1. Copyright 2005 Prentice Hall 1 Bus 411 Day 14

2. Copyright 2005 Prentice Hall Ch 3 -2 Agenda Assignment 5 D ue Mid term Exam  Available March 16  Due March 27  20 Short essays @ 5 points each New Course schedule  2 Oral and 1 Written Case study  Pick Groups and cases Discussion Strategy Review, Evaluation, and Control

3. Option 2 2 case study presentations @ 7.5% = 15% 1 written case study @ 10% =10% Ch 8-3 Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Mar 20 Strategy Review, Evaluation and Control Chapter 9 Mar 24 How to Prepare and Present a Case Study Pages 360- 374 in text Mar 27Case 1 (Instructor) Mar 31Group work Apr 3Case 2 (Group 1) Apr 7Case 3 (Group 2) Apr 10Case 4 (Instructor) Apr 14Group work Apr 17Case 5 (Group 1) Apr 21Case 6 (Group 2) Apr 24Free day Apr 31Take home final assigned Written case study due May 1Free day to work on take home final May 7 @ 8AM In class portion of Final Exam May 8Turn in Take home portion of Final Exam by 3PM Mid Term Exam (Chapter 1-9)15% Final Exam (Chaps 1-9 and Cases) 25% Assignments (5 @ 5%) 25% Case Presentations 15% Written Case Study10% Pre-professional Conduct 10% 100%

4. Case study assignments First Round - Restaurants Tony  20. Wendy’s International — 2007 Group 1  21. McDonald’s Corporation — 2007 Group 2  22. Compass Group PLC — 2007 Second Round – Automotive Tony  11. Skoda Auto — 2007 Group 1  9. Ford Motor Company — 2007 Group 2.  10. Winnebago Industries — 2008 Written Case Study  Pick one of the remaining 25 cases in the text List on page xxvii in text E-mail choice by next class Ch 8-4 Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall

5. Ch 9-5 Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Chapter 9 Strategy Review, Evaluation, and Control Strategic Management: Concepts & Cases 12 th Edition Fred David

6. Copyright 2007 Prentice Hall Ch 6 -6 Strategic Management Process Model

7. Ch 9-7 Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall “Organizations are most vulnerable when they are at the peak of their success.” – R. T. Lenz Strategy Evaluation

8. Ch 9-8 Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall – Strategies become obsolete – Internal environments are dynamic – External environments are dynamic Strategy Review, Evaluation, and Control

9. Ch 9-9 Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Vital to the organization’s well-being Alert management to potential/actual problems in a timely fashion Erroneous strategic decisions can have severe negative impact on organizations Strategy Review, Evaluation, and Control Strategy Evaluation

10. Ch 9-10 Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall 1. Examine the underlying bases of a firm’s strategy. 2. Compare expected to actual results. 3. Identify corrective actions to ensure that performance conforms to plans. Strategy Review, Evaluation, and Control Three Basic Activities

11. Ch 9-11 Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Complex & sensitive undertaking Overemphasis can be costly & counterproductive Strategy Review, Evaluation, and Control Strategy Evaluation

12. Ch 9-12 Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Strategy Review, Evaluation, and Control Have assets increased? Increase in profitability? Increase in sales? Increase in productivity? Profit margins, ROI, and EPS ratios increased? Appraisal of Strategic Performance

13. Copyright 2007 Prentice Hall Ch 6 -13 Strategy Evaluation, Review & Control Consonance Consistency Feasibility Advantage Rumelt’s 4 Criteria

14. Copyright 2007 Prentice Hall Ch 6 -14 Strategy Evaluation, Review & Control Strategy should not present inconsistent goals & policies  Issue and not “people” problems  Success for one department means failure for another  Policy problems rise to the top Consistency

15. Copyright 2007 Prentice Hall Ch 6 -15 Strategy Evaluation, Review & Control Consonance Consistency Feasibility Advantage Rumelt’s 4 Criteria

16. Copyright 2007 Prentice Hall Ch 6 -16 Strategy Evaluation, Review & Control Need for strategies to examine sets of trends  Need a Holistic view (internal and external) Consonance

17. Copyright 2007 Prentice Hall Ch 6 -17 Strategy Evaluation, Review & Control Consonance Consistency Feasibility Advantage Rumelt’s 4 Criteria

18. Copyright 2007 Prentice Hall Ch 6 -18 Strategy Evaluation, Review & Control Neither overtax resources or create unsolvable sub-problems  Can it be done with the given or available resources? Feasibility

19. Copyright 2007 Prentice Hall Ch 6 -19 Strategy Evaluation, Review & Control Consonance Consistency Feasibility Advantage Rumelt’s 4 Criteria

20. Copyright 2007 Prentice Hall Ch 6 -20 Strategy Evaluation, Review & Control Creation or maintenance of competitive advantage  If it doesn't create a competitive advantage then what’s the point? Advantage

21. Copyright 2007 Prentice Hall Ch 6 -21 Process of strategic evaluation Management should be continually aware of progress  Management by wandering around Don't wait for information get to you, go out and get the information  Things Change

22. Ch 9-22 Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Strategy Review, Evaluation, and Control 1. Increase in environment’s complexity 2. Difficulty predicting future with accuracy 3. Increasing number of variables Difficulties in Strategy Evaluation

23. Ch 9-23 Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Strategy Review, Evaluation, and Control 4. Rate of obsolescence of plans 5. Domestic and global events 6. Decreasing time span for planning certainty Difficulties in Strategy Evaluation

24. Ch 9-24 Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Strategy Review, Evaluation, and Control Initiate managerial questioning Trigger review of objectives & values Stimulate creativity in generating alternatives Strategy Evaluation Should –

25. Ch 9-25 Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Strategy Review, Evaluation, and Control Develop revised EFE Matrix Develop revised IFE Matrix Review of Underlying Bases of Strategy –

26. Ch 9-26 Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Strategy Review, Evaluation, and Control 1. Competitors’ reaction to strategy 2. Competitors’ change in strategy 3. Competitors’ changes in strengths & weaknesses 4. Reasons for competitors’ strategic change Review Effectiveness of Strategy –

27. Ch 9-27 Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Strategy Review, Evaluation, and Control 5. Reasons for competitors’ successful strategies 6. Competitors’ present market positions & profitability 7. Potential for competitor retaliation 8. Potential for cooperation with competitors Review Effectiveness of Strategy –

28. Ch 9-28 Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Strategy Review, Evaluation, and Control Are strengths still strengths? Have we added additional strengths? Are weaknesses still weaknesses? Have we developed other weaknesses? Monitor Strengths & Weaknesses; Opportunities & Threats

29. Ch 9-29 Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Strategy Review, Evaluation, and Control Are opportunities still opportunities? Other opportunities develop? Are threats still threats? Other threats emerged? Are we vulnerable to hostile takeover? Monitor Strengths & Weaknesses; Opportunities & Threats

30. Ch 9-30 Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Strategy-Evaluation Assessment Matrix Continue courseYesNo Corrective actionsNoYesNo Corrective actionsYes No Corrective actionsNo Yes Corrective actionsYesNoYes Corrective actionsNoYes Corrective actionsYes Corrective actionsNo Result Has the firm progressed satisfactorily toward achieving its stated objectives? Have major changes occurred in the firm’s external strategic position? Have major changes occurred in the firm’s internal strategic position?

31. Ch 9-31 Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall

32. Ch 9-32 Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Strategy Review, Evaluation, and Control Compare expected to actual results Investigate deviations from plan Evaluate individual performance Progress toward stated objectives Measuring Organizational Performance

33. Ch 9-33 Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Strategy Review, Evaluation, and Control Financial Ratios  Compare performance over different periods  Compare performance to competitors’  Compare performance to industry averages Quantitative Criteria for Strategy Evaluation

34. Ch 9-34 Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Strategy Review, Evaluation, and Control Return on investment (ROI) Return on equity (ROE) Profit margin Market share Key Financial Ratios

35. Ch 9-35 Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Strategy Review, Evaluation, and Control Debt to equity Earnings per share (EPS) Sales growth Asset growth Key Financial Ratios

36. Ch 9-36 Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Strategy Review, Evaluation, and Control Internal consistency of strategy Consistency with environment Appropriateness in view of resources Qualitative Evaluation of Strategy

37. Ch 9-37 Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Strategy Review, Evaluation, and Control Acceptable degree of risk Appropriate time frame Workability of the strategy Qualitative Evaluation of Strategy

38. Ch 9-38 Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Strategy Review, Evaluation, and Control – Evaluate strategies from 4 perspectives: 1. Financial performance 2. Customer knowledge 3. Internal business processes 4. Learning & growth Balanced Scorecard

39. Ch 9-39 Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall

40. Copyright 2007 Prentice Hall Ch 6 -40 Balanced Scorecard Area of ObjectivesMeasure or TargetTime ExpectationPrimary Responsibility Customers 1 2 Managers/Employees 1 2 Operations/Processes 1 2 Community/Social Responsibility 1 2 Business Ethics/Natural Environment 1 2 Financial 1 2

41. Ch 9-41 Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall

42. Ch 9-42 Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Strategy Review, Evaluation, and Control Economical Meaningful Generates useful information Timely information Provides accurate picture of events Characteristics of Strategy Evaluation

43. Ch 9-43 Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Strategy Review, Evaluation, and Control Alternative plans that can be put into effect if certain key events do not occur as expected Contingency Planning

44. Ch 9-44 Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Strategy Review, Evaluation, and Control Financial audits determine correspondence between assertions based on strategic plan & established criteria Environmental audits ensure sound and safe practices Auditing

45. Ch 9-45 Copyright © 2009 Pearson Education, Inc. Publishing as Prentice Hall Strategy Review, Evaluation, and Control Process is more an “art” than “science” Should strategies be visible or hidden from stakeholders? Should process be more top-down or bottom-up? 21 st Century Challenges in Strategic Management