Business Strategy and Policy

Topics: Strategic management, Management, Business Pages: 12 (2743 words) Published: February 12, 2014
Business Strategy and Policy – Chapter 1

BUS522(2008E)

CHAPTER 1: THE NATURE OF STRATEGIC
MANAGEMENT
CHAPTER SYNOPSIS
Chapter 1 provides an overview of strategic management. A practical, integrative model of the strategic-management process is introduced. Basic activities and terms in strategic management are defined. The benefits of strategic management are presented. Important relationships between business ethics and strategic management are discussed. In addition, the chapter initiates discussion of two themes that are present throughout the text: global considerations and the strategic implications of the natural environment.

VTN (Visit the Net): The website www.strategyclub.com, designed by Dr. David, provides strategic planning tools, templates, links, and information to help strategic management students analyze cases.

The first theme is that global considerations impact virtually all strategic decisions. The boundaries of countries can no longer be the boundary of our minds. It has become a matter of survival for businesses to see and appreciate the world from the perspective of others. The underpinnings of strategic management hinge on managers gaining an understanding of competitors, markets, prices, suppliers, distributors, governments, creditors, shareholders, and customers worldwide. The price and quality of a firm’s products and services must be competitive on a world basis, not just a local basis. A Global Perspective illustration is provided in all chapters of this text to emphasize the importance of global factors in strategic management. A second theme evidenced throughout this text is that the natural environment is an important strategic issue. Perhaps no greater threat exists to business and society than the continuous decimation and degradation of our natural environment. This is a strategic issue that needs immediate and substantive attention by all businesses and managers. A Natural Environment Perspective is provided in all chapters. Like the Global Perspectives, these are boxed inserts.

VTN (Visit The Net): The website www.prenhall.com/david provides sample tests and supplemental material for each chapter.

CHAPTER OUTLINE





What is Strategic Management?
Key Terms in Strategic Management
The Strategic-Management Model
Benefits of Strategic Management
Page 1

Business Strategy and Policy – Chapter 1









BUS522(2008E)

Why Some Firms Do No Strategic Planning
Pitfalls in Strategic Planning
Guidelines for Effective Strategic Management
Business Ethics and Strategic Management
Comparing Business and Military Strategy
The Nature of Global Competition
The Cohesion Case: Disney

CHAPTER OBJECTIVES
After studying this chapter, you should be able to do the following: 1.
2.
3.
4.
5.
6.
7.
8.
9.
10.

Describe the strategic-management process.
Explain the need for integrating analysis and intuition in strategic management. Define and give examples of key terms in strategic management. Discuss the nature of strategy formulation, implementation, and evaluation activities.

Describe the benefits of good strategic management.
Explain why good ethics is good business in strategic management. Explain the advantages and disadvantages of entering global markets. Discuss the relevance of Sun Tzu’s The Art of War to strategic management. Discuss how a firm may achieve sustained competitive advantage. Explain ISO 14000 and 14001

ISSUES FOR REVIEW AND DISCUSSION
1. Explain why Strategic Management often is called a “capstone course.” Business policy is commonly called a capstone course because students’ major responsibility in this class is to use all knowledge gained in prior courses to chart the future direction of different organizations.

2. What aspect of strategy formulation do you think requires the most time? Why?
Important aspects of strategy formulation include developing a business mission, performing an external audit,...
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