STRATEGIC THINKING
Chapter 1
STRATEGIC MANAGEMENT
Definition
The process through which organizations analyze and learn from their internal and
external environments, establish strategic direction, create strategies that are
intended to help achieve established goals, and execute those strategies, all in an
effort to satisfy key organizational stakeholders
External and Internal Environmental Analysis
Strategic Direction
Strategy Formulation
Strategy Implementation
and Control
Strategic Restructuring
The Broad Environment
Sociocultural
Forces
The Task Environment
Competitors
Unions
Suppliers
Economic
Forces
Technological
Forces
Gov’t agencies
Customers
The Organization
Owners & Directors
Managers
Employees
Financial
Intermediaries
Local
Communities
Activist
Groups
Political/Legal
Forces
Internal
Analysis
External
Analysis
Strengths
Opportunities
Weaknesses
Threats
SWOT ANALYSIS
Strengths
Opportunities
Weaknesses
Threats
APPROACHES TO STRATEGIC MANAGEMENT
Situation Analysis
• Analyze the internal and external environments, develop a SWOT analysis, and derive mission, goals and strategy
Environmental Determinism
• Determine the best strategy that best fits environmental forces and work to carry it out
Principle of Enactment
• Create your own environment; do not wait for external forces to dictate your strategy
Deliberate/Emergent Strategy
• Strategies are intended courses of action but can also emerge from a stream of decisions
Resource-based View
• Acquire and manage resources to achieve sustainable competitive advantage
Stakeholder Management
• Develop mutually beneficial relationships and alliances with external stakeholders
What does it take to have a successful company strategy?
Situation
Analysis
Stakeholder
Management
Environmental
Determinism
Strategic
Thinking
Resourcebased View
Principle of
Enactment
Deliberate /
Emergent
Strategy
STRATEGIC THINKING: CHARACTERISTICS
Intent Focused
Long-Term Oriented
Consideration of Past and Present
Systems Perspective
Ability to Seize Opportunities
Scientific Approach