11/04/2017

…
• We need a Monitor
CASES IN MANAGEMENT • We need a group email

Assoc Prof. Dr. Lê Thái Phong

Dean, Faculty of Business Administration
Foreign Trade University
E: lethaiphong@ftu.edu.vn
T: 0975.055.299

Materials Contents of this module

• Hill & Jones (2009) Essentials of Strategic • Module 1: Strategic management

Management, South-Western
• Le Thi Thu Thuy (2010), Giao trinh Quan tri
chien luoc (Vietnamese version),
• Relevant articles & documents
• Module 2: Culture and change
• Module 3: Managing globally and ethically
• Module 4: Organization structure
• Module 5: HRM
• Module 6: Groups and teams
• Module 7: Motivation
• Module 8: Operational management
• Module 9: Leadership.

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Some norms
Module 1:
Strategic Management

Assoc Prof. Dr. Lê Thái Phong

Dean, Faculty of Business Administration
Foreign Trade University
E: lethaiphong@ftu.edu.vn
T: 0975.055.299
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Games Strategy, why?

• Game 1
• Game 2
• “Without a strategy, the
• Lessons to be learnt? organisation is like a ship without a
rudder, going around in circles”
• Rose & Kami

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Learning objectives Strategy: concept

1. Definition: strategy & strategic management • Strategy is the long-term direction of an
2. Strategic management process organisation
3. Strategic management: 3 levels – Disney: cartoons to diversified entertainment
– Nokia: mobile phone to mobile computing
4. Strategic management in reality

Strategy: concept Strategy: concept

• Strategy is the process to identify
the long-term objectives, select
methods or processes of action
and allocate necessary resources
to achieve the goals
• Alfred Chandler.
• The determination of the long-run goals and
objectives of an enterprise and the adoption
of courses of action and the allocation of
resource necessary for carrying out these
goals
• Alfred D. Chandler
Logical flows

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Strategy: concept Strategy: concept

• Competitive strategy is about being different. • A pattern in a stream of decisions
It means deliberately choosing a different set • Henry Mintzberg
of activities to deliver a unique mix of value • The long-term direction of an organisation
• Michael Porter • Exploring Strategy

Not as planed,
can emerge in
Deliberate more ad hoc
choice ways

Strategy: concept Importance of strategy

• “The long-term direction of an organisation” • Without a strategy the
– Long-term: strategies are typically measured over
the years via 3 horizons organization is like a ship without
– Strategic direction: trajectory of firm. News a rudder, going around in circles
Corporation: from print to Internet media
(MySpace)
– Organisation: involve complex relationship,
internally and externally

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Importance of strategy Strategic Management

Analyze current situation
•Direction is more Develop appropriate strategies
Put strategies into action
important than Evaluate, modify, or change
strategy
speed!

Strategic management process Strategic management process

b. Identifying
a.External
opportunities
analysis and Threats

Internal &
Strategic aims 1. 2. External 3. Analysis 4.
External Strategic Strategic Evaluation and and Strategic Implementing
5. Controlling,
& Strategic evaluating and
Environment options implementationModification Internal choice strategy adjusting
objectives goals/ Analysis strategy
analysis objectives (SWOT)

d. Identifying
Strategic formulation Implementation Control c. Internal strengths and
analysis weaknesses
Video

Strategy formulation Strategy Strategy

Implementation Control

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Strategic mgt process: 5 steps Step 1: identifying goals & objectives

• Step 1: Identifying strategic goals & objectives • Mission
• Step 2: Conducting internal & external analysis • Vision
• Step 3: Strategic choice • Value
• Step 4: Implementing strategic choice • objectives
• Step 5: Controlling, evaluating, adjusting

Mission
• Focus on CURRENT business activities
• “WHO we are, WHAT we do”
– Current products & services offering
– Customer needs being served
– Technological & business capabilities
• A mission statement provide employees and
stakeholders with clarity about the overriding
purpose of the organisation

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Mission Mission
• Should be customer-oriented
• Not product-oriented

Mission Mission

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Mission
• IBM: A means for information processing and
storage, rather than supplying mechanical
tabulating equipments and typepwriters
Mission: KODAK
• Provide customers with the solutions they
need to capture, store, process, output, and
communicate images – anywhere, anytime
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Mission: BOSE
• BOSE maintains an exceptional strong
commitment to research, for it is within disciplines
of research that yesterday’s fiction becomes
tomorrow’s reality. We strive to identify things
which, when made better, improve people’s life
Vision
• Concerns a firm’s future business path
• “WHERE are we going?”
• A vision statement is concerned with the
desired future state of the organisation
– An aspiration that will enthuse, gain commitment
and stretch performance
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Unilever Unilever vision

• 180.000 employees worldwide • To grow our business, whilst decoupling our
• Products sold in more than 190 countries environmental footprint from our growth and
• 2 billion consumers worldwide use a U product increasing our positive social impact
on any day
• 55% of sales in emerging market • Vision in Vietnam
– 1995: Unilever, OMO, VISO, P/S, CLOSEUP, Sunlight, • The most admired company in Vietnam,
Sunsilk, hazeline, Lux, clear, Pond’s, Lifebuoy, Dove,
Lipton, Vaseline, Vim committed to make Vietnamese lives better
– 2000-2005: Knorr, Rexona, comfort, Sunlight (lau sanf
– 2006-2010: Surf, Cormetto, Cif, Paddle Pop, Wall’s
– 2011-2015: Axe, Tresemme

values Objectives
• Values communicate the underlying and • Purpose: what must be done if the company is
enduring core “principles” that guide an to attain its mission and vision
organisation’s strategy and define the way – Precise and measureable
that the organisation should operate – Addressing crucial issues
– Challenging and realistic
– SMART

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Objectives Step 2: Conducting internal & external

• Set your long- • Opportunities & Threats
term and
short – term
objectives

• Strengths & Weaknesses

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Step 3: Strategic choices Step 4: Implementing choices

• 1. Develop and evaluate strategic alternatives
• 2. Select appropriate strategies
– Feasibility – Acceptability - Suitability
• 3. Match org’s strengths to opportunities
• 4. Correct weakness and guard against threats
• 1. Designing organisational structure
• 2. Designing control system
– Market and output controls
– Bureaucratic controls
– Controls through organisational culture
– Rewards and incentives
• 3. Matching strategy, structure, and control
• Fit among strategy, structure, and control

Step 5: evaluating Hierarchy of strategy: diversified firm

• How effective the strategies have been?
• What adjustments, if any, is necessary? Headquarters

Unit 1 Unit 2
Marketing

Marketing
Operation

Operation
Finance

Finance
Sales

Sales
HRM

HRM

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Strategic management: 3 levels Hierarchy of strategy: single-business firm

Corporate level
Chiến lược cấp Tổng cty/tập đoàn
CEO

Business level

Marketing

Operation
Chiến lược kinh doanh (SBUs)

Finance
Sales

HRM
Functional level
Chiến lược cấp chức năng

Strategic management: 3 levels Corporate level strategy

• Corporate level strategy: concerned with the
overall scope of an organization and how
Business level
value is added to the constituent businesses
Chiến lược kinh doanh (SBUs)
of the organizational whole
– Geographical scope
Functional level – Diversity of products/services
Chiến lược cấp chức năng – Acquisitions of new businesses
– Resource allocation

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Business level Functional level strategy

• Is about the individual business should • Concerned with how the components of an
organization deliver effectively the corporate- and
compete in their particular markets business-level strategies in terms of resources,
• Often called competitive strategy processes, and people
• Focusing on improving the effectiveness of operations
• Can be stand-alone business (start-ups)/
– Marketing
business units within a large firm – Manufacturing
– Cost leadership – Materials management
– Differentiation – Research and development
– HRM
– Focus
– …

Strategic management in reality Unpredictability of real world

• Disadvantages of a formal strategic planning
processes
– Unpredictability of the real world
– The role of lower managers
– Many successful strategies are serendipity, not
rational planning

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Unpredictability of real world Unpredictability of real world

Unpredictability of real world The role of lower-level manager

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Strategic management in reality Strategic management in reality

Intended Realized • The story of Honda Cup 50 cc
Strategies Deliberate
Strategies
Strategies
1959
Honda USA

Unrealized
Emergent
Strategies Strategies

Thus, strategy can emerge from • iPhone

“a Pattern in the stream of decisions or actions”

Strategic management in reality Strategic management in reality

• Combination of intended and emergent • Scenario planning
• The message: • Involves formulating plan that are based on
– Recognise the process of emergence what-if scenarios about the future
– Intervene when appropriate, kill-off bad emergent • 50% of Fortune 500
strategy and nurturing potentially good ones
• The case of Shell
– Dynamics as Usual
Think out of
– For the Coming Age
the box

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Strategic management in reality
• Decentralised planning
• The story of GE
Thank you very much!
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Strategic leaders
• Vision, eloquence, and consistency
• Articulation of business model
• Being well informed
• Willingness to delegate and empower
• Smart use of power
• Emotional intelligence
• Commitment (Steve Jobs)
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