Strategy & Organisation LECTURE 1 Welcome Tuesday – 17:15-19:00 – Lecture – Vincent Kunst Wednesday – 11:00-12:45 – Tut. 01 – Rajani Bhaskarabhatla Wednesday – 11:00-12:45 – Tut. 04 – Andreia Duque Wednesday – 13:15-15:00 – Tut. 02 – Rajani Bhaskarabhatla Wednesday – 13:15-15:00 – Tut. 05 – Andreia Duque Wednesday – 15:15-17:00 – Tut. 03 – Rajani Bhaskarabhatla Wednesday – 15:15-17:00 – Tut. 06 – Antonios Dragolias Friday – 09:00-10:45 – Tut. 07 – Marko Kuzhman Friday – 09:00-10:45 – Tut. 11 – Antonios Dragolias Friday – 09:00-10:45 – Tut. 15 – Dara van Buiten Friday – 11:00-12:45 – Tut. 08 – Andreia Duque Friday – 11:00-12:45 – Tut. 12 – Antonios Dragolias Friday – 11:00-12:45 – Tut. 16 – Marko Kuzhman Friday – 13:15-15:00 – Tut. 09 – Akshita Chembolu Friday – 13:15-15:00 – Tut. 13 – Egor Bronnikov Friday – 13:15-15:00 – Tut. 17 – Marko Kuzhman Friday – 15:15-17:00 – Tut. 10 – Akshita Chembolu Friday – 15:15-17:00 – Tut. 14 – Egor Bronnikov Friday – 15:15-17:00 – Tut. 18 – Vincent Kunst Welcome Tuesday – 17:15-19:00 – Lecture – Vincent Kunst Friday – 09:00-10:45 – Tut. 01 – Rajani Bhaskarabhatla Friday – 09:00-10:45 – Tut. 05 – Andreia Duque Friday – 09:00-10:45 – Tut. 07 – Marko Kuzhman Friday – 09:00-10:45 – Tut. 11 – Antonios Dragolias Friday – 09:00-10:45 – Tut. 15 – Dara van Buiten Friday – 11:00-12:45 – Tut. 02 – Rajani Bhaskarabhatla Friday – 11:00-12:45 – Tut. 08 – Andreia Duque Friday – 11:00-12:45 – Tut. 12 – Antonios Dragolias Friday – 11:00-12:45 – Tut. 16 – Marko Kuzhman Friday – 13:15-15:00 – Tut. 04 – Andreia Duque Friday – 13:15-15:00 – Tut. 03 – Rajani Bhaskarabhatla Friday – 13:15-15:00 – Tut. 09 – Akshita Chembolu Friday – 13:15-15:00 – Tut. 13 – Egor Bronnikov Friday – 13:15-15:00 – Tut. 17 – Marko Kuzhman Friday – 13:15-15:00 – Tut. 06 – Antonios Dragolias Friday – 15:15-17:00 – Tut. 10 – Akshita Chembolu Friday – 15:15-17:00 – Tut. 14 – Egor Bronnikov Friday – 15:15-17:00 – Tut. 18 – Vincent Kunst Agenda for today About the course Questions Introduction to Strategy About the course 1. Identify current theories of strategy, organizational economics and organization theory, indicating their a priori assumptions, benefits, and dangers; 2. Understand the basics of firm-level behavior and large enterprises in particular; 3. Understand the basics of managerial and employee behavior within organizations 4. Develop practical recommendations on the ways in which business performance can be enhanced through the application of these theories. About the course WEEK DATES LECTURE TUTORIAL WEEK 01 25/04-29/04 Yes, introduction to the course & 1. Introduction to strategy. Yes, based on homework & lecture content WEEK 02 02/05-06/05 Yes, 2. The environment & 3. Strategic capabilities Yes, based on homework & lecture content WEEK 03 09/05-13/05 Yes, 4. Strategic purpose & 5. Business strategy Yes, based on homework & lecture content WEEK 04 16/05-20/05 Yes, 6. Corporate strategy & 7. M&As Yes, based on homework & lecture content WEEK 05 23/05-27/05 No No WEEK 06 30/05-03/06 Yes, 8. Behavioural theory & 9. Agency theory Yes, feedback on draft group assignment WEEK 07 06/06-10/06 Yes, 10. Transaction costs & 11. Motivation concepts Yes, based on homework & lecture content WEEK 08 13/06-17/06 Yes, 12. Organizational structure & 13. Organizational culture Yes, based on lecture content WEEK 09 20/06-24/06 No Yes, exam revision The deliverables The exam (60%) The group assignment (40%) The homework (4/5 ability to participate in resit) The deadlines DELIVERY METHOD DEADLINE DATE CONTENT PRINTED TUTORIAL WEEK 1 HOMEWORK – W1 PRINTED TUTORIAL WEEK 2 HOMEWORK – W2 VERBALLY TUTORIAL WEEK 2 FIRM CHOICE PRINTED TUTORIAL WEEK 3 HOMEWORK – W3 PRINTED TUTORIAL WEEK 4 HOMEWORK – W4 EMAILED WEDNESDAY 25/05/2022 DRAFT GROUP ASSIGNMENT PRINTED TUTORIAL WEEK 7 HOMEWORK – W7 BLACKBOARD MONDAY 20/06/2022 GROUP ASSIGNMENT N/A FRIDAY 01/07/2022 EXAM The exam 60% of your grade REMINDO in person Mainly open questions/cases 1st of July The group assignment 40% of your grade Groups are made in the first tutorial (Friday) DEADLINES 2nd tutorial: have firm and industry approved Wednesday the 25th of May 2022: draft Monday the 20st of June 2022: final submission The group assignment The goal of the assignment is to understand the position of a firm within a particular industry, the current and future factors that might threaten the position and profitability of the firm, the opportunities that the firm can exploit in the near future, and the current strategy of the firm. On this basis, you will then develop a set of alternative strategies that the firm can deploy. Grading criteria External analysis (25 points) Internal analysis (25 points) Current strategies (15 points) Strategic alternatives and recommendations (25 points) Overall quality of the report (10 points) Plagiarism The homework Homework in weeks: 1,2,3,4, and 7 Questions based on cases in the book Bring hardcopy of your answers to class and give to your tutor 4 out of 5 need to be acceptable for you to be allowed to do a resit No excuses besides official ones, and even then… The homework – week 1 the Glastonbury case (p. 25); please answer the following questions: Sticking to the 35 word limit suggested by Collis and Rukstad in section 1.2.3, what strategy statement would you propose for the Glastonbury Festival? Using the headings of environment, strategic capability, strategic purpose and culture seen in section 1.3.1, identify key positioning issues for the Glastonbury Festival and consider their relative importance. The lego case (p. 29); please answer the following questions: Look at the financial figures on page 29. What do you notice in terms of development? What might be the effects of Lego being a family owned enterprise? Why would Lego get an outside CEO? Why is the transition to digital challenging for Lego? The homework – week 2 the ‘global forces and the advertising industry’ case (p. 66). Please answer the following questions: Carry out a PESTEL analysis of the advertising industry in 2012, with particular attention to megatrends, inflexion points and weak signals. the ‘Vodafone’ case (p. 69). Please answer the following questions: What are the competitive dynamics in emerging markets such as the high-speed internet market? Can models like the five-forces framework by Porter be applied to these markets? Why so, or why not? What are your recommendations to Vodafone in terms of strategy? Please read the case study ‘Rocket Internet’ (p. 112). The homework – week 3 The ‘drinking partners’ case (p.153); Please answer the following questions: Consider the governance chain leading from the various shareholders of UBHL to the managers in the main business, with particular reference to United Spirits. Why might there be breakdowns in accountability and control in this chain? Group the various key stakeholders discussed in this case (economic, social/political, community and technological). What risks do key stakeholder groups face (including Diageo)? The ‘Ikea approach’ case (p.186); Please answer the following questions: Identify where (in its value network) and how IKEA has achieved cost leadership. Identify how IKEA has achieved differentiation from its competitors. Explain how IKEA tries to ensure that its ‘hybrid’ strategy remains sustainable and does not become ‘stuck-in-the-middle’. What are the lessons from China about IKEA’s approach? The ‘Ryanair’ case (p. 190); Please answer the following questions: What are the VRIO resources of Ryanair? Discuss why the Air Lingus deal might be a danger to Ryanair from a strategic perspective? What might be the rationale behind the Air Lingus acquisition? The homework – week 4 The ‘strategic development at Virgin 2013’ case (p.233); please answer the following questions: What directions of strategic development have been followed by Virgin over the period of the case? What is the corporate rationale for Virgin as a group of companies? How does the Virgin Group as a corporate parent add value to its businesses? To what extent are these parenting skills relevant to the various business in the group? What should the future corporate strategy be? The ‘SABMiller’ case (p.238); please answer the following questions: What is the main source of competitive advantage of SAB Miller? What is the dominant logic used at SAB Miller? Discuss the variety of strategic options available to SAB Miller and their potential. The homework – week 7 The ‘Netflix’ case (p.375); please answer the following questions: What were the primary cost components driving Netflix’s strategy prior to 2010? What are the dominant cost factors determining the success of Netflix today? What are the key technological developments that caused the disruptive change in the firm’s business plan and strategy? What are some of the primary barriers/hurdles that potential competitors are facing against Netflix? Consider the chain of production and the delivery of downstream content? Which firms can exert pricing power along the production and delivery process? The ‘equity and executive pay’ case (p.408); please answer the following questions: How does the executive compensation issue relate to equity theory? Who do you think should be the comparative others in these equity judgements? How should we determine what is a “fair” level of pay for top executives? If executive pay is related to the theory of extrinsic rewards, to what extend is it coercive? Define how stakeholders could measure the worth of an executive. Are there any positive motivational consequences of tying compensation pay closely to firm performance? The ‘sleeping on the job’ case (p. 408); please answer the following questions: If organizations introduced “nap rooms” or nap times, how would this factor into job satisfaction? Relate this to extrinsic factors of job satisfaction and the motivation-hygiene theory. How might reinforcement theory play a role in the extent to which employees are sleep-deprived? How might sleep deprivation influence aspects of expectancy theory? How might the incorporation of “nap rooms” for sleepdeprived employees influence aspects of equity theory? If you were a manager who noticed your employees were sleep-deprived, what steps might you take to help them? What theories of motivation could you use to help them? Glastonbury case The lego case Break QUESTIONS VIA: POLLEV.COM/VINCENTKUNST412 Introduction to strategy CHAPTER 1 What is strategy Word cloud Pollev.com/vincentkunst412 What is strategy στρατηγία = art of troop leader ‘the determination of the long-run goals and objectives of an enterprise and the adoption of courses of action and the allocation of resources necessary for carrying out these goals’(Chandler) ‘competitive strategy is about being different. It means deliberately choosing a different set of activities to deliver a unique mix of value’ (Porter) ‘the long-term direction of an organisation’ (Exploring strategy) Different streams of strategy Strategy as war Different streams of strategy Strategy as planning ..the determination of the long-run goals and objectives of an enterprise and the adoption of courses of action and the allocation of resources necessary for carrying out these goals Mainly relates to the strategic planning function of firms Strategic plans should include different time horizons Short term (Horizon 1), how do we defend and build our core business? Medium term (Horizon 2), how do we build emerging businesses? Long term (Horizon 3), how do we create new viable opportunities? And different levels (corporate, business, operational) Different streams of strategy Strategy as differentiation Strategy is about being different. It means deliberately choosing a different set of activities to deliver a unique mix of value. Copying industry leaders cannot lead to sustainable competitive advantages… Porter’s approach is rooted in industry analysis and requires that firms make trade-offs Strategy statements What is it? Contains the fundamental goals that the organisation seeks (mission, vision, or objectives); the scope or domain of the organisations activities; and the particular advantages or capabilities it has to deliver all of these. Mission (what business are we in?) Vision (what do we want to achieve?) Objectives (what do we have to achieve in the coming period?) Scope (customers or clients; geographical location; extend of internal activities) Advantage (what is the competitive advantage of the firm) Example: NS annual report 2016 “Our mission is to make sure passengers feel a connection with NS” (MISSION) “Our goal for 2019 is to pass the mid-term review by making passengers, passengers and passengers our top priorities” (VISION & advantage [?]) Objectives Better performance on the main rail network, including HSL and the associated international train services. World-class stations. Contributing to a better door-to-door journey. CAN WE DO BETTER?