strategic management
Summary Strategic Management
PART A STRATEGIC ANALYSIS
Lesson 1 Strategic Schools of Thought and Strategic Discourse
Strategy is the long-term direction of an organisation. Strategy and marketing are alike but they have different purposes.
The importance of a long-term perspective on strategy is emphasised by the three horizons framework. It suggest that every organisation should think of itself as comprising three types of business or activity, defined by their horizons in terms of years.
In an organisation, strategies can exist at three main levels of strategic thinking.
1. Corporate-level is concerned with the overall scope of an organisation and how value is added to the constituent business of the organisational whole.
2. Business-level is about how the individual business should compete in their particular markets.
3. Operational-level are concerned with how the components of an organisation deliver effectively the corporate and business level strategies in terms of resources, processes and people.
5 strategy statements – about strategic purpose
1. Mission – relates to goal and refers to the overriding purpose of the organisation. “What business are we in?”
2. Vision – too relates to goal, but refers to the desired future state of the organisation. “What do we want to achieve”?
3. Objectives – are more precise and ideally quantifiable statements of the organisations goals over some period of time. Might refer to profitability or market share values. “What do we have to achieve in the coming period”?
4. Scope – refers to the three dimensions: customer/clients, geographical location and extent of internal activities (vertical integration).
5. Advantage – describes how the organisation will achieve the objectives it has set for itself in a chosen domain. In competitive environments, this refers to the competitive advantage.
A strategic business unit (SBU) is a part of an organisation for which there is a distinct external market that
PART A STRATEGIC ANALYSIS
Lesson 1 Strategic Schools of Thought and Strategic Discourse
Strategy is the long-term direction of an organisation. Strategy and marketing are alike but they have different purposes.
The importance of a long-term perspective on strategy is emphasised by the three horizons framework. It suggest that every organisation should think of itself as comprising three types of business or activity, defined by their horizons in terms of years.
In an organisation, strategies can exist at three main levels of strategic thinking.
1. Corporate-level is concerned with the overall scope of an organisation and how value is added to the constituent business of the organisational whole.
2. Business-level is about how the individual business should compete in their particular markets.
3. Operational-level are concerned with how the components of an organisation deliver effectively the corporate and business level strategies in terms of resources, processes and people.
5 strategy statements – about strategic purpose
1. Mission – relates to goal and refers to the overriding purpose of the organisation. “What business are we in?”
2. Vision – too relates to goal, but refers to the desired future state of the organisation. “What do we want to achieve”?
3. Objectives – are more precise and ideally quantifiable statements of the organisations goals over some period of time. Might refer to profitability or market share values. “What do we have to achieve in the coming period”?
4. Scope – refers to the three dimensions: customer/clients, geographical location and extent of internal activities (vertical integration).
5. Advantage – describes how the organisation will achieve the objectives it has set for itself in a chosen domain. In competitive environments, this refers to the competitive advantage.
A strategic business unit (SBU) is a part of an organisation for which there is a distinct external market that