Documenti di Didattica
Documenti di Professioni
Documenti di Cultura
AND
STRATEGIC
Management
Planning
Corporate Planning
Corporate Planning gives the high-level, longhorizon
plan
that
identifies
financial
opportunities and links them directly and
tactically
to
key
value-driven
business
strategies.
BUSINESS POLICY
BUSINESS POLICY
Definition
Business policy is the study of the functions and
responsibilities of senior management, the crucial
problem that affect the success in the total
enterprise, and the decision that determine the
direction of the organisation and shape its future.
The problems of policy in business, like those of
policy in public affairs, have to do with the choice
of purposes, the moulding of orgaisational identity
and character, the continuous definition of what
needs to be done, and the mobilisation of
resources for the attainment of goals in the face
of competition or adverse circumstances.
Christensen and others
Prof. DEBASISH DUTTA
Simplicity
Clarity
Flexibility
Certainty
Consistency
Comprehensive
Relevant
Stability
Traditional Planning
Vs.
Strategic Planning
Prof. DEBASISH DUTTA
2.
3.
4.
5.
Strategic Planning
Strategic Management
STRATEGY
The word strategy, deriving from the Greek
noun strategus, meaning commander in chief,
was first used in the English language in 1656.
The development and usage of the word
suggests that it is composed of stratos (army)
and agein (to lead).
Strategic Management
In
the
descriptive
and
prescriptive
management texts, strategic management
appears as a cycle in which several activities
follow and feed upon one another.
The strategic management process is typically
broken down into five steps
VISION AND
MISSION
STATEMENT
Step 2
SCANNING
ENVIRONMENT
Step 3
DEVELOPING
STRATEGIC
CHOICES
Step 4
IMPLEMENTATION
Step 5
EVALUATION
Prof. DEBASISH DUTTA
Scanning Environment
Environmental analysis looks at the internal
organizational strengths and weak-nesses and
the external environment for opportunities and
threats.
The factors that are most important to the
organizations future are referred to as
strategic factors and can be summarized by
the acronym SWOT Strengths, Weaknesses,
Opportunities and Threats.
Prof. DEBASISH DUTTA
Implementation
Strategy implementation is an area of activity
that focuses on the techniques used by
managers to implement their strategies.
In particular, it refers to activities that deal
with leadership style, the structure of the
organization, the information and control
systems, and the management of human
resources.
Leadership is the most important and difficult
part of the strategic implementation process.
Prof. DEBASISH DUTTA
Evaluation
Strategy evaluation is an activity that
determines to what extent the actual change
and performance match the desired change
and performance.
Conclusion
The strategic management model depicts the
five major activities as forming a rational
and linear process. It is, however, important
to note that it is a normative model, that is,
it shows how strategic management should
be done rather than describing what is
actually done by senior managers.
The strategic decision-making implies a
potential gap between the theoretical model
and reality.
Prof. DEBASISH DUTTA
Levels of Strategy
STRATEGIC ANALYSIS
AND
CHOICE
Strategic Choice
Focusing on alternatives
Strategic Analysis
Nature of Strategy Analysis
-----
Strategic Analysis
Corporate Level
The analysis focuses on the question of what
should a corporate entity do regarding the
several business that are there in its portfolio.
It can be done through corporate portfolio
analysis and various techniques like BCG
matrix etc.
Strategic Analysis
Business Level
It refers to industry and competition analysis.
The industry and competition are vital for
consideration in making strategic choice.
Porters five forces model, experience curve
analysis, SWOT analysis etc. help in business
level analysis.
SWOT ANALYSIS
SWOT Matrix
Strengths-Opportunities (SO)
Weaknesses-Opportunities (WO)
Strengths-Threats (ST)
Weaknesses-Threats (WT)
SO Strategies
Strengths
Weaknesses
Opportunities
Threats
SWOT
SO
Strategies
Use a firms
internal strengths
to take advantage
of external
opportunities
WO Strategies
Strengths
Weaknesses
Opportunities
Threats
SWOT
WO
Strategies
Improving internal
weaknesses by
taking advantage
of external
opportunities
ST Strategies
Strengths
Weaknesses
Opportunities
Threats
SWOT
ST
Strategies
Use a firms
strengths
to avoid or
reduce the impact
of external
threats
WT Strategies
Strengths
Weaknesses
Opportunities
Threats
SWOT
WT
Strategies
Defensive tactics
aimed at reducing
internal
weaknesses &
avoiding
environmental
threats
SWOT Matrix
Strengths S
Weaknesses W
List Strengths
List Weaknesses
Opportunities O
SO Strategies
WO Strategies
List Opportunities
Overcoming weaknesses
by taking advantage of
opportunities
Threats T
ST Strategies
WT Strategies
List Threats
Leave Blank
GE Nine-Cell Matrix
GE Nine-Cell Matrix
GE Nine-Cell Matrix
The vertical axis represents industry
attractiveness,
which
is
a
weighted
composite rating based on eight different
factors.
These factors are:
1. Market size and growth rate
2. Industry profit margin
3. Competitive intensity
4. Seasonality
5. Cyclicality
6. Economics of scale
7. Technology and social environment
8. Legal and human aspects
Prof. DEBASISH DUTTA
GE Nine-Cell Matrix
The horizontal axis represents business
strength competitive position which a
weighted composite rating based on seven
factors.
These seven factors are:
GE Nine-Cell Matrix
GE Nine-Cell Matrix
The 9 cell matrix are grouped on the basis of
low to high industry attractiveness, and
weak to strong business strength. The zones
of three cells each are made, denoting
different combinations represented by green,
yellow, and red colours.
The
green
zone
indicates
expansion
strategies, yellow zone suggests stability and
consolidation
and
red
zone
suggests
retrenchment, liquidation, or turnaround.
Industry Attractiveness
GE Nine-Cell Matrix
10.0
Strong
6.7
Average
3.3
Weak
1.0
High
6.7
Medium
3.3
Low
1.0
GE Nine-Cell Matrix
Advantages over BCG Matrix:
It offers an intermediate classification of medium and
average ratings.
GE Nine-Cell Matrix