Chapter 1
The Concept of Strategy
Team 1 - 4380
Ashlyn Hargraves
Hunter Bernays
Sofia Maese
Kyle Gooch
Martin Gutierrez
FS1
Introduction To Strategy
● What is a strategy and what is its purpose?
○ Definition: A unifying theme that gives coherence and direction to the actions of an individual or an
organization
○ Strategy is all about success
● Origin of Strategy
○ Originated from 500 BC where it was first used in Sun Tzu’s book The Art of War
○ Derived from military purposes and was transformed for business purposes
● Strategy is not Planning
○ Strategy is not a detailed plan of tactics
○ Strategy is an overall theme
Introduction Continued
● Four common factors of strategic success
○ Simple, long term, and consistent goals
○ Thorough understanding of the competitive environment
○ Objective appraisal of resources
○ Effective implementation
Evolution of Business Strategy
● Corporate Planning
○ Developed in the 1950’s
○ Also known as long term planning
● Strategic Management
○ Evolved from corporate planning in the 1970’s
○ Increased focus on environmental competition
○ Competitive advantage became the primary goal
● Resource Based View
○ Shifted focus from the source of profits externally to focusing on the sources of profit from inside the firm
Strategy Today
● Motivation of profits shift
● Firm as Property VS. Firm as Social Entity
Case Studies
Lady Gaga
James Dyson
Alex Ferguson
Will King
Strategy as direction
A powerful sense of direction is essential
Even more important in uncertain environments
Clear direction can differentiate a company
Emergent Strategy
Strategy and Success
Simple, long term goals
Understanding the environment
Objective analysis of strengths and weaknesses
Implementing your strategy
Strategic Roles
Strategy as a target in the case of Dyson and King
Strategy as orientation in the case of Alex Ferguson
Current Event
WSJ: Why Obama’s Middle East Policy Is Failing
Obama made the case to Congress to authorize the use of military force in the war against ISIS stating,
"Our coalition is on the offensive, ISIL is on the defensive and ISIL is going to lose."
Focusing on Islamic State alone leaves the undesirable influence of civil wars to drag the surrounding
countries in the region deeper into disaster.
Problems of the Middle East stem from the failure of the post-World War II Arab state system. This had
led to power vacuums, state collapse and civil wars.
Current Event
Solution?
Since 1945, over 20% of the approximately 150 civil wars have ended in negotiated settlements. This
number has increased to 40% after 1991.
Neither in Iraq or Syria, has the United States or its coalition partners began to put in place external
peacekeeping forces that could convince Iraqis and Syrians to trust that the changes would last.
EY 2013
Purpose and energy
Relationships
Globalization
Policy Reform
Internal Changes
Company Name
Logo
Purpose
EY 2014
A year of change
7 drivers of Growth
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•
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People
Digital
Operations
Customers
Core Values
Nationalism
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•
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Financing
Transactions
Risk
EY 2015
A better working world
Six major trends
Internal effect
Multi-disciplinary Model
Quality Assurance Professional Practice
Assurance Sustainable Audit Quality
Technology and Training
Global economy
Industry strategy
The trend that has surfaced over the past few years in regards to the industry’s competitive strategy has been more acquisition
among the big four. They have put a demand on acquiring consulting businesses, this has led to more diversity and recent
success throughout the firms.
In the past the firm’s main focus was auditing.
In addition to this technology is taking over many of the tasks done by individuals and it has forced companies to comply and adapt
to the advances.
A successful strategy that the industries have incorporated is adding more diversity among the workforce,this includes hiring
different professions rather just being focused on accountants.
Consulting Acquisition
References
http://www.ey.com/Publication/vwLUAssets/EY_Global_review_2013/$FILE/EY_Global_review_2013.pdf
http://www.ey.com/Publication/vwLUAssets/EY_Global_review_2014/$FILE/Global_review_2014.pdf
http://www.ey.com/Publication/vwLUAssets/EY_Global_review_2015/$FILE/EY_Global_review_2015.pdf
Grant, R. M., & Jordan, J. (2012). Foundations of strategy (Chapter 1). Hoboken, NJ: Wiley and Sons.
http://www.economist.com/news/business/21589435-big-consulting-and-accounting-firms-are-making-risky-move-strategy-work-strategicmoves
http://www.wsj.com/articles/why-obamas-middle-east-policy-is-failing-1455579038