Strategic Management

SATHYA KEERTHY K
BE (IEM), MBA (Marketing & Systems), MISTE, MIMA

What differentiates these companies

Big Bazaar v/s Subhiksha Fuji v/s Kodak IndiGO v/s Kingfisher Airlines

IndiGO v/s Kingfisher Airlines

A STUDY IN CONTRASTS: How Vijay Mallyas Kingfisher stacks up against Rahul Bhatias IndiGo IndiGo Business Model Kingfisher Started with single-class model, shifted focus to Strictly followed a low-cost, single class as premium class and is once again changing to a mix well as aircraft model of less premium and more economy Merged with Air Deccan in order to expand Focused on inorganic expansion by adding a aggressively in both international and domestic plane every six weeks sectors Largest Low Cost Carrier, Market Share of Slipped to being the fifth-largest carrier in terms of more than 27%. 62 aircrafts passenger carriage to currently being grounded.

Expansion

Operations

Bruce Ashby, first CEO, was in place 18 Mallya insisted on running the airline most of the Management months before the launch. Dedicated time Management Team, headed by Aditya Gosh Current Standing In international expansion mode and is Is in deep financial trouble. Plans for revival, solidly profitable. discussions are with bankers and investors.

Why do some firms succeed while others fail?

Strategy

What is Strategy
Plan of action Organizational Goals Determines organizations performance

History of Strategy
Greek Word strategia - art of troop leader Has military roots Planning and control of combat operations Art of War Sun Tzu (512 BC)

Strategy Contd..
Strategy is all about gaining (or being prepared to gain) a position of advantage over adversaries or best exploiting emerging possibilities. As there is always an element of uncertainty about the future, strategy is more about a set of options ("strategic choices") than a fixed plan.

Some Definitions
Alfred Chandler
determination of the basic long-term goals and objectives of an enterprise, and the adoption of courses of action and the allocation of resources necessary for carrying out these goals.

James B Quinn
the pattern or plan that integrates an organizations major goals, policies, and action sequences into a cohesive whole

Henry Mintzberg
a pattern in a stream of decisions or actions Pattern - Intended x Emergent

Example
Honda Entry into American Market Plan
1959 enter market with
250cc and 350cc

Sluggish Sales

Emergent
Enquiries for 50cc bikes 50cc Bikes were sold Entered into new untapped market

What does strategic management does

Answers key questions
Where is the organization today? Where do we want it to be in the future? What needs to be done to get there?

Strategic Management Process

Selection of Corporate Mission and Goals
Mission and Goals

Analysis of external environment

Opportunities and Threats

Analysis of internal environment

Strengths and Weakness

Strategic Management Process

Selection of strategies
Functional Level
Manufacturing, Marketing, Materials, R&D, HR

Business Level
Cost Leadership, Differentiation, Niche/Focus

Global Level
Multi Domestic, International, Global, Transnational

Corporate Level
Vertical Integration, Diversification, Strategic Alliances, acquisitions, new venture, restructure

 Strategy Implementation
Designing Organizational Structure Designing Control Systems Matching Strategy, Structure and Controls Managing conflict, politics and change

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