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Comprehensive Strategic Management Model-02

The document discusses strategic management. It outlines a strategic management model involving identifying a vision and mission, auditing internal and external environments, establishing long-term objectives, generating and selecting strategies, implementing strategies, and measuring performance. Benefits of strategic management include being proactive, improving financials, and gaining a better understanding of competitors. Reasons some firms do not strategically plan and the importance of business ethics to strategic management are also covered.

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Muhammad Aditya TM
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565 views25 pages

Comprehensive Strategic Management Model-02

The document discusses strategic management. It outlines a strategic management model involving identifying a vision and mission, auditing internal and external environments, establishing long-term objectives, generating and selecting strategies, implementing strategies, and measuring performance. Benefits of strategic management include being proactive, improving financials, and gaining a better understanding of competitors. Reasons some firms do not strategically plan and the importance of business ethics to strategic management are also covered.

Uploaded by

Muhammad Aditya TM
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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Dr.

Bagus Nurcahyo
bagus@staff.gunadarma.ac.id
bnur_c@yahoo.com
External
Audit

Implement
Generate, Measure &
Vision Implement Strategies:
Long-Term Evaluate, Strategies: Marketing, Evaluate
& Objectives Select Mgmt Issues Fin/Acct, Performance
Mission Strategies
R&D, CIS

Internal
Audit
Strategic Management
Model

Strategic Management Process

 Dynamic & Continuous


 More formal in larger organizations
Strategic Management
Model

1. Identify Existing --

• Vision
• Mission
• Objectives
• Strategies
Strategic Management
Model
2. Audit external environment
3. Audit internal environment
4. Establish long-term objectives
5. Generate, evaluate & select
strategies
6. Implement selected strategies
7. Measure & evaluate performance
Benefits of Strategic
Management

• Proactive in shaping firm’s future

• Initiate and influence firm’s activities


• Formulate better strategies
•Systematic, logical, rational
Benefits of Strategic
Management

Financial Benefits

• Improvement in sales
• Improvement in profitability
• Productivity improvement
Benefits of Strategic
Management

Non-Financial Benefits

• Improved understanding of competitors


strategies
• Enhanced awareness of threats
• Reduced resistance to change
• Enhanced problem-prevention capabilities
Benefits of Strategic
Management (Greenley)

1. Identification of Opportunities
2. Objective view of management problems
3. Improved coordination & control
4. Minimizes adverse conditions & changes
5. Decisions that better support objectives
Benefits of Strategic
Management (Greenley –
cont’d)

6. Effective allocation of time & resources


7. Internal communication among personnel
8. Integration of individual behaviors
9. Clarify individual responsibilities
10. Encourage forward thinking
Benefits of Strategic
Management (Greenley –
cont’d)

11. Encourages favorable attitude toward


change
12. Provides
discipline and formality to the
management of the business
Why Some Firms Do No
Strategic Planning

Poor reward structures


Fire-fighting
Waste of time
Too expensive
Laziness
Content with success
Why Some Firms Do No
Strategic Planning

Fear of failure
Overconfidence
Prior bad experience
Self-interest
Fear of the unknown
Suspicion
Business Ethics & Strategic
Management

Business Ethics defined –

 Principlesof conduct within organizations


that guide decision making and behavior
Business Ethics & Strategic
Management

Good business ethics –

 Prerequisite
for good strategic
management
Business Ethics & Strategic
Management

Code of business ethics –

 Providesbasis on which policies can be


devised to guide daily behavior and
decisions in the workplace
Business Ethics & Strategic
Management

Business practices always considered


unethical –

 Misleading advertising
 Misleading labeling
 Harm to the environment
 Insider trading
 Dumping flawed products on foreign markets
 Poor product or service safety
 Padding expense accounts
Natural Environment
Perspective

ISO used to gain strategic advantage

 ISO 9000 focuses on quality control


 > 1.5 million companies incorporate ISO
Natural Environment
Perspective

ISO 14000 standards

 Voluntary standards
 ISO 14001 standard for Environmental
Management System
 Firms minimize harmful effects on
environment
The Nature of Global
Competition

International/multinational corporations

 Parent company
 Host country
The Nature of Global
Competition

Strategy implementation may be difficult

 Cultural differences
• Norms
• Values
• Work ethic
Advantages of International
Operations

Absorb excess capacity


Reduce unit costs
Spread risk over wider markets
Low-cost production facilities
Advantages of International
Operations (cont’d)

Less intense competition


Lower taxes
Economies of scale
Disadvantages of
International Operations

Difficult communications
Underestimate foreign competition
Cultural barriers to effective management
Complications arising from currency
differences

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