The concept of strategy

The concept of strategy

1. The role of strategy in success

   • Examples
     • In both cases:
       • Consistency of direction
       • Clear understanding of the desired goal
       • How to maneuver into a position of advantage
     • Characteristics of a strategy that are conductive to success
       • Goals: Consistent & long-term
       • Understanding of the competitive environment
       • Objective appraisal of resources:
       • Effective implementation
     • Lady Gaga
     • Queen Elizabeth II

2. The strategy process

   • Strategy may emerge as an adaptation to circumstances.

3. Introduction

   • Strategy is about achiving success
     • Gives coherence and directionto actions and decisions
     • Components
       • Analysis of external environment (industry)
       • Analysis of internal environments (Resources & capabilities)

4. The basic framework for strategy analysis

   • Strategy is the link between the firm & the industry environment
   • SWOT framework
     • Important to identify internal and external forces
   • Strategic Fit: Consistency of a firsm's strategy
     • "Strategy is the creation of an unique & differentiated position involving a different set of activities" - Porter
     • KEY: How activities fit together to form a consistent mutually reinforcing system
     • Contingency theory: The best way to design, manage & lead an organization depends upon circumstances (environment)

5. A brief history of Business Strategy

   • Strategies: is the overall plan for deploying resources to establish a favorable position
   • Tactic: scheme for a specific action.
   • Corporate planning: Long-term planning (1950's)
   • Shift from planning to Strategy making
     • Strategy making: Focuses on competition as the main characteristic of the business environment

6. Strategy today

   • means by which individuals or organizations achieve their objectives.
   • business environment has become more unstable & unpredictable
   • Neither Queen Elizabeth nor Lady Gaga appears to have had any detailed strategic plan.
   • Strategy
     • As decision support
       • simplifies decision making
       • facilitates the use of analytic tools
     • As coordinating device
     • As target
       • forward-looking strategy
       • set aspirations that can motivate and inspire members of the organization
     • WHere?
       • Heads of managers, articulations of strategy in speeches and written documents, & in decisions.
   • Where to compete? • How to compete?
     • the two major areas of a firm’s strategy:
       • corporate strategy and business strategy
         • CS: defines the scope of the firm in terms of the industries and markets.
         • BS: how the firm competes within a particular industry or market

7. Strategy is a key ingredient to success

8. Strategy is about direction, identity, and exploiting the sources of superior profitability.

9. Describing a strategy of a firm: where the firm is competing, how it is competing, and the direction in which it is developing.

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