Abhi Jain 08D1101 Raphael 08D1118 Ripuraj 08D1119 Anuha Kishore 08D1145 Akash 08D1145 Param 08D1154 Pritesh

Ranka 08D1155 Ayushi Singhania 08D1164

INTRODUCTION
STRATEGY : The determination of the basic long term goals and objectives in an enterprise and the adoption of courses of action and the allocation of resources necessary for carrying out these goals. EXAMPLES : price cutting strategy by the telecom companies in India, GE·s strategy to be number 1 or 2 in every field of its operations etc.

Features of strategy
Strategy is about winning Strategy offers broad guidelines Strategy is forward looking Strategys life span is limited Strategy is a product of top management thinking Strategy is a dynamic and flexible programme of action Strategy is an inherently creative process

Elements of a strategy
Goals-A strategy invariably indicates the long term goals towards which all efforts are directed Scope- A strategy defines the scope of the firm and the broad areas of activities Competitive advantage-A clear statement of what competitive advantages the firm will pursue and sustain Logic-is the core of and most important element of a strategy

Types of strategies
Master and grand strategies that cover the entire pattern of an organisations objectives Programme strategies are more specific and are concerned with the deployment of resources Sub-strategies are more detailed than programme strategies Tactics are action plans of specific step by step methods in executing strategies

LEVELS OF STRATEGY
The following can be considered as the different levels at which strategic decisions take place : 
Corporate Level  Business Level  Functional Level

Corporate Level Strategies 
Decision making consisting mainly members of Board of Directors and CEO·s.  People responsible for the financial performance of the company and achievement of a firm·s goals.  Set strategies for individual business units.

CONT. 
Determining the business in which the company should be involved.  EXAMPLES : Apple Inc. stating its competitive advantage to be its strength in the design of its product or Coca-cola not patenting its ´secretµ formula.

BUSINESS LEVEL STRATEGIES 
Decision making authority mainly in the hands of business and corporate managers.  Determine the basis on which a corporate can compete in the selected product market field  Managers responsible to translate the general statements of direction and the intent generated at the corporate level into solid, functional objectives and strategies for individual business divisions.

CONT. 
EXAMPLES : Bharti Airtel wanting to go global may be a corporate level strategy but the decision to specifically buying a Srilankan firm to fulfill its ambitions may be considered as a business level strategy.

FUNCTIONAL LEVEL STRTEGY 
Consisting of managers of product, geographic, and functional areas.  Develop annual objectives & short term strategies in the areas of production & operations, R&D, finance & accounting, & marketing etc.  Concentrate on implementing a firm·s strategic plans.

While corporate & business level managers centre their planning concerns on ´doing the right thingsµ the managers at functional level must stress on ´doing things right.µ

CASE STUDY 
Ryanair, a low cost British Airline in the year 1985 managed to garner permission to fly on the very lucrative London-Dublin route in the heavily regulated British Airline Industry.  Before Ryanair entered the industry the lowest return fare on the London-Dublin route was about 195 Irish Pounds by British Airways.

CONT. 
The cheapest return fares on boats or ferries which took about 8 hours to complete the journey was about 65 Irish Pounds.  The main & probably the only competition for Ryanair would have been BA

RYANAIR·S STRATEGY 
Ryanair decided to offer services on the LondonDublin route by competing head on with British Airways by claiming to offer equal if not better services to BA and excellent quality food and alcohol.  However compared to BA 195 Irish Pound ticket Ryanair would offer an all inclusive return ticket for 98 Irish Pounds.

WAS THIS A GOOD STRATEGY? 

I don·t think so«.  Even before Ryanair could enter the market British Airways offered a fare on the same route for 95 Pounds compared to Ryanair·s 98 Pounds

RYANAIR·S RESPONSE 
It entered the market by offering a fare of 94.99 Pounds!  This only led to a price war between the two airlines and by 1989 the cheapest fare on the London-Dublin route was around 75Pounds below which no airline could afford to go.

RESULT 
Ryanair was on the verge of bankruptcy in the year 1991 without enough money to even pay for its fuel!

Why did Ryanair·s strategy fail? 
Firms with similar cost structures cannot be profitable in industries where competition is fierce.  Ryanair could have been more efficient but«  «British Airways has deep pockets.  Moreover an absence of a sustainable Competitive advantage could have been another reason for Ryanair·s failure.

Entrepreneurial Approach
This is an approach in strategic decision making which is followed by the organisations headed by the family heads where by the organisations is moulded to the face of the environmental changes For eg : reliance, jyoti udhyog, nirma, kothari products, mofatlal group, dabur products, Infosys Technologies.

Basic features
Capitalising on the opportunities Centralized decision making power Growth and expansion orientation Efforts and rewards are well balanced

Adaptive Approach
This approach is reactive rather than pro active and tries to collect and mix the variant factors influencing the strategic decisions. This approach is very common in public sector enterprises where decision making power is divided

Basic features
It is an exercise of problem-solving. Dominance of decision making process by constituents. Priority based decisions

Planning Approach
This approach calls for making decisions in anticipation of the future state of affairs where the organisation is prepared to face it boldly. It is widely used by multi nationals which have formalised and structured strategic decision making processes.

Basic features
Analysis of factors influencing a strategy Systematic and structured approach It is a comprehensive approach

Strategic Intent
Strategic intent- The companies which have achieved global leadership began with an ambition out of line with their resources However this created a strong desire to win and they sustained the same over a long spell of time This desire or burning desire is known as strategic intent

Strategic intent is really an energising dream which provides the emotional future It implies a significant leap beyond the current capabilities and resource base for attaining future leadership The strategic intent signifies the very purpose of the organisation which is striving for

Vision
The term vision is rather difficult to define as it is dreamt than articulated A vision articulates the position that an organisation intends to attain in the distant future Vision encapsulates the basic strategic intent Eg:Henry ford dreamt about making an affordable automobile for the masses

Definition- Vision is the category of intentions that are broad, all-inclusive and forward thinking In strategic management, the word vision is strategic vision A strategic vision is a road map showing the route company intends to take in delivering and strengthening its business

Characteristics of a effective vision
Graphic-a well stated vision paints a picture a picture of the kind of company the management is striving to create &market % Directional-says about the companys journey and signals the kinds of business&strategies Focussed- A well stated vision is specific enough to provide managers guidance in making decisions and allocating resources

Flexible- Visions about a companys future path needs to change as events unfold and circumstances change Desirable-A well stated vision appeals to the long-term interests of the stake holders Easy to communicate- A well stated vision is explainable in less than 10 mts and ideally can be reduced to simple memorable slogan Eg:A car in every garage-vision of Henry Ford

Mission
Mission and purpose- The difference in both is synergy Mission has an external orientation and relates organization to the society Mission amplifies what brings a firm to business or why it is there The mission statement helps the organization to link its activities to requirements of the society

What do mission statements do
Mission statements establish boundaries to guide strategy formulation Mission statements acknowledge responsibilities to various stake holders and establish standards for organizational performance The dimensions are public responsibility, physical and financial resources, market standing, innovation, productivity & profitability

The need for explicit mission
Unity of purpose-unity in various sub systems Basis of motivation- for manpower & resources Foundation of standard- for performance, standardization of working conditions etc Creates organizational climate-invigorating better performance at all levels & culture Serves as a means of control- parameters are quality, quantity& definite time frame

Essential features of a mission statement
Mission stated is clear cut-in terms of words used and intentions smelt Mission stated is feasible-attainable & realistic Mission stated is neither too narrow or too broad Mission stated is distinctive-distinctive and stands out from others, contributions to the society

Goals and objectives
Goals are attempts to make mission statements more specific as mission tries to make vision more specific, following are the features Financial and non-financial issues Facilitate reasoned trade offs They can be reached with a strech-camelpolicy Cut across functional areas-coordination and competition among departments

Objectives
Goals describe in fairly general terms what the organization hopes to accomplish Objectives do it in more precise terms as to what will be done in order to reach the goal Objectives are short term and specific intensions of various operational units, often called as targets &key element in tactical plans

Charecteristics of objectives
They are measurable- They can be monitored and progress can be measured Each firm is keen about measuring the quality as it is a strategic goal or objective They incorporate the dimension of time- measurement has validity if its done with a definite time frame Eg: companys financial and non-financial performance is measured at the end of the year

They reduce conflict- Clearly stated objectives reduce the possible rivalry among the organization members Objectives encourage cooperative management behavior The importance is to overall organizational objectives than personal objectives Facilitates beneficial intra organizational relationships like resource and information strategy

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