Exploring Corporate Strategy

7th Edition

Part I

Introduction

Slide 1.1
Exploring Corporate Strategy, Seventh Edition, © Pearson Education Ltd 2005

Exploring Corporate Strategy
7th Edition

Chapter 1

Introducing Strategy

Slide 1.2
Exploring Corporate Strategy, Seventh Edition, © Pearson Education Ltd 2005

Introducing Strategy – Outline
• What is strategy and strategic management? • Strategic priorities at corporate, business and operational level • Vocabulary of strategy • Exploring Corporate Strategy strategic management model

Slide 1.3
Exploring Corporate Strategy, Seventh Edition, © Pearson Education Ltd 2005

Seventh Edition. Slide 1. which achieves advantage in a changing environment through its configuration of resources and competences with the aim of fulfilling stakeholder expectations.4 Exploring Corporate Strategy.Definition of Strategy Strategy is the direction and scope of an organisation over the long term. © Pearson Education Ltd 2005 .

© Pearson Education Ltd 2005 Slide 1.Strategic decisions Exhibit 1.1 Exploring Corporate Strategy. Seventh Edition.5 .

6 Exploring Corporate Strategy.Strategic Decisions are About… • • • • The long-term direction of the organisation The scope of an organisation‟s activities Gaining advantage over competitors Addressing changes in the business environment • Building on resources and competences (capability) • Values and expectations of stakeholders which affect operational decisions Slide 1. © Pearson Education Ltd 2005 . Seventh Edition.

7 Exploring Corporate Strategy.Strategic Decisions are Likely to : • • • • Be complex in nature Be made in situations of uncertainty Affect operational decisions Require an integrated approach (both inside and outside an organisation) • Involve considerable change Slide 1. © Pearson Education Ltd 2005 . Seventh Edition.

© Pearson Education Ltd 2005 .Strategic Business Unit (SBU) • A strategic business unit (SBU) is a part of an organisation for which there is a distinct external market for goods or services that is different from another SBU Slide 1.8 Exploring Corporate Strategy. Seventh Edition.

LEVELS OF STRATEGY • Corporate level – Determine overall scope of the organisation – Add value to the different business units – Meet expectations of stakeholders • Business level (SBU) – How to compete successfully in particular markets • Operational – How different parts of organisation deliver strategy Slide 1.9 Exploring Corporate Strategy. © Pearson Education Ltd 2005 . Seventh Edition.

2 Exploring Corporate Strategy.10 . © Pearson Education Ltd 2005 Slide 1.The vocabulary of strategy Exhibit 1. Seventh Edition.

© Pearson Education Ltd 2005 .11 Exploring Corporate Strategy. Seventh Edition. activities and processes • Business model – how product. service and information flow • Control – monitoring of action steps Slide 1.The Vocabulary of Strategy • • • • Mission – overriding purpose Vision/strategic intent – desired future state Goal – general statement of aim or purpose Objective – quantification or more precise statement of goal • Strategic capability – resources.

12 Exploring Corporate Strategy. holistic Routinised Managing existing resources Developing new resources Operating within existing strategy Ambiguous/uncertain Operationally specific Long term Day to day issues Slide 1.Strategy and Operations Strategic Management Conceptualisation of issues Creating new directions Operational Management Techniques and actions Organisation-wide. Seventh Edition. © Pearson Education Ltd 2005 .

13 Exploring Corporate Strategy.Elements of Strategic Management • Understanding the strategic position of an organisation • Making strategic choices for the future • Turning strategy into action Slide 1. Seventh Edition. © Pearson Education Ltd 2005 .

3 Exploring Corporate Strategy. Seventh Edition.14 .A model of the elements of strategic management Exhibit 1. © Pearson Education Ltd 2005 Slide 1.

Seventh Edition. © Pearson Education Ltd 2005 .15 Exploring Corporate Strategy.Strategic Position (1) • The Organisation‟s Environment – Political Economic Social Technological Legal Environmental – Sources of Competition – Opportunities and Threats • Strategic Capability of the Organisation – Resources and Competences – Strengths and Weaknesses Slide 1.

16 Exploring Corporate Strategy. Ethics and Culture – Sources of Power and Influence – Communication of Purpose: Mission and Objectives Slide 1. © Pearson Education Ltd 2005 . Seventh Edition. Stakeholders.Strategic Position (2) • Expectations and Purposes – Corporate Governance.

© Pearson Education Ltd 2005 . e. M&A.g. strategic alliances Slide 1. Seventh Edition.17 Exploring Corporate Strategy.Strategic Choices • Bases of competitive advantage at business level • Scope of activities at corporate level – Portfolio – Market spread. international – Value added by corporate parent (parenting) • Directions and methods of development – Directions: Product/Market – Methods: Internal/organic.

technology) • Managing change Slide 1. information. Seventh Edition.Strategy into Action • Structuring the organisation • Marshalling resources (people. finance. © Pearson Education Ltd 2005 .18 Exploring Corporate Strategy.

Processes of Strategy Development • Intended strategies – Deliberate management intent • Emergent strategies – Develop out of social and political processes in and around organisations Most strategies are a combination of intended and emergent processes Slide 1. Seventh Edition.19 Exploring Corporate Strategy. © Pearson Education Ltd 2005 .

20 Exploring Corporate Strategy. core competences 1990s Firms as organisms Innovation to deal with change (Eisenhardt. © Pearson Education Ltd 2005 . history 1980s 1980s Market positioning (Porter) Resource based theory (Hamel. Seventh Edition. politics. Influence of experience. culture. Prahalad) Assessing competitive forces (5 forces) and positioning Unique resources. Stacey) Slide 1.Strategy as a Subject of Study 1960s 60/70s 1980s Harvard case study Corporate planning Adaptive processes (Quinn) What would you do if you were CEO? Systematised and analytical approach Complexity and uncertainty.

© Pearson Education Ltd 2005 . Diverse products/markets/businesses. Portfolio management. brand image for competitive advantage. Restricted funds. Competitive strategy.21 Exploring Corporate Strategy. Structure/control/parenting. Seventh Edition. Limited product/service range. Strategic capability. Competitive strategy. Services – Organisations no physical product. competitive advantage based on intangibles Slide 1.Different Contexts for Strategy (1) Small Business Multinational Corporation Single market. Manufacturing/ Manufacturing – physical product often augmented with Service service. Resource coordination.

Stakeholder management. Voluntary and Not-for-Profit Slide 1. Competition for resource inputs.Different Contexts for Strategy (2) Public Sector Ideology. Values and ideology. Best value in outputs.g.22 Exploring Corporate Strategy. Interagency cooperation Diverse sources of funds. Lobbying. government). © Pearson Education Ltd 2005 . Seventh Edition. Direct/indirect external influence (e.

Ideas Slide 1. Seventh Edition.23 Exploring Corporate Strategy. © Pearson Education Ltd 2005 .Challenges of Strategic Management • Prevent strategic drift – Progressive failure to address strategic position – Deterioration of performance • Understand and address contemporary issues – Internationalisation – E-Commerce – Changing purposes – Knowledge and learning • View strategy in more than one way – Three strategy lenses – Design. Experience.

24 . © Pearson Education Ltd 2005 Slide 1.The risk of strategic drift Exhibit 1. Seventh Edition.4 Exploring Corporate Strategy.

25 Exploring Corporate Strategy. © Pearson Education Ltd 2005 .Contemporary Strategy Themes (1) • Internationalisation – Size of market – Range of competitors – Relationships overseas – Institutional/cultural orientation to strategy and profit orientation • E-Commerce – Speed and direction of technology change – Expectations about how to do business – E-commerce capability – Service small markets Slide 1. Seventh Edition.

© Pearson Education Ltd 2005 .Contemporary Strategy Themes (2) • Changing purposes – Change from pure profit driven – Corporate scandals – Corporate social responsibility – AND drive for shareholder value – Public sector more “business-like” – target setting and service orientation • Knowledge and Learning – Innovation – Generate and integrate knowledge/promote learning – New ways of doing business – People interactions Slide 1. Seventh Edition.26 Exploring Corporate Strategy.

© Pearson Education Ltd 2005 .The Strategy Lenses (1) • Strategy as design – Logical analytical process – Planned implementation – Top manager driven • Strategy as experience – Adaptation of past strategies based on experience – Influenced by taken for granted assumptions (culture) – Bargaining and negotiation Slide 1. Seventh Edition.27 Exploring Corporate Strategy.

28 Exploring Corporate Strategy. © Pearson Education Ltd 2005 . Seventh Edition.The Strategy Lenses (2) • Strategy as ideas – Importance of variety and diversity for innovation – Emergent strategy from within and around the organisation – Top managers create the conditions for this to take place Slide 1.

The role of the paradigm in strategy formulation Exhibit I.i Exploring Corporate Strategy.29 . Seventh Edition. © Pearson Education Ltd 2005 Slide 1.

30 .Conditions of adaptive tension Exhibit I. Seventh Edition. © Pearson Education Ltd 2005 Slide 1.ii Exploring Corporate Strategy.

„Strategy as simple rules. © Pearson Education Ltd 2005 Slide 1.31 .iii Exploring Corporate Strategy.‟ January 2001. Seventh Edition.Simple rules Source: Reprinted with permission from Harvard Business Review. Sull. Copyright © 2001 by the Harvard Business School Publishing Corporation. all rights reserved. Adapted from K.M. Eisenhardt and D.N. Exhibit I.

Seventh Edition.iv Exploring Corporate Strategy. © Pearson Education Ltd 2005 Slide 1.32 .Three strategy lenses: a summary Exhibit I.

Seventh Edition.Three strategy lenses Exhibit I.v Exploring Corporate Strategy. © Pearson Education Ltd 2005 Slide 1.33 .

Sign up to vote on this title
UsefulNot useful