BY TEJASWINEE PATANKAR

CMA INTERMEDIATE

STRATEGIC
MANAGEMENT

BY TEJASWINEE PATANKAR

1
 BY TEJASWINEE PATANKAR

1. INTRODUCTION TO STRATEGY
AND STRATEGIC MANAGEMENT

➢ STRATEGY:-

A goal oriented To gain + Superior Relative to

set of action sustain performance competitors

➢ ELEMENTS :-

Make or Diagnosis of
design a competitive
policy to challenge
address

Implement
the policy

Focus to make a unique strategy position

in industry.

➢ The word strategy is derived from Greek word ‘ strategia’ meaning

generalship.

2
 BY TEJASWINEE PATANKAR

➢ DEFINITION:-

Direction + Scope → Over Long Term → Achieve → Competitive Advantages

Premises → Changing Environment

Fulfill → Shareholders Expectations

Through Configuration Of Resources.

➢ CHARACTERISTICS OF STRATEGY:-

Long Term
Direction
Strategy is
affected by
resources,
Achieve
environmental
competitive
forces , value of
Advantage
expectations of
people running
an organisation

Create new
opportunities
Likely to affect Concerned With
operational Scope Of
decisions Activities

May require
Resources match
major resource
environment
change

3
 BY TEJASWINEE PATANKAR

➢ CONSEQUENCES:-

Complex In
Nature

Lead to
Situations Of
changes in
organisation Uncertainty

Change of
Integrated
relationship &
approach
network

➢ TYPES OF STRATEGY:-

1. Corporate strategy
•Overall purpose + scope
•Value addition - business units, product units
•Categories concerned with - Stability ,
Growth ,- Retrenchment

2. Business strategy
•Deals with competing successfully
•Competitive position ↑→ focus on goods,
services in given segment of segments.

3. Functional strategy
• They decision / serves → corporate +
business →strategy level .
•Using → Resources , process & people.

4
 BY TEJASWINEE PATANKAR

➢ RED OCEAN & BLUE OCEAN :-

Sr. no. Red ocean Blue ocean
1 Compete in existing markets Create uncontested markets to serve
2 Bost the companies Make to competition irrelevant.
3 Explain existing demand Create and capture new demand
4 Make the value – cost trade – off Break the value -cost trade -off
5 Align the whole existence of a firm’s Align the whole system of a firm’s
activities with its strategic choice of activities in pursuit of differentiation
differential or low cost. and a low cost.

➢ STRATEGIC MANAGEMENT :-

• Strategic management refers to a set of management decisions and

actions that determines the long-term performance of an organisation.

•Environmental scanning can be internal or external.

•Monitor , evaluate , ∆ disseminate info. from internal and external
•Purpose: to identify strategic factors →shape future of organisation.
Environmental •Various methods and techniques are available for environmental
scanning scanning.

•long range plan for effective management→ Opportunities & threats

→ in the light of strengths & weakness.
Strategy •Define mission + set objection + strategies + policy guidelines.
formulation

•Strategies + policy are put into action .

•Through → Programs , budget, procedure.
•Decision → to allocate resources → Middle management & Lower
management.
Strategy •Action are taken → corporate , Middle , functional .
implementation

•Activities + performance are monitored.

•Actual performance v/s Desired performance.
Evaluation & •Corrective action → to resolve any issues.
control

5
 BY TEJASWINEE PATANKAR

➢ ALIGNMENT OF STRATEGY WITH VISION, MISSION &

CULTURE :-

➢ VISSION:-

It is the desired future state of an organisation.

It is a clean image of what a company wants to behave in future.

Realistic , credible, attractive.

Example : Nike → To bring innovation and inspiration to every athlete in the world.

➢ MISSION :-

A company mission describes its purpose and its present business

( who we are? , what we do ? and why we are here?)

It declares what goods/ services are being provided by its company.

It identifies scope of the companies operations.

It includes → value + Philosophy about business, treatment of employees.

A separate document .
Example : Alibaba → To make it easy to do business anywhere.

6
 BY TEJASWINEE PATANKAR

➢ ORGANISATIONAL CULTURE:-

Basic assumptions + Beliefs

Shared by members of an organisation

They operate unconsciously

Define in a basic taken for granted fashion.

An organisations view of itself and surroundings.

➢ Four layers of organisational culture:-

Value

Beliefs

Behaviours

Paradigm or (Taken for

granted assumption)

7
 BY TEJASWINEE PATANKAR

•Conduct of managers and employees.

•How is business conducted.
Value •Built to achieve mission.

•value
•norms Achievement of mission 2 goals &
Bed Rook Elements •standards possibilities.

•More specific.
•It decides how do people respond to insures.
Beliefs •Collective value & beliefs are more element rather
than individual value & beliefs

•How an organisation operates on a day to day

basis & can be seen by people inside and outside
Behaviours the organisation .
•It includes - work routine, structure, controlling
methods, softer issues.

•Hard to identify & explain

•Paradigm → They are common assumptions or
Assumptions taken for granted.

➢ CULTURES INFLUENCE ON STRRATEGY :-

• Nature → Taken for granted
• Why is it important for strategy.

Managing culture Culture as on drives of strategy

• A culture is difficult to - Observe , • It is difficult to change strategy

identify, control outside bounds of the culture
• Reason - It works in a taken for a • When changing business
granted manner. environment is forced.
• Managers try to cope with that in
terms of existing culture.

8
 BY TEJASWINEE PATANKAR

➢ ETHICAL BEHAVIOUR:-
A culture should include ethical behaviour
↓
Important actions to be taken

Explicitly articulate values → That emphasize ethical behaviour.

→ How is it done? - draft a code of ethics. A code of ethics is a formal
statement of it is ethical priority.

Repeatedly emphasise their importance and act on them.

Intuitive & reward system.

Ethical core values

Underly → vision statement to ensure – stability & long term success

Mission & competitive advantages.

➢ Goals:-

An organisation hopes to accomplish in future period of time.

A future state of outcomes of efforts

Goals → financial & non financial - issues are addressed

Close - ended attribute → Precise , expressed in specific terms.

9
 BY TEJASWINEE PATANKAR

➢ CHARACTERISTICS OF A STRATEGIC LEADER:-

Should be visionary & should be capable of clearly communicating his vision to others

Able to identify & articulate the business model ( used to obtain vision)

A sense of commitment towards the vision & business model through actions & words

Build a strong network of formal & informal source

Encourage & empower subordinates → decision making

Consensus for ideas rather than using authority.

➢ ORGANISATIONAL CHANGE:-

• Inevitable aspects
• Shows one’s commitment to growth & evaluation to stay
modern, competitive, relevant.
• Example of changes :
Leadership
changes

A complete Updated
restructuring thinking

Updating of
Shifts in
business
strategy
process

10
 BY TEJASWINEE PATANKAR

• To manage changes we use organisation change management

methods:

• Create → Build → Form → Enlist → Enable → Generate

Kotler's → Sustain → Institute
Process

• Hard 'S' → Rigid Soft 'S' → Flexible

Mckinsey's 7 • Style, Skills, Systems, Structures, Staff, Strategies, Shares Values &
'S' Frame Goals
Work

• Unfreezing , →Changing → Refreezing

Kurt Lewin's
Model

• Awareness → Desire → Knowledge → Ability → Reinforcement

ADKAR
Model

• Shock → Anger → Bargaining → Depression → Acceptance

Kubler Ross
Model

• Lats Status Quo → Resistance → Chaos →Integration → New Status

Satin Change Quo
Model

William • Ending → Natural Zone → New Beggining

Bridge's
Transition
Model

11
 BY TEJASWINEE PATANKAR

➢ Alignment with individual level objective & organisational

level objective:-

Personal objective 5-7 goal / employee Alignment?

• Job specific goals for • Activity based - such as • To achieve quantity &
individual employees. total revenue/ month/ quality of efforts
• What is implant. week. between individual
• What is expected out • To well until also and team.
of them. specify outcomes.

➢ SMART FRAMEWORK :-

• Inform an employee the exact result required for their

Specific performance to be successful
• Productivity↑ Effectiveness ↑

• Define matrices that can determine success & progress

Measurable • Quota given for employees.

• Ambitious + achievable
Attainable • Provides with tools & resources
• Within a specific

• A relevant objective will contribute to organisations

Relevant objective . e.g., growth

• Provides realistic time frames to complete the task.

Time waste • Provides proper deadlines to complete the task.
• e.g., next review can be deadlines.

12
 BY TEJASWINEE PATANKAR

➢ FAST FRAMEWORK:-

Introduced by peter drucker .

MBO- which is management by objectives.

Employees and management must agree on common goals.

Management were following smart framework , however some companies

like google and intel started using a new approach to utilize power of goals
to drive and align an action

They replaced smart with fast . goals must include - freq. discussion , ambitious
in scope, measured by specific matrices & milestones, transport.

➢ PERFORMANCE OBJECTIVE:-

They are set so that employees will know, what is expected from them and what they are
accountable for.

They can be performance based or development based.

They are measured differently in different companies.

They may also carry different weightage in different industry.

13
 BY TEJASWINEE PATANKAR

• EXAMPLES :-

Education & self

Productivity Quality & efficiency
development

Deals with manner

of performing
activities. The work force
This will specify keeps goals for self
certain work improvement and
expected in specific that can include
time frame new skills , new
It also deals with courses, etc,.
the speed at which
work is done.

➢ Reasons of aligning individual goals to organisational goals:-

Sustain employee Helps individuals to

motivation understand how their
• By measuring impact Help in prioritization of personal goals are
of their actions. tasks & responsibilities related to
organisational goals.
collaboration.

14
 BY TEJASWINEE PATANKAR

➢ TYPES OF OBJECT:-

• Financial performance targets to be achieved

Financial
• E.g., Annual revenue↑

• Related to target outcomes that indicates

where a company is strengthening its market
standing competitive position & future
business prospect.
Strategic
• E.g., Achieving low or overall cost than
competitors global sales & distribution
capacities than rivals innovative products and
service.

➢ BALANCE SCORECARD:-

• Steps in balanced scorecard:

Establish organisations strategic present → including

mission and vision.

Identify specific measures related to 4 perspectives.

1. financial , 2. Customer , 3. Internal , 4. Learning
innovation

Strategy mapping → Identification of organisational

activities derived from strategies

Qualitative measures should be established to

accumulate measure perform in specific areas.

15