PowerPoint PresentationThe Concept of StrategyElements of SuccessSlide 4What is Strategy?Slide 6The Basic Framework Strategy: the Link between the Firm and its EnvironmentSlide 8Strategy Making : Design or Process?Strategy Making Processes within the Company: Multiple Roles of StrategyThe Role of AnalysisPRESENTATION SLIDES To accompany: Contemporary Strategy Analysis: Concepts, Techniques, Applications (5th edition, Blackwell, 2004)Robert M. GrantRobert M. GrantAssisted by Kate GrantThe Concept of StrategyThe Concept of Strategy•The role of strategy in success•A framework for strategy analysis•The evolution of strategic management•Corporate strategy and business strategy•Strategy making: Design or process?•The role of strategyOUTLINEElements of SuccessElements of SuccessMADONNA GIAP & NORTH RICHARD WILLIAMS VIETNAMESE MILITARY (VENUS & SERINA’S DAD) GOALS Single-minded quest for Reunification of Vietnam Wealth & recognitionstardom. under Communist rule.UNDERSTANDING Identified emerging trends Intimate knowledge of terrain. Careful diagnosis of THE in popular culture. Understanding U.S. political the physical and ENVIRONMENT Recognized power of sex. system. Psychological determinantsUnderstood showbiz of success in women’sdistribution channels. professional tennisRESOURSE Recognized limited raw Recognized economic and Systematic developedAPPRAISAL talent. Relied on strengths military weaknesses and key skills and physical, in self-promotion, image- political strengths. mental and social creation, relationship attributes from an early age. management IMPLEMENT- Commitment to hard work. Tight control. Long-term Careful meshing of ATION Disciplined, inspirational commitment. Effective roles—father, coach & Leadership. Attention to propaganda. Inspirational manager. Sustained, detail. leadership. supportive leadership.Successful StrategyLong-term, simple and agreed objectivesProfound understanding of the competitive environmentObjective appraisal of resourcesCommon Elements in Successful StrategyCommon Elements in Successful StrategyEFFECTIVE IMPLEMENTATIONWhat is Strategy?What is Strategy?•Distinguishing strategy from tactics:–Strategy is the overall plan for deploying resources to establish a favorable position.–Tactic is a scheme for a specific maneuver.•Characteristics of strategic decisions:–Important.–Involve a significant commitment of resources.–Not easily reversible.The Evolution of Strategic ManagementThe Evolution of Strategic ManagementDOMINANTTHEME1950s 1960s-early 70s Mid-70s-mid-80s Late 80s –1990s 2000sBudgetary Corporate Positioning Competitive Strategicplanning & planning advantage innovationcontrol Financial Planning Selecting Focusing on Reconcilingcontrol growth &- sectors/markets. sources of size withdiversification Positioning for competitive flexibility &leadership advantage agilityCapital Forecasting. Industry analysis Resources & Cooperativebudgeting. Corporate Segmentation capabilities. strategy.Financial planning. Experience curve Shareholder Complexity. planning Synergy Portfolio analysis value. Owning E-commerce. standards. — Knowledge Management— Coordination Corporate Diversification. Restructuring. Alliances && control by planning depts. Global strategies. Reengineering. networksBudgeting created. Rise of Matrix structures Refocusing. Self -organizsystems corporate Outsourcing. ation & virtualplanning organizationMAINISSUESKEY CONCEPTS&TOOLSMANAGE-MENTIMPLIC-ATIONSThe Basic FrameworkStrategy: the Link between the Firm and its EnvironmentThe Basic FrameworkStrategy: the Link between the Firm and its Environment THE FIRM Goals & ValuesResources &CapabilitiesStructure & SystemsTHE INDUSTRYENVIRONMENTCompetitorsCustomersSuppliersSTRATEGYSTRATEGYSources of Superior ProfitabilityRATE OF PROFIT ABOVE THE COMPETITIVE LEVELHow do we make money?INDUSTRYATTRACTIVENESSWhich businesses should we be in?COMPETITIVE ADVANTAGEHow should we compete?CORPORATE STRATEGYBUSINESS STRATEGYStrategy Making : Design or Process?Strategy Making : Design or Process?Strategy as DesignPlanning andrational choiceINTENDEDSTRATEGYMany decision makersresponding to multitude ofexternal and internal forcesREALIZED STRATEGYEMERGENT STRATEGYStrategy as ProcessMintzberg’s Critique of Formal Strategic Planning:•The fallacy of prediction – the future is unknown•The fallacy of detachment -- impossible to divorce formulation from implementation•The fallacy of formalization --inhibits flexibility, spontaneity, intuition and learning.Mintzberg’s Critique of Formal Strategic Planning:•The fallacy of prediction – the future is unknown•The fallacy of detachment -- impossible to divorce formulation from implementation•The fallacy of formalization --inhibits flexibility, spontaneity, intuition and learning.Strategy Making Processes within the Company: Multiple Roles of StrategyStrategy Making Processes within the Company: Multiple Roles of StrategyStrategy as DecisionSupportStrategy as Coordinationand Communication Strategy as Target Improves the qualityof decision making Creates consistencyand unity Improves perform- ance by setting high aspirationsThe Role of AnalysisThe Role of Analysis•Strategy analysis improves decision processes, but doesn’t give answers.•Strategy analysis assists us to identify and understand the main issues.•Strategy analysis helps us to manage complexity.•Strategy analysis can enhance flexibility and innovation by supporting