Professional Documents
Culture Documents
Course Objectives
• Explain What is Strategic Management
• Explain What is a Strategy
• Describe the Strategy Statement and its Components
• Explain the Steps of Strategic Management Process
• Describe the Components of Strategic Management Process
• Differentiate between Strategy Formulation and Strategy Implementation
• Differentiate between Strategic, Administrative and Operational Decisions
• Describe the Qualities of a Strategic Leader
• Explain What is a Business Policy
• Describe the Structure of BCG Matrix
• Describe the Factors of SWOT Analysis
• Explain Porter’s Five Forces Model of Competition
• Explain What is Corporate Governance
• Explain What is Business Ethics
• Describe the Core Competency Theory of Strategy
Introduction
Strategic Intent
Mission
Sta
of teme
Mi
ssi nt
jec and
es
Statement
on
tiv
Ob als
Vision
Go
Let us look at each in detail.
Goals and Objectives
Mission
Goals:
jec and
es
A goal is a desired future state or objective that an organization tries to achieve.
tiv
Ob als
Go
The following
Goals specify inare the features
particular whatof wellbe
must defined
done ifgoals:
an organization is to attain its
mission
• They or vision. Goals make mission more prominent and concrete. They co-
are precise and measurable.
ordinate and integrate various functional and departmental areas in an
• They look after critical and significant issues.
organization.
• They are realistic and challenging.
Objectives:
• They must
Objectives be achieved
are defined within
as goals thataorganization
specific timewants
frame.
to achieve over a period of
time. These are the foundation of planning. Policies are developed in an
• They include both financial as well as non-financial components.
organization so as to achieve these objectives. Formulation of objectives is the task
of top level management.
Real Life Example
Vision
Vision:
“To create exciting new digital
entertainment experiences for consumers
by bringing together cutting-edge
products with latest generation content
and services.”
Real Life Example
Vision Mission
Mission:
“Sony is committed to developing a
wide range of innovative products and
multimedia services that challenge the
way consumers’ access and enjoy
digital entertainment. By ensuring
synergy between businesses within the
organization, Sony is constantly striving
to create exciting new worlds of
entertainment that can be experienced
on a variety of different products.”
Components of Strategic Management Process
The image given below shows the components of the Strategic Management
Process.
tal
e n
o nm ing
nvir ann
Fo
Str ulati
E Sc
rm
ate on
gy
Str luatio
Eva
ate n
gy
tegy on
a ti
Let us look at each Str enta
l e m
component in detail. p
Im
Real Life Example
Globus Inc. is a
leading manufactu
rer
of economy class r in g and
cars. onit o
ev e r, m e rnal
Ho w ex t
id e d to l aunch ly s is of the icates that
ntly dec ana t ind
It h a s re ce h will be a n m e n the
‘Flash ’ w h ic enviro forecasts of erials
a new car r ca t e ri n g to the l
origina f the raw m aking
at
d ca
low-price o n s u m ers. o
prices involved in redible.
m
e t c
low-budg re
that a re no more
c
ra
the ca
Strategy Formulation Process
Performance Analysis:
Performance analysis includes discovering and analyzing the
gap between the planned or desired and actual
performance. A critical evaluation of the organization’s past
performance, present condition and the desired future
conditions must be done by the organization. This critical
evaluation identifies the degree of gap that persists
between the actual reality and the long-term aspirations of
the organization. An attempt is made by the organization to
estimate its probable future condition if the current trends
persist.
Did You Know?
a n a ger ’s
t o a m for
e fe r s is io n
e r s h ip r a t e g ic v
g i c lead ress a str t o f th e
e
Strat al to exp o r a pa r
e r s u ade
e n ti a ti o n, a n dp
po t
o rg a n iz
o tiv a t e
t ra t e gic
the a n d to m vision. S liz ing
atio n a t as u ti
g a n i z q u i r e th fi n e d y e es.
or a c d e lo
t h e r s to a ls o be t o f emp o n al
o p ca n e me n niza l ti
rs h i n a g o r g a
leade in the ma influence nizationa
t ra t e gy ti a l to t e o rga
s p o te n e x e c u c r e a te
i s t h e n d to a d e r s o u rc es
It
m b e rs a a t e g ic le c a t e res
me e . St r , allo
ch a n g
t r u c t u re
c v i s io n.
ti o n al s st r a teg i
iza ss
organ and expre
Policy vs. Strategy
The term “policy” should not be considered as synonymous to the term
“strategy”. The difference between policy and strategy are as follows:
Policy Strategy
Policy is a blueprint of the organizational Strategy is concerned with those
activities which are repetitive/routine in organizational decisions which have not
nature. been dealt/faced before in same form.
Policy formulation is the responsibility of Strategy formulation is basically done by
top level management. middle level management.
Policy deals with routine/daily activities Strategy deals with strategic decisions.
essential for effective and efficient
running of an organization.
Policy is concerned with both thought Strategy is concerned mostly with action.
and actions.
A policy is about ‘what is’ or ‘what is not A strategy is the methodology used to
done’. achieve a target as prescribed by a policy.
Structure of BCG Matrix