Strategic Management-My Notes

Introduction to Strategic Management

• Strategic management encompasses both the academic study and professional practice of strategy
• Durand et al. (2017) critique the disconnect between theory and practical application
• Strategy spans multiple levels within organisations: corporate, business, functional
• Corporate strategy addresses long-term goals and decisions about markets, industries, and geography
• Business strategy focuses on competition within specific markets or locations

Key terms: Corporate Strategy, Business Strategy

Strategic Intent: Purpose and Significance

• Strategic intent defines the overarching aim of an organisation
• Montgomery (2008) emphasizes its role as a unifying direction
• Purpose statements can take forms such as mission, vision, and values
• Strategic intent provides clarity and alignment for stakeholders and teams
• Collins et al. (2005) link well-defined intent to long-term performance

Key terms: Strategic Intent, Vision Statement

Levels of Strategic Intent: Mission, Vision, and Values

• Mission Statement focuses on organisational purpose and activities
• Vision Statement emphasizes future aspirations for the world
• Values define ethical principles guiding strategy and culture
• Challenges include lack of alignment and poorly communicated values
• Effective strategic statements foster clarity and inspire employees

Module 1: Strategic Options and Deliverables

• Strategic options include aim, tactic, direction, method, and competitive stance
• These options allow mapping paths to achieve strategic intent
• Successfully executed strategies provide tangible deliverables
• Strategy deliverables reflect success and are measured quantitatively and qualitatively
• Corporate-level strategies are multidimensional and integrate various aspects of intent

Key terms: Strategic Options, Strategy Deliverables

Module 3: Industry Life Cycle Analysis

• Industry Life Cycle (ILC) examines evolution of industries over time
• Stages: Emergence, Growth, Maturity, Decline
• Transition between stages requires strategic adjustment
• Tracking market indicators informs strategic decisions on entry, spending, and exit
• Disruption points challenge traditional life cycle predictions

Key terms: Industry Life Cycle, Market Indicator

Module 5: Value Chain and System Analysis

• Value Chain evaluates components of strategic business units (SBUs)
• Primary activities differ across industries; support activities bind SBUs together
• Value chains integrate functionally into an overall Value System
• Competitive decisions include outsourcing, vertical integration, or collaborative R&D
• Strategic linkages between activities drive competitive advantage

Key terms: Value Chain, Support Activity

Evaluating Business and Organisational Life Cycles

• Industry Life Cycle (ILC): Stages and Transitional Challenges
• Organisational Life Cycle (OLC): Non-linear Five-Stage Model
• ILC Transitional Risks: Competition from Growth to Maturity
• OLC Stages: Evolutionary Management Styles and Characteristics
• Independence of ILC from OLC: External and Internal Perspectives

Key terms: Industry Life Cycle, Organisational Life Cycle

Frameworks Explaining Organisational Culture

• The Cultural Web (Johnson, 1992): Interconnection of tangible and intangible elements
• Handy’s Gods of Management (1996): Divided into Power, Role, Task, and Personal cultures
• Suitability: Matching culture types to environments for optimal functioning
• Challenges in Changing Culture: Influence on behaviour and subculture dynamics
• Practical Tools: Adjust control systems and reward structures to facilitate change

Strategic Environmental Analysis

• Environment scanning examines external factors impacting strategy
• Three approaches: Objects, Attributes, and Perceptions
• Hypercompetition implies temporary advantage due to rapid change
• PEST categorizes factors into Political, Economic, Social, and Technological
• Scenario planning explores multiple future uncertainties

Key terms: PEST Analysis

Competitive Analysis: Porter’s Frameworks

• Porter's Five Forces analyzes industry competition and profitability
• Threats of New Entrants depends on entry barriers
• Threat from Substitutes evaluates alternative solutions
• Buyer Power examines customer influence
• Supplier Power evaluates upstream control

Key terms: Porter’s Five Forces

Strategic Implementation Challenges

• Execution bridges strategy formulation and action
• Challenges include Behavioral, Organisational, Analytical dimensions
• Organisational Design aligns structure with strategy
• Change Management facilitates transitioning teams and systems
• Performance Metrics require alignment but often suffer from misalignment

Key terms: Balanced Scorecard

Concluding Insights: Strategic Management in Practice

• Strategic Intent provides long-term direction and purpose
• Strategy evolves dynamically (Mintzberg et al., emergent strategy)
• Execution requires continuous innovation and alignment
• Tools like SWOT, PEST, and BCG Matrix integrate diverse perspectives
• Leadership plays a crucial role in enabling decision-making agility

Key terms: Emergent Strategy

References

• Durand, R., Grant, R.M. and Madsen, T.L. (2017) 'The expanding domain of strategic management research and the quest for integration'. Strategic Management Journal, 38(1), pp. 4–16.
• Montgomery, C.A. (2008) 'Putting leadership back into strategy'. Harvard Business Review, November, pp. 54–60.
• Collins, J.C. and Porras, J.I. (2005) 'Built to Last: Successful Habits of Visionary Companies'. New York: HarperCollins.
• Porter, M.E. (1980) Competitive Strategy. New York: Free Press.
• Durand, R., Grant, R., and Madsen, T.L. (2017) 'Evolution of strategy', Strategic Management Journal, 38(3), pp. 1-17.
• McGahan, A. (2004) 'Disruption and industry trajectories', Strategic Management Journal, 25(8), pp. 229-248.
• Porter, M.E. (1980). Competitive Strategy, New York: Free Press.
• Porter, M.E. (1985) Competitive Advantage. New York: The Free Press.
• Goold, M. and Campbell, A. (2000) 'Strategies for achieving synergy,' Harvard Business Review, 78(4), pp. 20-30.
• McGahan, A.M. (2004). 'Understanding industry evolution', Strategic Management Journal, 25(8), pp. 837-857.
• Lester, J.A. et al. (2003). 'The organisational lifecycle model', Journal of Business Research, 56(9), pp. 709–715.
• Handy Spectrum Outputs 1996 IoBrief BigDivide TangibilityBridge CaseWork 'subdivisions matching surface brightest matching-elevations/adaptive']
• Bourgeois, L.J. (1980) 'Performance and consensus among top management', Strategic Management Journal, 1(3), pp. 227-234.
• Porter, M.E. (1980) Competitive Strategy: Techniques for Analyzing Industries and Competitors. New York: Free Press.
• Kaplan, R.S., & Norton, D.P. (1996) The Balanced Scorecard: Translating Strategy into Action. Harvard Business School Press.
• Mintzberg, H. (2009) Strategy Safari. 2nd edn. Pearson Education.
• Kaplan, R.S., & Norton, D.P. (2000) Strategy Maps: Converting Intangible Assets into Tangible Outcomes. Harvard Business School Press.