ASSIGNMENT- Strategic Management

Unit 1: Introduction to Strategies

1. Explain the concept of strategy?

Strategy is an action that managers take to attain one or more of the organization’s goals.
Strategy can also be defined as “A general direction set for the company and its various
components to achieve a desired state in the future. Strategy results from the detailed
strategic planning process”.

Strategy means is a general plan to achieve one or more long-term or overall goals under
conditions of uncertainty. Strategy generally involves setting goals, determining actions to
achieve the goals, and mobilizing resources to execute the actions. A strategy describes how
the ends (goals) will be achieved by the means (resources).

A strategy is all about integrating organizational activities and utilizing and allocating the
scarce resources within the organizational environment so as to meet the present objectives.
While planning a strategy it is essential to consider that decisions are not taken in a vacuum
and that any act taken by a firm is likely to be met by a reaction from those affected,
competitors, customers, employees or suppliers.

Strategy is the blueprint of decisions in an organization that shows its objectives and goals,
reduces the key policies, and plans for achieving these goals, and defines the business the
company is to carry on, the type of economic and human organization it wants to be, and the
contribution it plans to make to its shareholders, customers and society at large.

2. Why is it important to set goals at workplace?

Goals give direction to your efforts: Goals are like a destination. Unless you know your
destination, you do not know what direction to move toward.

Goals help you set your priorities: While setting goals, you consider various
accomplishments for your future and reflect on what achievements are more important to
you. Once you have a clear idea about what is more important, and what is less important, it
becomes easy to set your priorities. Then, you can focus all your efforts to achieve your
goals and prevent yourself from wasting time on something that is not that important.

Goals increase your conviction in achievement: Defining your goals gives the conviction and
confidence that the set goals are achievable. Successful people typically know where they
are going and how long it would take them to reach their destination.

Goals support decision making: When you have set goals, there is no confusion as to the
direction you need to move toward. Whenever you need to choose between two courses of
action, you can choose one that takes you toward your goals. As a result, having your goals
defined aids effective decision making.

Goals motivate you to act: Keeping your meaningful goals in mind motivates you to
persevere. Instead of hoping to do something someday, you focus on your progress right
away. The joy of achieving your goals motivates you to keep working, regardless of the
difficulties involved.

3. Explain how the strategic intent concept benefits the organization?

The foundation for the strategic management is laid by the hierarchy of strategic
intent. The concept of strategic intent makes clear what an organization stands for.
Harvard Business Review, 1989 described the concept in its infancy.

Hamed and Prahalad coined the term strategic intent. A few aspects about strategic
intent are as follows: It is an obsession with an organization. This obsession may
even be out of proportion to their resources and capabilities. It envisions a derived
leadership position and establishes the criterion; the organization will use to chart
its progress.

It involves the following: 1. Creating and communicating a vision 2. Designing a

mission statement 3. Defining the business 4. Setting objectives

The strategic intent concept also encompasses an active management process that
includes focusing the organization’s attention on the essence of winning. The
concept of stretch and leverage is relevant in this context. Stretch is a misfit
between resources and aspirations. Leverage concentrates, accumulates, conserves
and recovers resources so that a meager resource base can be stretched. Leverage
reduces the stretch and focuses mainly on efficient utilization of resources. The
strategic fit matches organizational resources and environment. This positions the
firm by assessing organizational capabilities and environmental opportunities.
Under fit, the strategic intent would seem to be more realistic. It is hierarchy of
intentions ranging from a board vision through mission and purpose down to
specific objectives
 4. What are the characteristics of effective mission statement?

In order to be effective, a mission statement should posses the following characteristics.

i. A mission statement should be realistic and achievable. Impossible statements do not

motivate people. Aims should be developed in such a way so that may become feasible.

ii. It should neither be too broad not be too narrow. If it is broad, it will become
meaningless. A narrower mission statement restricts the activities of organization. The
mission statement should be precise.

iii. A mission statement should not be ambiguous. It must be clear for action. Highly
philosophical statements do not give clarity.

iv. A mission statement should be distinct. If it is not distinct, it will not have any impact.
Copied mission statements do not create any impression.

v. It should have societal linkage. Linking the organization to society will build long term
perspective in a better way.

vi. It should not be static. To cope up with ever changing environment, dynamic aspects be
looked into.

vii. It should be motivating for members of the organization and of society. The employees
of the organization may enthuse themselves with mission statement.

viii. The mission statement should indicate the process of accomplishing objectives. The
clues to achieve the mission will be guiding force.

5. Explain the concept of Core Competencies of Business?

Core competencies differentiate an organization from its competition and

In ordercreate
to be effective,
a company'sa mission statement
competitive shouldinposses
advantage the following
the marketplace. characteristics.
Typically, a core
competency refers to a company's set of skills or experience in some activity,
i. A mission statement should be realistic and achievable. Impossible statements do not
rather than physical or financial assets. An organizational core competency is
motivate people. Aims should be developed in such a way so that may become feasible.
an organization's strategic strength. Honda's strategic strength, for example,
lies in
ii. It should its engine
neither be tooand propulsion
broad systems.
not be too narrow.Sony
If ithas a coreitcompetency
is broad, will becomein
miniaturization.
meaningless. A narrowerFederal
missionExpress hasrestricts
statement a core competency
the activitiesinoflogistics and The
organization.
customer service.
mission statement should be precise.

iii. A mission statement should not be ambiguous. It must be clear for action. Highly
philosophical statements do not give clarity.

iv. A mission statement should be distinct. If it is not distinct, it will not have any impact.
Copied mission statements do not create any impression.

v. It should have societal linkage. Linking the organization to society will build long term
perspective in a better way.

vi. It should not be static. To cope up with ever changing environment, dynamic aspects be
looked into.

vii. It should be motivating for members of the organization and of society. The employees
of the organization may enthuse themselves with mission statement.

viii. The mission statement should indicate the process of accomplishing objectives. The
clues to achieve the mission will be guiding force.

In order to be effective, a mission statement should posses the following characteristics.

i. A mission statement should be realistic and achievable. Impossible statements do not

motivate people. Aims should be developed in such a way so that may become feasible.

ii. It should neither be too broad not be too narrow. If it is broad, it will become
meaningless. A narrower mission statement restricts the activities of organization. The
mission statement should be precise.

iii. A mission statement should not be ambiguous. It must be clear for action. Highly
philosophical statements do not give clarity.

iv. A mission statement should be distinct. If it is not distinct, it will not have any impact.
Copied mission statements do not create any impression.

v. It should have societal linkage. Linking the organization to society will build long term
perspective in a better way.

vi. It should not be static. To cope up with ever changing environment, dynamic aspects be
looked into.

vii. It should be motivating for members of the organization and of society. The employees
of the organization may enthuse themselves with mission statement.

viii. The mission statement should indicate the process of accomplishing objectives. The
clues to achieve the mission will be guiding force.
Three tests can be applied to determine a core competency:

A core competency can lead to the development of new products and services
and must provide potential access to a wide variety of markets.

It must make a significant contribution to the perceived benefits of the end

product.

It should be difficult for competitors to imitate. In many industries, such

competencies are likely to be unique.