Group 1 Presentation:
Strategic Management in Action
By Mary Coulter
Group Members:
Mark Beal, Adrienne Collins, Jessica Drummond, Mike
Sanchez, Mario Santos, Spencer Thomas, Alec Wegmann
1
Chp.1 Introducing the concepts
of Strategic Management
•Why
it is important
•What
it is
•Who’s
involved
•Impacting
factors
2
Why is Strategic Management
Important?
Individual Importance:
• Everyone in an organization is somehow
involved in strategic management
• Understanding strategic decisions will enable
you to do you job well, have your work valued,
and be rewarded for your work
3
Why is Strategic Management
Important?
• Two of the most fundamental business questions
relate back to strategy:
• why firms succeed or fail
• why firms have varying levels of performance
• Organizations that use strategic management tend
to have higher levels of performance or profits
4
Why is Strategic Management
Important?
• Situations are continually changing internally
and externally; being able to adapt to these
situations and achieve expected performance is
challenging
• Strategic management helps coordinate
activities from various levels and departments;
creating a more efficient organization
5
Example: The importance of
strategic management during the
current recession
Managers noticed that consumers no
longer wanted to buy pens or paper in
bulk. So the company created displays
to sell individual sharpies and small
packs of paper, which proved
successful.
•
6
Strategic Management can be found in
almost every sector of any given
business
Some Examples:
 Texas Tech’s head coaching decisions.
 Blockbuster’s attempts to compete with
Netflix.
 Or Disney’s ever continuing global expansions
tactics.
7
Why do similar companies differ in
success?
Because of their strategy/strategic
management.
 Wal-Mart and Kmart both founded in
1962.
 Wal-Mart: The world’s largest and most
successful retailer.
 Kmart: The largest retailer to seek Chp.11
bankruptcy.

8
Strategizing “Outside the Box”
3M has all employees take an hour of
each work day to brainstorm new
product ideas.
 The Post-it note was one of the products
that resulted

9
Four Characteristics of Strategic
Management

1. Interdisciplinary –all areas of the business
are involved.

2. External Focus – involves the interactions
of the company with the economy,
competitors, customers, etc.
10
Four Characteristics of Strategic
Management

3. Internal Focus – assessing the
organization’s resources and capabilities.
Such as all-star employees.

4. Future Direction – Companies must
make projections about their future
position to create a successful strategy.
11
The Strategic Management
Process
A process that implies sequential and
interrelated activities leading to some
outcome. These activities include:
 Situation Analysis
 Strategy Formulation
 Strategy Implementation
 Strategy Evaluation

12
Situation Analysis – Analyzing the
Current Situation
Scanning and evaluating:
 The current organizational context – The

economy, the role of stakeholders, the dynamics of
change, the role of the organizational culture and
mission
 External
environment – competitors, economy,
customers, trends
 And
organizational environment – resources,
distinctive capabilities, core competencies
13
Strategy Formulation
Developing and choosing appropriate
strategies as guided by the results of
situation analysis.
 3 Main Types of Strategies:
 1. Functional Strategies
 2. Competitive Strategies
 3. Corporate Strategies

14
1. Functional Strategies

Using functional areas, resources and
capabilities to support the corporate and
competitive strategies.
15
Most common functional areas:
Production-Operations (Manufacturing)
 Marketing
 Research and Development
 Human resources
 Financial Accounting
 Information Systems Technology and
Support

16
Functional Areas
Academics
 Student Services (health, housing, and
hospitality)
 Financial Services
 Facilities Management
 Athletics
 Alumni Relations

17
2. Competitive Strategies

Goal-directed plans and actions that are
concerned with how an organization
competes in a specific business or
industry.

The competitive strategies and
advantages an organization currently has
or wants to develop.
18
Competitive Strategy
Abercrombie and Fitch has strategies to
compete with:
 American Eagle Outfitters
 Gap
 J. Crew
 Other specialty clothing retailers.

19
3. Corporate Strategies

What business(es) to be in and what to
do with those businesses.
20
Corporate Strategy
 Competes with a portfolio of more than
3,000 beverages.

Coca-Cola Products A - Z
21
Strategy Implementation
•
Putting the various strategies into action.
•
It is not enough to just formulate a great
strategy, it must be implemented.
22
Strategy Evaluation
Involves evaluating both the outcomes of
the strategies and how they have been
implemented.
•
•If
the evaluation determines that the
strategic goals are not being met, then the
strategy may need to be modified.
23
Looking at Strategic Management’s
Past
•The
history of strategic
management helps us better
understand how and why today’s
managers implement strategic
management.
•The
history ranges from great
military battles to current research.
24
Strategy’s Military Roots
Strategy can be
seen in historical
decisions and
actions used by
military
organizations.
•
•Blitzkrieg
–a
lighting swift
attack by mobile
forces, named
after the
German WWII
strategy.
25
Academic Origins of Strategic
Management
•As
a field of study, strategic
management is relatively young.
•Most
of its theoretical foundation
comes from economics and
organization studies.
26
Strategic Planning and Strategic
Management Emerge
•1960’s
- One correct way to manage in
all situations was replaced by contingency
approaches.
•1970’s
and 1980’s - Researchers tried to
understand and describe strategic
management.
27
Who’s Involved with Strategic
Management?
•Employees
at all organizational levels play a role in
developing, implementing, and changing strategy.
•The
Board of Directors
•Top
Management
•Other
Managers and Organizational Employees
AC
28
The Board of Directors

The Board of Directors is an elected group
that represents a company’s shareholders.

Responsibilities:
◦ Review and approve strategic goals and plans.
◦ Review and approve the organization’s financial
standards and policies.
◦ Select, evaluate, and compensate top-level
managers.
◦ Etc.
AC
29
Home Depot’s Board
Company shareholders were vocal about the
unhappiness with the previous CEO’s pay and
performance.
 Bonnie G. Hill, the longest-serving director on Home
Depot’s board, met with stockholders and listened
to their complaints.
 The Board of Directors decided to link the pay of
current CEO Frank Blake to the company’s
performance.

AC
30
The Role of Top Management
An organization’s top manager is typically
the chief executive officer (CEO).
 The CEO’s top management team usually
includes:

◦
◦
◦
◦
COO
CFO
CIO
Other executive or senior managers.
AC
31
Strategic Leadership

The ability to anticipate, envision, maintain
flexibility, think strategically, and work
with others in the organization to initiate
changes that will create a valuable future
for the organization.

Samsung Electronics-Changing its
Leadership Team after financial scandal in
2008.
AC
32
Strategic Leadership
Determining
Organizations
POV
Maintaining Core
Competencies
Establishing
Balanced Controls
Emphasizing
Ethical Decisions
Effective
Strategic
Leadership
Developing
Human Capital
Creating Strong
Organizational
Culture
33
Determining Organization’s
Purpose/Vision
Reason for existence
 Bill Ford and the creation of the Ford U
Car
 Ford’s vision is to respect their past
accomplishments but lead the way in the
future.

MB
34
Exploiting and Maintaining Core
Competencies

Value adding to the company

Wal-Mart and the recession
MB
35
Developing Human Capital

Retention

Intellectual Capital
MB
36
Creating and Sustaining a Strong
Organizational Culture

Best Buy CEO Brian Dunn

Focus on ‘the team’ and ‘local growth’

Proven itself in this recession
MB
37
Emphasizing Ethical Decisions

Keeps the company in a positive PR
position

Johnson & Johnson Credo
MB
38
Establishing Appropriately Balanced
Controls
Curb the actions of the company in the
direction of the objective
 Two Types

◦ Financial (accounting based and typically
short-term)
◦ Strategic (exchanging information)

A balance of the two is required
MB
39
Other Managers and Organizational
Employees

Strategic Responsibilities
◦ Implementation
 Actually doing the job and completing the objective.
◦ Evaluation
 Lower levels of the organization hierarchy tend to
do this: this is when the processes to complete the
objective are evaluated to see their effectiveness.
 iPhone, Dev Center, and Forum
MB
40
Three Factors Impacting
Strategic Management
•Globalization
•Corporate
Governance
•E-Business
41
Global Economy &
Globalization

Benefits
◦ Economic
◦ Social

Challenges
◦ Current state of economy
◦ Openness
◦ Interdependence between trading nations
Mario
42
Challenges of Openness


Open to the good and bad
◦ Breaks down geographic barriers between
countries
◦ Increased sensitivity to political and cultural
differences?
Interdependence of trading countries
◦ Domino effect
◦ World Trade Organization
◦ World Bank Group
◦ International Monetary Fund (IMF)
43
Challenge of Cultural &
Political Differences

Cultural differences
◦ Religion, beliefs, traditions, etc…
 Ex. Nike and the Muslim culture

Must be sensitive to cultural and political differences
◦ Awareness of how decisions & actions will be viewed by ALL
◦ Adjust to diverse views

Negative views of capitalism
Corporate Governance



Observes how a company uses its resources
Protects stakeholders’ interest
Sarbanes-Oxley Act
◦ Enron, Tyco, Worldcom
 Billions of dollars lost in 18 months
◦ Changed Role of Board of Directors
 Independent group that looked out for the interest of
stockholders
 “The Business Roundtable”
◦ Improved Financial Reporting
 More disclosure and transparency of financial statements
Management in E-Business

E-Business – information and
communication technologies that support
activities of a business
◦ Cisco: Teleconferencing

E-Commerce – retailing side of EBusiness
Three Approaches to E-Business

Enhanced – provides a new medium of doing
business; does not replace traditional ways of
doing business
◦ Wal-Mart.com

Enable – helps perform business functions
better, but not to sell anything
◦ LeviStrauss.com

Internet Retail – utilizing the resource of the
internet to reach customers
◦ TheMountainHideaway.com
Bill's Corporate Strategy
48