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Lal Bahadur Shastri Institute of Management

PGDM (General)-Full-Time, Trimester-IV


Course Title: Strategic Management-1 Facilitators:
Course Code: 124009
Trimester-IV
Academic Session: 2017-18

COURSE OBJECTIVE:
The course is Part-1 of the Strategic Management. The objective of the course is to develop the
strategic-thinking skills of students through the concepts, models, and tools of strategic analysis,
as well as developing competencies to apply those tools to Strategy Formulation in actual
competitive situations.
The course takes a general management perspective, viewing the firm as a whole, and
examining how policies in each functional area are integrated into an overall competitive
strategy. The key strategic business decisions of concern in this course involve selecting
competitive strategies, creating and defending competitive advantages, defining firm
boundaries, and allocating critical resources. Decisions such as these can only be made
effectively by viewing a firm holistically, and over the long term.

LEARNING OUTCOME:
By the end of the course, students should be able to:
• Demonstrate understanding of Strategy as a concept and its importance for business
organizations.
• Analyze the main structural features of an industry and recognize the different stages of
industry evolution and develop strategies that position the firm most favorably in relation
to competition.
• Appraise the resources and capabilities of the firm in terms of their ability to confer
sustainable competitive advantage and formulate strategies that leverage a firm’s core
competencies.
• Demonstrate understanding of the concept of competitive advantage and its sources and
the ability to recognize it in real-world scenarios.
• Analyze dynamics in competitive rivalry including competitive action and response,
first-mover advantage, co-opetition and winner-take-all and make appropriate
recommendations for acting both proactively and defensively.
• Make recommendations for vertical and horizontal changes in the boundary of the firm;
taking firm international to create value.

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COURSE CONTENTS:
Module Session Topic & Reading/s
No. No./s
I 1-3 Strategic Management and Competitiveness
The Competitive Landscape, The Global Economy, Technology and
Technological Changes, The I/O Model and The Resource- Based Model for
Above Average Returns;
Setting Strategic Direction: Vision, Mission and Core Values: Strategic
Intent.
Stakeholders, Classification of Stakeholders, Strategic Leaders- The Work of
Effective Strategic Leaders, Predicting Outcomes of Strategic Decisions, The
Strategic Management Process.

Readings: Chapter-1, 2 Text Book (TPGSJ)

Additional Readings:
• Drucker, Peter (1994) "The Theory of Business", Harvard Business
Review, Sep-Oct
• Porter, M E (1996) "What is Strategy?", Harvard Business Review,
Nov-Dec
• Hamel, Gary (1996) "Strategy as Revolution", Harvard Business
Review, Jul-Aug
• Eisenhardt & Sull (2001) "Strategy as Simple Rules", Harvard
Business Review, Jan
• Mintzberg & Lampel (1999) "Reflecting on the Strategy Process" –
Sloan Management Review, Spring
• Collins & Porras (1996) "Building Your Company's Vision " – HBR
Sep-Oct
• Forest David & Fred David (2003) "It is time to redraft your mission
statement " – Journal of Business Strategy, Jan/Feb
• Hamel & Prahalad (1989) "Strategic Intent" – HBR May-June 1989
• The Different Approaches Firms Use to Set Strategy (2017), Jan W.
Rivkin; Kimberly Teti; Mu Jeung Yang; Nicholas Bloom; Raffaella
Sadun, HBR Web Article
II 4-5 The External Environment: Opportunities, Threats, Competition, and
Competitor Analysis
External Environmental Analysis; Segments of General Environment: The
Demographic Segment, The Economic Segment, The Political/Legal
Segment, The Socio-cultural Segment, The Global Segment, The Physical
Environment Segment
Industry Environment Analysis: Porter’s Five Forces Model, Strategic

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Groups, and Competitors Analysis

Readings: Chapter-3 Text Book (TPGSJ)

Additional Readings:
• M E Porter, (2008) "The Five Competitive Forces That Shape
Strategy?" – HBR January, pp.79-93
• M E Porter, (1990) "The Competitive Advantage of Nations" – HBR
March-April, pp.73-93
• Thompson & Strickland, Ch. 2
III 6-7 The Internal Environment: Resources, Capabilities, Competencies, and
Competitive Advantages
Analyzing the Internal Organization, The Context of Internal Analysis,
Creating Value, The Challenge of Analyzing the Internal Organization
Resources, Capabilities, Core Competencies: Four Criteria for Sustainable
Competitive Advantage
Value Chain Analysis and Outsourcing decision.
SWOT analysis and its interpretation

Reading: Chapter-4 (Text Book) (TPGSJ)

Additional Reading:
• Sanchez, R. (2004). Understanding competence-based management:
identifying and managing five modes of competence. Journal of
Business Research, 57, 518-532
• Sanchez, R., Heene, A. (2004). The New Strategic Management:
Organizations, Competition and Competence. New York: John Wiley
and Sons
• Wernerfelt, B. 1984. A Resource-based View of the Firm. Strategic
Management Journal, 5(June 1982): 171–180.
• Grant, R. M. 1996. Toward A Knowledge-Based Theory of The Firm.
Strategic Management Journal, 17: 109–122.
• Grant, Robert H. "The Resource-Based Theory of Competitive
Advantage: Implications for Strategy Formulation." California
Management Review 33, no. 3 (1991).
• Peteraf, M. A. 1993. The Cornerstones of Competitive Advantage: A
Resource-Based View. Strategic Management Journal, 14(3): 179–
191.
• Amit, R., & Schoemaker, P. J. H. 1993. Strategic Assets and
Organizational Rent. Strategic Management Journal, 14(1): 33–46.
• Szulanski, G. 1996. Exploring Internal Stickiness: Impediments to the

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Transfer of Best Practice Within the Firm. Strategic Management
Journal, 17: 27–43.
IV 8-9 Business Level Strategy
Business-Level Strategies, Effectively Managing Relationship with
Customers, Reach, Richness, and Affiliation;
Types of Business Level Strategies: Cost Leadership Strategy,
Differentiation Strategy, Integrated Cost Leadership/ Differentiation Strategy

Reading: Chapter 5 Text Book (TPGSJ)


V 10-11 Competitive Rivalry and Dynamics
Competitor Analysis: Market Commonality and Resource Similarity, Drivers
of Competitive Action and Responses.
Competitive Rivalry: Strategic and Tactical Actions, Likelihood of Attack
and Likely Hood of Response;
Competitive Dynamics: Slow Cycle Markets, Fast Cycle Markets and
Standard Cycle Markets.
Innovation as a Strategy

Readings: Text Book Chapter 6 (TPGSJ) and Chapter-4 (HIHM)

Additional Readings:
• Ming-Jer Chen, Competitor Analysis and Interfirm Rivalry: Toward A
Theoretical Integration, Academy of Management Review, 1996, Vol.
21, No. 1. 100-134.
• Eisenmann, Parker, and van Alstyne, “Strategies for Two-sided
Markets,” Harvard Business Review, October 2006.
12 Midterm Examination

VI 13-14 Corporate Level Strategy


Expansion Strategy: Organic and Inorganic
Levels of Diversification: Low, Moderate and High Levels of Diversification;
Reasons for Diversification- Value-Creating Diversification, Unrelated
Diversification, Restructuring of Assets, Value-Neutral Diversification and
Value-Reducing Diversification.
Business Portfolio Management Models- BCG, GE Multifactor etc.

Readings: Chapter-8 Text Book (TPGSJ)

Additional Readings:
• Campbell, Goold & Alexander, (1995) “Corporate Strategy: The
Quest” – HBR Mar-Apr
• Collis & Montgomery, (1998) “Creating Corporate Advantage” –

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HBR May-Jun

VII 15 Strategic Acquisitions and Restructuring


Mergers Acquisitions and Takeovers, Reasons of Acquisition, Problems in
Achieving Acquisition Success; Effective Acquisition; Restructuring

Readings; Chapter 6 (TPGSJ), Chapter-7 (HIHM)

Additional Readings:
John Stuckey and David White, “When and When NOT to Vertically
Integrate”, Sloan Management Review, vol. 34, 1993.
VIII 16 Global Strategy
Identifying International Opportunities: Incentives to use International
Strategy; International Strategies: International Business Level Strategies,
International Corporate Level Strategies.
Choice of International Entry Mode: Exporting, Licensing, Strategic Alliance,
Acquisitions, New Whole Subsidiary, Dynamics of Entry Mode;
Strategic Competitive Outcomes: International Diversification and Returns,
International Diversification and Innovation, Complexity of Managing
Multinational Firms;
Risks in International Environment: Political, Economic Risks,
Limits to International Expansion: Management Problems

Reading: Chapter-7 Text Book (TPGSJ)

Additional Readings:
Pankaj Ghemawat, Managing Differences: The Central Challenge of Global
Strategy, HBR 2007
IX 17 Co-operative Implications of Strategy
Strategic Alliances and Joint Ventures as Primary Type of Cooperative
Strategy, Types of Strategic Alliances, Reasons firms Develop Strategic
Alliances
Business-Level Cooperative Strategy, Corporate level cooperative strategy,
and International Cooperative Strategy
Network Cooperative Strategy.
Reading: Chapter-6 Text Book (TPGSJ), Chapter 9 (HIHM)
Additional Readings:

• Dyer, JH& Singh, H1998, ‘The relational view: cooperative strategy


and sources of interorganisational competitive advantage’, The
Academy of Management Review, vol. 23, no. 4, pp.
• McGrath, RG2013, ‘Transient Advantage’, Harvard Business Review,

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vol. 91, no.6, pp. 62-70.
• Hax & Wilde, (1999) “The Delta Model” – SMR Winter
• Katarina Funk, (2003) “Sustainability and Performance” – SMR
Winter
X 18-19 Group Presentations

XI 20 Wrapping up the Course- Strategic Management as a Process; Integrating


Strategy Crafting with Strategy Implementation.

SUGGESTED READINGS
Recommended Text Book:
Arthur A. Jr. Thompson, Margaret Peteraf, John E Gamble, A. J. Strickland III and A.K. Jain
(TPGSJ), Crafting & Executing Strategy: The Quest for Competitive Advantage: Concepts and
Cases, 19th edition, McGraw-Hill Education, India

Reference Books:
• Dess, Lumpkin, Eisner and Gerry McNamara Strategic Management: Creating
Competitive Advantages, sixth Edition, McGraw-Hill Education, India
• Hitt, Ireland, Hoskisson and Manikutty, (2012), Strategic Management, A South–Asian
Perspective, 9th. Edition, Cengage Learning, Indian Edition, Printed in India, 2012.
ISBN-13: 978-81-315-1621-8 and ISBN-10:81-315-1621-0
• Mason A Carpenter, Prashant Salwan, Wm. Gerard Sanders Strategic Management:
Concepts and Cases, 2/e, Pearson India, New Delhi-110001
• David, Fred R., (2016) Strategic Management: A Competitive Advantage Approach,
Concepts & Cases, 15/e, Pearson India, New Delhi-110001
• Jay B. Barney, William Hesterly Strategic Management and Competitive Advantage:
Concepts and Cases, 5/e, Pearson India, New Delhi-110001
• Robert M. Grant, Contemporary Strategy Analysis, 8th Edition, Wiley India, New Delhi
• Corporate Strategy: A Resource Based Approach, 2nd edition, by D.J. Collis and C.A.
Montgomery. Irwin McGraw-Hill Publishers
• Pankaj Ghemawat, Strategy and the Business Landscape, 3rd Edition, Pearson Education
• Hill, Charles W.L., Jones, Gareth R. Jones (2010), Strategic Management- An Integrated
Approach, Cengage Learning
• Sumantra Ghoshal et al (eds.) (2002) World Class in India, Penguin Books, New Delhi
• G Hamel & C K Prahalad (1994) Competing for the Future, Tata McGraw Hill
Publishing Co. Ltd.
• M E Porter (1990) Competitive Advantage of Nations, Free Press

Reference Journals:
• California Management Review
• Sloan Management Review

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• Academy of Management Journal
• Strategic Management Review
• Business Horizon
• Harvard Business Review
• Mckinsey Quarterly
• Indian Business Magazines like Business, Today, and Business World etc.
• Business Newspapers like Economic Times, Business Standard etc.

Suggested Cases:
Following are the indicative cases. The list is not exhaustive. Actual cases discussed in class
may vary depending on the facilitator.
1. Bhagwati Products Limited— Making in India for Micromax, Sunita Mehta, Surya Kant
Sharma, and Arun Pereira, Indian School of Business, December 2016 (Harvard
Publishing)
2. Tesla Motors (2014), by Eric Van Den Steen, Harvard Publishing
3. Coca-Cola vs. Pepsi in India: The Battle of the Bottle Continues –Case 1, Text Book
(HIHM) Page- 395
4. Arun Ice Cream (IIM- Ahmedabad Case)- Case-2 Text Book (Refer Text Book (HIHM)
5. Gujarat Co-Operative Milk Marketing Federation Limited (GCMMF) (IIM-Ahmedabad
Case)- Refer Case-3 (Text Book) (HIH)- Page 421
6. The Park Calcutta, (IIM-Ahmedabad Case) Case-4 (Text Book) (HIHM)-Refer Page-439
7. Kanpur Confectioneries Private Limited (A) and Kanpur Confectionaries Private
Limited (B)- Refer Text Book (HIHM): IIMA Case- 461 and 467
8. Arvind Eye Care System: Giving the Most Precious Gift (IIMA Case): Refer the Text
Book (HIHM)- Page-473
9. ITC Limited Bangalore (A) and ITC Bangalore (B)-Refer Text Book (page 495 and page
499)
10. Blockbuster Acquires Movie link- Refer Text Book (HIHM)-Page 615
11. Cognizant: Preparing for a Global Foot Print- Refer Text Book (HIHM)- Page-515
12. Emirates Airline: Connecting the Unconnected item by Juan Alcacer; John Clayton,
Harvard Publishing
13. Axis Bank, Banking on Technology and Market Segments for Competitive Space Refer
Text Book (TPGSJ) C 39-50
14. HT Media facing Competitive & Technological Convergence Challenges in 21st Century
Refer Text Book (TPGSJ) C71-88
15. TATA-Nano-vation Refer Text Book (TPGSJ) C 102-110
16. The Taj Hotels- Attempting a Broad Competitive Global Niche while Maintaining Brand
Equity Refer Text Book (TPGSJ) C 123-136
17. TATA Motors: Can it Become a Global Contender in the Automobile Industry? Refer
Text Book (TPGSJ) C 274-284
18. Coffee Wars in India: Cafe Coffee Day Takes on the Global Brands by David B. Yoffie;
Tanya Bijlani, Harvard Publishing

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EVALUATION:
The course will be evaluated on the following basis:
End Term Examination : 40 marks
Internal Assessment : 60 marks

Internal Assessment:
Mid-term Test (Compulsory) : 20 marks
Assignments and Presentation : 15 marks
Team Term End Project in Word Document : 15 marks
Quiz : 05 marks
Class Participation : 05 marks

This Evaluation Component and Weightage may vary depending on the Course Facilitator.
Internal evaluation will be done on a continuous basis and students will be formally briefed from
time to time about their progress. Final evaluation results may however be announced only at the
completion of an assignment.

The Course encourages both individual and Team Learning. The Students will form Teams with
approximately six students in each. Students will work group assignments in these teams and all
students are expected to actively engage with the group assignments.

PEDAGOGY:
The course will be a blend of interactive lectures, discussions, Case analysis, and Presentations.
In order to achieve the objectives of the course, majority of class time will be devoted to the
analysis and discussion of selected management and competitive strategy cases. Lectures will be
given to elaborate on key theoretical models and frameworks. Cases provide a natural "test-bed"
for theory and provide vivid examples that aid context to the concepts. Case analysis is an
indispensable proxy for the kind of knowledge that can only be gained through years of
experience and research. A set of business cases has been selected on a range of companies from
a variety of industry settings. Each case is intended to teach the participants something specific,
yet each can teach us many things. We will not attempt to exhaust each case of all its learning
experiences, but rather build up a "war chest" of analytical tools, skills and insights,
progressively over all the selected cases.

There are other reasons for employing the case discussion method of instruction. First, it allows
you to develop skills at problem definition in addition to problem solving. Cases typically do not
have an obvious set of tasks whose performance will lead to mastery. Rather, they force you to
sift through a mass of information, some of it irrelevant or contradictory, in order to identify the
important or strategic issues.

Second, the case method gives you a chance to deal with ambiguity. Most cases do not have
obvious "right" answers. Managers must be able to function in situations where the right answer

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is not known, without falling into the trap of assuming that any answer is as good as another.
Some analyses and proposed strategies are clearly wrong, and some are clearly better than others
are. A popular phrase in case analysis is "There are no right answers, but there are wrong
answers."

The quality of your learning experience during our class discussions will be directly determined
by: (1) your degree of preparation, active listening, and participation, and (2) your classmates'
preparation, listening, and participation. Some will not agree with you, and you may be asked to
defend your argument.

For a better understanding of Case Analysis students are advised to read “How to prepare and
Present a Case Analysis in Strategic Management by Fred. R. David (2011). Also Read the
PPT on How to do a Strategy Case Analysis by Dr. Figa adapted from (HIH). You can also
refer to Case Analysis from Dess, Lumpkin, Eisner and Gerry McNamara Strategic
Management: Creating Competitive Advantages, sixth Edition.