CHAPTER CONTENTS INTRODUCTION TO STRATEGIC MANAGEMENT INTRODUCTION - - PowerPoint PPT Presentation
INTRODUCTION TO STRATEGIC MANAGEMENT CHAPTER - 1 CHAPTER CONTENTS INTRODUCTION TO STRATEGIC MANAGEMENT INTRODUCTION TO STRATEGIC MANAGEMENT VISIT US AT : www.waytopinnacle.com BUSINESS POLICY CONCEPT OF MANAGEMENT STRATEGY
* Stream of instruction, guidance & direction for decision & action * Future Oriented. * Formulated by top management. * Emphasize on rational-analytical aspect of SM. * Gives direction * Set of rules & regulations.
in charge of it’s affairs.
process carried out by the management to achieve it's
Two Senses
Peter Drucker: "Management" is a Function, a Discipline, a task to be done, Peter Drucker: "Management" is a Function, a Discipline, a task to be done, and Managers practice this discipline carry out the functions and and Managers practice this discipline carry out the functions and discharge these tasks. discharge these tasks. Peter Drucker: "Management" is a Function, a Discipline, a task to be done, and Managers practice this discipline carry out the functions and discharge these tasks. Peter Drucker: "Management" is a Function, a Discipline, a task to be done, and Managers practice this discipline carry out the functions and discharge these tasks.
Term derived from Greek word Strategos was used in military setup.
stream of decisions and actions
and integrated plan of action designed to assure that objectives are achieved
Strategy is partly proactive & partly reactive
resource past trend etc. "Proactive
change or new learning " Reactive Env is dynamic
(i) To create a competitive advantage (ii) To cope with changing environment (I) Costly (ii) Time Taking (iii) Complex Environment (iv) Difficult to understand/ Estimate strategies response of rivals
Strategic Management
" Consists of analysis, decision & action " Creates Competitive Advantages. " Management process of (i) Define vision mission (ii) Set Objective (iii) Formulation strategy (iv) Implement (v) Control
Objectives of SM Limitations of SM
(i) Give direction. (ii) Makes organization Proactive. (iii) Create future and pathfinder
(iv) Longativity of business. (v) Competitive advantage. (vi) Defense Mechanism. (vii) Framework for major decisions.
Importance of SM
Medical Institutions Educational Institutions
to door
by people
home etc
Technology.
Governmental Agencies & Departments
strategic autonomy
freedom in altering mission and redirecting objectives.
unrelated business or merge with other
& legislature
Strategic Management In Government And Not For Profit Organization
Many Non-Profit Organization outperforms private firms A Non-Commercial Organization is established to meet the needs not met by business enterprises SM Required in all types of Org whether commercial or non-commercial Required to cope with mounting competitive pressure
Strategic Level Description Characteristics of Decisions Examples of Decision. 1) Corporate Level
" Consists of CEO, BOD, Senior Executives. " Oversee Development of strategy for whole org. " Sets strategic direction.
" Value Oriented " Less Concrete " Conceptual " Rare " Long Term " High Risk " High Cost " High Profit Potential " Maximum organization wide involvement " High Flexibility.
" Dividend Policies " Divestment of acquisitions " Deciding on long term financing " Formulating & Implementing Strategy " Launching new business etc.
2) Business Level
" Include Executives at business level. " Business Level mgrs " Translates general statement of direction into concrete strategies for individual business. " Concerned with strategies specific to a particular business. " Bridge between corporate & function " Periodic decision or rare " Moderate organization " Less costly " Less Risky " Mid term " Less Profit potential
" Plant Layout " Plant Capacity " Distribution network etc.
3) Functional Level
" Consists of functional manager " Develop Functional Strategies. " Provide info & Support to Business & Functional Level " Usually quantifiable " Short Range " Periodical decision " Low flexibility " Risk is low " Day to day action oriented
" Production scheduling " Inventory Management " Daily Transportation etc.