Strategic Management

Dr Geetika School of Management Studies Motilal Nehru National Institute of Technology Allahabad

Strategic Management
Set of managerial decisions and actions that determine long term performance of corporations Emphasizes monitoring and evaluating environmental opportunities an threats in the light of own strengths and weaknesses Key to success: not merely adapt to change but create change

 Company should ask three questions:

Where is the organisation now? Where it will be in two/five/ten years from now if no changes made? Are the answers acceptable? If NO. What actions should be taken? What are the payoffs and risks?

Strategic Intents
Integrative Vision Mission Objectives and Goals Few

Specificity

Plans

Many

Vision
Refers to inspirational picture of future Fundamental reason for existence Unchanging core values Huge and audacious but and achievable aspiration Clarity Brevity Reachability Shared vision: shared sense of purpose

Vision Statements
Bharat Electronics To be a world -class enterprise in professional electronics. Infosys technologies ltd. To be a globally respected corporation that provides best of breed business solutions. Leveraging technology delivered by best in class people. Punjab National Bank To evolve and position the bank as a world class progressive ,cost effective and customer friendly institution providing comprehensive financial and related services ; integrating frontiers of technology and serving various segments of society especially the weaker sections ; committed to excellence in serving the public and also excelling in corporate values.

Vision Statement
MNNIT Allahabad To be a provider of globally competitive, high quality technical and managerial human resources. To promote and significantly contribute towards development of technologies and innovations appropriate to sustainable economic growth and enrichment of quality of life.

Mission
Enduring statement of purpose of existence of the organisation
What is it? What it wants to do? Whom it want to serve?

Reference point Educative value Motivating force Expression of vision, values, beliefs and philosophy

Basic components: customers, product, market, technology, concern for growth, employees, public image

Mission Statements
Intel
To do a great job for our customers, employees and stockholders by being the preeminent building block supplier to the worldwide Internet economy. Values Customer Orientation Discipline Risk-Taking Results Orientation Quality Great Place to Work
Our values are timeless and do not depend on business conditions.
Andy Grove, Intel Chairman

Mission Statements
Bharat Electronics Ltd.
To be a customer focused, globally competitive company in defense electronics and in other chosen areas of professional electronics, through quality, technology and innovation. Values - Putting customers first. - Working with transparency, honesty & integrity. - Trusting and respecting individuals. - Fostering team work. - Striving to achieve high employee satisfaction. - Encouraging flexibility & innovation. - Endeavoring to fulfill social responsibilities. - Proud of being a part of the organization.

Mission Statements
Infosys
To achieve our objective in an environment of fairness , honesty and artery towards our clients, employees, vendors & society. Values Customer delight Leadership by example Integrity and transparency Fairness Pursuit of the excellence

Mission Statements
Punjab National Bank
To provide excellent professional services and improve its position as a leader in the field of financial and related services; build and maintain a team of motivated and committed workforce with high work ethos; use latest technology aimed at customer satisfaction and act as an effective catalyst for socio-economic development.

Objectives and Goals

What organisations aim for and try to reach Results the organisation wants to achieve Towards which the behaviour is directed. Form a hierarchy: over the levels Form a network: interdependent and interlocking Multiplicity: coexistence of many objectives

Hierarchy of Objectives
Strategic Objectives Corporate Mission Strategic Measures

Business Process Objectives Individual Objectives

SBUs Critical processes

Business Process Measures KRAs & Performance Measures

Departments/individual managers

Performance Appraisal Rewards & Consequences

Objectives
Bharat Electronics Limited
To be a customer focused company providing state-of-the-art products & solutions at competitive prices, meeting the demands of quality, delivery & service. To generate internal resources for profitable growth. To attain technological leadership in defense electronics through in - house R&D, partnership with defense/research laboratories & academic institutions. To give thrust to exports. To create a facilitating environment for people to realize their full potential through continuous learning & team work. To give value for money to customers & create wealth for shareholders. To constantly benchmark companys performance with best- in -class internationally. To raise marketing abilities to global standards. To strive for self- reliance through indigenization.

Objectives
Intel
The interpretation of our mission, objectives and values means that Intel mustsupply products that are performance and price competitive, of high quality, and when the customer wants themoffer competitive compensation and opportunities for continuous professional developmentdeliver a good return on stockholders investmentsand work hard, as a global citizen, to achieve the goals of the triple bottom line.

Strategic decisions
Rare
No precedent Need broad perspective (beyond functional skills) Taken at top level

Consequential
Involve substantial resources Resource reallocation Strong commitment of top level

Directive
Guide actions Have enduring effects

Future orientation
Long term Based on forecasts

Strategic Decision Makers

Board of Directors
Apex Governing body

Top management
Apex Executive body

Board of Directors
Responsibilities of Board of Directors
Setting corporate strategy Deciding succession Controlling and monitoring Reviewing and approving resources Caring for shareholders

Board of Directors
Low

High

Phantom Rubber stamp Minimal Review Nominal Participation Active Participation Catalyst

Involvement

Top Management
Characteristics
Few tasks are continuous but responsibility always present Require wide range of capabilities
Analytical Awareness of events Interest in multiple actions Ability to pursue abstract ideas

Effects
Have unplanned free time Tendency to pursue activities which suit temperament

Good business leaders create vision, articulate vision, own the vision and relentlessly drive it to completion - Jack Welch

Top Management
Responsibilities of Top Management
Fulfill key roles Provide executive leadership Manage strategic planning process

Key Roles
Mintzberg identified ten key roles which vary in importance and time needed for each
Figurehead Leader Liaison Monitor Disseminator Spokesperson Entrepreneur Disturbance handler Resource allocator negotiator

Executive Leadership
Articulate a transcendent goal Present a role to others to follow Communicate high performance standards for self and others Show confidence in followers abilities

Strategic Planning Process

Take long range view Use information provided by
Strategic planning staff Divisional managers Functional managers

Modes of strategy formulation Entrepreneurial: proactive search

Environment is a force to be used and controlled

Adaptive: reactive solutions

Environment is too complex

Planning: proactive search and reactive solutions

Environment scanning to acquire key information

What is Strategy?
Its all about winning Being the best Creating an edge For a long sustainable time