Professional Documents
Culture Documents
Strategic Planning
Strategic planning has taken on new importance in todays world of globalization, deregulation, advancing technology, and changing demographics, and lifestyles
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Thinking Strategically
Answers to the following define an overall direction for the organization's grand strategy Where is the organization now? Where does the organization want to be? What changes are among competitors? What courses of action will help us achieve our goals?
Strategic Management
Set of decisions and actions used to implement strategies that will provide a competitively superior fit between the organization and its environment so as to achieve organizational goals Responsibility = top managers & chief executive
Strategic Management
Managers ask such questions as... What changes and trends are occurring? Who are our customers? What products or services should we offer? How can we offer these products or services most efficiently?
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Grand Strategy
General plan of major action to achieve long-term goals Falls into three general categories A separate grand 1. Growth strategy can be 2. Stability defined for global 3. Retrenchment operations
Growth can be promoted internally by investing in expansion or externally by acquiring additional business divisions
- Internal growth = can include development of new or changed products - External growth = typically involves diversification businesses related to current product lines or into new areas
Stability, sometimes called a pause strategy, means that the organization wants
to remain the same size or to grow slowly and in a controlled fashion
Retrenchment = the organization goes through a period of forced decline by either shrinking current business units or selling off or liquidating entire businesses Liquidation = selling off a business nit for the cash value of the assets, thus terminating its existence Divestiture = involves selling off of businesses that no longer seem central to the corporation
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Transnational Strategy
Seeks to balance global efficiencies and local responsiveness Combines standardization and customization for product/advertising strategies
Export Strategy
Domestically focused Exports a few domestically produced products to selected countries
Multi-domestic Strategy Handles markets independently for each country Adapts product/advertising to local tastes and needs
Low
Low
High
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Global Strategy
Globalization = product design and advertising strategies are standardized around the world Multi-domestic = adapt product and promotion for each country Transnational = combine global coordination with flexibility to meet specific needs in various countries
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Purpose of Strategy
The plan of action that prescribes resource allocation and other activities for dealing with the environment, achieving a competitive advantage, that help the organization attain its goals Strategies focus on: Core competencies Developing synergy Creating value for customers
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R&D
Manufacturing
Marketing
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SWOT
Implement Strategy via Changes in: Leadership culture, Structure, HR, Information & control systems
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Strategy Formulation = stage of strategic management that involves planning and decision making that lead to the establishment of the organizations goals and of a specific strategic plan Strategy Implementation = stage of strategic management that involves the use of managerial and organizational tools to direct resources toward achieving strategic outcomes
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Profit margin
Debt-equity ratio Inventory ratio Return on investment Credit rating
Plant location Machinery obsolescence Laboratory capabilities Research programs Purchasing system New-product innovations Quality control
Productivity/efficiency Technology innovations
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Portfolio Strategy
BCG Matrix
Mix of business units and product lines that fit together in a logical way to provide synergy and competitive advantage
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Differentiation = attempt to distinguish products or services from that of competitors Cost leadership = aggressively seeks efficient facilities, pursues cost reductions, and uses tight cost controls to produce products more efficiently than competitors Focus = concentrates on a specific regional market or buyer group
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Mergers
Strategic Alliances
Joint Ventures
Degree of Collaboration
High
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Environment
Organization
Strategy
Structural Design Organization Chart Teams Centralization Decentralization, Facilities, task design
Performance
Information and Control Systems Pay, reward system Budget allocations Information systems Rules/procedures
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THANKU!!
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