PORTFOLIO IN

STRATEGIC MANAGEMENT
Course No.

Submitted by:

DANIELLA GALLARDO
BSBA-2B

Submitted to:
LORNA JARDINEZ
Designation
 TABLE OF CONTENTS
I. TITLE PAGE
II. Table of Contents
III. Cover Letter
IV. TOPICS
A. Lesson 1
 Evolution of Policy and Strategy
 Keywords/Keyconcepts/Summary . . . . . . . . . . . . . . .1
 Activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
B. Lesson 2
 Motivators and Drivers of Strategic Management
 Keywords/Keyconcepts/Summary . . . . . . . . . . . . . .
 Activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
C. Lesson 3
 Porter’s Competition Model
 Keywords/Keyconcepts/Summary . . . . . . . . . . . . . . 7
 Activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
D. Lesson 4
 Corporate Level Strategy
 Keywords/Keyconcepts/Summary . . . . . . . . . . . . . .
 Activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
E. Lesson 5
 Business and Functional Level Strategies . . . . . . . .
 Keywords/Keyconcepts/Summary . . . . . . . . . . . .
 Activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
F. Lesson 6
 Crafting Strategies
 Keywords/Keyconcepts/Summary
 Activities

V. GENERAL REFLECTION
VI. Grading Rubrics
COVER LETTER
LESSON 1
Evolution of Policy and Strategy

 KEYWORDS/KEYCONCEPTS/SUMMARY

Business Policy
 In the world of business, the set of rules that guides the decisions and actions of
the members of the organization.

The two types of it are:

 Informal - This are the day to day given policies by your superior or the people
around you in your organization.
 Formal/Written - Basis policy of an organization where you involved.

Strategy

 (Wright, Kroll, and Parnell) - Essentially referring to top management’s plan to

attain the outcomes consistent with the organization’s mission and goals.

Categories of Strategy

 Intended Strategy- Refers to the original strategy that management plans and
intends to implement; this will be the plan they create the “what they want to
happen.”

 Realized Strategy- Refers to the actual and eventual strategy that management
actually implement. There some unforeseen environmental or organizational
events occur that makes the intended strategy to change in realized strategy.

Strategy
  (Thompson and Strickland) - Operational level referring to it as a set of
competitive moves and business approaches that management is employing to
run the company.

Game plan to achieve

 Attract and please customers;

 Stake out a market position;
 Conduct operations; and
 Complete successfully.

Origin and Nature of Strategy

 JEFFREY BRACKER OF GERGIA STATE UNIVERSITY - He elaborated the

concept of strategic m1anagement and cited that he term Stratego was
mentioned in the Old Testament and largely treated as semantic issue.

 According to Bracker strategy originated from the Greek word “Stratego”

referring to a “General” which in turn traces its root from the word “Army” and
“Lead”. Stratego means “to plan the destruction of one’s enemies through
effective use of resource.”

Strategic Management

 (Wright, Kroll and Parnell) - Continuous process.

Strategic Types

 Defender - This includes companies with a limited product line that focus on
improving the efficiency of their existing operations.
 Prospector - This type of companies includes firms with fairly broad product
lines that focus on product innovation and market opportunities.

 Analyzer - This type includes business organizations that operate in at least two
different product- market areas, one stable and one variable.
 Reactors - This type includes companies that lack a consistent strategy-
structure- culture relationship

Bases of Policies and Strategies

  Legal Mandate - This refers to formulating policies on the basis of the provision
of the charter or legal basis for creation or existence of the business organization
including the applicable provisions of the laws and policies or pronouncement of
the government and its statutory or regulatory body.
 Vision and Mission Statement - Refers to the leadership bias as well as sense
of direction and mission for which the organization was conceived or established.
 Specific Objectives - These are the corporate objectives purposely developed
for the organization and for its members or employees at large to pursue.
 Program and Policies - These are specific programs and policies set forth by
the organization’s policymakers in pursuit of short and long- term goals given
certain considerations at hand.

Richard Whittington (2001)

 Theorized that strategy comes in four generic approaches that differ

fundamentally along two dimensions: the outcome of the strategy and the
process by which is made.

Strategic Decision

 Usually take into account a lot of external factors and deal with the long- run
future of the entire organization.

Decision Making Function

 Is a daily or routine aspect of a managerial function.

ACTIVITIES
A. LESSON 2
MOTIVATORS AND DRIVERS OF STRATEGIC MANAGEMENT

 KEYWORDS/KEYCONCEPTS/SUMMARY

The Triggering Events

 Refer to the situations or scenarios that may have caused or resulted to the
actions or initiatives of the top management of the firm to consider certain
strategic options to make the firm competitive or to achieve certain strategic
objectives.

Forms :

Internal Triggering Events

 Are those situations and scenarios intervening or disturbing the business

organization on account of factors internal or inherent to the firm itself and one
that the company can exercise certain level of control.

External Triggering Events

 Are those factors external to the firm or matters where the business organization
itself may not like or want to happen but there is nothing much it can do.

Types of Market Structure

 Monopoly - It is a market structure characterized by the existence of single seller

of a product which dominates the market.
 Oligopoly - This type of market has more than one producer or seller of a
product, which may be either homogeneous or differentiated.
  Monopolistic Competition - It exists when many sellers offer similar products
that are not perfect substitutes for one another.
 Perfect Competition - It is a market structure characterized by many producers
or sellers and a homogeneous product.

The Product Life Cycle

 Also referred to as the S- curve- it is a living proof that just like humans, there is
beginning and end for everything and the same is true for every product or
service in this world.

Experience Curve

 It suggests that as the business organization stay much longer in the business or
the industry, the business organization accumulates a body of knowledge and
experience that enables the firm to do its business better.

Economies Scale

 It postulates that there is a decline in the per unit cost of production as the
volume of production is increased.

Best Operating Level

 In the field of production management and engineering science, it is a point of

machine use that redounds to the best mix.

Optimum Level

 Of operating machines or using resources that can result to the lowest possible
cost of production of a product or service.

Transaction Cost Economics

 It proposes that vertical integration is more efficient than contracting goods and
services in the marketplace when the transaction cost of buying goods in the
open market becomes too great.
ACTIVITIES
B. LESSON 3
PORTER’S COMPETION MODEL

 KEYWORDS/KEYCONCEPTS/SUMMARY

Michael Porters

 The contributor of the theory and framework that has somehow greatly influenced
the popularization of the concept of strategic management - Porter’s Five Forces
Competition Model.

Porter’s Five Forces Competition Model

 This theory advocates that other than the competition or rivalry among business
organizations producing and selling the same or similar products in the same
market sector or segment, there are other factors or forces that drive business
competition.

Rivalry among competing sellers

 This constitute the traditional view of business competition and this is positioned
in the middle block in the Porter’s competition model refers to the key players or
direct competitors within the industry or the sector offering the same or similar
products and services.

Supplier of Key Inputs

 This includes another group of business organizations outside the middle box of
Porter’s competition model in the sense that they do not pose as direct threat to
competition.
Substitutes

 This generally refers to the product or services which prospective buyers can buy
or source elsewhere who’s utility, function or use is similar to a desired product
for a lesser price or other reasons.

Switching Cost

 Is a factor that leads prospective customers to entertaining or considering the

idea of buying or patronizing other products for a variety of reasons.

Buyers

 Buyers are objects of desire of businesses competing in the same segment or

industry.

Potential and New Entrants

 Refers to business organizations attempting to or have now joined the market

trying hard to make a name for their product and the business organization as a
whole.

Barriers to the New Entrants

 Economies of scale;
 Access to secret technology;
 Brand recognition;
 Capital cost entry;
 Access to distribution channels;
 Etc.

The Shakesholders

 It emerged in the late 1990s and became widely popular by the early 2000.
ACTIVITIES
C. LESSON 4
CORPORATE LEVEL STRATEGY

 KEYWORDS/KEYCONCEPTS/SUMMARY

Corporate Strategy
 GROWTH (increase in size)
 STABILITY (retain current size)
 RETRENCHMENT (decrease in size)

Growth Strategy

Internal Growth
 Expanding by internally increase its size and sales

External Growth
 Acquiring other companies
Merger
 Occurs when two or more firms, usually of roughly similar sizes, combine into
one through an exchange of stock.
Acquisition
 Is a form of merger whereby one firm purchases another, often with a
combination of cash and stock.
Horizontal (Related) Integration
 A firm that acquires other companies in the same line of business is engaging in
horizontal intergration.
Horizontal (Related) Diversification
 A firm is engaging in horizontal related diversification when it acquires a business
outside its present scope of operation, but with similar to related core
competencies, the firm’s key capabilities and collective learning skills that are
fundamental to its strategy, performance, and long term profitability.

Vertical Integration
 Refers to merging various stages of activities in the distribution channel.

Strategic Alliance
 Often called partnerships occur when two or more firms agree to share the costs,
risks,and benefits associated with pursuing new business opportunities.

Stability
 Attempting to maintain the present size and scope of operations may be more
attractive than growth.

Retrenchment Strategies
 Is often accompanied by a reorganization process known as corporate
restructuring.


The three forms of Retrenchment :

Turn Around
 A turnaround seeks to transform the corporation into a leaner, more effective
firm, and includes such action a eliminating unprofitable outputs, pruning assets,
reducing the size of the workforce, cutting cost of distribution, and reassessing
the firm’s product lines and customer groups.
Divestment
 Selling one or more of a firm’s business units may be necessary when the
industry is in decline, or when a business units drains resources from more
profitable units, is not performing well, or is not synergistic with other corporate
holdings.
Liquidation
 Is a strategy of last resort, and terminates the business unit by selling its assets.
In effect, liquidation represents a divestment of all the firm’s business units and
should be adopted only under extreme conditions.
ACTIVITIES
LESSON 5
BUSINESS AND FUNCTONAL LEVEL STRATEGIES

 KEYWORDS/KEYCONCEPTS/SUMMARY

Business Level Strategy

 Can help your organization achieve a competitive advantage in the market place.
 They provide generic way to think about providing value to customers by
exploiting your core competencies

WHAT ARE THE BUSINESS LEVEL STRATEGIES

Cost Leadership Strategy

 For organizations that want to compete for a broad customer based on price
 To maintain above-average returns and provide the lowest price, you must focus
on internal efficiencies continually.
Differentiation Strategy
 For firms that want a broad customer base on their uniqueness.
 Typically done through building unique features.

Focused Cost Leadership Strategy

 These organizations compete on price but also stand out because they focus on
serving a niche market

Focused Differentiation Strategy

 This strategy is very similar to a differentiation strategy expect that it is focused
on a very narrow segment of the market
 These firms compete by offering unique features to a small market segment
Integrated Cost Leadership/Differentiation Stategy
 This strategy involves producing low-cost products with differenciated features

Functional Level Stategy

 Are the actions and goals assigned to various departments that support your
business level strategy and corporate level strategy. These strategies specify the
outcomes you want to see achieved from the daily operations of specific
departments (or functions) of your business.

FUNCTIONAL DEPARTMENTS OF AN ORGANIZATIONS ARE :

Marketing
 Reach potential customers,
 Bond with existing ones

Finance
 Take care the money of the organization
 Where is the money coming from and raising capital
 They also take care the things like where is the money is going to be used and
allocating resources

Human Resource
 Is going to take care one of the most important essence of the organization that
is the people that working in your organization they will take care the process of
recruiting and educating the people that will be the future of the company. They
need to find the willing worker that perfect fit to the organization.
Production
 Is going to make what is your going to sell to the market. Flexible and
manufacturing.
Information Technology

 Responsible for automating all of the processes that being conducted and they
have the power to reduce the cost of communicating throughout the organization
and coordinating large projects.

Research and Development

 Research and Develop new way of the process of manufacturing, innovation and
their also need to design new model of the product.
ACTIVITIES
LESSON 6
CRAFTING STRATEGY

 KEYWORDS/KEYCONCEPTS

Crafting strategy of Mintzberg’s thoughts

 Strategies are both plans for the future and patterns from the past
 Strategies need not be deliberate – they can also emerge
 Effective strategies develop in all kinds of strange ways
 Strategic reorientations happen in brief, quantum leaps
 Management strategy is crafting thought and action, control and learning, stability
and change

Strategy
 The crafting image better captures the process by which effective strategies
come to be Managers are craftsmen and strategy is their clay Managers Strategy

People’s acts of Strategy:

 Consistency of past behavior – a pattern in action over time.
 Effective strategies can show up in the strangest places and develop through the
most unexpected means • There is no best way to make strategy • Example of
Facebook
ACTIVITIES