About

the Instructor
BUSI 4006 Strategic Management
Name: Ya (Lisa) LIN
Oce: WLB 711
Oce Hours:
Monday and Tuesday AMernoon

Chapter One
Fall, 2016 Email:
lisalin2015@hkbu.edu.hk

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Strategic Management:
Fundamental Concept Review Fundamental Concept in Management:
What are organizaXons?
Why do organizaXons exist? Eciency: doing things right

EecXveness: doing the right thing ( P10)

Why can some rms

outperform others? CompeXXve advantages

Management is the art of ge_ng things done through
people to achieve eciency and/or eecXveness, thus
What is strategic to create and sustain compeXXve advantages.
management?
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Roadmap of 8 Lectures) Dene strategic management

Acributes of strategic management
What Strategic management process
Where do we want to be?
Mission, vision, goals ( Chapter 1)
Corporate governance
Stakeholder vs. shareholders
How can we get there? Who Social Reasonability
Strategy Formation and Implementation
(Chapter 5, 6,7: strategy of
different levels; Chapter 9: Strategy Coherence in strategic direcXon
Control; Chapter 11: strategic leadership)
How Vision, mission and objecXves

Where are we now?

situation analysis ( Chapter 2 and 3:
internal and external environment)
Structure of Chapter One:
Strategic Analysis 6

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 Strategic Management Dening Strategic Management
(1) three ongoing processes
Analysis
ANALYSIS Strategic goals
Internal and external environment of the firm
Decisions
What industries should we compete in?
How should we compete in those industries?
DECISION
ACTION Actions
Allocate necessary resources
Design the organization to bring intended
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strategies to reality
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Dening Strategic management (3) Key Acributes of Strategic

(2) Two fundamental quesXons Management
1. How should we 2. How can we create
compete in order to competitive DirecXng toward overall goals
create competitive advantages in the
advantages in the marketplace that are
marketplace? unique, valuable, Including mulXple stakeholders
in decision making
>>> create and difficult for rivals
to copy or
IncorporaXng both short-term
substitute?
https://www.youtube.com/watch?
v=GQREagFb0J0
and long-term perspecXves
>>> sustain
https://www.youtube.com/watch? Trade-os between eciency
v=37fMdoU8kyY
and eecXveness ( p10)
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Strategic Management
Process(1)
Ambidexterity: Intended strategy
Exploitation and Exploration Decisions are determined only by analysis
The challenge managers face of both aligning Realized strategy
resources to take advantage of existing Decisions are determined by both analysis
product markets as well as proactively and unforeseen environmental developments,
exploring new opportunities unanticipated resource constraints, and/or
changes in managerial preferences

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 Strategic Management Process Strategic Management Process(2)

Strategic
analysis

Strategy
formaXon

Strategy
implementaXon
Adapted from Exhibit 1.2 Realized Strategy and Intended Strategy: Usually Not the Same
Source: H. Mintzberg and J. A. Waters, Of Strategies, Deliberate and Emergent, Strategic Management Journal 6 (1985), pp.
257-72.

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Strategy FormulaXon 3 levels of management & plans

CEO Corporate
A firms strategy formulation is developed at Corporate level
Top managers level planning
several levels:
Business-level
Corporate level Business (or Middle Business level
divisional) level managers planning
International

FuncXonal (or First-line FuncXonal

department) level managers level planning

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Stakeholders dierent interest and

Corporate Governance
conicXng demands: zero sum or
Top symbiosis
Management
Team
Immediate stakeholders:
Stockholders, employees,
customers, suppliers,

Shareholders Board of
directors

community Government
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3
Social Responsibility A Hierarchy of Goals
Social responsibility
The expectation that businesses or individuals
will strive to improve the overall welfare of
society
Triple bottom line
Assessment of a companys performance in
financial, social, and environmental dimensions

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Coherence in Strategic DirecXon What is a vision statement?

Hierarchy of goals A vision is a long-term goal

describing what an organization
Goals ranging from those that are less wants to become. It is a clear
specific yet able to evoke powerful and sense of the future and the
compelling mental images those that are more actions need to get there.
specific and measurable Goal that is massively
Vision, mission statement, strategic inspiring, overarching, and
objectives long term
Represents a destination that
is driven by and evokes
passion
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Coherence in Strategic DirecXon Strategic Visionexamples

Company vision
_____: to bring innovation and inspiration
Massively inspiring Company vision to every athlete in the world.
Overarching
Long-term ______: To be the happiest place on
Driven by and evokes earth.
passion
______: To be the worlds best quick
Fundamental statement
of the organizations Hierarchy of Goals service restaurant.
Values
Aspiration
Inspiring and long-term
Goals

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 Why Do Visions Fail? Coherence in Strategic DirecXon
The walk doesnt Not the holy grail
match the talk Mission statements
An ideal future
Purpose of the company
Irrelevance irreconciled with the
Basis of competition and
Too much focus leads present
competitive advantages Mission statements
to missed More specific than vision
opportunities Focused on the means
by which the firm will
compete Hierarchy of Goals

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BROAD VS NARROW BUSINESS

DEFINITION Determine an
organizaXons business
Determine an
organizaXons mission

Broad Narrow
Footwear Athletic footwear
Beverage Soft drinks
Fashion Handbag

_______To promote global mail delivery services to 1. Who are our customers?
all types of senders worldwide. 2. What customers needs are being
_______To handle overnight package delivery for saXsed?
o customers who have unplanned emergencies and 3. How are we saXsfying customer
needs?
tight deadlines.
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ABELLS FRAMEWORK FOR Missions vs Strategic Visions

DEFINING THE BUSINESS

Definition
Who is being satisfied?
of Business
What is being satisfied? A ____ statement A ____concerns
focuses on a firms future
How are current business business path --
customer
activities -- who where we are
needs being
satisfied?
we are and what going
we do

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 Mission and Vision incorporaXng
MISSION STATEMENT into a statement

Mission + Vision Ritz-Carlton Hotels

Who we are?
What we do? The Ritz-Carlton is a place where the genuine care and
comfort of our guests is our highest mission. We
How are customers need being pledge to provide the finest personal service and
facilities for our guests who will always enjoy a warm,
satisfied? and relaxed yet refined ambiance.fulfills even the
unexpressed wishes and needs of our guests (vision)
Where we are headed?

A MISSION IS NOT . . . Coherence in Strategic DirecXon

Strategic objectives
Operationalize the
Simple slogan/motto, e.g. mission statement
UPS - When time is running out, we Provide guidance on
how the organization
put time on your side can fulfill or move
toward the higher Strategic objectives
Dragon Air - We aim higher goals
Hierarchy of Goals
Pizza Hut- Share a slice of life More specific
Cover a more well-
defined time frame

What are strategic objecXves?

Where do we want to be? VISION
What do we want to achieve?
Strategic objectives
Goals that are used to operationalize the Why do we exist MISSION
as an organization? Purpose Business Scope
mission statement
Specific, measurable, appropriate, realistic, Analysis:
Where are we now?
timely PETS, FIVE FORCES,SWOT analysis

How will we get there? STRATEGY

Formulation &
Implementation

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