The process of strategic management

1. The process of strategic management strategic management as a process consists of different phases. These phases are sequential in nature.

2. Phases in strategic management process Establishment of strategic intent Formulation Of strategies Implementation Of strategies Strategic evaluation Strategic control

3. There are four essential phases in the strategic management process • Establishing the hierarchy of strategic intent • Formulation of strategies • Implementation of strategies , and • Performing strategic evaluation and control

4. Establishing the hierarchy of strategic intent • Creating and communicating a vision • Designing a mission statement • Defining the business • Setting objectives

5. IOC’s Vision: “ Indian Oil aims to achieve international standards of excellence in all aspects of energy and diversified business with focus on customer delight through quality products and services.”

6. IOC’s mission : “ Maintaining national leadership in oil refining,marketing,and pipe line transportation .”

7. IOC’s objectives : “ Focusing on cost, quality, customer care, value addition and risk management .”

8. IOC’s corporate strategies : “ Expansion ,diversification and integration through strategic alliances and joint ventures”

9. IOC’s business : “ Harnessing new business opportunities in petrochemicals, power, and lube marketing.”

10. Formulation of strategies • Performing environmental appraisal, • Doing organizational appraisal, • Considering corporate level strategies, • Considering business level strategies, • Undertaking strategic analysis, • Exercising strategic choices, • Formulating strategies, • Preparing a strategic plan

11. Implementation of strategies : • Activating strategies • Designing structures and systems, • Managing behavioral implementation • Managing functional implementation • Opertionalising strategies

12. Performing strategic evaluation and control : • Performing strategic evaluation, • Exercising strategic control , and • Reformulating strategies.

13. Comprehensive model of strategic management process : Establishing strategic intent : Vision,mission,business definition Formulation of strategies: SWOT analysis etc.,Porter’s generic Business strategies,Competitive advantage, BCG matrix Strategic control Strategy implementation: Project,procedural,resource allocation, Structural,behavioural,functional And operational Strategic evaluation :

14. Environmental appraisal • Environment literally means the surroundings, external objects, influences or circumstances under which someone or something exists. • SWOT analysis

15. Environmental sectors : • Market environment • Technological environment • Supplier environment • Economic environment • Regulatory environment • Political environment • Socio-cultural environment • International environment

16. Organizational appraisal • It deals with the internal environment of an organization.

17. Frame work for the development of strategic advantage by an organization Strategic advantage Organizational capability Competencies Synergistic effects Strength & Weakness Organizational resources + Organizational behavior

18. Organizational capability factors • Financial capability • Marketing capability • Operations capability • Personnel capability • Information management capability • General management capability

19. Methods and techniques used for organizational appraisal : • Internal analysis • Comparative analysis • Comprehensive analysis

20. Internal analysis : A. Value chain analysis B. Quantitative analysis (i) Financial analysis (ii) Non-financial quantitative analysis C. Qualitative analysis

21. Comparative analysis : • Historical analysis • Industry norms • Benchmarking

22. Comprehensive analysis: • Balanced scorecard • Key factor rating

23. Balanced scorecard : • The balanced scorecard identifies four key performance measures as follows : • Customer perspective : “ How do customers see us ?” • Internal business perspective : “ What must we excel at ?”

24. Balanced scorecard : • Innovation and learning perspective : “ Can we continue to improve and create value?” • Financial perspective : “ How do we look at shareholders ?”