Final Presentation Of Sbm

GROUP MEMBERS     

M.Zia Dherijha M.Mobieen Iqbal Khurrum Saddique Muhammed Asgher Irsalan Saleem

BASIC CONCEPTS OF STRATEGIC MANAGEMENT

"Effective managers live in the present – but concentrate on the future."     

What is Strategy? 

A strategy is a comprehensive action plan that identifies longterm direction and guides resource utilization to accomplish organizational goals with sustainable competitive advantage.

 Strategic

Management

Process of formulating, implementing, and evaluating, strategies to accomplish long-term goals and sustain competitive advantage.

Benefits of Strategic Management. 

Clear sense of strategic vision of the firm

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Sharper focus on what is strategically important

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Improved understanding of a rapidly changing environment

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Main Questions

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Where is organization now?

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If no changes are made, where will the organization be in 1,2,5 years?

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If the answers are not acceptable, what specific actions should management undertake?

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What are risks and payoffs involved?

Environmental Scanning External: Social Environment External: Task Environment Internal: Structure

Opportunities & Threats (External) Analysis of Trends: •

Economic

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Social

Internal: Resources

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Cultural

Strengths & Weaknesses (Internal)

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Demographic/Environmental

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Political, Legal, Governmental

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Technological

Typically located in functional areas of the firm

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Competitors

Internal: Culture

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Management

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Marketing

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Finance/Accounting

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Production/Operations

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Research & Development

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Computer Information Systems

Products Services

Strategy Formulation Vision & Mission

Markets

Customers

Technology

Objectives Strategies

Employees

Mission Elements

Policies

Vision Statement – What do we want to become?

Public Image

Mission Statement – What is our business?

Key Strategic Questions

• What is our business mission? • Who are our customers? • What do our customers consider value? • What have been our results? • What is our plan?

Self-Concept

Philosophy

Survival Growth Profit

Strategy Formulation

Objectives The end results of planned activity: • what is to be accomplished • by when • it should be quantified if possible “…increase profits 10% over last year” Policies

A policy is a broad guideline for decision making that links the formulation of strategy with its implementation. 

Maytag Company: Maytag will not approve any cost reduction proposal if it reduces product quality in any way.

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3M: Researches should spend 15% of their time working on something other than their primary project.

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Intel: Intel cannibalizes its own product line with better products before a competitor does so.

Types of Strategies

Corp Level

Division Level

Functional Level

Strategies 

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Operational Level

Corporate strategy directs the organization as a whole toward sustainable competitive advantage. Business strategy sets the strategic direction for a single business unit or product line. Functional strategy guides the use of resources to implement business strategy.

Strategy Implementation

Programs Budgets Procedures • A program is a statement of the activities or steps needed to accomplish a single-use plan. • A budget is a statement of a corporation’s program in terms of dollars.

• Procedures are a system of steps or techniques that describe in detail how a particular task or job is to be done.

Strategy Evaluation & Control

Internal Review External Review Measuring Performance Strategic audit

Feedback/Learning Process

Internal/External Review

Revision of Decisions Corrective Actions

Strategic Decisions Characteristics: • Rare: strategic decisions are unusual and typically have no precedent to follow

• Consequential: strategic decisions commit

substantial resources and demand a great deal of commitment from people on all levels.

• Directive: strategic decisions set precedents for lesser decisions and future actions throughout an organization.

Thanks ?