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    The Nature of Strategic Management

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    ssalmanali08
    Sm David

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    The Nature of Strategic Management

    Uploaded by

    ssalmanali08
    33 views29 pages
    Sm David

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    david_sm13_ppt_01

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    Sm David

    Copyright:

    © All Rights Reserved
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
    33 views29 pages

    The Nature of Strategic Management

    Uploaded by

    ssalmanali08
    Sm David

    Copyright:

    © All Rights Reserved
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
    of 29

    Copyright 2011 Pearson Education, Inc.

    Publishing as Prentice Hall


    Ch 1 -1
    Chapter 1
    The Nature of Strategic Management


    Strategic Management:
    Concepts & Cases
    13
    th
    Edition
    Fred David



    Copyright 2011 Pearson Education, Inc.
    Publishing as Prentice Hall
    Ch 1 -2

    Art & science of formulating,
    implementing, and evaluating,
    cross-functional decisions that
    enable an organization to achieve its
    objectives

    Strategic Management Defined
    Copyright 2011 Pearson Education, Inc.
    Publishing as Prentice Hall
    Ch 1 -3
    Strategic Management

    In essence, the strategic plan is a
    companys game plan
    Copyright 2011 Pearson Education, Inc.
    Publishing as Prentice Hall
    Ch 1 -4
    3 Stages of the Strategic
    Management Process

    Strategy formulation

    Strategy implementation

    Strategy evaluation
    Copyright 2011 Pearson Education, Inc.
    Publishing as Prentice Hall
    Ch 1 -5


    Vision & Mission
    Strategy Formulation
    External Opportunities & Threats
    Internal Strengths & Weaknesses
    Long-Term Objectives
    Alternative Strategies
    Strategy Selection
    Copyright 2011 Pearson Education, Inc.
    Publishing as Prentice Hall
    Ch 1 -6


    Strategy Implementation
    Annual Objectives
    Policies
    Employee Motivation
    Resource Allocation
    Copyright 2011 Pearson Education, Inc.
    Publishing as Prentice Hall
    Ch 1 -7


    Strategy Evaluation
    Internal Review
    External Review
    Performance Measurement
    Corrective Action
    Copyright 2011 Pearson Education, Inc.
    Publishing as Prentice Hall
    Ch 1 -8
    Key Terms in Strategic Management
    Competitive advantage
    Strategists
    Vision and mission statements
    External opportunities and threats
    Internal strengths and weaknesses
    Long-term objectives
    Strategies
    Annual objectives
    Policies
    Copyright 2011 Pearson Education, Inc.
    Publishing as Prentice Hall
    Ch 1 -9

    Anything that a firm does especially
    well compared to rival firms
    Strategic Management is
    Gaining and Maintaining
    Competitive Advantage
    Copyright 2011 Pearson Education, Inc.
    Publishing as Prentice Hall
    Ch 1 -10


    Strategists
    Gather Information
    Analyze Information
    Organize Information
    Copyright 2011 Pearson Education, Inc.
    Publishing as Prentice Hall
    Ch 1 -11

    Vision Statement
    What do we want to become?


    Mission Statement
    What is our business?
    Vision and Mission Statements
    Copyright 2011 Pearson Education, Inc.
    Publishing as Prentice Hall
    Ch 1 -12
    External Opportunities and Threats
    Analysis of Trends
    Economic
    Social
    Cultural
    Demographic/Environmental
    Political, Legal, Governmental
    Technological
    Competitors
    Copyright 2011 Pearson Education, Inc.
    Publishing as Prentice Hall
    Ch 1 -13
    Basic Tenet of Strategic Management
    External Opportunities and Threats
    Strategy Formulation

    Take advantage of
    External Opportunities

    Avoid/minimize impact of
    External Threats

    Copyright 2011 Pearson Education, Inc.
    Publishing as Prentice Hall
    Ch 1 -14

    Controllable activities performed
    especially well or poorly

    Determined relative to competitors
    Internal Strengths and Weaknesses

    Copyright 2011 Pearson Education, Inc.
    Publishing as Prentice Hall
    Ch 1 -15
    Typically located in functional areas of the firm

    Management
    Marketing
    Finance/Accounting
    Production/Operations
    Research & Development
    Management Information Systems
    Internal Strengths and Weaknesses
    Copyright 2011 Pearson Education, Inc.
    Publishing as Prentice Hall
    Ch 1 -16
    Assessing the Internal Environment
    Internal Strengths and Weaknesses
    Internal Factors
    Performance Measures
    Financial Ratios
    Industry Averages
    Survey Data
    Copyright 2011 Pearson Education, Inc.
    Publishing as Prentice Hall
    Ch 1 -17

    Specific results that an organization
    seeks to achieve in pursuing its basic
    mission

    Long-term means more than one year
    Long-Term Objectives

    Copyright 2011 Pearson Education, Inc.
    Publishing as Prentice Hall
    Ch 1 -18
    Long-Term Objectives
    Essential for ensuring the firms success
    Provide direction
    Aid in evaluation
    Create synergy
    Reveal priorities
    Focus coordination
    Provide basis for planning, organizing,
    motivating, and controlling

    Copyright 2011 Pearson Education, Inc.
    Publishing as Prentice Hall
    Ch 1 -19

    Means by which long-term objectives
    are achieved
    Strategies
    Copyright 2011 Pearson Education, Inc.
    Publishing as Prentice Hall
    Ch 1 -20
    Strategies
    Examples
    Geographic expansion
    Diversification
    Acquisition
    Product development
    Market penetration
    Retrenchment
    Divestiture
    Liquidation
    Joint venture

    Copyright 2011 Pearson Education, Inc.
    Publishing as Prentice Hall
    Ch 1 -21

    Short-term milestones that firms must
    achieve to reach long-term objectives
    Annual Objectives
    Copyright 2011 Pearson Education, Inc.
    Publishing as Prentice Hall
    Ch 1 -22

    Means by which annual objectives will
    be achieved
    Policies
    Copyright 2011 Pearson Education, Inc.
    Publishing as Prentice Hall
    Ch 1 -23
    Copyright 2011 Pearson Education, Inc.
    Publishing as Prentice Hall
    Ch 1 -24

    Strategic Management Process
    Dynamic & continuous
    More formal in larger
    organizations
    Strategic Management Model
    Copyright 2011 Pearson Education, Inc.
    Publishing as Prentice Hall
    Ch 1 -25
    Strategic Management

    Communication is a key to
    successful strategic management
    Copyright 2011 Pearson Education, Inc.
    Publishing as Prentice Hall
    Ch 1 -26
    Benefits of Strategic Management
    Copyright 2011 Pearson Education, Inc.
    Publishing as Prentice Hall
    Ch 1 -27
    Benefits of Strategic Management


    Nonfinancial Benefits
    Enhanced awareness of threats
    Improved understanding of competitors strategies
    Increased employee productivity
    Reduced resistance to change
    Clearer understanding of performance-reward
    relationship
    Enhanced problem-prevention capabilities
    Copyright 2011 Pearson Education, Inc.
    Publishing as Prentice Hall
    Ch 1 -28
    Why Some Firms Do No Strategic
    Planning

    Lack of knowledge of strategic planning
    Poor reward structures
    Fire fighting
    Waste of time
    Too expensive
    Laziness
    Content with success
    Copyright 2011 Pearson Education, Inc.
    Publishing as Prentice Hall
    Ch 1 -29
    Why Some Firms Do No Strategic
    Planning (continued)
    Fear of failure
    Overconfidence
    Prior bad experience
    Self-interest
    Fear of the unknown
    Honest difference of opinion
    Suspicion

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