Q1. How do you differentiate between strategy and strategic management? What is your understanding of ‘Policy’? Write down source definitions of strategic management. Strategy is defined as the unified plan designed to achieve goals and objectives. This plan is conducted after understanding the environment and system. Strategy is the process of providing a trick so as to reach the destination with saving in time, cost, resources and energy. Strategy is all about providing a course of action and every strategy is how to beat the competition. Strategy is all about providing a right set of tools and techniques to make sure that the process of success is well defined. Strategy is a tool in every initiative we take up with. It starts with proper understanding o environment and creating a strategy requires providing a option for understanding the decision and providing solutions for each of the type. Strategies are done at corporate, business and functional level. The term strategy is derived from Greek word ‘Strategos’ which means ‘Generalship’ i.e. The science or art of planning and directing large scale military movements and operations. In business parlance strategy may be defined a stream if management decisions that determine the purpose and direction if the enterprise. These management decisions serve as a route may to guide the enterprise towards its desired destination as specified in its mission statement. Example of strategic decisions include:(i) (ii) (iii) (iv) (v) Financing if business Pricing if products to gain competitive advantage in the market place Diversification, acquisition and divestment Retrenchment of employees Recognition if trade unions etc
Strategy is the directions and scope of an organization over the long term which achieve advantages for the organization through its configuration if resources within a changing environment, to meet the need of market and to fulfill stake holder expectations. Strategic Management: It is all about creating a mission understanding, the environment analyzing the environment institutionalizing the strategy, controlling and evaluating, whereas institutionalizing means way if doing a practice and uses. Strategic Management requires a proper way if evaluating and controlling by use of various types if strategies defined strategic management as “a stream of decisions and actions which leads to the development of an effective strategy or strategies to help achieve corporate objectives”. Policy: The implementation of strategy requires development of functional policies. These provide direction to middle management on how best to make use if the resources allocated. They guide middle managers in devising operational plans and tactics to make the strategy work. Policy is only guide to action. It does not provide prescription on how to handle specific situations like introduction of specific products or dismissal of a particular worker. Policy is the general guidelines which help managers to make certain choices. Policies are developed to ensure that strategic decisions are implemented. It channelizes organizational efforts. It leads to the achievement if goals, objectives, purpose and mission if the company. Firms environmental factors, internal policies and power play, all affect the policy making process as the policies decided will ultimately influence the distribution if resources. Also internal resistance to change, coalition building and conflicts between units are likely to occur during the development of policies. Specialists in each functional area develop plans and policies. The functional areas have traditionally been classified as production, marketing, finance and personnel.
Strategic decision making is the prominent task of the senior management. The characteristics of strategic decision 1. strategic advantage can be thought of as providing better value for money services than other providers thus attracting support and funding from the government. Thus. most aspects of strategy rest on strategic decision making. Strategic decisions are normally about trying to achieve some advantage for the
organization over competition. resource allocation etc. The issue if scope of activity is fundamental to strategy because it concerns the way in which those responsible for managing the organization conceive the organizations boundaries. necessary to achieve renewal and growth within the organizational system needed to effectively manage the strategic formulation and implementation process.Strategic decision making is the most important functions if any manager. The fundamental strategic decision relates to the choice of a mission. This could include important decisions about product range or geographical coverage. as the search if effective positioning in relation to competition so as to achieve advantage. at times intriguing and enigmatic process specially in organization with wide geographic scope such as multinational firms or in firms with wide ranges if products and services.
2. Hofer and others considered strategic management as the process which deals with fundamental organizational renewal and growth with the development if strategies. In other words. answers to questions. 3. It is also defined as a “stream if decisions and actions which lead to the development of an effective strategy or strategies to help achieve corporate objectives”. company’s strength and weakness. Strategic decisions are likely to be concerned with the scope of an organizations activity. complicated and.g. Strategic decisions are likely to affect operational decisions. Strategic decisions are sometimes conceived of. Strategic decisions are likely to be concerned with the long-term direction if an organization. at the level if choosing the strategy. For e. Thus. the senior managements chooses from among a number of strategic alternative in order to adopt one specific course if action which would make the company achieve its objective and realize its mission. In the public sector. The merger was expected to give manager advantage in the music industry to the extent that it could transformer the way in which music was sold and distributed and how artists received payments. In the process of strategic mgt the basic thrust of strategic decision making is to make a choice regarding the courses if action to adopt.
4. structures and systems. In other situations advantage may be achieved in different ways and may also mean different things. “What is our business? What will it be? And what should it be?” Are the basic concerns in strategic management? Finally.g. Senior management has to make important strategic decisions with regard to environmental threat and opportunities.”
. strategic decision making joins the cores of strategic management. therefore. For e. They are extremely
difficult. Strategic decisions can involve a high degree of uncertainty. Definitions of strategic management Strategic management includes understanding the strategic position of an organization. strategic choices for the future and tuning strategy into action.
Mission can be defined as the overriding purpose in line with the values on expectations of stakeholders.
Q2. Ranbaxy – “To become $1 billion research based global pharmaceuticals company”. the firm’s core values and its role in the society. Objectives are open ended attributes whereas goals are closed ended attributes. The forces in the environment which are represented by the firm’s stockholders. functions and markets it expects to serve. 4. The mission statement therefore informs everyone if the corporate vision and purpose. service or markets. Mission The corporate mission statement describes the firm’s basic purpose i. Examples are:1. Write down your company’s vision and mission statements and discuss whether they fit into your definitions. Distinguish between official and operative objectives. The following factors influence the formulation if objectives:-
1. Increase in the market share. trade unions.
Objectives should be specific. What are goals and objectives? What are the main features of objectives? State factors affecting objectives. its beliefs and its long term aspirations.
These comprise the owners.. Goals: These are the general statement of purpose. The objectives if a firm is formulated by the top management. When expressed in specific terms objectives become goals.e. 2. 3. Tata Information System – “To be India’s most successful and most respected IT Company’. why it exists. shareholders. which are if vital and continuing importance to the total organization. governments. competitors and suppliers. They provide standards against which to measure organizational performance. Examples of few mission statements include:1. Growth in profits Quality products or services to customers Service to society. Vision It is desired future state on the aspiration if the organization. Objectives: Objectives are the ends which the organization strives to achieve in order to fulfill its mission. It should also provide a good statement of the business definition if the firm by specifying the products. 2. What is vision and mission? Enumerate its elements.Strategic mgt can also be defined as the formulation and implementation of plans and carrying out if activities related to the matters. attainable and time bound. how it sees itself. A clear business definition provides a better focus when top management considers various strategic alternatives with respect to products. measurable.
. what it wishes to do.
2. The firm should conduct themselves on the basis of certain fundamental principles. 6. 3. Concern for the quality of life including life at work. 3. however.g. No unfair discrimination in hiring promotion or dismissal of employee. Evaluate and write down to what extent does the organization follows social responsibility and its objectives? Corporate social responsibility demands that firms behave as ‘good citizen’ while pursuing purely commercial goals. Cost and increased corporate efficiency. What are the basic social obligations of a business organization? Do these conflicts with the profit objective of the business? What is social audit? Analyze the mission and objectives of your own organization. 4. 5. 7. The enterprise’s resources. opt to behave in socially responsible ways as cooperation and support of the community is vital to their long term survival and commercial success. Many large. profitable firms. Q3. 4. The extent of support management enjoys if others in the organization e.
.2. Employees. Source of the benefits that accurse from such involvement are:1. These are generally taken as reference by top managers to set current objective. The changes to the past objectives may be incremental in nature depending on the competing claims presented by the stake holders. 4. No mis-representation in advertising on fraudulent activities. Firm’s image as a good employer helps to attract and retain high caliber workers. Fair reward for effort and enterprise. Interest and involvement in activities of the wider community. 5. Projection of a ‘green’ image which is good for business and leads to higher soles. The past objectives of the firm. Compliance with laws and established customs of the community. 3. 2. Source of the commonly accepted principles are :1. Sponsorship of charitable and community events attracts valuable publicity. The internal power relationship amongst the top managers. Use of energy conservation and anti pollution environmental methods leads to reduced production. stockholders etc will determine the degree if influence. Larger firms have nine resources to combat forces in the environment. Concern for the physical environment.
What shape and character the environment assumes depends upon the perception of the observer.Q4. • Firm’s documents. The environment in which a business firm exists may either be internal or external. forecasting. share holders. Characteristics of environment
• • • •
Environment is complex – The environment consists of a number of factors.The environment is constantly changing in nature. As the main purpose of environmental survey is
. employees etc. educational institution.
The sources of verbal and written information include: • Mass media such as radio and television. The external environment on the other hand consists of various forces which may either present an opportunity or pose a threat to the firm. Analyze the environment scanning process in your own organization and evaluate how it will face the environment which is fast developing as per your analysis above? To a business firm environment means the sum total of conditions. and the influences exerted by them. Environment is dynamic. spying. marketing intermediaries. files. customers etc. trade associations. trade journal. Owners. government publications etc. • Spying through services of professional’s agencies. markets research agencies etc. The players in the internal environment comprises if stakeholders i. Environmental scanning is normally carried out by means of a search of verbal and written information. events. • External agencies such as the government. Typically these external forces exist in the following sectors:• Political • Social • Demographic • Economic • Supplier • Technology • Physical. • Secondary sources of information such newspapers. MIS etc.e. MIS. What is the concept of environment? Search the library and other sources of information to predict the type of environment managers are likely to face ten years hence. events and influences that surround and affect it. magazines. one’s employees and former employees of competition. The internal environment refers to all factors (players) within an organization which could provide strengths or weaknesses of a strategic nature. Environment is multifaceted . competitors etc. • Formal studies by consultants. conditions and influences accusing from different sources. A wide range of methods and techniques are used in conduct of environmental survey and forecasting in strategic planning. .
(e. 8. Market researches facilities.forecasting the future state of environmental factors. 2. 5. Explain the role of SWOT analysis as the tool of facilitating strategic choice at the business level. Customer’s relations. Control of distribution network. Volatility in on collapse of the stock market.
A few examples of sources of strength and weakness existing within the form jerm are :1. Advertising and sales promotions. New product development) 4. 4. R &D skills.dependence on main suppliers in margin customers. SWOT ANALYSIS :.The two projects ETOP and SAP. 5. Corporate image. A few examples of areas where opportunities may be present are:1. opportunities and threats’. 7._ 1. can be merged and analyzed to narrow down the strategic alternative to once which feasible. Development of new markets on penetration of existing one. 6. Competitions. Production efficiency 3. Cash flow management. Distribution network. 10. 3.g. How is it similar/dissimilar to the grand strategy matrix and the matrix of grand strategy clusters? SWOT is the acronym for ‘strengths. 4. Typically strength and weaknesses exists within the organization whereas opportunities and threats and normally encountered in the external environment. 2. Organization culture. Quality control and quality assurance. mergers or acquisition of competing fairs. Q5. social responsibility and brand equity. 6. Sudden changes in customer preferences Over. Introduction of new production/ services. Human resource potential. most of the techniques are based on the statistical methods used in forecasting. 6. 11. By way of illustration of SWOT profile. International market. 3. improvement of relation with suppliers
A few examples of areas where threats may emerge are. 9. Governments legislations Technical obsolescence. 2. of a hypothetical firm in the software business is show as:ETPO sector impact Government Market SAP impact factor Finance Marketing
. weakness. 5.
On the basis of its resources and behavior. What is core competence? Explain with some examples. Competencies are special qualities possessed by an organization that make them without and pressures of competition in the market place.imaging and microprocessor controls • Sony’s in miniaturization • Philips in optical media • 3 m’s in stick tape
. It should be difficult for the competition to imitate for example • Canon’s core competence lies in optics . skills or know show which distinguish it from competition and provide value to customers or clients. core capabilities. Prior to making a strategic choice various subjective factors will need to be considered when analysis that emerge from the SWOT analysis
Q1. Any strategy formulated through the SWOT analysis technique will depend on certain other factors as well. the firm should intensify marketing efforts to attract orders from abroad. As government policies are favorable and international market shown potential. Other terms frequently used as being synonymous to competencies are unique resources. The expansion strategy appears to offer a feasible approach competence and financial and personnel resources. an organization develops certain strengths and weaknesses which when combined lead to synergistic effects. Firm may also consider suitable merger acquisitions. To identify a cone competence.Supplier Technological International
RAO Personnel management
ETOP profile of a Hypothetical firm Based in the above information it may be such that the firm has definite strength in the functional areas of corporate capabilities and resources. Prahalad and Hamel prescribe three tests:1. Such effects manifest themselves in terms of organizational competencies. The environment shown the domestic market to be sluggish. A strategy of expansion will only be selected provided to management has an inclination for risk-taking. In other words. invisible assets embedded knowledge. provided substantial synergy benefits are likely to accrue. the net results of the strategic advantages and disadvantages that exist for and organization determine its ability to compete with its revolts. as a part of the expansion strategy. and so on. It should be able to provide potential access to a wide variety of markets 2. It should make a significant contribution to the perceived customers benefits of the era product 3. Can you list your company’s core competencies? What is organizational culture? Why is it important? Core competencies are the basis upon which as organization achieves strategic advantage in terms of activities.
. • S Kumar in textile processing. There are major assumptions in common: beliefs and values. on core-competence to the extent of becoming prisoners of one’s own excellence my result in strategic. Kumar Mangalam Birla.g. myths. The idea of core competence is brilliant way to focus upon the latent strength of and organization yet they cannot be taken for granted. raw material sourcing. of the AV Birla group. and create cooperation and commitment. Organizational culture may be innovative. which is such total of resource and behavior..• Honda’s in engine and power trains etc. incentive schemes for acceptance of new working methods. they create a corporate culture. The core. • Nandas if Escorts in light engineering. “let’s get down to work”) Shared actions (e. and perception. A firm’s culture evolves gradually. As a strength. laser printers. culture can facilitate communication. operations. The manifestation of corporate culture in as an organization is evident in:Shared things (e. When beliefs and values are shared in an organization. decision making and control. canon has entered into.g. attitude. Organizational culture is the set of important assumption – often unstated – that members of an organization share in common. feelings etc. To change the existing culture of an organization may require injection of new staff.myopia. and even dominates. diverse markets such as copies. Core competency save a useful purpose if they are used to develop sustained strategic advantages though building up organizational capability.
Attitudes towards what is right or wrong. land work is not rewarded him) These shared assumptions can help to decipher the composition of the corporate culture of any organization Culture is a strength that can also be a weakness... Assumption about how work should be performed. Believes are assumption about reality and are divided and reinforced by experience. It affects:• • • Leadership styles Individual perceptions of colleagues and situations. distribution and logistics. cameras and image scanners. strength & weakness. the way people dress) Shared saying (e.g..g. It creates norms of behavior. Values are assumptions about ideals that are desirable and worth striving for. sees the group’s core competencies in a wide array of skills related to process industries. • Reliance industries in skillful project management and execution. whole hearted management support of new ideas etc. synergistic efforts occurring in and the competence of any organization Organizational culture: This is a dimension of climate that leaders help to develop. The culture of an organization consists of customary ways of doing things and its members shared perceptions of issues that affect the organization. conservative or a mix to two. Over reliance. a service oriented approach) Share feeling (e. setting up dealer networks commodity branding.competencies of this cooperation have
enabled them to operate in diverse markets offering different products. and raising finance at a competitive cost. In instance. project management.
. promoting bureaucracy in preference to creativity and entrepreneurship and unwillingness to look outside the organization for best practices. A major role of the leadership within an organization is to create an appropriate strategy culture fit. • A sincere and dedicated commitment to operate the business of the organization according to the business of the organization according to the desirable value. Managerial behavior arising out of corporate culture car either facilitates or obstructs the smooth implementation of strategy. Politicized organizational environment. There are three factions that seen to contribute to the building up of a strong culture there are:• A founder or an influential leader was established desirable values. culture may obstruct the smooth implementation of strategy by creating resistance to change. • A genuine concern for the well being of the organization’s stakeholders.weakness.
The subjective factors. • Changing:-Teaching employees to think and preformed differently. experience. This is so because strategies choice finally boils down to choice of products and markets that the fearing will play in. Must sewing has suggested there stages for overcoming resistance to change:• Unfreezing: .
. To implement change consultants use a variety of techniques which include survey feedback. The farina must ensure the strategy chosen and the CEO. The strategic alternative generated are armload our basis of the objective and subjective selection faction. temperament and personality.Q2 Explain the role of three behavioral considerations in strategy examination and chaise. The selection factions’ car is classified as objective and subjective factions.Establishing new moors and standard practices. However every fern does have it’s our culture and its own set of values sometimes these are not clear to outsiders in ever to those within value drives business firm must articulate their values clearly so that the stakeholders understand what the organization stands for. on the other hand. Corporate values are the fundamental beliefs on which the farina is built.resistance rid of existing practices and ides that stand in the way of change.Leaders are important to an organization as they help it cope with change. So performer the task the frail relies heavily on its marketing research and marketing information systems. The criteria employed will include such factors as education. transactional analysis etc. They ensure that plans and policies formulated are implemented as planned. • Refreezing. The objective factors which are based our analytical technique are also referred to as rational normative is prescript facts. What are the advantages of centralization and decentralization? How does having exceptionally competent people at lower levels in the organization facilitate decentralization? Glueck has defined Strategic choice as the decision to select from among the alto nature grand strategies considered the strategy which will best meet the enterprise’s objective. These are small set of guiding principle not to the comp outlined for financial gain or short their expediency values run deep they are timeless guiding principles that drive the way a their operates. confrontation meetings. abilities. Organization Development (OD): OD is an aspect if leadership implementation that involves charge processes. It is defined as a large range effort to improve an organizations problems-soling and renewal processes through a more effective and collaborative management of organization culture. team building selections. Strategic choice is an analytical as well as judgmental task. These factions are also referred to as intuitive or descriptor faction. They are long lasting and serve as a beacon for firm to chain their business course values and nouns and nouns are truly invisible and often an firm’s employees are not very aware of their culture or the role they play in helping to maintain it. Awareness of the need and benefits of change can be introduced through the OD techniques. are qualitative in nature and based on personal judgment. Leadership Implementation: . Refreezing involves the consolidation and stabilization of the new change. The successful implementation of strategy chosen will need to be ensured by selecting the right strategist in the right place at the right tire. They are the essence of a just identity. So complete and grow in global market places joins must concentrate on being creative and innovative and to achieve this they will need people centered leaders not the old style authoritative managers. Corporate or core value are of paramount importance when building or lasting firm.
‘People are not like other resources’.Centralization:-The organization is dominated by either a very powerful individual or a dominate small group strategic decisions and many operational Owen are made by the centre and very few are devolved to other managers. Such an organizations ability to respond to environmental change becomes limited. consensus – building. Decentralization. Consisting of board of directors the CEO or managing director. Besides the strategic budget. it has role culture which is common in traditional bureau races such as government departments. • Expert Power arises from the manager’s competence. PLC and so on.is usually adopted in an entrepreneurial mode of strategy implementation.Resources are allocated after a process of aggregation from the operating level. The task of management in a role culture is to manage procedures. Distinguish between ‘Power’ and ‘Politics’? It is said. Take a position and defend it. • Referent Power arises from the ability of the managers to create a liking among subordinates due to charisma or personality. Explain the relationship between renounce commitments to strategy activation? It is said. Strategic budgeting . knowledge and expertise that is acknowledged by others. • Reward Power arises from the ability of managers to reward positive outcomes. These organizations resound slowly to change due to slow decision making process. • Legitimate Power arises from the ability of managers to use position to influence behavior. • Concise Power arises from the ability of managers to penalize negative outcomes. Bottom-Up approach .
.It is a mix of the above approaches and involves an iterative from of strategic decision making between different levels of management. there are several other means of resource allocation such as BCG matrix.The organization is run by rules and laid down precedence’s. and the creation of commitment to organizational purpose and mission. and executive committee could decide the requirements and distribute resources accordingly. Top-Down approach . Making a Strategic Budget: Power is defined as “the ability to influence others” and power within an organization is derived from five types of sources. The nature of organization itself creates the conditions for corporate politics to manifest itself. Politics is concerned with the use of power and relates to managing coalitions.
Q3. Strategists use one or nine of these power to influence the behavior of organizational members. “People are not like other resources” take a position and defend it Distinguish between ‘power’ and ‘polities’. There is power culture in centralized organization power culture is common in small entrepreneurial organization. Corporate politics is “the carrying out of activities not prescribed by policies for the purpose of influencing the distribution of advantages within the organization”.
. Yes. They affect the way a strategy is formulated and implemented. This strategy was successful and it was evident from the company’s exports turnover. which was their major strength. where he found that executive were open to the idea of buying insulators from India. Mr. V Srinivasan. therefore. vice Chairman and Managing Director of the company. WS could often international quality at competitive prices. WS industry adopted the strategy to join the competitors and make them partners instead of competing with them. despite source well-meaning managers shunning it. Insulators being labor intensive product. as they were faced with rising costs at home and WS represented the opportunity to lower their production costs. are a part of behavioral implementation by strategists. The company repeated the performance in the US market after which the company entered into a collaboration to set up a plant in Canada. politics remains a part of the organization. Politics and power may be thought of as a means for the achievement of organizational objectives. Political considerations and use of power. made personal visits to companies in Europe. WS industry decided to supply their core components to the original equipment manufacturers and end users. WS industry identified its core-competency which was their knowledge of the physical and chemical process involved in mass production of electrical insulating porcelain. surge arrestors and capacitors was impossible on the multinational’s home territory for WS industries. So.For everyone manger that considers corporate politics and the use of power as bad. Politics is related to the use of power but it is not similar to it. I agree with the view that ‘WS industries strategic success has been the synergy it was able to establish with its competencies to supply core-components and its competitive advantage in terms of price? Since competing for end products like lightening conductors. there could be another manager who feels that it is good.
ASSIGNMENT ‘B’ CASE STUDY
Question: It has been observed that “WS industries strategic success has been the synergy it was able to establish with its competencies to supply core components and its competitive advantage in terms of price’.
Q8. Q3. Yes
Q20. Yes Q23. Q11. oral and written communication skills. No Q17. Q6. No Q19. Q4. Yes Q13. Yes Q15. No Q22. Contingency strategy is required as backup in situations where the occurrence of an event or its timing cannot be predicted. Q7. Yes Yes Yes Yes Yes Yes No Yes
Q9. Skills and abilities required will be mental ability. Yes. No Q14. Yes Q12. Resource allocation Leadership implementation Structural implementation
Q1. the steps of strategic implementation are as follows. Q2. analytical ability. SBU is Strategic Business Unit. Functional policies Q21. No Q16. Q10. Q5. Q18. No. No Q24.
Q40. MBO. These include financial analysis ratio. Strategic control continually monitors strategy in the context of organizational and environmental change and take necessary steps to adjust the strategy to the new requirements. The two techniques used to evaluate strategic control are:(a) (b) Strategic momentum control and Strategic leap control.
Q31. No Q39. Performance gap is the gap between the expected outcomes of continuing with the existing strategy and the desired outcomes which could result in the future if the new strategy were to be implemented. Yes No
Functional implementation Behavioral implementation
Q27. Yes. Q32. No Q45. Operational Control is aimed at allocation and use of firm’s various resources. Yes Q44. Q38. network techniques like PERT and CPM etc. Yes Q30. Yes Q37. Q42. Yes Q29. These are basic types of strategic controls. Yes Q43. Q36.Q25. Yes Q34. The evaluation techniques for this type of control system are based on internal analysis neither than environmental scanning. Yes Q35. Yes Q41. Strategic Review and Control Q33. Yes Q28. budgetary control. Yes
. Structure of a firm can influence its strategy formulation process. Q26.