What is strategy &

types of strategy
The plan

Strategy definition Advantages and Types of strategy

disadvantages of
strategic planning

2
Strategy definition

• Long term direction

• Sustainable competitive
advantage

• Resources and competencies

• Stakeholder expectations

3
Advantages & disadvantages of strategic planning

ADVANTAGE OR DISADVANTAGE?

Predict the future Identify risks Consistency

Rigidity Cost Control

4
Advantages & disadvantages of strategic planning

ADVANTAGES DISADVANTAGES

o Identify risks o Predict the future

o Consistency o Rigidity

o Control o Cost

5
Types of strategy 1 – Rational planning

• Analysis
• Choice
• Implementation
• Stable environment,
large organisation

6
Types of strategy 2 – Emergent

• Analysis & Choice together

• Implementation

• Dynamic environment,
large organisation

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Types of strategy 3 – Logical incrementalism

• Small scale changes

• Bounded rationality

• DANGER = strategic drift

• Stable environment, small

organisation

8
Types of strategy 4 – Freewheeling opportunism

• No formal strategy

• Exploit opportunities

• Reactive

• Dynamic environment,
small organisation

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Example

Stable

Complex
A freewheeling opportunism
approach for strategic
formulation would be Hostile
advantageous for which
ONE of the following types of Static
environment?
Bureaucratic

10
Example - Answer

Stable

Complex
A freewheeling opportunism
approach for strategic
formulation would be Hostile
advantageous for which
ONE of the following types of Static
environment?
Bureaucratic

11
Summary

Strategy definition Advantages and Types of strategy

disadvantages of
strategic planning

12
Strategy lenses &
levels of strategy
The plan

Strategy lenses Certainty and

agreement

Approaches to
strategic planning Levels of strategy

14
Strategy lenses

• Strategy as design

• Strategy as experience

• Strategy as variety / ideas

• Strategy as discourse

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Certainty and agreement (Stacey, 2007)
Certainty (How)
Close to Far From

Close to
Agreement (Outcomes)

Rational Judgement
e.g. Donald Trump e.g. Apple

Political Edge of chaos

e.g. Labour party e.g. Google
Far from

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Approaches to strategic planning

Accounting led Position based Resource based

(Outside in) (Inside out)

17
Levels of strategy

Senior management
Corporate Entire company
strategy e.g. overseas expansion

Business level Middle management

strategy Strategic Business Unit
e.g. products to sell

Lower level managers

Operational strategy Departmental level
e.g. marketing plan

18
Example – Levels of strategy

Throughout all levels of its Corporate

organisation, a restaurant chain is
hoping to promote a new strategy.
This strategy will include the Strategic
direction for the whole business,
and for all of its subsidaries and all
functions within each business unit.
Operational

Choose ALL levels of strategy that Business level

the restaurant chain is initiating:

Rational

19
Example – Levels of strategy

Throughout all levels of its Corporate

organisation, a restaurant chain is
hoping to promote a new strategy.
This strategy will include the Strategic
direction for the whole business,
and for all of its subsidaries and all
functions within each business unit.
Operational

Choose ALL levels of strategy that Business level

the restaurant chain is initiating:

Rational

20
The plan

Strategy lenses Certainty and

agreement

Approaches to
strategic planning Levels of strategy

21
The strategy
process
Introduction
Content covered

What is strategy? Types of strategy

Strategy lenses Levels of strategy

23
Learning outcomes

• Analyse the advantages and

disadvantages of strategy development

• Analyse the essential features and

characteristics of strategy

• Analyse different approaches to

strategy development

• Analyse the different levels of strategy

24
Study hints

Cost leader Differentiator Services

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