Topic 1 Introduction To Strategic Management Large

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Redeemer Krah @ Kramankus ICA Family. Redeemer Krah @ Kramankus ICA Family.
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Contact 0243340420/dornkra@yahoo.com
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Introduction to Strategic
TOPIC 1
management
The discussion covers:
Meaning and characteristics of strategic
INTRODUCTION TO management
Levels of strategic management
STRATEGIC Strategic planning process
MANAGEMENT Contextualization of strategic management
Strategic Lenses and approaches.
Redeemer Krah @Kramankus ICA Family.

0243340420/dornkra@yahoo.com 1
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Characteristics of Strategic
1.Meaning of Strategy Management
 What is strategy?  Characteristics of strategic decisions include:
 No generally accepted definition of a strategy  strategic decisions are usually complex because it
affected organisation’s activities and hence affected by
several factors.
“Strategy is a course of action, including the specification
 Strategy involves linkage of organisation’s activities to its
of resources required, to achieve a specific objective”- environment which makes it susceptible to uncertainty.
CIMA  Strategy also links activities to resource capability of the
organisation
“Strategy is the direction and scope of an organisation over  Strategic decision significantly affect operational
decisions (it is felt at lowest level of the organisation)
the long term, which achieves advantage for the  Strategic decisions have holistic effect on the
organisation through the configuration of resources within a organisation
changing environment, to meet the needs of markets and to  Strategic decision often lead to organisational change
fulfil stakeholder expectations”. JSW  Strategic decisions are apt to affect the long-term
directions of the organisations.

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Strategic decisions coverage 2. Levels of Strategic Management

 Areas of strategic decision include:
Levels of Strategic Management
Long term direction (vision)
Scope of activities (what are we doing and not doing

Top Level
here?) l management Corporate
Strategy
 Advantage in competition
Middle level
 Environmental adaptability Management
Business Strategy
 Stakeholder expectation management

Lower level
Management Functional/Operational Strategy
 Organisation Change

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2. Levels of Strategic Management 2. Levels of Strategic Management

 Corporate Strategy (why & which?)  Business Strategy (The how?)
Concerns with the general direction of the whole  It is about how to achieve advantage over
organisation competitors
Concerns with the overall purpose and scope of It is about how to avoid competitive disadvantage
the organisation and how value will be added to and compete successfully in a particular market.
the different parts of the organisations. Operational Strategies (day to day how?)
Concerns with overall resource sourcing and Its concern about how the various functional units
allocation and choices. (marketing, HR, production, finance, IS, R&D)
Concerns with stakeholders expectation deliver effectively the corporate and business
strategies in terms of resources, processes and
people.

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Mini Case 1 3. Strategic Management Process

Kramankus is a service company in the second
year of the operation. The company intends to  How does an organisation create a
have 90% growth in clientele in next five years strategy?
and expanding its service line to five. The new Different models exist and choice depends on
service line according to the marketing manager organisation
will include consultancy, door step professional  Strategic planning models include:
tuition, and advocacy in public financial manage  Rational model -logical, formalized step-by step
and also operate in all the ten regions. The approach.
expansion will be financed by debt and shares.  Emergent approach (Mintzberg)-evolving, continuous
and incremental
 Incrementalism (Lindbolm)- smalll-scale extensions of
Q past practices
Identify the levels of strategies in the  Freewheeling opportunism –wait for opportunities and
Kramankus and indicate the strategies at take advantage
each level.

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Strategic Management Process Phase of Rational Model of strategic model

 Three Phases/strages
Rational Strategic Planning Process
Three phases /stages arise from the rational
Internal
Environment
model (Johnson Scholes and Whittington, JSW)
Strategic position analysis
Mission & Strategic Strat Eval & Strategy Review &
Strategic choices
Position
Strategic position
Objective Options choice Implement Control
Appraisal
on
External
Environment
Strat egi c Posi ti on Anal ysi s Strat egi c Choi ce Strat egi c Impl ement ati on
(Posi ti on) (choi ce) (Acti on)
(Poi

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Illustration Strategic Management

Strategic Management Process
Process
Three Phases of Strategic management  Illustration on the Phases of strategic
management
Phases description Issues involved  A full-price airline is considering setting up a no-
Strategic position analysis • Environment analysis frils, low fare subsidiary. The strategic planning
• Capacity (resource & competence
• Stakeholder expectations and Analysis process (JSW) will include
 Strategic analysis- competitor action, oil price forecast,
Strategic choices • Competitive advantage based on knowledge of passenger volume forecast, landing rights, public concern
customers and markets (environmental issues), effect on main brand
• Scope of activates
 Strategic choices- which routes to launch? Set up a
subsidiary or acquire existing one?, which plane to use?
Strategy implementation • Structuring (process, relationship, org structure Which on board services to offer?
(action) etc)
 Strategic implementation- set up new subsidiary.
• Enabling (resource use to support and create
strategy –detailed plans and budget)
Recruitment and training issues, acquisition of aircraft,
• Monitoring and control getting landing right etc
• Change management

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Long term strategic planning (rational

4. Contextualization of Strategic management model) - Advantages
 The context of a strategy is the organisational
 Advantages of rational planning process
setting in which it is developed.
are:
Context affects strategic decisions thereby you
Forces managers to look ahead in order for the
need to understand the context in which the
firm to stay relevant in its market and survive.
strategy is developed and implemented.
 Improved control and goal congruence due to
The typical context that you must consider in
well defined mission, objectives and targets.
your strategic decision include:
 Identifying key risk exposures and developing
Small business context contingency plans to deal with them.
Multinationals Encourages creativity and innovation as
Public sector and not for profit ( 3Es model) development of ideas are crucial in strategic
 Intangible products planning

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Long term planning model-

5. Strategic lenses and approaches
disadvantages
Disadvantages include  The way strategy is perceived will determined the
 Difficulty in formulation of acceptable and meaning attached to it.
effective mission and objectives.
 There are three lenses (perspectives)
 Short termism pressure (meeting short terms
goals at expense of long term)  Strategy as design – Rational model of planning
Forecasting in uncertain conditions (traditional view)
Bounded rationality due to human inability to
predict the future with certainty  Strategy as experience – reliance on past experience
Rigidity in plans ( only fools don’t change their as in emergent strategy of Mintzberg.
minds)
High cost in formulating long term plans
Management distrust and resistance. Some  Strategy as idea – strategy is result of innovations
managers just believe in it. and ideas rather than a formal step to step process.

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5. Strategic lenses and approaches

 The approach adopted by an organisation does Now we Know!
not only rely on the lenses but prioritization of
the lenses in varying manner.
Thus there are three approaches (orientations) Reflections!
 Traditional approach- prioritises stakeholders What do you now!
expectation in setting objective. Aims at Creating
market-objective misfit.
 Market led/positioning approach – starts with
analysis of markets and competitors’ actions before Coming next…. Mission & Objective
setting objectives. It achieve environment-objective fit.
 Resource –based/competence led approach-
focusing on what the firm is good at (core
competences). Looks for critical success factor.


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14/07/2016

STRATEGIC Strategic planning process

MANAGEMENT Contextualization of strategic management

Strategic Lenses and approaches.

Redeemer Krah @Kramankus ICA Family.

Redeemer Krah @Kramankus ICA Family.

Strategic decisions coverage 2. Levels of Strategic Management

Scope of activities (what are we doing and not doing

 Stakeholder expectation management

Redeemer Krah @Kramankus ICA Family.

2. Levels of Strategic Management 2. Levels of Strategic Management

Redeemer Krah @Kramankus ICA Family.

Mini Case 1 3. Strategic Management Process

Redeemer Krah @Kramankus ICA Family.

Strategic Management Process Phase of Rational Model of strategic model

Redeemer Krah @Kramankus ICA Family.

Illustration Strategic Management

Redeemer Krah @Kramankus ICA Family.

Long term strategic planning (rational

Redeemer Krah @Kramankus ICA Family.

Long term planning model-

Redeemer Krah @Kramankus ICA Family.

5. Strategic lenses and approaches

Redeemer Krah @Kramankus ICA Family.

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