MGMT 300 Chapters 5 & 6 PPT: Strategic Management

Strategos
the Greek word for ‘strategy’ – the art of the army general
Strategic Management
the process of identifying an organization’s mission, stakeholders, and goals and objectives, analyzing environments, formulating strategies, implementing strategies, and evaluating the effectiveness of our strategies
Key Attributes of Strategic Management:
goal driven

includes multiple stakeholders in the decision-making process

incorporates both short-term and long-term perspectives

alignment between all aspects of an organization’s strategy (mission, goals and objectives, strategies, etc.)

Identify
Analyze
Formulate
Implement
Evaluate
5 Steps in the Strategic Management Process:
Vision Statements
forward looking, inspirational statements of what an organization hopes to become
Values
help describe an organization’s culture; can guide organizational decision making by reminding employees what really matters
Stakeholder Analysis
involves identifying the people and/or organizations that can impact, or are affected by, an organization’s successes and failures
includes: employees, suppliers, buyers, community, natural environment
Strategic Goals
broad statements of what an organization hopes to achieve

goals should:
– be outcome oriented
– help to guide the development of strategies

Strategic Objectives
narrowly focused, tangible statements of how goals will be achieved (should be SMART)
Step 2: Analyze (internal and external environments)
SWOT analysis
PESTEL analysis
VRIO analysis
SWOT Analysis
useful tool for internal and external environmental analysis
– Strengths and Weaknesses stem from an organization’s own internal environment
– Opportunities and Threats stem from an organization’s external environment
Political
Economic
Social
Technological
Environmental
Legal
PESTEL Analysis
VRIO Analysis
to provide sustainable competitive advantage,
resources must be:
– Valuable
– Rare
– Inimitable
– Organized
Path Dependence
Social Complexity
Causal Ambiguity
Uniqueness
Non-substitutable
5 Sources of Inimitability:
attributes of the product
relationship between firm and customers
linkages within or between firms
What are some common sources of differentiation?
economies of scale
economies of learning
input costs (location, differential access to inputs)
What are common drivers of low cost leadership