1. Strategic Management

2. If you don’t have a map, any route you take will get you where you are going. Peter Drucker
If a man take no thought about what is distant, he will soon find sorrow near at hand. He who will not worry about what is far off will soon find something worse than worry.
Confucius

3. Strategic Planning What is the strategic management process?
External environment analysis
Internal environment and strategic direction
SWOT analysis
Formulation, Implementation and Control

4. Strategic Management Process
External and Internal Environmental Analysis
Strategic Direction
Strategy Formulation
Strategy Implementation and Control
Strategic Restructuring

5. Strategy and Strategic Management
Strategy and Competitive Advantage
Strategy is an action focus that links an organization to its environment

6. Strategy and Strategic Management
The Strategic Management Process
the process of formulating and implementing strategies to advance an organization’s mission and objectives and secure competitive advantage

7. Strategy and Strategic Management
The Strategic Management Process
Strategy formulation (Drucker)
What is our business mission?
Who are our customers?
What do our customers consider value?
What have been our results?
What is our plan?

8. Strategy and Strategic Management
The Strategic Management Process
Strategy implementation
putting plans into action

9. Strategy and Strategic Management
Analysis of Mission, Values, and Objectives
Mission statement
domain
customers
products and/or services
location
philosophy

10. Strategy and Strategic Management
Analysis of Mission, Values, and Objectives
Strategic constituencies analysis
assessment of how well the organization serves stakeholders

11. Strategy and Strategic Management
Analysis of Mission, Values, and Objectives
Core values
broad beliefs about what is/is not appropriate
Objectives
direct activities toward key and specific results

12. SWOT
Opportunities
Weaknesses
Strengths
Threats

13. Strategy and Strategic Management
Analysis of Organizational Resources and Capabilities
SWOT analysis
Organizational
Strengths
Weaknesses
Environmental
Opportunities
Threats

14. Situation Analysis (SWOT)
Strengths
What resources and capabilities do you possess that can lead to a competitive advantage for position and market share in the industry?

15. Situation Analysis (SWOT)
Weaknesses
What resources and capabilities do you not possess, but are necessary to compete for position and market share in the industry?

16. Situation Analysis (SWOT)
Opportunities
Conditions in the external environment that that allow you to take advantage of your strengths, overcome your weaknesses or neutralize threats.

17. Situation Analysis (SWOT)
Threats
Conditions in the external environment that may stand in the way of achieving corporate goals and objectives.

18. Strategies Used by Organizations
Levels of Strategy
corporate
business
functional

19. Strategies Used by Organizations
Types of Strategies
growth
concentration
diversification

20. Strategies Used by Organizations
Types of Strategies
retrenchment (defensive)
turnaround
divestiture
liquidation

21. Strategies Used by Organizations
Types of Strategies
stability
combination
used by large and complex organizations

22. Strategy Formulation Opportunities for Competitive Advantage
Cost and quality
Knowledge and timing
Barriers to entry
Financial resources

23. Strategy Formulation Boston Consulting Group (BCG) Matrix
ties strategy formulation to analysis of business opportunities according to market growth rate and market share
stars
cash cows
question marks
dogs

24. Strategy Formulation Portfolio Planning
investing scarce organizational resources among competing business opportunities

25. Porter’s Five Competitive Forces
New Entries
Industry Environment
Direct Competition
Buyers
Suppliers
Substitutes

26. Competition The healthcare industry: Complex Highly competitive
High tempo of change
External Environment
Highly demanding consumers, Government regulation
New entries
Group practice, Ambulatory centers

27. Competition (con’t) Buyers Suppliers Substitutes Employers
Health plans
Suppliers
Physicians
Substitutes
Generic Rx
Alternative health care

28. Strategy Formulation Porter’s Competitive Strategies Model
new competitors
bargaining power of suppliers
bargaining power of customers
threats of substitute products and services
competition between existing companies

29. Strategy Formulation Porter’s Competitive Strategies Model
Strategies to Gain Competitive Advantage
differentiation
cost leadership
focus

30. Business Strategy (Domain and Navigation)
Low-Cost leadership (volume discounts)
Differentiation (set apart from other competitors)
Focused (a niche market combining differentiation and low-cost leadership)

31. Strategy Formulation Corporate Strategy (Domain) Specialization/niche
Vertical integration (forward and backward)
Horizontal integration
Diversification
Retrenchment or divestiture
Strategic alliances (joint ventures, mergers and consolidations)

32. Strategy Formulation Product Life Cycles Stages introduction growth
maturity
decline

33. Strategy Formulation Emergent Strategies Logical incrementalism
develop progressively over time
Logical incrementalism
strategies that develop as modest adjustments to past patterns

34. Strategy Implementation
Strategic Management Failures
Substance
inadequate attention to major strategic planning elements
Process
poor handling of strategy implementation

35. Strategy Implementation
Leadership and Top Management Teams
effective strategy implementation depends on all managers
Corporate Governance
boards of directors
inside
outside

36. Strategy and Entrepreneurship
Who are the Entrepreneurs?
Risk-taking individuals who pursue opportunities that others do not see

37. Strategy and Entrepreneurship
Typical Characteristics of Entrepreneurs
internal locus of control
high energy level
high need for achievement
tolerance for ambiguity
self-confidence
action oriented

38. Strategy and Entrepreneurship
Entrepreneurship and Small Business
Small business
fewer than 500 employees
most common type of business in the U.S.
high failure rate

39. Strategy and Entrepreneurship
Small Business Development
Small Business Administration (SBA)
Small Business Development Centers
offer guidance on how to run a business successfully

40. Strategy and Entrepreneurship
Entrepreneurship and Large Enterprises
intrapreneurship
entrepreneurial behavior within large organizations
skunk works
groups of employees work in a creative setting