ARIOLA, Hanz Darryl B.

BSMA-4

SUMMARY

PRELIMS

CHAPTER 1

THE REALITY OF DYNAMISM – the 21st century epitomizes the reality

of dynamism. Today’s milieu is in a state of fluidity: it is not static.
Nothing is stable; neither is regularity a logical expectation.

HYPERCOMPETITION – it is a fundamental feature of the new

economy. It occurs when product/service offerings and technologies are
so new that standards become unstable and competitive advantage is not
sustainable. It is a situation where both globalization and technology
collaborate to create a heightened cut-throat situation.

STRATEGIC MANAGEMENT – is a continuous process of strategy

creation.

STRATEGIC ANALYSIS – consists of a systematic evaluation of

variables currently existing in the external and internal environments.

STRATEGIC DECISION-MAKING – is deliberately bringing together

the right resources for the right markets at the right time.

STRATEGIC FORMULATION – is designing strategies on the business

and corporate levels.

STRATEGY IMPLEMENTATION – is employing those crafted strategies

to achieve organizational set goals and objectives.
STRATEGIC CONTROL – is the application of an appropriate monitoring
and feedback system.

STRATEGIC INTELLIGENCE – is the capability of an organization to

process relevant and related knowledge, abilities, foresight, and systems
thinking.

STRATEGIC THINKING – is the cognitive process of competently and

analytically weighing factors and arriving at critical decisions.

ORGANIZATIONAL COMPETITIVENESS – pertains to the ability of

any business/company to utilize its resources optimally and sustainably for
maximum performance and productivity.

COMPARATIVE ADVANTAGE – refers to the ability of an organization

to produce a particular good or service at lower marginal and opportunity
costs than its competitors.

STRATEGIC PERFORMANCE – is the accomplishment of a high level of

productivity that is characterized by efficiency in the context of lean and
quantifiable management.

STRATEGIC PLANNING – is defined as continuous, repetitive, and

competitive process of setting the goals and objectives that an
organization aims to attain.

TYPES OF STRATEGIC PLANS

1. MEDIUM/LONG-RANGE PLAN – prepared in 3-5, 10 or more
years.
2. ANNUAL/YEARLY PLAN – short-term; describes the organization’s
present situation.

Strategic planning defines an organization’s mission, vision, and set

objectives.
ORGANIZATIONAL VISION – is an inspirational statement of what an
organization hopes to achieve at some point in the future. It is the image
of what an organization desires to achieve.

MISSION STATEMENT – defines the current purpose of an

organization. It answers what the organization does, for whom it is done,
and how it does what It does.

To operationalize the mission statement, organizational goals and

objectives are defined.

VALUES – are inherent roots of motivation within an individual, an

organization, a community, or a nation. It is generally exhibited in two
different ways: belief and attitudes.

BELIEFS – are cognitive manifestations.

ATTITUDES – are characteristically behavioral.

VALUE SYSTEM - is broader in scope; aside from values, it includes

other variables such as the organization’s dreams, aspirations, interests,
expectations. Philosophies, as well as leadership and management styles
and ethical practices.

ORGANIZATIONAL CLIMATE – the regular and repetitive patterns of

attitudes and behavior exhibited by employees of an organization.

ORGANIZATIONAL CULTURE – denotes a wide range of social

phenomena that helps to define an organization’s character and norms.

Culture is an idealized system because a system focuses on types of

meanings.
CHAPTER 2

ORGANIZATIONAL INTELLIGENCE – refers to the expertise, insight,

and wisdom possessed by an entity. It serves as a valuable guide to its
journey to becoming competitive.

ENVIRONMENTAL SCANNING – is the study and interpretation of the

forces existing in the external and internal environments.

The external environment includes Social, Economic, Political,

Technological, and Environmental forces.

Competitive environment includes competitors, suppliers, customers,

stakeholders, culture, and government.

STRATEGIC INFORMATION – consists of the facts and data used by

an organization to assist them in achieving their mission, vision, and
goals.

PRIMARY DATA – gathered through personal experiences, observation,

and experimentation.

SECONDARY DATA – are data collected from reports, internet sources,

and other published materials.

Scanning the environment involves two processes: (1) looking at or

simply viewing information, (2) looking for or searching for
information.

4 WAYS OF ENVIRONMENTAL SCANNING

1. UNDIRECTED VIEWING – the individual is exposed to information

with no specific informational need in mind.
2. CONDITIONED VIEWING – the individual directs viewing of
information to specified facts and data to be able to assess their
general impact on the organization.
3. INFORMAL SEARCH – the individual actively looks for information
to increase knowledge of a particular issue.
4. FORMAL SEARCH – the search is both focused and structured and
the research methodology is clearly enumerated and followed.

SWOT MATRIX – is a structured assessment tool used to evaluate an

organization, industry, a place, or a person in terms of set of parameters
like strength, weaknesses, opportunities, and threats.

STRENGTH – are features that organizations possess, thus, giving them

a significant advantage over others.

WEAKNESSES – are characteristics that place organizations at a

disadvantage relative to others and may just be limitations or
vulnerabilities of organizations.

OPPURTUNITIES – are possibilities in the external environment that

organizations can exploit to their advantage.

THREATS – are challenges in the external environment that can cause

problems to organizations.

SOCIAL FORCES
 Changing Social Structure
 Aging Population/Demand for Health Services
 Sophisticated Lifestyles of People
 Cross-cultural Diversity

SOCIAL FORCES – refers to important issues that are characteristics of

global and local societies. Society consists of individuals, families, and
communities, including their beliefs, aspirations, traditions, and practices.
SOCIAL STRUCTURE – refers to the network of social institutions that
includes the family and the community.

POLITICAL FORCES
 Political Independence/Changing Governments
 Terrorism/Suicide Bombings
 Chemical and Nuclear Threats
 Global Alliances

ECONOMIC FORCES
 Globalization
 Competitors and Suppliers
 Fall of Financially Stable Organizations
 Increasing Oil Prices
 Economic Trade Agreements
 Emerging Markets
 Rise of China

TECHNOLOGICAL FORCES
 Communication Technology
 Computer-Integrated Business
 E-banking
 E-learning
 Digital Medicine
 E-security

ENVIRONMENTAL FORCES
 Climate Change/Use of Biodegradable Materials
 Environmental Waste Management
 Preservation of Rainforests and Marine Life
CHAPTER 3

INTERNAL ENVIRONMENT – it is the setting in which an organization

exists locally. This covers the areas of government, culture, the
stakeholders, competitors, suppliers, customers, and the community.

Government: The Business Caretaker

- The government is the sole legitimate institution tasked with
overseeing organizational operations in the country.

Culture: A Communal Convergence

Worth mentioning are the:

1. The trait of hospitality
2. The practice of bayanihan
3. Filipinos generally take care of their parents, old relatives, and sibling.
4. Pakikisama and utang na loob
5. The habits of ningas kugon and “Filipino Time”
6. The attitudes of crab mentality and bahala na
7. The virtue of resiliency
8. The idea of kanya-kanya
9. The consciousness of being politically involved

Stakeholders: The Business Investors

- Stakeholders are business investors. They are assets of the country.
They also provide opportunities for exchange of products and services.
Provide employment to the country.

Individuals/entities that stand to benefit from the investments of the

owners: the employees, the government, and the community.

Competitors: The Business Threats

Competition – an economic scenario where nations, communities,
organizations, companies, and individuals offer and sell their products
and services.

Competitors fall in different categories:

1. Same Products – companies who sell exactly the same products
or offer the same services. They are direct competitors.
2. Similar Products – companies who sell similar products.
3. Substitute Products – Ex. Competitors of marketplaces are fast-
food centers.
4. Different Products

Competitors also differ with respect to the strategies they

adopt:
1. Complementary Competition
2. Collaborative Competition
3. Corrupted Competition

Different ways of identifying competitors:

1. Determining similarity in characteristics
2. Studying consumers
3. Researching company data
4. Considering corporate success

Customers: The Business Challenge

Customer Relationship Management

Company

CRM

Product Customers
CRM is the emphasis of most companies. It revolves around the interplay
of three significant variables, namely, the company that produces the
product, the product produced, and the customers who buy the product.

Suppliers: The Business Partners

Suppliers – refer to individuals and companies engaged in the delivery of

raw materials, machinery, technology, labor, skills, and other forms of
services.

The supplier component is important for the following reasons:

1. It is responsible for the quality of the products produced and the
services rendered.
2. It affects continuity in operational processes.

Community: The Business Concern

- The community is the intermixture of people. It is “customers,
suppliers, and competitors” all bundled as one.

Porter’s Five Forces Model (Michael Porter)

Bargaining Power of
Customers

Threats of Substitute Competitive Rivalry Threats of New

Products Within the Industry Entrants

Bargaining Power of
Suppliers