Professional Documents
Culture Documents
Basic Concepts
of Strategic
Management
1-1
Basic Concepts of Strategic Management
Globalization
Internationalization of markets and corporations
Global (worldwide) markets rather than national
markets
Electronic Commerce
Use of the Internet to conduct business
transactions
Basis for competition on a more strategic level rather
than traditional focus on product features and costs
1-2
Basic Concepts of Strategic Management
1-3
Basic Concepts of Strategic Management
1-4
Strategic Management Defined
1-5
Basic Concepts of Strategic Management
1-6
Basic Concepts of Strategic Management
1-7
Basic Concepts of Strategic Management
1-8
Basic Concepts of Strategic Management
1-9
Environmental Scanning Defined
1-10
Basic Concepts of Strategic Management
Environmental
Variables
1-11
Environmental Scanning
SWOT Analysis
• Strengths – Weaknesses
• Opportunities - Threats
1-12
Strategy Formulation
1-13
Strategy Formulation
Mission Statement
1-14
Organizational Adaptation
1-15
Organizational Adaptation
Strategic flexibility
1-16
Learning Organizations
1-17
Learning Organizations
4 Chief Activities
1-18
Basic Concepts of Strategic Management
Hierarchy of
Strategy
1-19
Goals & Objectives
Corporate Goals/Objectives
1-20
Basic Concepts of Strategic Management
3 Types of Strategy
–Corporate strategy
–Business strategy
–Functional strategy
1-21
Basic Concepts of Strategic Management
Corporate Strategy
–Stability
–Growth
–Retrenchment
1-22
Basic Concepts of Strategic Management
Business Strategy
–Competitive strategies
–Cooperative strategies
1-23
Basic Concepts of Strategic Management
Functional Strategy
–Technological leadership
–Technological followership
1-24
Basic Concepts of Strategic Management
Strategic
Decision-Making
Process
1-25
Strategic Decision Making
Strategic Decisions
–Rare
–Consequential
–Directive
1-26
Strategic Decision Making
Mintzberg’s Modes
–Entrepreneurial mode
–Adaptive mode
–Planning mode
–Logical incrementalism
1-27
Hambrick and Fredrickson – Good Strategy
1. Arenas
2. Vehicles
3. Differentiators
4. Staging
5. Economic logic
1-28
CHAPTER 2
Corporate Governance
1-29
CHAPTER 2
Corporate
Governance
1-30
Corporate Governance
1-31
Corporate Governance
1-32
Corporate Governance
Role of Board
–Monitor
1-33
Board of Directors Continuum
1-34
Board of Directors
Members --
–Inside directors
•“management directors”
•Officers or execs employed by the firm
–Outside directors
•“non-management directors”
•Execs of other firms not employed by the
board’s corporation
1-35
Agency Theory
Agency Problem –
–Objectives of owners & agents in conflict
–Difficult for owners to verify agent performance
1-36
Stewardship Theory
1-37
Board of Directors
–Affiliated Directors
–Retired Directors
–Family Directors
1-38
Board of Directors
Codetermination
1-39
Board of Directors
Interlocking Directorates
–Direct Interlocking
–Indirect Interlocking
1-40
Board of Directors
–Traditional Approach
•CEO invitation to membership
•Shareholders approval in annual proxy statement
•All nominees usually elected
1-41
Board of Directors
1-42
Board of Directors
Sarbanes-Oxley
–Code of Ethics
1-43
Board of Directors
–Size
1-44
Board of Directors
Corporate Governance
1-45
Board of Directors
Transformational leaders
1-46
Board of Directors
Successful CEO’s
–Strategic vision
–Passion for the company
–Strong communication
–charisma
1-47
Board of Directors
Executive Leadership
–Strategic vision
–Role model
1-48
Board of Directors
Executive Leadership
1-49
Strategic Management Process
1-50
Strategic Management Process
1-51
Strategic Management Process
1-52
CHAPTER 3
Ethics & Social
Responsibility
1-53
CHAPTER 3
Ethics & Social
Responsibility
1-54
Ethics & Social Responsibility
1-55
Corporate Governance
Broader responsibility --
1-56
Social Responsibility
Milton Friedman
There is one and only one social responsibility of
business—to use its resources and engage in
activities designed to increase its profits so long
as it stays within the rules of the game, which is
to say, engages in open and free competition
without deception or fraud.
1-57
Corporate Governance
Carroll’s 4 Responsibilities
–Economic
–Legal
–Ethical
–Discretionary
1-58
Carroll’s 4 Responsibilities
1-59
Corporate Stakeholders
1-60
Corporate Stakeholders
Stakeholder Analysis –
–Primary stakeholder
•Sufficient bargaining power to affect outcomes
–Secondary stakeholder
•Indirect stake but are affected by corporation’s actions
–Stakeholder Input
•Determine whether input is necessary
1-61
Ethical Behavior
“business ethics”
1-62
Ethical Decision Making
Corporate practices --
1-63
Ethical Decision Making
1-64
Reasons for Unethical Behavior
Provocative Question --
1-65
Reasons for Unethical Behavior
Perceptions caused by --
1-66
Reasons for Unethical Behavior
–Aesthetic
–Economic
–Political
–Religious
–Social
–Theoretical
1-67
Reasons for Unethical Behavior
1-68
Moral Relativism
1-69
Kohlberg’s Levels of Moral Development
1. Preconventional level
1-70
Kohlberg’s Levels of Moral Development
2. Conventional level
1-71
Kohlberg’s Levels of Moral Development
3. Principled level
1-72
Encouraging Ethical Behavior
Codes of Ethics
1-73
Encouraging Ethical Behavior
–Ethics
–Morality
–Law
1-74
Encouraging Ethical Behavior
–Utilitarian
•Judged by consequences
–Individual Rights
•Fundamental rights in all decisions
–Justice
•Distribution in equitable fashion
1-75
Encouraging Ethical Behavior
–Categorical imperative
•“golden rule”
•Means - Ends
1-76
Strategy Bits
1-77