Unit – 1

2019

a) Define strategic management. *1

Ans: Strategic management as a broad overall process is defined, by
Arthur Sharplin, as the set of decisions and actions, resulting in
formulation and implementation of strategies, designed to achieve
the objectives of an organization.
Example – Determining customer needs and providing them with
desired products to increase sales and profit of a company.

b) What do you mean by mission? *1

Ans: Mission is a statement which defines the role that an
organization plays in a society. It expresses the reason for existence
and nature of the business, what kind of product or service it
provides, its primary customers or market, and its geographical
region of operation.
Explaining a company's culture, values, and ethics, Mission talks
about the present such as where the organization is, how it
competes, and what makes it different leading to the future.

Example: Google: “To organize the world’s information and make it

universally accessible and useful.”
Walmart: “We save people money so they can live better.”

l) What is strategy implementation? *5

Ans: Written Below

2. a) Briefly describe the different levels of strategy in a multi business

organization. *1
b) "Vision is the guiding framework that describes the organization
views and objectives are targets that it tries to achieve."— Discuss. *1
6+6=12

Ans: Different levels of strategy in multi business organization: -

(C B F)

I. Corporate Level Strategy:

Example: The Whole Tata Group.
a. It is also known as Grand / Master level strategy.
a. Strategy made by top management
b. In which direction the company should go in future.
c. What will be its attitude towards growth
d. In which areas the company will operate
e. This strategy is made for the whole organization / company.
f. Where the resources should be put and used.
g. It answers what the company wants to achieve.
h. Has high risk.
i. Policy making.

Types of Corporate level strategy are:

Corporate Level Strategy represents the pattern of

entrepreneurial actions and intents underlying the organizations,
strategic interests in different business, division, product lines,
customer groups, technologies, etc. Corporate strategy
 emphasizes upon the fact that how one should manage the scope,
mix and emphasis of the various activities and how the resources
should be allocated over the different priorities of the
corporation.

II. Business Level Strategy:

E.g. - Only Tata Motors
a. Separate strategies are applied for different business.
b. Think to satisfy the customer’s need.
c. Enhance competitive strategy.
d. It is used by middle level managers
e. Also known as Generic Business strategy.
f. Lower the cost of the products to attract customers.
g. Make different products which are unique in the market.
h. Focus on a particular segment or market in business.
i. Development or penetration of new product in market.

Types of Business level strategy are:

For many companies which are dealing in number of product

mix, dealing with different types of buyers and different types of
market, for them a single strategy is inadequate and
inappropriate. The need is for multiple strategies at different
levels. In order to segregate different units or segments each
performing a common set of activities, many companies organize
on the basis of operating divisions. These divisions may also be
known as profit centers or Strategic Business Units (SBUs).
Business level strategy is a comprehensive plan providing
objective for SBUs. Allocation of resources among functional
 areas and coordination between them for making optional
contribution to the achievement for the corporate level objectives.

III. Functional Level Strategy:

E.g. – Manufacturing department of Tata Motors

a. It helps the strategy at ground level.

b. Supports strategy implementation.
c. It is a restricted plan designed to achieve objectives in a specific
functional area.
d. Allocation of resources to different functional areas.
e. This strategy is derived from the Corporate and Business level
strategies.
g. Useful for day-to-day tasks
h. Also known as Tactical level strategy.

Functional level strategy is implemented on:

Functional level strategy involves decision making at the

operational level with respect to specific areas – production,
marketing, personnel, finance, etc. Decisions at the functional
levels are often describes as ‘tactical’ decision. But these decisions
are necessarily guided by overall strategic considerations and
must be consistent with the frame work of business strategy.
Thus, for example, finance policy decisions should provide
guidelines for finance management in accordance with the chosen
strategy providing the overall direction of business.

Write its other names: Grand, Generic, Tactical

(b) Ans: Vision:

A vision statement describes what a company desires to achieve in the
long-run, generally in a time frame of five to ten years, or sometimes
even longer. It depicts a vision of how the company will look like or
where they want to be in the future, and sets a defined direction for
the planning and execution of corporate-level strategies. Vision
statements act as a goal for a company to strive toward.

Example: - Amazon: Our vision is to be earth’s most customer-centric

company; to build a place where people can come to find and discover
anything they might want to buy online.

Characteristics of a good vision are: (GDFFFDE)

i. Graphical: The vision should draw a picture that can reveal
where the company is heading and can also indicate clearly the
market position.
ii. Directional: It is able to provide clear direction to the managers
and employees as well as describe a forward-looking picture of
the company.
iii. Focused: It can specifically guide managers in decision making
and allocating resources of the company.
iv. Flexible: It must be flexible enough so that with changes in the
products or technology or market, the vision itself can also be
changed to keep pace with the changing situations.
v. Feasible: It should portray an expectation for the future that is
achievable – not just spelling out an expectation for the sake of
talking about an expectation.
vi. Desirable: It should be able to indicate; ‘why the chosen path
makes good business sense’.
vii. Easy to communicate: The vision must be worded in such a way
that it can be communicated easily to the stakeholders, especially
the shareholders, employees, and customers.

Objectives:
The objective is the target that is set to accomplish the organization’s
vision and mission. It is the expected outcome of the organization. An
organization’s objective gives it direction.
Determining objectives is an integral part of strategic management.
They translate the strategic vision into concrete results. As a result,
organizational activities are geared toward achieving them.
Examples: Focus Area: Customer Satisfaction
Deliver a customer survey overall satisfaction score of 90% by 2024.
Focus Area: Innovation/Product Growth
Launch 3 new products by 31st Dec 2024.

Characteristics of Objectives are: (UMA-HSF)

i. Understandable: In order for a company to establish a business
objective, it must first understand where it stands and where it
has been. It then determines what its goals are and how it will
attain them.
ii. Measurable: Objectives of an organization must be measurable.
Unless the objectives are set the organization will not be able to
compare the actual performance with the planned target.
Objectives give the business a clearly defined target.
iii. Achievable: Business goals must be achievable. The organization
should frame those goals, which can be achieved taking into
consideration its capabilities and resources. The objective must be
feasible enough to keep team members motivated to strive
towards its achievement. While setting the objectives, the
organization must concentrate on the limitations also.
iv. Hierarchy of objectives: Hierarchy means level. Business
objectives are structured according to its hierarchy. All the
objectives are not equally important. It should be achieved
according to its priority and importance. The most important
objective should be achieved first.
v. Objectives should be specific: Objectives must be specific in
terms of time, quality and quantity. Specific objectives help in the
accomplishment of those objectives in the specified time frame
and resource availability. If the objectives are specific, it gives
precise results.
vi. Flexible: Flexibility means, ‘that keeps on changing’. Business
objectives should be flexible. It must not be rigid. Business
 environment keeps on changing. Therefore, the objectives should
be changed or modified according to the changing situation. The
objectives must be able to reframe in the light of changes in the
environment.

Role of Objectives: (PDCBM)

i. Purpose: Objectives describe the purpose of the organization
so that people know what it stands for and will accept its
existence and continuance.
ii. Direction: Objectives provide guidelines for organizational
efforts. They keep attention focused on common purposes.
Every activity is directed toward the objectives, every
individual contributes to meet the goals.
iii. Coordination: Objectives keep activities on the right track.
They make behaviour in organizations more rational, more
coordinated and thus more effective, because everyone
knows the accepted goals to work toward.
iv. Benchmarks for Success: Objectives serve as performance
standards against which actual performance may be
checked. They provide a benchmark for assessment. They
help in the control of human effort in an organization.
v. Motivation: Goals are motivators. The setting of a goal that
is both specific and challenging leads to an increase in
performance because it makes it clear to the individual what
he is supposed to do. He can compare how well he is doing
now versus how well he has done in the past and in some
instance how well he is performing in comparison to others.

2018

a) State any two benefits of Strategic Management. *1

Ans: Benefits of Strategic Management are: (ASPR-CC-GM)
 i. Alternative of strategies: It helps the organization to opt for
the best strategy options considering all possible pros and cons
of the market environment.
ii. SWOT analysis: It is a study by the organization to
understand its strength, weakness, opportunities and threats. It
helps the trade to keep momentum with the dynamic essence
of the environment stirring to the company.
iii. Benefits in planning: Strategic Management benefits the
organization to construct economic planning.
iv. Formulating Resources: Organizing adequate resources
becomes possible only when the management has a systematic
plan regarding what, where and how the resources have to be
utilized.
v. Ease communication: For accomplishing the objectives,
Strategic Management needs to have appropriate
communication and governance at all stages of operations.
vi. Supports to confront competition: Strategic Management
helps the organization to face the competition more
productively.
vii. Helps Achieve Goals: Irrespective of the industry and size,
every company has goals to achieve. Strategic management
accelerates your progress towards successfully achieving any
of these goals.
viii. Enables Progress Measurement: Strategic management forces
a company to set clear objectives and measure success.

b) What do you mean by objectives? *1

Ans: Written above

c) State any two attributes (features/characteristics) of strategic intent.

*1
Ans: All 3 attributes of strategic intent are:
i. Sense of Direction: The sense of direction defines where the
organisation wants to go in the future and why. Every
organisation requires a significant, steady, and common end.
 These ends should be valuable and necessary for the
organisation. A proper set direction helps organisation to
achieve its long-term strategic intent.

ii. Sense of Discovery: The sense of discovery refers to the ability

of inspiring the employees for innovation and creativity. This
is necessary because the employees feel less enthusiastic when
the strategic intent is not inspiring. The strategic intent should
motivate the employees to perform the challenging tasks and
explore new concepts. It should introduce new dimensions in
the organisation and innovate superior ways to achieve them.

iii. Sense of Destiny: The sense of density refers to the ability of

the strategic intent to provide meaning to the existence of the
organisation. It should be able to create a sense of respect
among the organisational members. Strategic intent should be
meaningful and significant so that it can direct the organisation
and motivate its employees. Thus, strategic intent must be
meaningful for the employees and have the capability to set
proper direction for them.

e. Give two examples of social objectives of an enterprise. *1

Ans: Examples of social objectives of an enterprise are:
i. Supplying Quality Products & Services: Customers are a part
of the society that a business actively seeks to serve. Thus,
providing quality products/services at reasonable prices
becomes a pre-requisite. Quality refers to product attributes
such as purity, safety, durability, utility etc. Customers will be
satisfied if they get value for money products.
ii. Fair Pricing: Goods and services need to be priced reasonably.
Sales are linked to the pricing of a product. Costlier products
have a limited demand as compared to reasonably priced
products.
iii. Generating Employment: Business enterprises are run by
human beings. Competent persons are required for all levels
 and activities of an organisation. Business therefore provides
employment for people to work and earn livelihood.
iv. Social Security: Business enterprises follow various welfare
schemes like group insurance, accident insurance, provident
fund and pension to provide effective security to workers and
employees.

j. State the levels of strategy in a single business organization. *1

Ans: Levels of strategy in a single business organization are:
i. Corporate Level Strategy: The corporate level is the highest
level of business strategy, and it is the broadest. You should
craft your corporate-level strategy with your main purpose in
mind. This is the place to set lofty, long-term goals. It’s at this
level that you craft your mission and vision statements.
ii. Business Level Strategy: Here you would define separate
strategies for the various industries you operate in. Business
owners who operate in many different niches must decide
which to focus on most, and that may change over time.
iii. Functional Level Strategy: When you craft functional level
strategy, you're concerned with smooth internal operation.
This involves how departments operate and interact, and how
they support your corporate level strategy day in and day out.

2. “Strategic management is that set of decisions and actions which leads

to the development of effective strategy or strategies to achieve the
firm's objectives". — Explain this statement and discuss the process of
strategic management. *1 12

Ans: Process of Strategic Management: (IS-FIE)

i. Establishing Strategic Intent- The strategic management process
is all about creating a roadmap to help you achieve your vision.
So, before you go any further, you need to clarify what your
company wants to achieve.
Its key elements are:
a. Vision,
 b. Mission,
c. Business Definition and
d. Objectives.

ii. Environmental Scanning- Environmental scanning refers to a

process of collecting, scrutinizing and providing information for
strategic purposes. It helps in analysing the internal and external
factors influencing an organization. After executing the
environmental analysis process, management should evaluate it
on a continuous basis and strive to improve it.
Its key elements are:
a. Internal and External Environment scanning
b. SWOT analysis
c. Learning about customers of specific regions

iii. Strategy Formulation- Strategy formulation is the process of

deciding best course of action for accomplishing organizational
objectives and hence achieving organizational purpose. After
conducting environment scanning, managers formulate
corporate, business and functional strategies.
Its key elements are:
a. Corporate Level Strategies
b. Business Level Strategies
c. Strategic Choice
d. Strategic Planning

iv. Strategy Implementation- Strategy implementation implies

making the strategy work as intended or putting the
organization’s chosen strategy into action. Strategy
implementation includes designing the organization’s structure,
distributing resources, developing decision making process, and
managing human resources.
Its key elements are:
a. Project
b. Procedural
c. Resource Allocation
d. Structural
e. Behavioural
 f. Functional and Operational

v. Strategy Evaluation- Strategy evaluation is the final step of

strategy management process. The key strategy evaluation
activities are: appraising internal and external factors that are the
root of present strategies, measuring performance, and taking
remedial / corrective actions. Evaluation makes sure that the
organizational strategy as well as its implementation meets the
organizational objectives.
Its key elements are:
a. Are we still making progress toward this goal?
b. Do we have the resources to achieve the goal?
c. Can the goal be accomplished if the deadline is extended?
d. Is the goal still relevant to our current circumstances?
e. Can the goal be changed slightly to accomplish something
similar?

10.Write short notes on any two of the following:

a) Mission *1 6+6=12

Ans: (c) Mission

Definition of Mission: Written Above
Characteristics of Mission: (FPC-EUSO)
 i. Feasibility: A good mission statement should always be a wide-
ranging goal, but it should also be achievable. It should not be an
impossible statement. The organisational employees should find
it feasible and credible.
ii. Precise: An effective mission statement should be neither too
narrow nor too wide. A narrow mission statement will not be
able to convey the operations performed by the organisation and
a wide mission statement will fail to define the organisational
objectives and goals.
iii. Clarity: A mission statement should clearly state the
organisational goals so that it stimulates actions. A mission
statement is beneficial only when it is stated in clear terms and
leads to action.
iv. Encouraging: A good mission statement should be capable of
encouraging its employees and its customers. The employees,
customers, and other stakeholders should feel valued by being a
part of organisation. This will lead to enhanced skills and
expertise in the employees and will create a sense of loyalty in the
stakeholders.
v. Uniqueness: A mission should be distinct and unique in every
sense from that of the competitors. If all the companies which are
in same business write their mission statements in the same way,
it would hardly create a unique identity and a positive impact on
the public.
vi. Indication of Strategy: A good mission statement should indicate
the strategy to be adopted for achieving the long-term goals.
vii. Specify the Ways to Achieve Objectives: An efficient mission
statement should define the ways in which the organisational
objectives can be achieved.

2017

a) What is strategic management? *1

Ans: Written Above

b) Why objectives are important in an organization? *1

 Ans: Written Above

c) 'What is 'mission'? *1
Ans: Written above

m) What do you mean by strategy implementation? *5

Ans: Written above

1. a) Briefly describe the different levels of strategy in a multi-business

organization. *1
b) Discuss two important factors that affect the formulation of mission
and objectives of an organization. *1 8+4=12

Ans: (a) Written above

(b) Written above (2018-10.c- Characteristics of Mission)

Important factors that affect the formulation of objectives of an
organization

 Forces in the Environment: Different stakeholders want to further their own

interests. Each stakeholder group expects that its interests and claims will be
considered in setting objectives. Customers, employees, investors, Government and
community are the major stakeholders. Any factor relating to them may influence
the objectives. For example, the objectives of an enterprise may be influenced by
Government policy. The interests of various stakeholders may change from time to
time thereby, causing a shift in the importance attached to different objectives.

 Resources and Capabilities of the Organisation: The strengths and weaknesses

of a company influence the choice of objectives. Resources – both material and
human place restrictions on objective setting. For example, a company facing
resource crunch cannot think of diversification and rapid growth.

 Internal Power Relationships: The relative decisional power which different

decision-makers wield with respect to each in sharing the organisation’s resources
is an important determinant of objectives. A dominant group such as the Board of
Directors or Chief Executive may dominate objective setting.

 The values System of the Top Executives: A company’s focus on profits. Social
responsibility and other objectives depend on the beliefs and attitudes of the top
management. For example, if the top executives have philanthropic attitudes, the
organization is likely to set socially oriented objectives.
  Awareness of Management: Organisations do not deviate radically from the paths
that they have been following in the recent past; Changes in the choice of
objectives take place in an incremental manner. Therefore, awareness of past
objectives and evolution of the enterprises leads to a choice of objectives that have
been emphasised in the past.

2016

(a) What do you mean by strategy? *1

Ans: It is possible to define strategy as a plan of action to achieve short,
middle and long-term desired goals. A strategy explains how a company
plans to compete in a market and how it intends to grow at a profit.
(b) Define strategic intent. *1
Ans: Strategic intent refers to the pre-defined future state that the
organisation is planning to reach within a stipulated period of time. The
term strategic intent was popularised by Gary Hamel and C.K Prahalad.
They defined strategic intent as the reason of existence of an organisation
and the end it wants to achieve.
(c) Provide examples of two long-term objectives. *1
Ans:
Examples: Focus Area: Customer Satisfaction
Deliver a customer survey overall satisfaction score of 90% by 1st Jul
Focus Area: Innovation/Product Growth
Launch 3 new products by 31st Dec 2024

2. Briefly explain the process of strategic management. *1 12

Ans: Written Above

2014
(a) State two benefits of strategic management. *1
Ans: Written Above
(b) What do you mean by strategic intent? *1
Ans: Written above
(c) Define objectives. *1
Ans: Written above
2. (a) Explain the process of strategic management. *1
Ans: Written Above
(b) Provide a brief overview of corporate level strategy. *1 8 + 4 = 12
Ans: Written above
10. Write short notes on the following: 6 + 6 = 12
(b) Mission. *1
Ans: (b)Written Above