Professional Documents
Culture Documents
Strategic
Management
However
7
Dr. Chowdhury Saima Ferdous
A Brief History of Strategy
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Dr. Chowdhury Saima Ferdous
A Brief History of Strategy
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Dr. Chowdhury Saima Ferdous
A Brief History of Strategy
“He will win who knows when to
“Every Battle is won before fight and when not to fight”
it is fought”
“Strategy without tactics is the
slowest route to victory
Tactics without strategy is the noise
before defeat”
“Can you imagine what
would I do if I do all I can”
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Dr. Chowdhury Saima Ferdous
A Brief History of Strategy
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Dr. Chowdhury Saima Ferdous
A Brief History of Strategy
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Dr. Chowdhury Saima Ferdous
A Brief History of Strategy
•From Corporate Planning to Strategic Management: contd….
•During 1970s and early 80s, confidence in Corporate Planning was
severely shaken
• Not only did diversification fail to deliver the anticipated
synergies but the oil shocks of 1974 and 1979 ushered in a
new era of macroeconomic instability,
• While increased international competition intensified as
Japanese, Korean and Southeast Asian firms stepped onto
the world stage
•This shake meant that forms could no longer plan their investment
and resource requirements 3 to 5 years ahead
•The result was a shift from PLANNING to STRATEGY
MAKING.
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Dr. Chowdhury Saima Ferdous
A Brief History of Strategy
•From Corporate Planning to Strategic Management: contd….
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Dr. Chowdhury Saima Ferdous
A Brief History of Strategy
•During 1990s the focus of strategy analysis shifted from the source
of profit in the external environment to the sources of profit within
the firm
• Increasingly Resources and Capabilities of the firm became
the main source of competitive advantage and the primary
basis for formulating strategy – this is called Resource Based
View of the Firm.
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Dr. Chowdhury Saima Ferdous
A Brief History of Strategy
A co’s strategy is :
❑ About Competing differently
▪ Mimicking others/rivals –either being copy cat or but maneuvers – rarely works.
▪ Co’s strategy needs to have some Distinctive element – that draws in customers &
provide competitive edge.
▪ Means doing what rivals don’t do or rivals can’t do.
▪ Different does not mean 100% different; rather it means – it should differ in at least
some important respects.
▪ Guides for what co should do; and should not do
❑ A quest for Competitive Advantage
▪ A co achieves CA whenever it has some type of edge over rivals in attracting
buyers and coping with competitive forces
▪ There are many routes of CA; but that all involve
▪ either giving buyers what they perceive as superior value compared to the rivals;
or
▪ giving buyers the same value as rivals at a lower cost
Dr. Chowdhury Saima Ferdous 22
What is Strategy?
Successful Strategy
Effective Implementation
Profound
Objective
Clear, consistent , understanding of the
appraisal of
long Term Goals competitive
resources
environment
• A strategy is reflected in
its actions in the market place
And the statement of senior managers about the co’s
current business approaches,
Future plans
Efforts to strengthen its competitiveness and
performance.
❑ If you put these two words in a continuum, Strategy should typically come
before plan
❑ A company develops a plan to accomplish a strategy
Another way to explain the difference
• A strategy is a solution to move from where you are now (A) to where you
want to be (B)
– or put another way, it is what you want to happen to achieve an end.
Strategy is a class of solution that deals with uncertainty – the
possibility that opposing forces may inhibit you reaching (B) or
reaching it in acceptably good form.
❑ A plan is how you will move from (A) to (B). As such it should support
your strategy by providing a way to reach (B) that provides an acceptable
balance of risk and reward.
❑ So your strategy is what you want to do and your plan is how you will do
it.
❑ For example, you may decide as a strategy that you need to acquire lots of
patents in an area to help you maintain freedom of operation, and then
your plan is how specifically you will do that…R&D, acquisition, license,
etc.
Clear, Profound
Objective
consistent , understanding of
appraisal of
long Term the competitive
resources
Goals environment
▪ Strategy as Theory
▪ Debate between plan and action is ongoing
▪ However, many believe, in relaity, strategy is a combination of
both.
▪ Planned deliberate actions
▪ Unplanned emergent activities
▪ Thus leading to a “strategy as integration” (First advocated by
Alfred Chandler, an American business historian).
Unpredicted
Change Unplanned shift
Unrealized Emergent by top level mgt
Strategy
Strategy
Serendipity Autonomous
action by lower
level managers
Intended Strategy
Emergent Strategy
❑ Implementing Strategies
Functional-Level Strategy
Business-Level Strategy
Global Strategy
Strategy Implementation
Feedback
Dr. Chowdhury Saima Ferdous 64
Step 1: Mission Statement
▪ It is the description/declaration of why co is existing.
▪ In short, the company mission describes the company’s
▪ product,
▪ market,
▪ tech area of emphasis
- in a way that reflects the values and priorities of the strategic
decision maker.
Formulating Mission:
Business Level:
Div A Div B Div C
Divisional Mgrs & Staff