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LECTURE 03

LECTURE 03. MGT686. Objectives needed at all levels. Parts supporting the whole Top-down objective-setting - cohesion - leadership. Approaches to performing the strategy making tasks. Master strategist: manager is chief architect Delegate to others Collaborative approach

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LECTURE 03

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  1. LECTURE 03 MGT686

  2. Objectives needed at all levels Parts supporting the whole Top-down objective-setting - cohesion - leadership

  3. Approaches to performing the strategy making tasks Master strategist: manager is chief architect Delegate to others Collaborative approach Champion approach

  4. External Society political regulatory Industry Attractive- ness Opportunity threat Factors that shape strategy Craft a Strategy Evaluation Choice Company’s strategic situation Strengths weakness Manager values / ambitions Culture Internal

  5. Societal, Political, Regulatory Conditions Limit the strategic actions that a company can or should take May cause company to change strategy anti-smoking lobby (direct mkg/advertising) lead-free petrol (eg Pura) recycling

  6. Industry Attractiveness Strategy must be matched to industry and competitive conditions eg. technology shift change in cost structure of industry

  7. Market Opportunities and Threats Be open to opportunities Aim at capturing best growth opportunities Defend against threats to well-being and future performance

  8. Organisational Strengths and Weaknesses Strategy must be well-matched to the company’s strengths strategy should be grounded in what company is good at doing perilous to depend on what it’s not good at

  9. Manager’s Values, Beliefs and Ambitions Management play a pivotal role Strong leadership builds commitment Management communication - ‘buy-in’

  10. Strategy formulation: deciding what to do what you might do: opportunity what you can do: resources what you’d like to do: values/ ambitions what you ought to do: ethics

  11. Tests for a good strategy • Goodness of fit test • matches well the company’s situation • internal • external • Competitive advantage test • leads to sustainable competitive advantage • Performance test • leads to superior performance • profitability • long term business/ market position strength

  12. Benefits of a Strategic Approach Direction Adaptable / in-tune with environment Basis for budget/resource allocation Unifies decisions across organisation Encourages pro-active management Requires strategic thinking rather than gut-feel/drift

  13. THANK YOU

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