Strategy and Strategic Management

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What is Strategy?
A strategy is a long-term approach to implementing a firm's business plans to achieve its business objectives. It is also defined as the art and science of planning and marshalling resources for their most efficient and effective use. However, Johnson and Scholes (Exploring Corporate Strategy) define strategy as follows: "Strategy is the direction and scope of an organization over the long-term: which achieves advantage for the organization through its configuration of resources within a challenging environment, to meet the needs of markets and to fulfill stakeholder expectations". In other words, strategy is about:

* Where is the business trying to get to in the long-term (direction)| * Which markets should a business compete in and what kinds of activities are involved in such markets? (markets; scope)| * How can the business perform better than the competition in those markets? (advantage)| * What resources (skills, assets, finance, relationships, technical competence, facilities are required in order to be able to compete? (resources)| * What external, environmental factors affect the businesses' ability to compete? (environment)| * What are the values and expectations of those who have power in and around the business? (stakeholders)|

“The best business strategy must steer a course between the inevitable internal pressure for business continuity and the demands of a rapidly changing world for revolutionary business strategies…” Strategy at Different Levels of a Business

Strategies exist at several levels in any organization - ranging from the overall business (or group of businesses) through to individuals working in it. Corporate Strategy - is concerned with the overall purpose and scope of the business to meet stakeholder expectations. This is a crucial level since it is heavily influenced by investors in the business and acts to guide strategic decision-making throughout the business. Corporate strategy is often stated explicitly in a "mission statement". Business Strategy - is concerned more with how a business competes successfully in a particular market. It concerns strategic decisions about choice of products, meeting needs of customers, gaining advantage over competitors, exploiting or creating new opportunities etc. Functional Strategy - is concerned with how each part of the business is organized to deliver the corporate and business-unit level strategic direction. Operational strategy therefore focuses on issues of resources, processes, people etc. TYPES OF STRATEGIES

1. Stability Strategies
a. Maintenance of Status Quo
- firms adopting this, maintain the same level of operations rather than growth b. Sustainable Growth
- a sustainable growth strategy is more optimistic than a zero growth 2. Growth Strategies
c. Concentric Expansion Strategy
i. Market Penetration
ii. Market Development
iii. Product Development
d. Diversification Strategy
iv. Concentric Diversification
v. Conglomerate Diversification
e. Cooperation Strategy
f. Integration Strategy
vi. Vertical Integration
vii. Horizontal Integration
3. Retrenchment Strategies
g. Restructuring
h. Divestment Strategy (Divestiture)
- selling off parts of the organization
c. Downsizing
4. Global or International Strategies
i. Globalization Strategy
j. Multidomestic Strategy
k. Transnational Strategy
5. Cooperative Strategies
l. Merger
m. Takeovers
n. Strategic Alliance
o. Co-opetition
6. E-business Strategies
p. E-business Strategy
q. B2B Business Strategy
r. B2C Business Strategy

“Strategic management is not a task, but rather a set of managerial skills that should be used throughout the organization, in a wide variety of...
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