LECTURE 1: INTRODUCTION TO

STRATEGIC MANAGEMENT

Arlene C. Gutierrez
Assistant Professor
DAME,CEM,UPLB

Department of Agribusiness Management and Entrepreneurship

CEM, UPLB
INTRODUCTION
“Almost every company
has hot moments. But only great
companies achieve strong, sustainable
performance over time.
While it’s fun to be hot; it’s far more
gratifying to create an enduring,
sustainable business.”
- John Donahue, CEO, eBay

Department of Agribusiness Management and Entrepreneurship

CEM, UPLB
WHAT IS STRATEGIC MANAGEMENT?
• Strategic management
consists of the analyses,
decisions, and actions an
organization undertakes
in order to create and
sustain competitive
advantages

Department of Agribusiness Management and Entrepreneurship

CEM, UPLB
STRATEGY
• Comes from the Greek word
“strategos” which referred to
military command
• Referred to the overarching plan
which had to accommodate
uncertainties of external
circumstances and enemy
actions

Department of Agribusiness Management and Entrepreneurship

CEM, UPLB
STRATEGY

Sustainable
Competitive
Advantage
Department of Agribusiness Management and Entrepreneurship
CEM, UPLB
STRATEGY

Department of Agribusiness Management and Entrepreneurship

CEM, UPLB
STRATEGY

Integrated set of choices

that positions the business it
its industry as to generate
superior financial returns
over the long run

Department of Agribusiness Management and Entrepreneurship

CEM, UPLB
STRATEGY

The key to a successful

strategy is:

Department of Agribusiness Management and Entrepreneurship

CEM, UPLB
COMPETITIVE ADVANTAGE
• A firm has a competitive advantage over
its rivals if it has driven a wide wedge
between the amount its customers are
willing to pay and the cost it incurs,
allowing it to earn superior profits within
the industry

Department of Agribusiness Management and Entrepreneurship

CEM, UPLB
COMPETITIVE ADVANTAGE

Department of Agribusiness Management and Entrepreneurship

CEM, UPLB
ASSESSING COMPETITIVE ADVANTAGE

Department of Agribusiness Management and Entrepreneurship

CEM, UPLB
STRATEGIC MANAGEMENT

How should we compete in

order to create competitive
advantages in the
marketplace?

How can we create competitive

advantages in the marketplace
that are unique, valuable, and
difficult for rivals to copy or
substitute?

Department of Agribusiness Management and Entrepreneurship

CEM, UPLB
FOUR KEY ATTRIBUTES OF STRATEGIC
MANAGEMENT?
Strategic management is directed toward overall
organizational goals and objectives.
Strategic management includes multiple
stakeholders in decision making
Strategic management requires incorporating
both short-term and long-term perspectives
Strategic management involves the recognition of
trade-offs between effectiveness and efficiency

Department of Agribusiness Management and Entrepreneurship

CEM, UPLB
STRATEGIC MANAGEMENT PROCESS

Strategic
Analysis

Strategic Strategic
Implementation Formulation

Department of Agribusiness Management and Entrepreneurship

CEM, UPLB
STRATEGIC MANAGEMENT PROCESS

Where are we?

Where do we want to go?

How do we get there?

Department of Agribusiness Management and Entrepreneurship
CEM, UPLB
STRATEGIC MANAGEMENT PROCESS

STRATEGIC ANALYSIS

Analyzing Goals
and Objectives

Analyzing the Analyzing the

External Internal
Environment Environment

Assessing
Intellectual
Capital

Department of Agribusiness Management and Entrepreneurship

CEM, UPLB
STRATEGIC MANAGEMENT PROCESS

STRATEGIC FORMULATION

Business Level
Strategies

Corporate Level International

Strategies Strategies

Entrepreneurial
Strategy and
Competitive
Dynamics

Department of Agribusiness Management and Entrepreneurship

CEM, UPLB
STRATEGIC MANAGEMENT PROCESS

STRATEGIC IMPLEMENTATION

Strategic
Control and
Corporate
Governance

Organizational Strategic
Designs Leadership

Corporate
Entrepreneurship

Department of Agribusiness Management and Entrepreneurship

CEM, UPLB
STRATEGIC MANAGEMENT PROCESS

STRATEGIC IMPLEMENTATION

Strategic
Control and
Corporate
Governance

Organizational Strategic
Designs Leadership

Corporate
Entrepreneurship

Department of Agribusiness Management and Entrepreneurship

CEM, UPLB
BENEFITS OF STRATEGIC MANAGEMENT

Department of Agribusiness Management and Entrepreneurship

CEM, UPLB
WHY SOME FIRMS DO NO STRATEGIC
PLANNING
• Lack of knowledge or experience in strategic planning
• Poor reward structures
• Firefighting
• Waste of time
• Too expensive
• Laziness
• Content with success
• Fear of failure
• Overconfidence
• Fear of unknown
• Honest difference of opinion
• Suspicion

Department of Agribusiness Management and Entrepreneurship

CEM, UPLB
WHY SOME FIRMS DO NO STRATEGIC
PLANNING
• Lack of knowledge or experience in strategic planning
• Poor reward structures
• Firefighting
• Waste of time
• Too expensive
• Laziness
• Content with success
• Fear of failure
• Overconfidence
• Fear of unknown
• Honest difference of opinion
• Suspicion

Department of Agribusiness Management and Entrepreneurship

CEM, UPLB