OVERVIEW OF

STRATEGIC
MANAGEMENT
DEFINITION OF
STRATEGIC MANAGEMENT
Strategic management is the set of
decisions and actions that result in the
formulation and implementation of plans
designed to achieve a companys
objectives.



DIMENSIONS OF STRATEGIC DECISIONS

Typically, STRATEGIC ISSUES have the following dimensions:
*Strategic issues require top-management decisions
-Strategic issues require large amounts of the Firms
resources
4Strategic issues often affect the firms long-term
prosperity
^Strategic issues are future oriented
=Strategic issues usually have multifunctional or
multibusiness consequences
=Strategic issues require considering the Firms external
environment


DIMENSIONS OF STRATEGIC DECISIONS


Three steps of strategy:
*Formulation
-Implementation
4Evaluation

Three levels of strategy:
*Corporate level
-Business level
4Functional Level


FORMALITY IN STRATEGIC MANAGEMENT

The Strategy Makers:

*Managers of all three company level

-Company planning staffs




BENEFIT OF STRATEGIC MANAGEMENT


*Strategy formulation activities enhance the firms ability
to prevent problems.
-Group-based strategic decisions are likely to be drawn
from the best available alternatives.
4The involvement of employee in strategy formulation
improves their understanding of the productivity-reward
relationship in every strategic plan and, thus, heightens
their motivation.
^Gaps and overlaps in activities among individuals and
groups are reduced as participation in strategy
formulation clarifies difference in roles.
=Resistance (conflict) to change is reduced.



COMPONENT OF THE STRATEGIC MANAGEMENT
MODEL

O Company mission
pthe unique purpose that sets it apart from other companies
of its type and identifies the scope of its operations.
pdescribes companys product, market, and technological
areas of emphasis in away that reflects the values and
priorities of the strategic decision makers.

Internal Analysis
panalyzes the quantity and quality of the companys
financial, human, and physical resources
passesses the strengths and weaknesses companys
management and organization structure.

COMPONENT OF THE STRATEGIC MANAGEMENT MODEL
( Continue)


External environment
pConsists of all the conditions and forces that affect
its strategic options and define its competitive
situation.
pConsists of three interactive segments: the operating,
industry, and remote environment.

Strategic analysis and choice
pSimultaneous assessment of the external
environment and the company profile enables a firm
to identify a range of possibly attractive interactive
opportunities.


COMPONENT OF THE STRATEGIC MANAGEMENT MODEL
( Continue)

Long-Term Objectives

pProfitability
pReturn on Investment
pCompetitive position
pTechnological leadership
pProductivity
pEmployee relations
pEmployee development
pPublic responsibility










COMPONENT OF THE STRATEGIC MANAGEMENT MODEL
( Continue)

Generic Strategy
pLow Cost
pDifferentiation/Diversification
pFocus

Grand Strategy
pConcentration
pMarket development
pProduct development
pInnovation
pHorizontal integration



pVertical integration
pJoint venture
pStrategic alliance
pConsortia
pConcentric diversification
pConglomerate diversification
pTurnaround
pDivestiture
pLiquidation


COMPONENT OF THE STRATEGIC MANAGEMENT MODEL
( Continue)

Action Plan & Short-Term Objectives
ptranslate generic and grand strategies into action.

Functional Tactics
pdetailed statements of the means or activities that will
be used to achieve short-term objectives and establish
competitive advantage.

Policies that Empower Action
pBroad, precedent-setting decisions that guide or
substitute for repetitive managerial decision making.
pGuide the thinking, decisions, actions of managers, and
their subordinates in implementing the companys
strategy.

COMPONENT OF THE STRATEGIC MANAGEMENT MODEL
( Continue)

Restructuring , Reengineering, Refocusing the
Organization

preflect the critical stage in strategy implementation
wherein managers attempts to recast their
organization.

Strategic Control & Continuous Improvement

pdetecting problems and changes in its underlying
premises, making necessary adjustment .

presponding more actively and timely to rapid
developments