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11 Cards in this Set

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  • 3rd side (hint)

Concept of Strategy


  • From Greek word strategia - art of war
  • 1st used in the context of warfare
  • applied to business management since 1960s

art of war

warfare

management

Concept of Strategy

(Chandler's definition)

Chandler's definition:


  • Determination of goals + objectives

(improve profitability)


  • adoption of courses of action

(launch new product)


  • allocation of resources

(natural, financial, technological, human)

goals - profitability

action - new product

resources - natural, human

Strategic concept - extensions


  • Strategic management
  • Strategic planning
  • Strategic thinking
  • Strategic decision-making

management


planning


thinking


decision-making

Strategic management


  • coordination + monitoring

(organisation's strategy)


  • development + implementation process

(organisation's strategy)


  • 3 key issues:


  1. value creation
  2. responsiveness
  3. responsibility

coordination

implementation

3 key issues

Strategic management

(Value creation)

$ = money





  • Be profitable - more value than competition
  • Value meaning - depends on stakeholders


  1. customers - products/services - value for $
  2. investors - return on investment in organisation
  3. employees - job satisfaction/fair treatment

profitable


value




(customers, investors,


employees)

Strategic management

(responsiveness)

Business environment more volatile



  • strategic management to be more dynamic + responsive
  • Difference between intended strategy + realized strategy
  • i.e. intended strategy not realized due to environmental changes
  • But can evolve + adapt - emergent strategy

Business volatile

Strategic management

(responsibility)
  • ethical behavior of organisations
  • economic, social, environmental impact of organisation's actions (i.e. fraud, pollution, unfair practice)
  • society aware of actions - pressure on organisations to be allowed to operate

ethical behavior + impact of organisations

Strategic planning


  • process through which strategy is operationalized
  • involves decisions on strategy implementation by various functions/departments in organisation
  • strategic plans implemented - to improve organisation
  • provide staff + stakeholders with info - direction organisation is planning to take

strategy


operationalization, implementation, improve

Strategic planning

(weaknesses)


  • images of lengthy, elaborate, expensive processes - reserved for senior managers
  • Today's changing environment? not realistic/ideal
  • All staff members ideas should be incorporated, regardless of rank
  • World will come to a standstill! While plan is developed
  • Plan maintains it's predicted course, doesn't reflect reality

complex processes


not reserved for everybody


world comes to a standstill


not realistic

Strategic thinking


  • top management's broad vision of organisation's future
  • manner which parts of organisation + external environment influence each other
  • aware of interconnectivity between past, present, future
  • recognize + take advantage of opportunities

organisation's future


influence - inside/outside


opportunities

Strategic

decision-making


  • development + implementation of strategy


  • Various information is needed, based on:

  1. organisation's resources + culture
  3. stakeholder expectations

  • depends on effective communication system
  • Insufficient to gather info
  • communication infrastructure necessary

- ensure info reaches decision-makers quickly

Info needed

Organisation's resources

Effective communication System