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The Nature of Strategic Management

The document provides an overview of strategic management, including its definition, key components, and benefits. It discusses the formulation of strategy, which involves analyzing external opportunities/threats and internal strengths/weaknesses to develop long-term objectives and strategies. It also discusses implementing strategies through annual objectives, policies, and resource allocation, and evaluating strategies using internal/external reviews and performance metrics. The overall aim is achieving sustained competitive advantage by adapting to changes in trends, capabilities, and resources, and effectively formulating, implementing, and evaluating strategies.

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32 views14 pages

The Nature of Strategic Management

The document provides an overview of strategic management, including its definition, key components, and benefits. It discusses the formulation of strategy, which involves analyzing external opportunities/threats and internal strengths/weaknesses to develop long-term objectives and strategies. It also discusses implementing strategies through annual objectives, policies, and resource allocation, and evaluating strategies using internal/external reviews and performance metrics. The overall aim is achieving sustained competitive advantage by adapting to changes in trends, capabilities, and resources, and effectively formulating, implementing, and evaluating strategies.

Uploaded by

duit
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPT, PDF, TXT or read online on Scribd
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Chapter 1

The Nature of Strategic Management

Ch 1 - 1
Definition of Strategic Management

Art & science of formulating,


implementing, and evaluating,
cross-functional decisions that
enable an organization to achieve
its objectives

Ch 1 - 2
Strategy Formulation

Vision & Mission

External Opportunities & Threats

Internal Strengths & Weaknesses

Long-Term Objectives

Alternative Strategies

Strategy Selection

Ch 1 - 3
Strategy Implementation

Annual Objectives

Policies

Employee Motivation

Resource Allocation

Ch 1 - 4
Strategy Evaluation

Internal Review

External Review

Performance Metrics

Corrective Actions

Ch 1 - 5
Comprehensive Strategic Management Model
External
Audit

Chapter 3

Long-Term Generate, Implement Implement Measure &


Vision
Objectives Evaluate, Strategies: Strategies: Evaluate
&
Select Mgmt Issues Marketing, Performance
Mission
Strategies Fin/Acct,
R&D, CIS
Chapter 2 Chapter 5 Chapter 6 Chapter 7 Chapter 8 Chapter 9

Internal
Audit

Chapter 4

Ch 1 - 6
Aim of strategic management: Achieving
Sustained Competitive Advantage

1. Adapting to change in external trends,


internal capabilities and resources

2. Effectively formulating, implementing &


evaluating strategies

Ch 1 - 7
Adapting to Change – Key Strategic
Management Questions

• What kind of business should we


become?
• Are we in the right fields?
• Are there new competitors
• What strategies should we
pursue?
• How are our customers changing?

Ch 1 - 8
The answers to those key questions
are usually stated in:

Vision Statement –
What do we want to become?

Mission Statement –
What is our business?

Ch 1 - 9
To realize its vision & mission firms must
know:
Opportunities & Threats (External)

Analysis of Trends:
• Economic
• Social
• Cultural
• Demographic/Environmental
• Political, Legal, Governmental
• Technological
• Competitors

Ch 1 - 10
Strengths & Weaknesses (Internal)

Typically located in functional areas of the firm


• Management
• Marketing
• Finance/Accounting
• Production/Operations
• Research & Development
• Computer Information Systems

Ch 1 - 11
Key Terms

Strategies

Means by which long-term objectives are


achieved

Ch 1 - 12
Benefits of Strategic
Management

Financial Benefits

• Improvement in sales
• Improvement in profitability
• Productivity improvement

Ch 1 - 13
Benefits of Strategic
Management

Non-Financial Benefits

• Improved understanding of competitors strategies


• Enhanced awareness of threats
• Reduced resistance to change
• Enhanced problem-prevention capabilities

Ch 1 - 14

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