What Is Strategy?

Topics: Management, Strategic management, Michael Porter Pages: 3 (896 words) Published: July 20, 2013
Strategic Management

BM3310

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Student Name : Kim Heejun
Student I.D.: 607-1213-02
Programme: BABHM

Today's dynamic markets and technologies have called into question the sustainability of competitive advantage. Under pressure to improve productivity, quality, and speed, managers have embraced tools such as TQM, benchmarking, and reengineering.
Dramatic operational improvements have resulted, but rarely have these gains translated into sustainable profitability. And gradually, the tools have taken the place of strategy. As managers push to improve on all fronts, they move further away from viable competitive positions. Michael Porter argues that operational effectiveness, although necessary to superior performance, is not sufficient, because its techniques are easy to imitate. In contrast, the essence of strategy is choosing a unique and valuable position rooted in systems of activities that are much more difficult to match.

In answering the question ‘what is strategy?’, some theorists focus more on the role of strategy in allowing a firm to ‘position’ itself in an industry, hence to make choices regarding ‘what game to play’. Others focus more on the role of strategy in determining how well a given game is played. Strategy is about both: choosing new games to play and playing existing games better.

One of the biggest disagreements among strategy researcher concerns the process by which strategies emerge. Some describe stratgy as a rational and deliberate process, while others describer it as an evolutionary process which emerges from experimentation and trial and error. Some place more emphasis on external factors, like the structure of the industry to which the firm belongs (e.g. the industrial organization approach), while others place more emphasis on factors internal to the organization, like the way production is organized (e.g. Resource-Based approach). Furthermore, some...
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