of 21
8/11/2019 Ch 01_Instructor PPT Global Edition.ppt
1/21
StrategicManagement:
Creating
CompetitiveAdvantages
Chapter One
8/11/2019 Ch 01_Instructor PPT Global Edition.ppt
2/21
Learning Objectives
After reading this chapter, you should have a good
understanding of:
LO1.1The definition of strategic management
and its four key attributes.
LO1.2The strategic management process and its
three interrelated and principal activities.
1-2
8/11/2019 Ch 01_Instructor PPT Global Edition.ppt
3/21
Two Perspectives of Leadership
Romantic view
Leader is the key force
in organizations
successExternal control
perspective
Focus is on external
factors that may affectan organizations
success
1-3
8/11/2019 Ch 01_Instructor PPT Global Edition.ppt
4/21
QUESTION
A CEO made a lot of mistakes such as committingerrors in assessing the market and competitiveconditions and improperly redesigning theorganization into numerous business units. Sucherrors led to significant performance declines. Thisillustrates the __________ perspective ofleadership.
A. External control
B. Romantic
C. Internal mechanism
D.Operational
1-4
8/11/2019 Ch 01_Instructor PPT Global Edition.ppt
5/21
Example: 3M
Elements of Buckleys turnaround
Set clear business goals for the company
Wanted 3M to develop lower-costproducts to compete in emerging markets
Became an outspoken champion for 3M
labs
1-5
8/11/2019 Ch 01_Instructor PPT Global Edition.ppt
6/21
1-66
The Basic Framework Strategy:
the Link between the Firm and its
Environment
THE FIRM
Goals &
Values
Resources &
Capabilities
Structure &Systems
THE
INDUSTRY
ENVIRONMENT
Competitors
Customers
Suppliers
STRATEGY
STRATEGY
2010 Robert M. Grant
www.contemporarystrategyanalysis.com
8/11/2019 Ch 01_Instructor PPT Global Edition.ppt
7/21
What is Strategic Management?
Strategic
management must
become both a
process and a wayof thinking
throughout the
organization
Leaders must be
proactive, anticipate
change, and
continually refinechanges to their
strategies
1-7
8/11/2019 Ch 01_Instructor PPT Global Edition.ppt
8/21
Defining Strategic Management
Strategic management
Analyses, decisions, and actions an
organization undertakes in order to create
and sustain competitive advantages
1-8
8/11/2019 Ch 01_Instructor PPT Global Edition.ppt
9/21
Defining Strategic Management
Analysis
Strategic goals
Internal and external environment of the firm
Strategic decisions
What industries should we compete in?
How should we compete in those industries?
1-9
8/11/2019 Ch 01_Instructor PPT Global Edition.ppt
10/21
Defining Strategic Management
Actions
Allocate necessary resources
Design the organization to bring intended
strategies to reality
1-10
8/11/2019 Ch 01_Instructor PPT Global Edition.ppt
11/21
1-1111
1950sFinancial budgeting:
Operational budgeting
Capital budgeting (the
wonders of DCF)
1960s & early 1970sCorporate planning:
Corporate plans
based on 5-10 yr economic
forecasts
Diversification
Late 1970s & 1980s
Emergence of Strategic
Management:
Industry analysis
Competitive positioning
Strategic priorities: locating
in attractive industries &
establishing market
leadership
1990s & early 2000s
Quest for Shareholder Value:
Refocusing, outsourcing, delayering, costcutting
Quest for Competitive Advantage:Emphasis on resources &
capabilities
Flexibility & innovation
Collaborationalliances, networks
Succeeding in dynamic (Schumpeterian)
markets
?
3 key changes:
1. Changing concept of strategy2. Changing processes of strategy formulation
3. New tools of strategy analysis
The Evolution of Strategic Management
8/11/2019 Ch 01_Instructor PPT Global Edition.ppt
12/21
Strategic Management Concepts
1-12
Exhibit 1.1
8/11/2019 Ch 01_Instructor PPT Global Edition.ppt
13/21
Key Attributes of Strategic
Management
Stakeholders
those individuals, groups, and organizations who
have a stake in the success of the organization,
including owners (shareholders in a publicly heldcorporation), employees, customers, suppliers,
the community at large,
131-13
8/11/2019 Ch 01_Instructor PPT Global Edition.ppt
14/21
Key Attributes of Strategic
Management
Ambidexterity
The challenge managers face of both aligning
resources to take advantage of existing product
markets as wellas proactively
exploring new
opportunities
1-14
8/11/2019 Ch 01_Instructor PPT Global Edition.ppt
15/21
Ambidextrous Behaviors in Individuals
They take time and
are alertto
opportunities beyond
the confines of theirown jobs
They are brokers,
always looking tobuild internal
networks
They are cooperative
and seek out
opportunities to
combine their effortswith others
They are multitaskers
who are comfortablewearing more than
one hat
1-15
8/11/2019 Ch 01_Instructor PPT Global Edition.ppt
16/21
8/11/2019 Ch 01_Instructor PPT Global Edition.ppt
17/21
Strategic Management Process
1-17
Exhibit 1.2
8/11/2019 Ch 01_Instructor PPT Global Edition.ppt
18/21
Strategic
ManagementProcess
Exhibit 1.3
1-18
The Strategic
Management
Process
8/11/2019 Ch 01_Instructor PPT Global Edition.ppt
19/21
Strategy Analysis
Consists of advance work that must be
done in order to effectively formulate and
implement strategies
Starting point
1-19
8/11/2019 Ch 01_Instructor PPT Global Edition.ppt
20/21
Strategy Formulation
Strategy formulation
decisions made by firms regarding investments,
commitments, and other aspects of operations
that create and sustain competitive advantage.
1-20
8/11/2019 Ch 01_Instructor PPT Global Edition.ppt
21/21
Strategy Implementation
Strategy implementation
actions made by firms that carry out the
formulated strategy, including strategic controls,
organizational design, and leadership.
1-21