STRATEGIC

MANAGEMENT
CHAPTER 9
 Describe competitive 9.5
advantage and the
competitive strategies
organizations Discuss current
9.4 strategic management
use to get it.
issues.

Explain what managers 9.3

do during the six steps
of the strategic Describe the three
management process 9.2 types of corporate
strategies

9.1
Define strategic
management and explain
why it’s important
 9.1 Define strategic management and explain why it’s important

STRATEGIC MANAGEMENT - what managers do to

develop the organization’s strategies

Strategies - the plans for how the organization will do wh

at it’s in business to do, how it will compete successfully,
and how it will attract and satisfy its customers in order to
achieve its goals

BUSINESS MODEL - how a company is going to make money

 9.2 Explain what managers do during the six steps of the strategic management process

STRATEGIC MANAGEMENT PROCESS - is a 6 step process that encompasses strategy planning,

implementation, and evaluation
Step 1: Identifying the Organization’s Current Mission, Goals, and Strategies

MISSION a statement of an
organization’s purpose
Step 2: Doing an External Analysis Step 3: Doing an Internal Analysis
RESOURCES an organization’s
assets that are used to develop,
manufacture, and deliver products
to its customers
OPPORTUNITIES Positive CAPABILITIES are its skills and
trends in the external abilities in doing the work
environment activities needed in its business
CORE COMPETENCIES the
organization’s major value-creating
capabilities that determine its
competitive weapons

THREATS negative trends in STRENGTHS & WEAKNESSES

the external environment are activities the organization
doesn’t do well or resources it need
s but doesn’t possess

SWOT ANALYSIS an analysis of the organization’s strengths, weaknesses, opportunities, and threat
s

Step 4: Formulating Strategies
Step 5: Implementing Strategies
Step 6: Evaluating Results
As managers formulate strategies, they should
consider the realities of the external environment and their
available resources and capabilities in order to design
strategies that will help an organization achieve its goals.
The three maintypes of strategies managers will formulate
include corporate, competitive, and functional
Once strategies are formulated, they must be implemented.
No matter how effectively an organization has planned its
strategies, performance will suffer if the strategies aren’t
implemented properly.
The final step in the strategic management process is
evaluating results
 9.3 Describe the three types of corporate strategies
CORPORATE STRATEGY an organizational strategy that determines what businesses a company
is in or wants to be in, and what it wants to do with those businesses

3 main types of corporate strategy

 GROWTH STRATEGY A corporate strategy that’s used when an organization wants to expand
the number of markets served or products offered, either through its current business(es) or
through new business(es)

 STABILITY STRATEGY is a corporate strategy in which an organization continues to do what it

is currently doing

 RENEWAL STRATEGY a corporate strategy designed to address declining performance

BCG MATRIX a strategy
tool that guides resource
allocation decisions on
the basis of market share
and growth rate of SBUs
9.4Describe competitive advantage and the competitive strategies organizations use to get it.

COMPETITIVE STRATEGY an organizational

strategy for how an organization will compete in its
business(es)

STRATEGIC BUSINESS UNIT (SBU) those single

businesses that are independent and that have
their own competitive strategies

COMPETITIVE ADVANTAGE what sets an

organization apart; its distinctive edge
QUALITY AS A COMPETITIVE ADVANTAGE If a business is able to continuously improve the
quality and reliability of its products, it may have a competitive advantage that can’t be taken
away

SUSTAINING COMPETITIVE ADVANTAGE organization must be able to sustain that advantage;

that is, to keep its edge despite competitors ’actions or evolutionary changes in the industry.
FIVE FORCES MODEL in
any industry, five competitive
forces dictate the rules of
competition. Together, these
five forces determine
industry attractiveness and
profitability, which managers a
ssess using these five
factors

1. Threat of new entrants

2. Threat of substitutes.
3. Bargaining power of buyers
4. Bargaining power of supplier
5. Current rivalry
FUNCTIONAL STRATEGY the strategies used by an organization’s 9.5 Discuss
various functional departments to support the competitive strategy current
strategic
STRATEGIC LEADERSHIP the ability to anticipate, envision, maintain flexibility, management
think strategically, and work with others in the organization to initiate changes that issues
will create a viable and valuable future for the organization
Strategic flexibility the ability to recognize major external changes, to quickly commit resources,
and to recognize when a strategic decision was a mistake

Developing Strategic Flexibility

• Encourage leadership unity by making sure everyone is on the same page.
• Keep resources fluid and move them as circumstances warrant.
• Have the right mindset to explore and understand issues and challenges.
• Know what’s happening with strategies currently being used by monitoring and measuring results.
• Encourage employees to be open about disclosing and sharing negative information.
• Get new ideas and perspectives from outside the organization.
• Have multiple alternatives when making strategic decisions.
• Learn from mistakes.
 In today’s environment we think three strategies are important in
today’s environment: e-business, customer service, and innovation

e-BUSINESS STRATEGIES might be a clicks-and-bricks strategy. A clicks-and-bri

cks firm is one that uses both online (clicks) and traditional stand-alone locations
(bricks)

CUSTOMER SERVICE STRATEGIES companies emphasizing excellent customer

service need strategies that cultivate that atmosphere from top to bottom. such
strategies involve giving customers what they want, communicating effectively with
them, and providing employees with customer service training

INNOVATION STRATEGIES using this strategy, an organization looks for ways to

improve and enhance its work processes. The organization innovates new and
improved ways for employees to do their work in all organizational areas

FIRST MOVER an organization that’s first to bring a product innovation t

o the market or to use a new process innovation
First-Mover Advantages and Disadvantages
THANK YOU!!!