BUSINESS STRATEGY

BUSINESS STRATEGY UNIT STRUCTURE

Section 1: Business strategy Section 2: Case Study: Samsung Section 3: Case Study: Maersk Section 4: Business Strategy Models Section 5: Company Profiles Section 6: Student Presentations

BUSINESS STRATEGY UNIT STRUCTURE

Section 1: Business strategy Section 2: Case Study: Samsung Section 3: Case Study: Maersk Section 4: Business Strategy Models Section 5: Company Profiles Section 6: Student Presentations

BUSINESS STRATEGY STRATEGIC PLANNING

Strategy Derives from the Greek strategos meaning a general Associated with Greek words such as army and lead Concept Long associated with military and national statecraft Involves a broader perspective General von Clausewitz (1805) Tactics T ti constitute the theory of the use of armed tit t th th f th f d forces in battle; strategy forms the theory of using battle for the purpose of war Strategy = The purpose of going to war (goal) Tactics = how to win battles

BUSINESS STRATEGY STRATEGIC PLANNING

Strategic Planning In modern business emerged after WWII Commerce became increasingly separated from State Business complexity increased Speed of communications improved Forced rapid decision-making Business adopted military techniques Peter Drucker The Practice of Management (1954) Management has no choice but to anticipate the future, to attempt to mold it and to balance short-range and long short range -range goals. Management must, with every decision, make provision for molding the future as far as possible toward the predicted shape of things to come -Management have to predict the future -Management have to influence the future -Balance short term and long term goals

BUSINESS STRATEGY EMERGING THEORY

Strategic Planning took two paths Decision-Process Focused on quantifying data and mathematical modeling Change-Process A behaviorist approach focusing on the organizations environmental context.

Modern strategic thinking combines both approaches

BUSINESS STRATEGY PUT SIMPLY Strategic Planning Process

Where do we want to be? Wh d tt b ?

Where are we now?

How do we get there?

BUSINESS STRATEGY STRATEGIC PLAN - PURPOSE

What we do now How well do we do it What we will be doing in the future Confirm core values Establish purpose (Vision and Mission) Ensure purpose is understood by: Our customers Our suppliers and other stakeholders Our O employees l Create common understanding of where we should be and how we are going to get there Establish a process for change Ongoing review Action plans

BUSINESS STRATEGY SHOULD BE:

Statement of ends, purpose, and intent Should inspire Underlying direction High level plan Provide a means of achieving the purpose Who, when, where how and with what Means of beating the competition Aim of a strategy is to win Keep ahead of the competitors (who are they) An element of leadership Leaders of an enterprise must agree with the strategy New leaders often mean new strategies Positioning for the future Preparation for uncertainty of the future Make the enterprise adaptable to survive change Building capability Match capabilities and opportunities Result of deep involvement with the business Aligned with the behavior and culture of the enterprise In reality emerge and is an iterative process
Source: Strategic Management Macmillan and Tampoe 2000

BUSINESS STRATEGY LEVELS

INCREASING Scope p Strategic Level Time horizon Uncertainty Complexity Tactical Level

Operational Level

BUSINESS STRATEGY STRATEGIC LEVEL

Concerned with Acquisition of sustainable competitive advantage Setting long-term corporate objectives Formulating, evaluating, selecting and monitoring g g g g strategies to achieve those objectives Made by senior managers (directors) Affect whole organization Long-term in nature Complex and based upon uncertain information Senior managers require multi-conceptual skills consider effects of multiple internal and external influences on business and organisation.
Strategic Level

Tactical Level

Operational Level

BUSINESS STRATEGY STRATEGIC PLANNING - ELEMENTS

Internal & external Environment Managerial effectiveness Market and competition Identify Id tif opportunities t iti Strategic analysis AWARENESS Common Purpose Strategy Strategic planning Long term planning Short t Sh t term planning l i Organizational & operational planning PLANNING

Goal tracking Critical success factors Measurement tools Compare plan to actual Identify additional needs

RESULTS

DEVELOPMENT

Goal setting Actions plans Productivity & sales Leadership & management

Motivation & team development Communication

BUSINESS STRATEGY STRATEGIC PLANNING - ELEMENTS

What is happening - internal & external - Competition & market How good are we? H d ? What opportunities exist AWARENESS Common Purpose Strategy Strategic planning Long term planning Short t Sh t term planning l i Organizational & operational planning PLANNING

Record performance Assess progress Compare actual to goals Identify divergence Propose new goals etc

RESULTS

DEVELOPMENT

Set goals Create action plans Align productivity & sales targets

Establish appropriate culture Align staff, clients, stakeholders

BUSINESS STRATEGY SHOULD WE CO-OPERATE & WHO WITH

Collusion: manage capacity supply and raise prices: Liner conferences, OPEC Strategic Alliances: advantages include: obtain technology, access to specific market, reduce financial and political risks, learn new capabilities market risks global agreements CKYH. Mutual service consortia: partnership with similar companies to share resource (too expensive to develop alone): trade route agreements Joint ventures: disadvantages include: the loss of control, lower profit, conflict potential, possible technology transfer Licensing arrangements, franchising Value-chain partnerships: alliance with key suppliers or distributors Mutual Service JV, Licensing Value chain partnership

Weak & Distant

Strong & Close

BUSINESS STRATEGY SHOULD WE INNOVATE

Strategy Leader
-Pioneer low cost product design & processes - 1st to market - Establish powerful brand position - Easier to attract high caliber staff - Unique product - Innovate service / marketing - Compete against old solutions - 1st to market - Innovation failure - Product recall - Regulatory challenge - Market acceptance - Develop latent demand

Follower
- Learn from leader - Avoid R&D costs - Gain market understanding - Lower cost manufacturing

Cost advantage

Differentiation

- Ensure product fits buyers needs - Position against know product

Risks

- Brand reputation of follower / conservative - Compete against 1st to market product - Higher cost structure until innovation occurs - Cost of catch up

BUSINESS STRATEGY SUPPLIER MANAGEMENT

Multiple sourcing Competition amongst suppliers to reduce unit cost Supplies are always on hand Lowest bid is a compromise with quality No commitment Sole sourcing High supplier quality q alit Buyer and supplier work closely together. Problems cause delay to production process. Long term commitment Parallel sourcing Two suppliers are a e the sole suppliers of two different parts, but they are also backup suppliers for each others part. Long term commitment Make or Buy Outsource Internal l production Protect core expertise

BUSINESS STRATEGY TACTICAL LEVEL

Concerned with How corporate objectives are to be met How strategies are implemented Dependent upon overall strategy and involve its finetuning and adjustment Made at head of business unit, department or functional area level Affect only parts of the organization They are medium-term in timescale, semi-complex Usually involve some uncertainty, but not as much as at the strategic level
Strategic Level

Tactical Level

Operational Level

BUSINESS STRATEGY OPERATIONAL LEVEL

BUSINESS STRATEGY UNIT STRUCTURE

Section 1: Business strategy Section 2: Case Study: Samsung Section 3: Case Study: Maersk Section 4: Business Strategy Models Section 5: Company Profiles Section 6: Student Presentations

CASE STUDY SAMSUNG ELECTRONICS VISION 2020

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CASE STUDY SAMSUNG ELECTRONICS VALUE SYSTEM

CASE STUDY SAMSUNG ELECTRONICS CORE VALUES

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CASE STUDY SAMSUNG ELECTRONICS 3 VISIONS

CASE STUDY SAMSUNG ELECTRONICS VISION 2020 SUMMARY

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CASE STUDY SAMSUNG ELECTRONICS VISION 2020 SUMMARY

CASE STUDY SAMSUNG ELECTRONICS CORE PRODUCT FOCUS

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CASE STUDY SAMSUNG ELECTRONICS TARGETS

CASE STUDY SAMSUNG ELECTRONICS PURCHASING ETHICS

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CASE STUDY SAMSUNG ELECTRONICS GREEN MANAGEMENT

CASE STUDY SAMSUNG ELECTRONICS GREEN MANAGEMENT

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CASE STUDY SAMSUNG ELECTRONICS GREEN MANAGEMENT

CASE STUDY SAMSUNG ELECTRONICS VISION 2020 - 2010

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CASE STUDY SAMSUNG ELECTRONICS SUPPLY CHAIN LEADERSHIP

BUSINESS STRATEGY UNIT STRUCTURE

Section 1: Business strategy Section 2: Case Study: Samsung Section 3: Case Study: Maersk Section 4: Business Strategy Models Section 5: Company Profiles Section 6: Student Presentations

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CASE STUDY MAERSK MAERSK GROUP & MAERSK LINE

CASE STUDY MAERSK MAERSK GROUP VALUES

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CASE STUDY MAERSK MAERSK LINE VALUES

CASE STUDY MAERSK MAERSK LINE CLIENT COMMUNICATION

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CASE STUDY MAERSK MAERSK LINE CLIENT COMMUNICATION

CASE STUDY MAERSK MAERSK LINE PROCUREMENT

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CASE STUDY MAERSK MAERSK LINE EXTERNAL SCANNING

CASE STUDY MAERSK MAERSK LINE EXTERNAL SCANNING

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CASE STUDY MAERSK MAERSK LINE 2015 VISION

CASE STUDY MAERSK MAERSK LINE SOCIAL RESPONSIBILITY

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CASE STUDY MAERSK

MAERSK LINE ENVIROMENTAL RESPONSIBILITY

CASE STUDY MAERSK

MAERSK LINE ENVIROMENTAL RESPONSIBILITY

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CASE STUDY MAERSK MAERSK LINE STRATEGY OF OPENNESS

CASE STUDY MAERSK CEO INTERVIEW

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CASE STUDY MAERSK

TRIPLE E CLASS

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