WK01Introductionpart2 - Staffordshire University

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Readings: Chapter 1
Exploring Corporate Strategy
8th Edition
Introducing Strategy
Pete Considine
Considine 2011-12 BLB10089-3. Text: Exploring (Corporate) Strategy, 2008 or 2011, © Pearson
Education Ltd
1
Learning Outcomes (1)
To understand:
• The basic concepts of strategy and strategic
management
• The general characteristics of strategic decisions
and what is meant by strategy and strategic
management, distinguishing them from
operational management
• How strategic priorities vary by level: corporate,
business, and operational
• The basic vocabulary of strategy
Considine 2011-12 BLB10089-3. Text: Exploring (Corporate) Strategy, 2008 or 2011, © Pearson
Education Ltd
2
Learning Outcomes (2)
To Understand:
• The three key elements of the
Corporate Strategy in terms of the
strategy process and strategic
management model in Johnson et al.
(2008)
• The differences between ‘prescriptive’
and ‘emergent’ approaches to
strategy
Considine 2011-12 BLB10089-3. Text: Exploring (Corporate) Strategy, 2008 or 2011, © Pearson
Education Ltd
3
Introducing Strategy – Outline
• What is strategy and strategic
management?
• Strategic priorities at corporate, business
and operational level
• Vocabulary of strategy
• Exploring Corporate Strategy – a
strategic management “model”
Considine 2011-12 BLB10089-3. Text: Exploring (Corporate) Strategy, 2008 or 2011, © Pearson
Education Ltd
4
What is Strategy?
Many definitions exist (see the modules Backboard
site for week 1). The one below is from the core
text: Johnson et al. (2008) Exploring Corporate
Strategy:
Strategy is the direction and scope of an
organisation over the long term, which
achieves advantage in a changing
environment through its configuration of
resources and competences with the aim of
fulfilling stakeholder expectations.
Considine 2011-12 BLB10089-3. Text: Exploring (Corporate) Strategy, 2008 or 2011, © Pearson
Education Ltd
5
Characteristics of
Strategic Decisions
•
•
•
•
•
•
Long-term direction
Scope of an organisation’s activities
Competitive advantage
Strategic fit with business environment
Organisation resources and competences
Values and expectations of power players
Considine 2011-12 BLB10089-3. Text: Exploring (Corporate) Strategy, 2008 or 2011, © Pearson
Education Ltd
6
Strategic Decisions are Likely to :
•
•
•
•
Be complex in nature
Be made in situations of uncertainty
Affect operational decisions
Require an integrated approach (both
inside and outside an organisation)
• Involve considerable change and also
• Relationships and networks
Considine 2011-12 BLB10089-3. Text: Exploring (Corporate) Strategy, 2008 or 2011, © Pearson
Education Ltd
7
LEVELS OF STRATEGY
• Corporate level
– Determine overall scope of the organisation
– Add value to the different business units
– Meet expectations of stakeholders
• Business level (SBU) – an SBU is part of an organisation
for which there is a distinct external market for goods
and service that is different from another SBU – an
example?
– SBU-s focus on “How to compete successfully in particular
markets”
• Operational Level
– How different parts of organisation deliver strategy
Considine 2011-12 BLB10089-3. Text: Exploring (Corporate) Strategy, 2008 or 2011, © Pearson
Education Ltd
8
Levels of Strategy
Corporatelevel
strategy
Business-level
strategy
Operational strategy
Considine 2011-12 BLB10089-3. Text: Exploring (Corporate) Strategy, 2008 or 2011, © Pearson
Education Ltd
9
The Vocabulary of Strategy
•
•
•
•
Mission – overriding purpose
Vision/strategic intent – desired future state
Goal – general statement of aim or purpose
Objective – quantification or more precise
statement of goal
• Strategic capability – resources, activities
and processes
• Business model – how product, service and
information flow
• Control – monitoring of action steps
Considine 2011-12 BLB10089-3. Text: Exploring (Corporate) Strategy, 2008 or 2011, © Pearson
Education Ltd
10
Vocabulary of Strategy:
• Nokia : Vision/Mission
– Connecting is about helping people feel close to
what matters. Wherever, whenever, Nokia believes
in communicating, sharing, and in the awesome
potential in connecting the 2 billion who do with the
4 billion who don’t.
• Staffordshire University
university_plan_2007_2012_tcm44-4257.pdf
Considine 2011-12 BLB10089-3. Text: Exploring (Corporate) Strategy, 2008 or 2011, © Pearson
Education Ltd
11
So What is Strategic Management?
Strategic management includes
understanding the strategic position of a
organisation, making strategic choices for
the future, and managing strategy in
action.
Considine 2011-12 BLB10089-3. Text: Exploring (Corporate) Strategy, 2008 or 2011, © Pearson
Education Ltd
12
Exploring
Corporate
Strategy
“Model”?
Considine 2011-12 BLB10089-3. Text: Exploring (Corporate) Strategy, 2008 or 2011, © Pearson
Education Ltd
13
Strategic Position
Environment
Capability
The
Strategic
Position
Purpose
Culture
Considine 2011-12 BLB10089-3. Text: Exploring (Corporate) Strategy, 2008 or 2011, © Pearson
Education Ltd
14
What is
Strategic Position?
Strategic position is concerned with the
impact on strategy of the external
environment, an organisation’s strategic
capability and the expectations and
influence of stakeholders. (further readings in
Exploring Corporate Strategy, and on Blackboard)
Considine 2011-12 BLB10089-3. Text: Exploring (Corporate) Strategy, 2008 or 2011, © Pearson
Education Ltd
15
Strategic Choices
Businesslevel
Corporatelevel
Strategic
Choices
Innovation
International
Evaluation
Considine 2011-12 BLB10089-3. Text: Exploring (Corporate) Strategy, 2008 or 2011, © Pearson
Education Ltd
16
What are Strategic Choices?
Strategic choices involve understanding
the underlying bases for future strategy at
both the business unit and corporate
levels and the options for developing
strategy in terms of both the directions and
methods of development.
Further Readings in Core text on Blackboard
(& workbook)
Considine 2011-12 BLB10089-3. Text: Exploring (Corporate) Strategy, 2008 or 2011, © Pearson
Education Ltd
17
Strategy in Action
Processes
Structuring
Strategy
in Action
Changing
Resourcing
Practice
Considine 2011-12 BLB10089-3. Text: Exploring (Corporate) Strategy, 2008 or 2011, © Pearson
Education Ltd
18
Strategy in Action
‘Strategy in action is
concerned with ensuring
that strategies are
working in practice’
Involving:
• Structuring the organisation
• Marshalling resources (people,
information, finance, technology)
• Managing change
Considine 2011-12 BLB10089-3. Text: Exploring (Corporate) Strategy, 2008 or 2011, © Pearson
Education Ltd
19
Processes of Strategy Development
• Intended strategies
– Deliberate management intent
• Emergent strategies
– Develop out of social and political processes
in and around organisations
Most strategies are a combination of
intended and emergent processes
Considine 2011-12 BLB10089-3. Text: Exploring (Corporate) Strategy, 2008 or 2011, © Pearson
Education Ltd
20
Prescriptive and Emergent Approaches to
Strategy
• Prescriptive – Corporate strategy is essentially a
linear and rational process, starting with where-arewe-now and then developing new strategies for the
future. Thus, strategy is prescribed in advance.
• Emergent – Corporate strategy emerges, adapting to
human needs and continuing to develop over time.
Thus, strategy is evolving, incremental and
continuous, and therefore it is hard to summarise into
a plan.
(see workbook/Blackboard for related Self Managed Exercises – also further readings in
journal articles such as Mintzberg and Waters (1985) Of Strategies, Deliberate and
Emergent and readings in “core text” Chapter 11)
Considine 2011-12 BLB10089-3. Text: Exploring (Corporate) Strategy, 2008 or 2011, © Pearson
Education Ltd
21
•
Challenges of Strategic
Management
Prevent strategic drift
– Progressive failure to address strategic position
– Deterioration of performance
• Understand and address contemporary issues:
– Internationalisation
– E-Commerce
– Changing purposes
– Knowledge and learning
• View strategy in more than one way
– Three strategy lenses – Design, Experience, Ideas
• Managing strategy in different contexts SME, MNE
and...?
Considine 2011-12 BLB10089-3. Text: Exploring (Corporate) Strategy, 2008 or 2011, © Pearson
Education Ltd
22
The risk of strategic drift
A progressive failure to address loss of strategic position
Considine 2011-12 BLB10089-3. Text: Exploring (Corporate) Strategy, 2008 or 2011, © Pearson
Exhibit
1.4
Education Ltd
23
Environment Values Resources
Opportunities
And Threats
Strengths/
Weaknesses
Resources
Environ
ment
Values
Values and
Leadership
•The EVR framework (J.L
Thompson 2001 p71 )
separates out the SWOT.
•Here have “EVR congruence”
between with overlap between
Critical Success Factors
(CFS’s) and resources or
competence's
•Ie the firms strategies would
appear to be consistent
Considine 2011-12 BLB10089-3. Text: Exploring (Corporate) Strategy, 2008 or 2011, © Pearson
Education Ltd
24
Environment Values Resources
Environ
ment
Resources
Values
STRATEGIC DRIFT”
Considine 2011-12 BLB10089-3.
•This time the incongruence is
due to strategic drift where an
internally cohesive firm
simply loses touch with its
competitive environment.
•Getting back in alignment
often requires a change in
management.
•New ideas/innovations are
required and a rethink of the
Text: Exploring (Corporate) Strategy,
firms
2008
basic
or 2011,
assumptions.
© Pearson
Education Ltd
25
Contemporary Themes
•
•
•
•
Internationalisation
E-Commerce – and spatial technologies
Changing purpose of organisations
Knowledge and learning
Considine 2011-12 BLB10089-3. Text: Exploring (Corporate) Strategy, 2008 or 2011, © Pearson
Education Ltd
26
The Strategy Lenses
• Strategy as design
– Logical analytical process
– Planned implementation
– Top manager driven
• Strategy as experience
– Adaptation of past strategies based on experience
– Influenced by taken for granted assumptions (culture)
– Bargaining and negotiation
• Strategy as ideas
– Importance of variety and diversity for innovation
– Emergent strategy from within and around the organisation
– Top managers create the conditions for this to take place
• Strategy as Discourse
– This lens sees strategy in terms of language, recognising that
managers spend most of their time communicating – based on
power, influence, making strategic proposals and debating
issues.
Considine
2011-12 BLB10089-3. Text: Exploring (Corporate) Strategy, 2008 or 2011, © Pearson
Education Ltd
27
The Four strategy lenses: a
summary
Exhibit I.iv
Considine 2011-12 BLB10089-3. Text: Exploring (Corporate) Strategy, 2008 or 2011, © Pearson
Education Ltd
28
Chapter Summary
• Strategy as direction and scope of an
organisation over the long term
• Strategic decisions made at multiple levels
in an organisation
• Strategic position, strategic choices, and
strategy in action as the major elements of
strategic management
• Two primary streams include strategy
content and strategy process
• Strategic issues best seen through several
lenses
Considine 2011-12 BLB10089-3. Text: Exploring (Corporate) Strategy, 2008 or 2011, © Pearson
Education Ltd
29
Reminders
• Do not forget to visit the Blackboard site
for further readings and learning exercises
for this week and details on the
module/assessment.
• Obtain the core text Johnson Scholes and
Whittington (2008) “Exploring Corporate
Strategy” (ASAP)
• Prepare work for tutorials and portfolios
Considine 2011-12 BLB10089-3. Text: Exploring (Corporate) Strategy, 2008 or 2011, © Pearson
Education Ltd
30
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