SESSION 2-3 Flashcards
(46 cards)
What is Strategic Management?
The art and science of formulating, implementing, and evaluating cross-functional decisions that enable an organization to achieve its objectives.
What is the goal of Strategic Management?
Competitive advantage
What does Strategic Management say about Competition?
- We operate in a world of
competition. - We have to out-run competition
- But we compete not just to be the
best, but to be UNIQUE vs.
competition, and to sustain it.
What does Strategic Management say about Plan?
You have to have an objective and a plan to meet that objective.
What is the role of management according to Peter Drucker?
To make people capable of joint performance through common goals, common values, the right structure, and the training and development they need to perform and to respond to change
What are the four functions of Management?
Planning, Organizing, Leading, Controlling
What is Planning?
This involves identifying short-term and long-term goals, establishing strategies and developing policies and procedures that will serve as the framework for decision making.
What is Organizing?
Organize resources to execute initiatives required to attain goals. Identify activities, delegating them, and establish
relationships with others. This also involves staffing or organizing the right people for the job.
What is Leading?
Leading your team comes next, and is the most obvious yet difficult function to accomplish. Entails properly communicating with your team, and motivating them.
What is Controlling?
The final phase involves controlling or monitoring results to see if you have achieved your goals or not. Involves performance measurement, identifying errors and correcting them.
What is Strategic Thinking?
It highlights a mindset involved
with making action plans or decisions grounded on a vision or long-term objectives.
The goal now is to shift from simply doing things towards doing things with a purpose.
- Identifying “the purpose” is one of the key measures of strategic thinking.
What is Strategic Management Process/Plan?
A strategic plan is a company’s game plan or battle plan.
To have any chance of success a company needs a strategic plan to compete successfully.
Strategic plans also involve making trade-offs and tough decisions among several alternatives.
What are the three stages of Strategic Management Process?
Formulate, Implement, Evaluate
What is Strategy Formulation?
- Developing a vision and a mission
- Identifying external opportunities and
threats - Determining internal strengths and
weaknesses - Establishing long-term objectives, generating alternative strategies, and choosing particular strategies to pursue.
- Strategy Formulation Decisions:
- What new businesses to enter
- What businesses to abandon
- Whether to expand operations or diversify
- Whether to enter other markets
- Normally happens at the top-level of the organization
What is Strategy Implementation?
- Stage where a firm will establish annual objectives, devise policies, motivate employees, and allocate resources so that formulated strategies can be executed
- Also called the action stage
- The most difficult part of the Process
because it involves working with people - Strategy has to be communicated clearly to the entire organization
What is Strategy Evaluation?
*Determining which strategies are not
working well
*Three fundamental activities:
✓reviewing external and internal factors that are the bases for current strategies
✓measuring performance
✓taking corrective actions if needed
What is the Role of Managers?
To ensure that work activities are completed efficiently and effectively by the people responsible for doing them
Is Strategic Management Process a “pure” or “hard” science? Explain.
No. Strategic Management Process is not a “pure” or “hard” science.
- Objective, logical, systematic
approach to making major decisions - Data-based
- Organizes qualitative and
quantitative information to allow
effective decision-making in times of uncertainty - But there is still room for “intuition” or experience
What are the key takeaways on Strategic Management?
- Strategic management is focusing on
a single vision and linking all activities and decisions into that long-term goal or objective. - It is important to stand out and
differentiate yourself from competition in order to become the premier choice of your customers. - It all boils down to having a competitive advantage, and devising strategies to ensure that such advantage is sustained.
- To do so requires the three stages of
the strategic management process.
What is Competitive Advantage?
- Micheal Porter
*Any activity a firm does especially well compared to activities done by rival firms or any resource a firm possesses that rival firms desire.
- An attribute that allows an organization to out- perform its competitors.
- Can be natural resources, such as high-grade ores or a low-cost power source, highly skilled labor, geographic location, high entry barriers, and
access to new technology. - A firm must strive to achieve sustained
competitive advantage
What are Strategists?
- Individuals most responsible for the success or failure of an organization
- Help an organization gather, analyze, and organize information
- Values, ethics, personal beliefs impact corporate strategies
- Founder, CEO, President, Chief Strategy Officer, Strategic Planning
Director - “Visionary”
- Good communicators
- With great imagination
- Sports coaches
What are Vision and Mission Statements?
- A vision statement answers the
question “What do we want to
become?” - A mission statement answers the
question “What is our business?” and
why an organization exists
What are Opportunities and Threats?
External Environment
- Economic, social, cultural, demographic, environmental, political,
legal, governmental, technological, and competitive trends and events - Factors the firm cannot control
What are Strengths and Weaknesses?
Internal Environment
- An organization’s controllable activities that are performed especially well or really poorly
- Determined relative to competitors
