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StraMa-Reviewer-1

The document outlines two perspectives of leadership: the romantic view, which emphasizes the leader's role in organizational success, and the external control perspective, which attributes success to external forces. It defines strategic management (STRAMA) as a process involving analysis, decision-making, and implementation to achieve organizational goals while considering stakeholders. Additionally, it discusses the importance of strategy analysis, formulation, and implementation, highlighting the need for effective organizational design, corporate governance, and a commitment to continuous improvement and ethical behavior.

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8 views4 pages

StraMa-Reviewer-1

The document outlines two perspectives of leadership: the romantic view, which emphasizes the leader's role in organizational success, and the external control perspective, which attributes success to external forces. It defines strategic management (STRAMA) as a process involving analysis, decision-making, and implementation to achieve organizational goals while considering stakeholders. Additionally, it discusses the importance of strategy analysis, formulation, and implementation, highlighting the need for effective organizational design, corporate governance, and a commitment to continuous improvement and ethical behavior.

Uploaded by

shmaghetti
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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STRATEGIC MANAGEMENT MODULE 1 REVIEWER

TWO PERSPECTIVES OF LEADERSHIP


1. ROMANTIC VIEW
Leader is the key force in the organization’s success

2. EXTERNAL CONTROL PERSPECTIVE


External forces determine the organization’s success

A LEADER MUST BE:


• Proactive – anticipate changes
• Continually refine strategies
• Aware of external opportunities and threats
• Thoroughly understand their firm’s resources and capabilities
• Make strategic management both a process; and a way of thinking throughout
the organization

STRAMA DEFINED
A process which organizations analyze and learn from internal and external
environments;
Establish strategic direction;
Create strategies intended to achieve goals;
In an effort to satisfy key organizational constituencies – stakeholders

STRAMA INVOLVES:
1. ANALYSIS
• Strategic goals; vision, mission, strategic objectives
• Internal and external environment

2. DECISIONS – FORMULATION
• What industries should we compete in?
• How should we compete in those industries

3. ACTIONS – IMPLEMENTATION
• Allocate necessary resources
• Design the organization to bring intended strategies to reality

KEY ATTRIBUTES
• Directs toward overall goals and objectives
• Includes multiple stakeholders in decision making
• Incorporates short-term and long-term perspectives
• Trade-offs between efficiency and effectiveness

NOTES:
Not all stakeholders are stockholders, but all stockholders are stakeholders;
Being effective is about doing the right thing, and being efficient is about doing it with
minimal resources and as fast as possible;
INTENDED VS REALIZED STRATEGIES
1. INTENDED STRATEGY
• Decisions are only determined by analysis
• Rarely survives its original form

2. REALIZED STRATEGY
• Determined by analysis and unforeseen environmental developments,
unanticipated resource constraints, and changes in managerial
preferences

EXAMPLE SCENARIO:
Every time you go to school, you ride a train (intended). All of sudden, the train station is
closed. You start panicking, thinking you might be late at school (unrealized). You come
up with a solution to choose other modes of transportation (deliberate). However, other
people who uses the train might do the same thing as well, so you think on how to
avoid them as competition (emergent). You chose to ride a bus, and you got to school
completely fine (realized).

I. STRATEGY ANALYSIS
• The starting point
• Precedes effective formulation and implementation
• Careful analysis of overarching goals
• Thorough analysis of external and internal environment

1. ANALYZING GOALS AND OBJECTIVES


Establish hierarchy of goals
• Vision
• Mission
• Strategic Objectives

2. EXTERNAL ENVIRONMENT
Managers must monitor and scan, as well as analyze competitors
• General Environment (McDonalds in the fast-food industry)
• Industry Environment (McDonalds in the food industry)

3. INTERNAL ENVIRONMENT
• Strengths and relationships of a firm’s value chain
• Uncover potential sources of competitive advantage

4. FIRM’S INTELLECTUAL ASSETS


• Knowledge workers and other intellect assets drive competitive
advantage and wealth creation
• Networks, relationships, and technology enhances collaboration,
accumulates and stores knowledge

II. STRATEGY FORMULATION


• Based on strategy analysis
• Developed at several levels
• Create and sustain competitive advantage
o Investment
o Commitment of resources
o Operational synergies
o Viable opportunities

1. BUSINESS LEVEL
• Cost leadership
• Differentiation
• Focus on narrow or industrywide market segment

2. CORPORATE LEVEL
Firm’s portfolio (or group) of businesses
• What businesses should we compete in?
• How can we manage this portfolio of business to create synergies

3. INTERNATIONAL LEVEL
• What is the appropriate entry strategy?
• How do we attain competitive advantage in international markets?

4. ENTREPRENEURIAL STRATEGY AND COMPETITIVE DYNAMICS


• How do we recognize viable opportunities?
• How do we formulate effective strategies?

III. STRATEGY IMPLEMENTATION


• Implements formulated strategy
• Proper control systems
• Appropriate organizational design, coordinates, and integrates activities
• Coordinates with suppliers, customers, and alliance partners
• Leadership commitment to excellence and ethical behavior
• Learning and continuous improvement
• Act entrepreneurially
1. STRATEGIC CONTROL AND CORPORATE GOVERNANCE
Informational Control
• Monitor and scan environment
• Respond to threats and opportunities

Behavioral Control
• Balance of rewards and incentives
• Cultures and boundaries

Effective Corporate Governance

2. Creating Effective Organizational Design


• Structures must be consistent
• Boundaries must be flexible and permeable
• Alliances must capitalize on capabilities of other organizations

3. Creating a Learning and Ethical Organization


Effective Leaders
• Set a direction
• Design
• Develop an organization committed to excellence and ethical behavior

Create a Learning Organization


• Benefit from individuals and collective talents

4. Fostering Corporate Entrepreneurship


• Firms must continually improve and grow
• Find new ways to renew themselves
• Entrepreneurship and innovation provide for new opportunities
o Enhances firm’s innovative capacity
o Allow autonomous entrepreneurial behavior

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