to realize.
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Strategic Leadership
# Vision, eloquence, and consistency
# Articulation of business model
# Commitment
# Well informed
# Willing to delegate or empower
# Astute use of power
# Emotional intelligence
Good leaders of strategy-making
process have key attributes:
What’s your personal Vision?