Choose to complete only one of the following Options for this individual assignment:
Option 1:
An Article Review is a written assignment that requires getting an article that is published in a scientific/academic magazine/journal. The topic of the article should be related to any of the topics in Strategic Management, such as RBV, IO, Benchmarking, Balance Score Cards, types of strategies, competitive advantage, etc.
Each student must read an article, and write a short analytical review about it, including the following:
1. Official cover page. (1 point)
2. Introduction to identify the chosen topic, a background of the autho
s – scholars. (1 point)
3. Summary of the article – between 100 and 150 words. (1 point)
4. Discussion of the main points that the article covered, your arguments should be based on what you have learnt from the course, using citations and academic references as needed – at least 2 academic reference.
+ The main article needs to be attached (as PDF, or handled separately as a hard copy). (2 points)
Option 2:
Each student must write a short essay about one of the topics related to Strategic Management, such as RBV, IO, Benchmarking, Balance Score Cards, types of strategies, competitive advantage, etc.
The paper must include the following:
1. Official cover page - should be the first page of the paper. (1 point)
2. Introduction to identify the chosen topic (1 point)
3. Discussion of the main points, your arguments should be based on what you have learnt from the course, using citations and academic references as needed – at least 3 academic reference, one of them should be an academic article. (2 points)
4. Conclusion (1 point)
General instructions for both options:
1. The assignment should be sent only as a Word Document.
2. Students must follow the Guidelines for Written Assignments stated in the Course Syllabus (page 5 section b)
3. Total number of pages for this assignment is between 2 and 3 pages (excluding the cover page).
4. Students are free to write their opinions in the discussion of the article, or use examples from real life, and draw figures to highlight any special points if they want to.
5. Late submission will lead to the deduction of (-2) marks per day.
Slide 1
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Copyright © 2011 Pearson Education
This is Khaled
Strategic Management: Concepts and Cases
Arab World Edition
Fred R. David
A
as J. Ali
Abdulrahman Y. Al-Aali
Chapter 1:
The Nature of Strategic
Management
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Copyright © 2011 Pearson Education
What is “Strategy?”
Comes from the Greek “strategia” meaning generalship. In the military, strategy often refers to maneuvering troops into position before engaging the enemy.
Entered the management literature as a way of refe
ing to what one did to counter a competitor’s actual or predicted move
There is very little agreement about what strategy is in the business world
Strategy is perspective, plan and pattern. It is a general framework that provides guidance for actions to be taken and, at the same time, is shaped by actions taken
Can you have a strategy without a goal? Sure. But then where do you end up?
Art & science of formulating, implementing, and evaluating cross-functional decisions that enable an organization to achieve its objectives
In essence, the strategic plan is a company’s game plan.
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Strategic Management – Defined
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As a discipline, it was developed in the 1970’s but has evolved in response to changes in internal and external environments
What is “Strategic Planning?”
A management tool for organizing the present on the basis of projections of a desired future.
A strategic plan is a road map to lead an organization from where it is now to where it would like to be three, five or ten years out.
Can you manage strategically without strategic planning? You can try!
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Strategic management achieves a firm’s success through integration:
Management
MIS
Production/Operations
Finance/Accounting
Marketing
Research & Development
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Copyright © 2011 Pearson Education
Strategic Management
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Copyright © 2009 Pearson Education, Inc.
Publishing as Prentice Hall
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Vision & Mission
SWOT Analysis
PEST Analysis
Long-Term Objectives
Alternative Strategies
Strategy Selection
Strategy
Formulation
Strategy
Implementation
Strategy
Evaluation
Objectives
Policies
Employee Motivation
Resource Allocation
Internal Review
External Review
Performance Metrics
Co
ective Actions
Three Stages of Strategic Management
Copyright © 2009 Pearson Education, Inc.
Publishing as Prentice Hall
SM involves developing appropriate strategies, putting those strategies into action and evaluating, modifying or changing strategy as needed.
The main activities of Strategic Management are:
Situation analysis: what does the external environment look like and what are our cu
ent organizational capabilities? Where are we headed? Then Strategy formulation: With what we’ve got and/or what we can acquire, what do we need to do to get there?
Strategy Implementation: Just do it!
Strategy Evaluation: How is it working? Are we getting where we want to go? Why? Why not? What do we need to change?
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Vision Statement:
What do we want to become?
Mission Statement:
What is our business?
Key Terms
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New business opportunities
Businesses to abandon/give up
Allocation of resources
Expansion or diversification
International markets
Avoidance of aggressive takeove
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Strategy Formulation
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Issues in Strategy Formulation
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The Action Stage of Strategic Management
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Strategy Implementation
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Is the most difficult stage
Involves mobilization of employees & managers
Interpersonal skills are critical
There must be harmony on goal chases
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New issues in SM today
Globalization
Corporate Governance
E-business
Final Stage of Strategic Management
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Strategy Evaluation
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Copyright © 2011 Pearson Education
Subject to future modification
Today’s success is no guarantee of future success
New and different problems
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Why Manage Strategically?
To make a difference in an organization’s performance.
To provide direction and energy to everyone in an organization
To anticipate and cope with changing internal and external realities
To coordinate and focus the different functions within an organization on achieving goals
In short, to create and support a relevant, sustainable enterprise.
Strategic Management (Benefits):
Is proactive in shaping firm’s future
Initiates and influences firm’s activities
Helps to formulate better strategies that are systematic, logical, and rational
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Benefits of Strategic Management
Financial Benefits
Improvement in sales
Improvement in profitability
Productivity improvement
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Nonfinancial Benefits
Improved understanding of competitors’ strategies
Enhanced awareness of threats
Increased employee productivity
Reduced resistance to change
Enhanced problem-prevention capabilities
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Organizations must monitor events
Ongoing process
Internal and external events
Timely changes
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Adapting to Change
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Some of the characteristics/features for adopting to change process are
Effective Adaptation to change requires long-term focus
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Adapting to Change
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What kind of business should we become?
Are we in the right fields?
Are there new competitors?
What strategies should we pursue?
How are our customers changing?
Adapting to Change
Key Strategic Management Questions
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Competitive Advantage:
Anything that a firm does especially well compared to competing firms
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Strategic Management is Gaining and Maintaining Competitive Advantage
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Adapting to change in external trends, internal capabilities, and resources
Effectively formulating, implementing, and evaluating strategies
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Achieving Sustained Competitive Advantage
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Who is Responsible for Managing Strategically?
The short answer is EVERYONE.
Specifically:
Board of Directors
Senior Management
Other managers and employees
Key Terms
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The Strategists – Those that affect a firm’s success or failure:
Chief Executive Officer (CEO)
Chief Strategy Officer (CSO)
President
Owne
Board Chai
Executive Directo
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More about who does it…
BOD: The board is empowered to act on the shareholders’ behalf in overseeing the management of the company. May actually be involved in management or may simply have an approval role.
Senior Management: CEO, COO, CFO. Responsible for every decision and action of every employee.
Other Managers and employees: Implement and evaluate strategy
Key Terms
Environmental Scanning (Industry Analysis):
The process of conducting research and gathering and assimilating external information
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The basic principle of strategic management:
Key Terms Opportunities & Threats
Strategy Formulation
Take advantage of External Opportunities
Avoid/minimize impact of External Threats
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Opportunities and Threats (External)
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External opportunities and threats are largely beyond the control of a single organization.
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Analyzing Opportunities and threats helps to spot anticompetitive conditions for antitrust purposes
Oportunities and Threats (External) Cont’d…
Analysis of Trends:
Economic
Social
Cultural
Demographic/Environmental
Political, Legal, Governmental
Technological
Competitors
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Strengths & Weaknesses (Internal):
Controllable activities performed especially well or poorly
Strengths and Weaknesses (Internal)
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Strengths and Weaknesses (Internal) Cont’d…
Strengths and weaknesses are typically located in the functional areas of the firm, such as:
Management
Marketing
Finance/Accounting
Production/Operations
Research & Development
Computer Information Systems
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Long Term Objectives (Cont’d)
Long term objectives are essential for ensuring a firm’s success. They:
Provide direction
Help with evaluation
Create interaction
Focus coordination
Basis for planning, motivating, and
controlling
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Key Terms
Annual Objectives:
Short-term milestones that firms must achieve to attain long-term objectives
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Long-term Objectives:
Mission-driven pursuit of specified results more than one year out
Long Term Objectives
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Key Terms
Policies:
Means by which annual objectives will be achieved
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Assessing the Internal Environment
Internal Factors
Performance Metrics
Financial Ratios
Industry Averages
Survey Data
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Strategies:
The means by which long-term objectives are achieved
Strategies
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Some examples of different strategies are:
Geographic expansion
Diversification
Acquisition
Market penetration
Retrenchment
Liquidation
Joint venture
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Example Strategies in Action in 2009
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Mohammed Abdulmohsin Al-Kharafi & Sons Company
(MAK Group)
The MAK Group is one of the largest family-owned organizations in the Arab world. In 2008 it was listed among the top 100 companies in the Muslim world by Dinar Standard. In 2009 its annual turnover was over US$5 billion; it operates in more than