Fbs - Lesson 2 Week 1

Foundations of Business Strategy International College at Beijing

INSTRUCTOR: PAUL J. RAPANT EMAIL - [email protected]

Session Agenda  What is Strategy?  Strategic process  Case 1 – Ben & Jerry’s Homemade Ice Cream Inc

What is Strategy?

"Strategy is the direction and scope of an organization over the long-term: which achieves advantage for the organization through its configuration of resources within a challenging environment, to meet the needs of markets and to fulfill stakeholder expectations"

What is Strategy?  * Where is the business trying to get to in the long-term (direction)  * Which markets should a business compete in and what types of

activities are involved in such markets? (markets; scope)  * How can the business perform better than the competition in those markets? (advantage)?  * What resources (skills, assets, finance, relationships, technical competence, and facilities) are required in order to be able to compete? (resources)?  * What external, environmental factors affect the businesses' ability to compete? (environment)?  * What are the values and expectations of those who have power in and around the business? (stakeholders)

Strategy defined  Henry Mintzberg’s 5P’s  







Plan – Detailed from start to finish Ploy – Short-term in nature, to gain advantage over competition Pattern Behavior - Sometimes unintentional that turn into consistent behaviors Position – How companies relate to their competition and markets Perspective – Changing culture to achieve success

Strategy defined  Deliberate and Emergent Strategies 

Deliberate Planned with a specific objective  Monitored and controlled start to finish 



Emergent  Not

pre-conceived, but develops over time

Levels of strategic decision-making

Strategic Level Long-term (years)

Tactical Level Medium-term (months-one year

Operational Level Day-to-day

Stakeholders  Any group or individual that can affect or be affected by the

achievement of an organization’s achievements 



Internal  Directors  Employees  Employee representatives External  Shareholders  Customers  Suppliers  Competitors  Communities and society

Stakeholders  Mendelow 

Stakeholder interest and power  Interest

– willingness to influence the organization and the extent to which the stakeholders cares  Power – the ability to influence the organization  Formula: 

Stakeholder interest = power x interest

Stakeholders

Stakeholder interest

Low

Low

Stakeholder power

Least influential

Inc re

High

High

asi n

gi

nfl

ue n

ce

Most influential

Strategic Process Internal Analysis

External Analysis

External opportunities and threats

Identification of key strategic issues Evaluation of options and selection of strategy Implementation and management of the chosen strategy

Continual Feedback

Continual Feedback

Internal strengths and weaknesses

Strategic Process  Never-ending process  Adapt to the environment  Three stages 

Two main stages  Internal

analysis  External analysis  Third stage • Implementation and management  Feedback link

Case 1 - Instructions  Break out into teams of 6-8 people  Read the case and discuss 

Case Analysis structure  Situation

overview (1-2 paragraphs outlining the case in your teams own words)  Problem statement (1-2 paragraphs outlining what is impacting the company)  Alternatives (3-4 ideas, 4-6 paragraphs)  Critical Issues (1-2 paragraphs, clearly explain what is or can prevent this company from being successful)  Recommendation (1, clearly explain what your team thinks the company should do – provide steps and timelines)

Assignment #1 

Read Ben & Jerry’s Homemade Ice Cream Inc.  “A

new corporate concept of linked prosperity”  Follow the case instructions and hand in completed case analysis by September 26th (Assignment will only be accepted on or before this date)  Paper must be 11-12 font typed (no hand written papers will be accepted)  Paper can be emailed or printed (stapled)  Paper must include • Each member name in pinyin • Each member student ID #