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STRATEGIC MANAGEMENT

INTRODUCTION AND PROCESS


CLIENTS
FIRM
Products Strengths &
Competencies
COMPETITORS
Products
SATISFY
Distinctive Competencies
STRATEGIES
STRATEGIES
Key Success FACTORS
Competitive Advantage
CONCEPTS & DEFINITIONS
Needs
&
Wants
SATISFY

CONCEPTS & DEFINITIONS
WHAT IS STRATEGIC MANAGEMENT?
Definition of Thompson & Strickland,
1987:
Strategic management is the ongoing process
whereby managers establish an organizations
long-term direction, set specific performance
objectives, develop strategies to achieve these
objectives in the light of all the relevant internal
and external circumstances, and undertake to
execute the chosen action plans.
CONCEPTS & DEFINITIONS
WHAT IS STRATEGIC MANAGEMENT?
Definition of Dess, Lumpkin & Taylor,
2004:
Strategic management consists of the analysis,
decisions, and actions an organization
undertakes in order to create and sustain
competitive advantages.
CONCEPTS & DEFINITION

Process - comprises a sequence of activities

Competitive advantage - is a distinctive
competence that allows firms to consistently
outperform their rivals.

Strategy - management's game plan for
strengthening the performance of the
company (how the company will be unique,
how the company will build its competitive advantage,
how the company will sustain that advantage over time),
the result of choices made, on where to play and how to
win, to maximize long-term value.

CONCEPTS & DEFINITION
Strength = a resource or competence (ability) of a firm
to carry out well an activity.
Core competence = a competence that matters for
the firm's profitability and competitiveness.
Key success factors consist of the several activities
which are the primary determinants of success in the
industry.
Distinctive competence = a competitively valuable
core competence better than what competitors might
possess.


CONCEPTS & DEFINITIONS
Key attributes of strategic management
Directs the organization toward overall goals
and objectives.
Includes multiple stakeholders in decision
making
Needs to incorporate short-term and long-term
perspectives
Recognizes trade-offs between efficiency and
effectiveness
CONCEPTS & DEFINITIONS
Thinking strategically means answering three
questions:
1. WHERE ARE WE NOW?
2. WHERE DO WE WANT TO GO? (strategic and
financial outcomes)
3. HOW WILL WE GET THERE?
CONCEPTS & DEFINITIONS
Strategic management is the study of:
-why some firms outperform others?
-how to compete in order to create
competitive advantages in the
marketplace (unique, valuable, and
sustainable, difficult for competitors to
copy or substitute)
THE STRATEGIC MANAGEMENT PROCESS
Situation Analysis
Evaluation of the external
environment and the
organization
Strategic Direction


Creation of organizational
vision, mission and strategic
objectives
Strategy Formulation


Development of corporate,
business and functional
strategies
Strategy Implementation,
Follow-up & Evaluation

Design of organizational
structure, control,
informational and
decisional systems, and
performance indicators.
THE STRATEGIC MANAGEMENT PROCESS
Situation Analysis (external and internal environments
analyses)
Direction settings (develop a strategic vision & mission,
and setting strategic objectives)
Strategy formulation
Strategy implementation and Evaluation of performance,
reviewing new developments, and initiating corrective
adjustments

Strategic Management is an Ongoing Process.