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Strategic Planning

Module 5
LIS 580: Spring 2006
Instructor- Michael Crandall

Roadmap




The strategic management process
Mission and vision statements
Analyzing strategic drivers and core
competencies
SWOT analysis
Scenario planning

April 11, 2006

LIS580- Spring 2006

2

Dessler.1 The Strategic Management Process  Define the business and its mission. G.Spring 2006 3 .  Translate the mission into strategic goals.Checklist 5.  Evaluate performance.  Implement the strategy.  Perform external and internal audits.  Generate and select strategies to reach strategic goals. 2003 April 11. 2006 LIS580.

Dessler. NJ: Prentice-Hall. April 11. Strategic Management (Upper Saddle River. p.Spring 2006 FIGURE 5–1 G.A Comprehensive StrategicManagement Model Source: Adapted from Fred David. 77. 2003 4 . 2006 LIS580. 2001).

what principles or beliefs guide our work April 11. 2006 LIS580.the needs we exist to address – Business .Vision and Mission • A vision statement tells people – – – – Where we want to go What we want to become What we want to accomplish Why it is important • And a mission expresses the organization’s: – Purpose .Spring 2006 5 .what are we doing to address these – Values .

INC. area.as aswell wellas ascellular cellularphone phoneand andpaging paging services.Dessler. GRAY GRAYCOMPUTER. To Totransform transformhow howeducators educatorswork workby byproviding providinginnovative innovativeand andeasy-to-use easy-to-use multimedia-based multimedia-basedcomputer computersystems.error-free error-freemethod methodfor formoving movingpeople peopleand and products productsup. systems. 2006 LIS580.Spring 2006 G. INC.INC. JOSEPHSON JOSEPHSONDRUG DRUGCOMPANY. UNITED UNITEDTELEPHONE TELEPHONECORPORATION CORPORATIONOF OFDADE DADE To Toprovide provideinformation informationservices servicesininlocal-exchange local-exchangeand andexchange-access exchange-access markets marketswithin withinits itsfranchised franchisedarea. up. products. 2003 6 . FIGURE 5–2 April 11. high-reliability.and andsideways sidewayswithin withinaabuilding. To Toprovide providepeople peoplewith withlonger longerlives livesand andhigher-quality higher-qualitylives livesby byapplying applying research researchefforts effortstotodevelop developnew newor orimproved improveddrugs drugsand andhealth-care health-care products. down.Examples of Mission Statements APEX APEXELEVATOR ELEVATOR To Toprovide provideaahigh-reliability. building.down. COMPUTER. services. COMPANY. INC.

May 2001. first—anytime.Dessler. 2006 LIS580.Strategies in Brief COMPANY COMPANY STRATEGIC STRATEGICPRINCIPLE PRINCIPLE America AmericaOnline Online Consumer Consumerconnectivity connectivityfirst—anytime. 74. “Frontline Action.every everyday day Source: Arit Gadiesh and James Gilbert. prices.anywhere anywhere Dell Dell Be Bedirect direct eBay eBay Focus Focuson ontrading tradingcommunities communities General GeneralElectric Electric Be Benumber numberone oneor ornumber numbertwo twoin inevery every industry industryin inwhich whichwe wecompete.or orget getout out Southwest SouthwestAirlines Airlines Meet Meetcustomers’ customers’short-haul short-haultravel travelneeds needsat atfares fares competitive with the cost of automobile travel competitive with the cost of automobile travel Vanguard Vanguard Unmatchable Unmatchablevalue valuefor forthe theinvestor-owner investor-owner Wal-Mart Wal-Mart Low Lowprices.Spring 2006 7 . compete.” Harvard Business Review. p. 2003 April 11. FIGURE 5–3 G.

2003 April 11.Dessler. 2006 LIS580.Spring 2006 8 .2 How to Test the Quality of Your Strategy  Does your strategy fit with what’s going on in the environment?  Does your strategy exploit your key resources?  Will competitors have difficulty keeping up with you?  Are the elements of your strategy internally consistent?  Do you have enough resources to pursue this strategy?  Can your strategy be implemented? G.Checklist 5.

2006 LIS580.Dessler.Spring 2006 9 .Relationships Among Strategies in Multiple-Business Firms FIGURE 5–4 G. 2003 April 11.

Strategy Types • Corporate – – – – – – Concentration Vertical integration Diversification Status quo Investment reduction Strategic alliances/joint ventures • Competitive – Cost leadership – Differentiation – Focus April 11.Spring 2006 10 . 2006 LIS580.

Dessler. Porter.Forces Driving Industry Competition Source: Reprinted with the permission of The Free Press.Spring 2006 FIGURE 5–5 G. 2003 11 . 2006 LIS580. a division of Simon & Schuster from Competitive Strategy: Techniques for Analyzing Industries and Competitors by Michael E. Copyright © 1980 by The Free Press. April 11.

“Strategy and the Internet.Dessler.How the Internet Influences Industry Structure Source: Adapted from Michael Porter. p. 2006 FIGURE 5–6 G.Spring 2006 12 .” Harvard Business Review. 2003 LIS580. March 2001. 67. April 11.

Dessler.Spring 2006 13 . Opportunities. 2003 April 11. and Threats FIGURE 7–7 G. Weaknesses. 2006 LIS580.Examples of a Company’s Strengths.

Dessler. 2003 April 11. 2006 LIS580.Worksheet for Environmental Scanning FIGURE 5–8 G.Spring 2006 14 .

2006 LIS580. and don’t look for new product information.3 How to Benchmark  Focus on a specific problem and define it carefully  Use employees who will actually implement changes to identify the bestpractices companies and to conduct onsite studies. G. 2003 April 11.  Be willing to share information with others.  Avoid sensitive issues such as pricing.Spring 2006 15 .Checklist 5.  Keep information you receive confidential.Dessler.

Cineplex Odeon TOWS Matrix Source: Fred David. p. 2003 LIS580. 2001). April 11.Spring 2006 16 . Strategic Management (Upper Saddle River. 2006 FIGURE 5–9 G.Dessler. 207. NJ: Prentice-Hall.

Spring 2006 17 . 2006 LIS580. 2003 April 11.Dessler.BCG Matrix FIGURE 5–10 G.

Scenarios add value to decision making only when managers and others use them to systematically shape questions about the present and the future.Checklist 5. 2006 LIS580. and refining the substance of managers’ mindsets and knowledge. and to guide how to go about answering them. 2003 April 11.Spring 2006 18 .Dessler.4 Scenario Planning Principles    Scenarios have value only to the extent that they inform decision makers and influence decision making. G. the emphasis must be on identifying. In each step of developing scenarios. challenging.

2006 LIS580. hypotheses.Dessler. G. and assumptions. perspectives.  The dialogue and discussion spawned by the consideration of alternative futures should directly affect managers’ knowledge.Spring 2006 19 . 2003 April 11.Checklist 5.4 (cont’d) Scenario Planning Principles  Alternative projections about a given future must challenge managers’ current mental models by creating tension among ideas.  Scenarios should include enough indicators so that managers can track how the future is actually evolving so that the learning and adaptations stimulated by the scenarios are continuous.

2006 LIS580.Spring 2006 FIGURE 5–11 G. From “What Is Strategy?” by Michael E.Southwest Airlines’ Activity System Source: Reprinted by permission of Harvard Business Review. Copyright © 1996 by the President and Fellows of Harvard College. Porter.Dessler. 2003 20 . November–December 1996. April 11. all rights reserved.

Stretch • Southwest follows Michael Porter’s view that functional strategies should support corporate and competitive strategies • Hamel and Prahalad argue that leveraging resources is more important for long-term success • Core competencies define key strengths of the organization.Strategic Fit vs. 2006 LIS580. and provide the focus for strategic choices April 11.Spring 2006 21 .

Cleveland Public Library • How did the library go about building their plan? • Did they effectively engage the stakeholders in the process? • What kinds of outside help did they seek in formulating their plan? • How did the concrete steps they defined relate to their mission and vision statements? • Were there any measurements of success built into the plan? April 11. 2006 LIS580.Spring 2006 22 .

Next Time • Guest lecture – Mike Eisenberg. Dean Emeritus.Spring 2006 23 . and think of it in the context of the discussions we’ve been having over the past several days – Come prepared with questions that use class readings and discussion to examine this plan – A great chance to hear from someone who’s gone through a full planning cycle April 11. the Information School • Read the iSchool Strategic Plan Mike wrote in 1998. 2006 LIS580.