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Strategic Management Process

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SMP of scanning environment,Formulation,implementation,& Evaluation
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Strategic Management

Process

Wal-Mart Story

Grown from a discount store in 1962 to become worlds largest Retailer.

How did it happen?

Constant focus on Customer ServiceExtensive use of technology Management Structure that welcome change Extensive effort to Grow business Globally Sales from $44 billion in 1992 to $425 billion in 2012

5 Ps of HR Strategy

Philosophy Policies Programmes Practices Process

the wall mart story

Now, I want you to raise your right hand I want you to repeat after me:

from this day forward I solemnly promise and declarethat every time a customer comes within 10 feet of me I will smile, Look towards the customer and greet

I am Sam May I help You

the wall mart story

Success

Missiona firm must define clearly its Mission & what it means by Success in its mission Statement

Strategy

Then it must develop a road map to accomplish the mission which we call

strategy

Mission Statement of Wal-Mart

Wal-Mart"To give ordinary folk the chance to buy the same thing as rich people. Always Low Prices

Save Money Live Better

What is a Strategy & Strategic Management ?

A strategy is a set of goals and specific Action plans that, if achieved, provide the desired competitive advantage

SM involves identifying and implementing these goals and action plans

Strategy

&

Strategic Management

Goals 2013

Objectives

Mission

2018

2036

Paramjit Sharma

9

3/2/2013

Strategy

&

Strategic Management

Mission

Goals 2014

Objectives

2019

2037

Paramjit Sharma

10

3/2/2013

Strategy

&

Strategic Management

Goals 2015

Objectives

Mission

2020

2038

Paramjit Sharma

11

3/2/2013

What is Strategic Management?

Application of the basic planning process at the highest levels of the company

Strategic Management ProcessEnvironment Scanning Formulation

Implementation

Evaluation

Basic ConceptsEnvironment Scanning External SocietalEnvironmental

Strategy Formulation

Strategy Implementation

Evaluation & Control

MissionReason for Existence ObjectivesWhat to accomplish By whom

ProgrammesActivities needed to accomplish a planPerformance

Industry AnalysisInternal

StrategiesPlan to achieve mission & Objectives

Budgets Cost of the Programmes Procedures Sequence of Steps needed to do the job

Actual Results

Structure Resources Assets Skills Competence Knowledge

Policies Guidelines for Decision Making

Strategic Management Process

15

Companys SWOT Analysis to shape the strategies

SWOT Analysis

Process that allows companies to evaluate overall health Internal (SW) and external (OT)

SWOT Analysis

Weaknesses

Threats

External

Strengths

Opportunities

Internal

Strategy information Matrix Strategy/TacticsAppropriate inappropriatePossible short term success but ultimately Failure

Marketing Information

Excellent

Success

Poor

Trouble or Failure

Failure

Formulating Strategy

To understand the current position of the companyIdentify mission, identify past and present strategies, Diagnose the companys past and present performance, Set goals & objectives for the companys operation

Formulating Strategy

Identify the mission statementOutlines why the company existsDescribes the companys basic products and/or services

Designed to accomplish goals and Objectives

Mission Statement of Wal-Mart

Wal-Mart"To give ordinary folk the chance to buy the same thing as rich people. Always Low Prices

Save Money Live Better ,

Mission Statement

Saraswat Cooperative Bank

Business Turnover of Rs 25000cr by 2011

Mission Statement

Ford Motor (ford. com)

Provide personal mobility for people around the world

Mission Statement

United Parcel (ups. com)

To move at the speed of business

Mission Statement

Walt Disney (Disney. com)

To make people Happy

Identifying Past and Present Strategies

Companies need to understand and appreciate their corporate history

Identifying Past and Present Strategies

Strategic managers should askHas past strategy been developed? If not, can past history of the company be analyzed to identify the strategy that has evolved? If yes, has the strategy been recorded in writing?

Diagnosing Past and Present PerformanceA corporate planner must decide if past strategies worked and if strategic changes are needed by asking:

How is the company currently performing?

How has it performed during the past few years?Is the performance trend moving up or down?

Kizashi

Setting Goals

Concise statements that provide direction

Setting standards for achievementGoals must be re-evaluated as the environment and opportunities change

ObjectivesSMART Specific Measurable Achievable Realistic Timely

Goals which are measurable

Top line Bottom line Efficiency Growth Technology Leadership Shareholders Wealth Brand Equity Corporate Social Responsibility Market Share Employees Package Cost

Policies

Policies are broad general guidelines to action that establish boundaries within which employees must operateanswering all written customer complaints in writing within 10 days Our organization wont give any Bribe

Policies

No cost Reduction at the cost of the Quality

Policies

GE Must be number one or two wherever it competes

Policies

No question Asked when customer return merchandise

Implementing Strategy

Implementing Strategy

It is the Process by which strategies are put into action through development of programmes, budgets and procedures

Amazon invented the retailing business model that all other dot - coms are struggling to copy

Amazon.com list of items

Books Movies ,Music & Games Electronics & Computers Home & Gardens Grocery Toys ,Kids, Baby Care Apparel, Shoes & Jewelry Health& Beauty Sports & Outdoors

Strategy Implementation

Programmes Budget Procedures

Strategy ImplementationFedEx

A programme is a statement of the activities or steps needed to accomplish a plan . It makes a strategy action oriented . It may involve restructuring the Firm, changing the internal culture or beginning a new research effort1-43

Strategy Implementation

Nano

A Budget is a statement of Firms programmes in monetary value.It has detailed cost of each programme.

Strategy ImplementationDelta Airlines

Procedures , are a system of sequential steps or techniques that describe in detail how a particular task or job is to be done

1-45

Strategies

Corporate Strategy

Business StrategyFunctional Strategy

3 Types

It describes a companys overall direction in terms of general attitude towards Growth and Management of the Organization

Corporate Strategy

It deals with 3 main categories of Stability, Growth and Retrenchment

Corporate Strategy

Maytag followed the strategy of acquiring other appliance companies

It usually occur at the business unit & it emphasizes improvement of the competitive position of a corporations product or services in the specific industry or segment

Business Strategy

Generic & Grand Strategies

Core idea of how best a firm can Compete in the market place is called Generic Strategy

Comprehensive General Plan of major actions through which objectives are to be achieved is called Grand Strategy

Generic Strategies

Cost Leadership Differentiation Focus

developing a competitive strategy

Cost Leadership

developing a competitive strategy

Cost Leadership is a competitive Strategy in which a firm succeeds in producing or selling products or services at the lowest costs in the industry

Cost Leadership

NIRMA

AMUL

BIG BAZAAR

CAVIN CARE

Required Skills & ResourcesStrategy Cost Leadership

Capital Investments Process Reengineering Labour Supervision Product Designing

Product Service Personnel Coverage Image

Required Skills & ResourcesStrategy Differentiation

Strong Mkt Abilities Product Engineering Corporate Reputation Uniqueness Competent & Trained manpower

Grand Strategies

Concentration Market Development Product Development Innovation Horizontal Integration Vertical Integration Joint Venture Strategic Alliance Concentric Diversification Conglomerate Diversification Turnaround Divestiture Liquidation

Followed to maximize resource productivity Concerned with developing and nurturing distinctive competence to provide a business unit with a competitive advantage.

Functional Strategy

Technology Leadership----TCS P& GHuge Advertising Budget

MARKETING STRATEGY

FINANCIAL STRATEGYRESEARCH & DEVELOPMENT STRATEGY OPERATIONS STRATEGY PURCHASING STRATEGY LOGISTICS STRATEGY HUMAN RESOURCES STRATEGY INFORMATION TECHNOLOGY STRATEGY

Functional Strategies

Market Penetration STRATEGY

MARKET DEVELOPMENT STRATEGY

Marketing Strategies

PRODUCT DEVELOPMENT STRATEGY

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