What is strategy ?

Strategy is the direction and scope of an

organization over the long term ; ideally,
which matches its resources to its changing
environment, and in particular its markets,
customers or clients so as to meet
stakeholder expectations.

“The clear cut choices about how to compete”

“ The direction or path chosen to pursue the

goal”

“ Strategy is about making tradeoffs in choices”

What is the difference between
Strategy and Tactics.

Strategy is the path or choice

made to pursue the goal.
Tactic is the rate or speed at which
you pursue the strategy.
Characteristics of Strategic
Decisions:

Strategic Decisions are about:

•The long-term direction of an
organization.
•The scope of an organization’s
activities
•Gaining advantage over competitors.
•Addressing changes in the business
environment.
•Building on resources and
competencies
(capability)
Thus strategic decisions are likely to
be :

• Complex in nature
• Be made in situations of
uncertainty.
• Affect operational decisions.
• Require an integrated approach
(both inside and outside the
organization)
• Involve considerable change
Evolution of the concept of
strategic Management
 The word Strategy comes from the Greek work-
Strategia, which means a General or Military
Commander(the art of the general)
 Stratos: clouds
 Argos: army
Thus literally it means, “ the view of the army from
the clouds”
War and Strategy are inseparable.
Strategic Management can be defined
as the set of decisions and actions
resulting in formulation and
implementation of strategies designed
to achieve both the short and long
term objectives of an organization.

The strategist’s work is to challenge

the existing set up with a single
question -Why?
 Work done in the field of Strategy

The Gurus:
Igor Ansoff- pioneered the concept of strategy
Henry Mintzberg
Peter Drucker
Michael Porter

All of them of them enriched the concept of

strategic management with their original
insights.
 Ansoff’s Strategic Success
Paradigm
 Igor Ansoff conducted extensive
research on acquisitions by American
companies between 1948 and 1968.
 He found that acquisitions based on a
rational strategy fared far better than
those that were based on opportunistic
decisions.
Ansoff’s other contributions-
 His book “ Corporate Strategy” (1965),
played a key role in the development of
strategic planning.
 An analytical Approach to Business Policy
for Growth and Expectation.
 He introduced gap analysis and the
concept of synergy to a wide audience for
the first time.
 He created the famous “Ansoff’s Grid”
 Henry Mintzberg- Strategy
as craft
 The next most influential thinker in the
field of strategic management – he gave
the personal side of the manager into the
picture.
 Advocated a more humane approach to
strategy formulation and implementation
and coined “crafting strategy”.
 Seminal works include “ The rise and fall of
Strategic Planning” & “Strategy Safari”
 Peter Drucker ‘s
contribution
 Biggest contribution to business strategy
was the introduction of the concept of
Management by Objectives (MBO).

 The focus was shifted from processes to

goals.
 Major contributions-
The Practice of Management ,
The Essential Drucker
Michael Porter:
Competitive Strategy and Competitive Advantage

Based on environment analysis, he introduced

the “ five forces model”.
He introduced generic strategies like focus,
cost leadership and differentiation.
He also introduced the “value chain
analysis”.
Literally his contributions include-
Competitive Strategy(1980),
Competitive Advantage(1985),
The Competitive Advantage of Nations (1990)
 Other notable contributors in the field of strategy include-

 C.K. Prahalad and Gary Hamel

 Sumantra Ghoshal and Christopher
Bartlett.
 Kenechi Ohmae.
 Chan Kim and Renee Maubourgne.