Presentation on

Strategic Management
What is strategy?

• Strategy is a tactical course of action which is designed to achieve long term

objectives. It is an art and science of planning and marshalling resources for
their most efficient and effective use in a changing environment.

• Strategy of a business enterprise consists of what management decides about

the future direction and scope of the business. It entails managerial choice
among alternative action programs, competitive moves and different business
approaches to achieve enterprise objectives.

• Strategy once formulated has long term implications. It is framed by top

management in an organization. In short, it may be called as the ‘game plan of
management’.
Definition of
Strategy

As per Glueck,
Strategy is unified, comprehensive and integrated plan relating the strategic
advantages of the firm to the challenges of the environment. It is designed
to ensure that the basic objectives of the enterprise are achieved.

As per Alfred D. Chandler,

Strategy is “The determination of basic long-term goals and objectives of

an enterprise and the adoption of the courses of action and the allocation
of resources necessary for carrying out these goals.”
Features of
Strategy

• Top management responsibility

• Allocation of large amount of resources
• Impact on long term prosperity of the firm
• Future oriented
• Consideration of factors in the external environment
Strategic Management includes all decisions and
actions set by the managers and provides a gauge
on the performance of a particular organization.

Business Policy is also strategic management in

context although generally it serves primarily on
integrating various functional activities.
THE STRATEGIC MANAGEMENT PROCESS
SITUATION ANALYSIS
-outlines how an organization formulates,
implements, and evaluates
STRATEGY systems and processes
FORMULATION
for efficientMission/Vision
and effective company performance
Strategies/Policies

STRATEGY IMPLEMENTATION
Programs/Activities Budgets/Procedures

STRATEGY EVALUATION AND CONTROL

Performance Actual Results
 STRATEGIC MANAGEMENT
PROCESS
Situation Analysis Strategy Formulation
-involves development of company
-includes environmental scanning strategies
-provides the information necessary to -composed of three organizational
formulate the company’s vision/mission levels:
statement 1. Operational Strategies
-involves scanning and evaluating the 2. Competitive Strategies
organization 3. Corporate Strategies
OPERATIONAL
STRATEGIES

-are short-term and are associated with the various

operational departments of the company such as human
resource, finance, marketing , and production
-refers solely to the set of processes and structures
-strategies that direct overall performance and day-to-day
priorities
COMPETITIVE STRATEGIES

-are those related to the techniques in competing

in a certain industry
-use to gain competitive advantage
>identifying the strengths and weaknesses of
competitors
-deal with establishing competitive strength
against competitors
CORPORATE STRATEGIES

-use to improve both operational and competitive

strategies
-solidify all the other strategies that will result to
overall organizational performance
-are long-term and are involved in providing
direction for the organization
COMPETITIVE ADVANTAGE

-looks at quality
-tantamount to superior quality
-also covers continuous innovation that leads to
customer loyalty
-is also achieved when the company always
anticipates what the customers need and want
 STRATEGIC MANAGEMENT
PROCESS

Strategy Implementation Strategy Evaluation

-involves the development of procedures, -includes appraising the company’s

programs and activities to put the strategies performance
into practice -all employees are involved in this
-the time to determine which strategies process
-involves modification of strategies to
should be implemented first
be attuned to changes
-involves communication of the strategies to
be implemented
 STRATEGIC
MANAGEMENT:PLANNING PHASES
PHASE 1: PLANNING FINANCIAL
PHASE 2: FORECASTING
ASPECTS
-for long-term planning, five-year
-financial data is planned such as next plans are made
year’s budget -it takes a while before final projects
-timeline is usually one year are evaluated and approved
-in reality, no strategic management yet in -timeline: 3 to 5 years
this phase
 STRATEGIC
MANAGEMENT:PLANNING PHASES
PHASE 3: EXTERNAL PLANNING PHASE 4: STRATEGIC MANAGEMENT
-task of top management -the process of getting the rudiments of
-they gather and formulate strategies strategies in detail (STRATEGIC PLANS)
for the company on a five-year period -provides possible scenarios and the
-lower-level managers are hands off accompanying contingent measures
(STRATEGIC ACTIONS)
in this process and only come into the
picture during the implementation
stage
GLOBALIZATION
-the internationalization of markets and
corporations
-has changed the way people do business

TO BE COMPETITIVE:
-means a paradigm shift
-requires a product or service to be at an
affordable price but at the same time
maintains good quality

With these, strategic management plays a key

role in positioning the company at the
forefront.
 THE
ELECTRONIC Electronic transaction refers to the various
AGE uses of the internet in conducting business
transactions.

1.The internet has become a force for

companies to improve and enhance the
way they transact business.
2. Distribution channels have changed
drastically through the years.

Effects: reduce cost, improved customer

service, and better relationships with
customers
 THE
ELECTRONIC
AGE
3. Customers have more power than ever.
4. Firms are now exploring endless
possibilities to innovate using the internet.
5. Business pacing is increasing.
6. The internet is putting corporations out
of their traditional boundaries.
7. Companies have a competitive
advantage if they are well-informed.
THEORY OF
BUSINESS by
PETER
3 assumptions:
DRUCKER 1.Business becomes obsolete when the
business goals are already attained.
-objectives must be based on what the
environment dictates
2. Business should work on its core
competencies
3. Business should not only concentrate on
customers but also NON-CUSTOMERS.
(Customer-driven into Market-driven)
Thank You !