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Strategic Management

Strategic Management. Strategic Management. The larger vision that guides the activities of managers and other employees in an organization

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Strategic Management

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  1. Strategic Management Strategic Management

  2. Strategic Management • The larger vision that guides the activities of managers and other employees in an organization • The set of decisions and actions used to formulate and implement strategies that will provide a competitively superior fit between the organization and its environment so as to achieve organizational goals • The process of establishing and sustaining competitive advantage Strategic Management

  3. Competitive Advantage • What is it? • An edge over your rivals • Traditional sources • Product and process technology • Protected and regulated markets • Access to financial resources • Economies of scale • New source • People !!! Strategic Management

  4. Levels of Strategy • Grand strategy • Where are we going? • Corporate • What business are we in? • Business-level • How do we compete? Strategic Management

  5. Analyze environment Identify OT Identify mission and strategies Formulate strategies Analyze organization Identify SW Feedback The Strategic Management Process Implement strategies Strategic Management

  6. SWOT Analysis Strength Opportunity Where are we going? Weakness Threat Strategic Management

  7. Grand Strategies • Growth • Stability • Retrenchment Strategic Management

  8. WalMart…Growth (Number of Stores) 6,141 24 Strategic Management

  9. Paths to Growth: WalMart • Direction of growth • New stores in existing markets • Enter new markets • New product lines • Means of growth • Greenfield • Acquisition Strategic Management

  10. WalMart…International Expansion and Acquisitions *Bailed out ** Not profitable Strategic Management

  11. General Electric – Overall Stability Earnings Before Taxes ($M) Strategic Management

  12. Kmart -- Decline Strategic Management

  13. Note that text combines global and home replication strategies Global Strategy: Four Choices Transnational Strategy Global Strategy High Cost and efficiency pressures Low Home Replication Strategy Multi domestic Strategy Low High Pressures for local responsiveness Strategic Management

  14. Corporate Level Strategy • Strategic business units • Diversification • Single business • Diversified • Vertical Integration • Conglomerate • BCG Matrix Strategic Management

  15. PowerEdge servers PowerVault and Dell | EMC storage products Services  PowerConnect switches OptiPlex desktops Latitude notebooks Dell Precision workstations Inspiron notebooks Dimension desktops Dell monitors Dell printers Axim handhelds Software and Peripherals Dell Products Single Product Strategic Management

  16. ThyssenKrupp Diversified Strategic Management

  17. Alcoa at a Glance • Alcoa is the world’s leading producer of primary aluminum, fabricated aluminum, and alumina and is active in all major aspects of the industry. • Alcoa serves the aerospace, automotive, packaging, building and construction, commercial transportation, and industrial markets, bringing design, engineering, production, and other capabilities of Alcoa’s businesses as a single solution to customers. • In addition to aluminum products and components, Alcoa also markets consumer brands including Reynolds Wrap® aluminum foil, Alcoa® wheels, and Baco® household wraps. Among its other businesses are vinyl siding, closures, precision castings, and electrical distribution systems for cars and trucks. Vertical Integration Strategic Management

  18. Sara Lee Conglomerate Headquarters Household Products Food and Beverage Intimates and Underwear Strategic Management

  19. Another Conglomerate Strategic Management

  20. Problem Children High Stars Market Growth Market Share Cash Cows Dogs Low High Low BCG Matrix Strategic Management

  21. What Business Are We In? • What are our core competencies? • Who are our customers? • Economies of scale • Economies of scope Strategic Management

  22. Business-Level Strategy • Porter’s Five Forces • Generic strategies • Value chain Strategic Management

  23. Porter’s Five Forces • Bargaining power of suppliers • Bargaining power of buyers • Threat of substitutes • Potential new entrants to the market • Rivalry among current competitors Strategic Management

  24. Porter’s Five Generic Strategies • Low-cost leadership • Broad differentiation • Best-cost provider • Focused or market niche / cost • Focused or market niche / differentiation Strategic Management

  25. Value Chain Analysis • How are we creating value for customers? • Where can costs be reduced? Strategic Management

  26. Product R &D, Technology, Systems Development Human Resource Management General Administration Support Activities The Value Chain Raw Materials Operations Distribution Sales and Marketing Customer Service Strategic Management

  27. Strategy Implementation • Leadership • Structure and design • Information and control systems • Human resources Strategic Management

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