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1st Chapter - Introduction To Strategic Management

The document provides an overview of strategic management, including: 1) It defines strategic management as a process that examines present and future environments to formulate objectives and make decisions to achieve those objectives. 2) The strategic management process involves 5 steps - goal setting, analysis, strategy formulation, implementation, and evaluation. 3) Corporate governance and stakeholder management play important roles in ensuring strategic decisions are made in stakeholders' interests.

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Cláudio Henrique CH
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161 views25 pages

1st Chapter - Introduction To Strategic Management

The document provides an overview of strategic management, including: 1) It defines strategic management as a process that examines present and future environments to formulate objectives and make decisions to achieve those objectives. 2) The strategic management process involves 5 steps - goal setting, analysis, strategy formulation, implementation, and evaluation. 3) Corporate governance and stakeholder management play important roles in ensuring strategic decisions are made in stakeholders' interests.

Uploaded by

Cláudio Henrique CH
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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Strategic Management:

Creating Competitive Advantages

Prepared and presented by:


CLAUDIO V. HENRIQUE
July 4th , 2019
CHAPTER OUTLINE
• Introduction to Strategic Management
• Concept of Strategic Management
• Strategic Management Process
• Role of Corporate Governance and Stakeholder Management
• Strategic Management Perspective
• Ensuring Coherence in Strategic Management
Introduction to Strategic Management
• Why do some companies succeed while others fail?

• “Strategic management” as a term and concept is not new. The term was
first used in the 1970’s, and it meant that a staff of strategic planners more
or less thought up strategic programs and then tried to sell them to
decision makers.
Concept of Strategic Management
• The term strategic management is used to refer to the entire scope of
strategic-decision making activity in an organization.

• Strategic management as a concept has evolved over time and will


continue to evolve. As result there are a variety of meanings and
interpretations depending on the author and sources. For example, some
scholars and practitioners the term strategic planning connote the total
strategic management activities.
Concept of Strategic Management
• Moreover, sometimes managers use the terms strategic management,
strategic planning, and long-range planning interchangeable. Finally, some
of the phrases are used interchangeably with strategic management are
strategy and policy formulation, and business policy

• Strategic management is the process of managing the pursuit of


organizational mission while managing the relationship of the organization
to its environment (James M. Higgins).
Concept of Strategic Management
• Strategic management is defined as the set of decisions and actions
resulting in the formulation and implementation of strategies designed to
achieve the objectives of the organization (John A. Pearce II and Richard
B. Robinson, Jr.).

• Strategic management is the process of examining both present and


future environments, formulating the organization's objectives, and
making, implementing, and controlling decisions focused on achieving
these objectives in the present and future environments (Garry D. Smith,
Danny R. Arnold, Bobby G. Bizzell).
Concept of Strategic Management
• Strategic management is a continuous process that involves attempts to
match or fit the organization with its changing environment in the most
advantageous way possible
Strategic Management Process
• The strategic management process is concerned with a long-run
perspective. The time horizon involved often is at least 3 years and
normally may be 5 or 10 years into the future. However, in certain
extremely dynamic industries, the strategic management process could be
concerned with much shorter time frames.
Strategic Management Process
• Strategic Management Process is an ongoing process of five steps which
defines the way an organization makes its strategy to achieve its goals.

• Using Strategic Management Process, an organization decides to


implement a selected few strategies along with stakeholders, details the
implementation plan and keeps on appraising the progress & success of
implementation through regular assessment.

• The five stages of strategic management process are shown in the next
slide
Strategic Management Process
Strategic Management Process

GOAL SETTING

EVALUATION SMP ANALYSIS

IMPLEMENTATION FORMULATION
Strategic Management Process
• Goal Setting:
The vision and goals of the organization are clearly stated. The short-term
and long-term goals are defined, processes to achieve the objectives are
identified and current staff is evaluated to choose capable people to work on
the processes. This can be done through proper environmental scanning.
Strategic Management Process
• Analysis:
• Data relevant to achieve the goals of the organization is gathered,
potential internal and external factors that can affect the sustainable
growth of the organization are examined and SWOT analysis is also
performed.
Strategic Management Process
• Strategy Formulation:
• Once the analysis is done, the organization moves to the Strategy
Formulation stage where the plan to acquire the required resources is
designed, prioritization of the issues facing the business is done and finally
the strategy is formulated accordingly
Strategic Management Process
• Implementation:
• After formulation of the strategy, the employees of the organization are
clearly made aware of their roles and responsibilities. It is ensured that
funds would be available all the time. Then the implementation begins.
Strategic Management Process
• Strategy Evaluation:
• In this process, the strategies being implemented are evaluated regularly
to check whether they are on track and are providing the desired results. In
case of deviations, the corrective actions are taken.

• As shown in the figure, the five stages are not stand-alone and constantly
interact with each other in order to ensure better management of the
business.
Strategic Management Process
• Limitations of Strategic Management Process
• Strategic Management process is not an objective one time process which
would yield the expected results in the first attempt. Optimizing the
strategic management process for the organization may take time. The 5
steps stated above may have to be revisited multiple times and still the
results may differ.

• The main limitation is the time it would take to completely tune and
manage the process for a particular organization in order to see real
benefits but having said that strategic management process if mastered
properly can lead to serious advantage for the organizations.
Role of Corporate Governance and
Stakeholder Management
• One of the important roles of corporate governance is to ensure that
strategic decisions are made in the interest of the with a stake in
successful outcome.

• Roles of Corporate governance


• Policy Setting
• Stablishing Corporate Strategy
• Assurance that Actions Support Strategic Positions
• Monitoring Investment Decisions and Capital Investment.
• Accountability to Stakeholders
Role of Corporate Governance and
Stakeholder Management
• Stakeholders are usually partied who have a stake in a project and have a
great influence on its success or failure. They may be equity or preference
shareholders, employees, the government agencies, contractors, financial
institutions, competitors, suppliers and the general public.

• Stakeholders play different roles within management, depending on


responsibilities, rules and titles formulated during the formation of a project
or during its growth
Role of Corporate Governance and
Stakeholder Management
• Here are some roles played y the stakeholders
• Voting and Decision Making
• Providing Expertise
• Managing Industrial Crises
• Corporate Social Responsibility
Strategic Management Perspective
• The strategic management perspective: an imperative throughout the
organization

• To succeed, firm must align workers in all functional areas to make


decisions and strive toward goals

• Need for strategic perspective & greater involvement throughout


organization driving forces
• Globalization
• Technology
• Intellectual capital
Strategic Management Perspective
• Leaders are needed throughout organization
• Top executives are essential for setting the tone and serve as catalysts for
employees to take charge

• To have strategic management perspectives throughout organization ,


changes might have to be made
Ensuring Coherence in Strategic
Management
• Massively inspiring, overarching and long term
• Articulates managements desired future state of the company
• Developing mission = leaders central role
• Broad and enduring
• Visions should capture minds and hearts of employees
• Vision can be slogan, picture must grab attention
Ensuring Coherence in Strategic
Management
• Vision may or may not succeed – it might fail because:
• If management behaviors doesn’t match the great vision they displayed
• Irrelevance vision ignores the needs of those expected to buy into it
• Vision cant cure organization from illness not an elusive solution to solve all
problems
• Vision cant ignore reality cant just be a rosy picture of the future
• Tunnel vision too much focus on a concrete vision should be flexible
Thank You

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