Basic Concepts of Strategic Management

Strategic Management
 Set of managerial decisions and actions that determines the long-run performance of a
firm.
Business Policy
 General management orientation that looks inward for properly integrating the firm's
functional activities.
Challenges to Strategic Management
Globalization
 Internationalization of markets and Corporations
– Global (worldwide) markets rather than national markets

Electronic Commerce

• Use of the Internet to conduct business transactions

– Basis for competition on a more strategic level rather than traditional focus on
product features and costs
E-Commerce: 7 Trends:
1. Internet forcing companies to transform themselves
2. Market access and branding are changing, causing disintermediation of traditional
distribution channels
3. Balance of power shifting to the consumer
4. Competition is changing
5. Pace of business increasing drastically
6. Internet purchasing corporations out of their traditional boundaries
7. Knowledge becoming a key asset and source of competitive advantage
Adaptation to Changing Environmental Conditions
Strategic flexibility:

• Demands a long-term commitment to the development and nurturing of critical resources

• Demands that the firm become a learning organization

Learning Organizations
An organization skilled in creating, acquiring, and transferring knowledge and modifying its
behavior to reflect new knowledge and insights.
Learning Organizations

• Solving problems systematically

• Experimenting with new approaches

• Learning from their own experiences

• Transferring knowledge quickly and efficiently throughout the organization

Environmental Scanning
The monitoring, evaluating, and disseminating of information from the external and internal
environments to key people within the firm.
Environmental Scanning
Identify strategic factors
SWOT Analysis

• Strengths, Weaknesses

• Opportunities, Threats

Internal Environment

• Strengths & Weaknesses

– Within the organization but not subject to short-run control of management

External Environment

• Opportunities & Threats

– External to the organization but not subject to short-run control of management

Strategy Formulation

• Development of long-range plans for the effective management of environmental

opportunities and threats in light of corporate strengths and weaknesses.
Mission Statement

• Purpose or reason for the organization's existence

• Promotes shared expectations among employees

Maytag Corporation Mission Statement

To improve the quality of home life by designing, building, marketing, and servicing the best
appliances in the world.
Objectives

• The end results of planned activity

1. What is to be accomplished
2. Time in which to accomplish it
3. Quantified when possible
Goals vs. Objectives
• A goal is an open-ended statement of what one wants to accomplish with no
quantification of what is to be achieved and no time criteria for completion
Goals & Objectives

• Corporate goals and objectives include:

1. Profitability (net profits)
2. Growth (increase in total assets, etc.)
3. Utilization of resources (ROE or ROI)
4. Market leadership (market share)
Strategies
 • A strategy of a corporation forms a comprehensive master plan stating how the
corporation will achieve its mission and objectives. It maximizes competitive advantage
and minimizes competitive disadvantage.
3 Types of Strategy
1. Corporate strategy
2. Business strategy
3. Functional strategy
Corporate Strategy

• Stability

• Growth

• Retrenchment

Business Strategy

• Competitive strategies

• Cooperative strategies

Functional Strategy

• Technological leadership

• Technological followership

Chapter 2
The Strategic Management Process
Strategic Management
is the process through which organizations...

• analyze and learn from stakeholders inside and outside of the organization,

• establish strategic direction,

• create strategies that are intended to help achieve

• established goals, and

• execute those strategies....

all in an effort to satisfy key organizational stakeholders.

Strategic Management Process

THE BROAD ENVIRONMENT

External Environmental Analysis

• The external environment of business may be divided into two sectors:

1. Broad
2. Task
• All trends and stakeholders in the external environment should be analyzed at both the
domestic and international level
Broad Environment

• The broad environment consists of domestic and global forces such as

1. socio-cultural trends (e.g. demographics)
2. technological trends (e.g. internet)
3. political trends (e.g. open markets)
4. economic trends (e.g. growing economy)
• The broad environment forms the context within which the firm and its task environment
exist.
Task Environment
 • The task environment consists of external stakeholders -- groups or individuals outside
the organization that are significantly influenced by or have a major impact on the
organization -- such as:
1. Customers
2. Suppliers
3. Competitors
Internal Environmental Analysis

• Internal stakeholders include managers, employees and the owners and their
representatives (e.g., board of directors).
• Internal analysis includes an evaluation of internal stakeholders and the organization's
resources and capabilities
• Purpose of internal analysis to determine
1. strengths and opportunities for competitive advantage,
and
2. weaknesses and organizational vulnerabilities that should be corrected.
Strategic Direction
Strategic direction involves

• setting long-term goals and objectives, such as mission and vision

• defines the purposes for which an organization exists and operates

Strategy Formulation

• Strategy is an organizational plan of action intended to accomplish goals.

• Corporate strategy formulation refers to domain definition, or the choice of business

areas. Usually decided by the CEO and the board of directors.
• Business strategy formulation involves domain direction and navigation, or how to
compete in a given area. Usually decided by division heads and business unit managers.
• Functional strategy formulation contains the details of how the functional areas such as
marketing, operations, finance, and research should work together to achieve the
business-level strategy.
Strategy Implementation and Control

• Strategy implementation involves creating the functional strategies, systems, structures,

and processes needed by the organization in achieving strategic ends.
 • Strategic control refers to the processes that lead to adjustments in strategic direction,
strategies, or the implementation plan when necessary.
• Strategic restructuring involves a renewed emphasis on what an organization does well,
combined with a variety of tactics to revitalize the organization and strengthen its
competitive position.
Strategy Evaluation

• The strategy evaluation process involves analyzing your strategic plan and assessing how
well you've done against achieving the goals in your strategy.
• strategy evaluation is an internal analysis tool and should be used as part of a broader
strategic analysis for the organization when making decisions about your strategy.

Chapter 3
Environmental Scanning and Industry Analysis
Environmental Scanning

• the monitoring, evaluation, and dissemination of information relevant to the

organizational development of strategy

Identifying External Environmental Variables

• Natural environment
3. includes physical resources, wildlife and climate that are an inherent part of
existence on Earth
4. form an ecological system of interrelated life
Societal environment
1. mankind's social system that includes general forces that do not directly touch on the
short-run activities of the organization, but that can influence its long-term decisions
2. economic, technological, political-legal and sociocultural
Task environment
1. those elements or groups that directly affect a corporation and, in turn, are affected by it
2. government, local communities, suppliers, competitors, customers, creditors, unions,
special interest groups/trade associations
Industry analysis

• an in-depth examination of key factors within a corporation's task environment

Scanning the Societal Environment: STEEP Analysis

STEEP Analysis

• monitoring trends in the societal and natural environments

• sociocultural, technological, economic, ecological and political-legal forces

Current Sociocultural Trends

1. Increasing environmental awareness
2. Growing health consciousness
3. Expanding seniors market
4. Impact of Millennials
5. Declining mass market
6. Changing pace and location of life
7. Changing household composition
8. Increasing diversity of workforce and markets
Technological Breakthroughs
1. Portable information devices
2. Electronic networking
 3. Alternative energy sources
4. Precision farming
5. Virtual personal assistants
6. Genetically altered organisms
7. Smart, mobile robots
Categories of Risk
1. Regulatory risk
2. Litigation risk
3. Supply chain risk
4. Reputational risk
5. Product and technology risk
6. Physical risk
Threat of New Entrants
Threat of new entrants

• new entrants to an industry bring new capacity, a desire to gain market share and
substantial resources
Entry barrier

• an obstruction that makes it difficult for a company to enter an industry

Barriers to Entry
1. Economies of scale
2. Product differentiation
3. Capital requirements
4. Switching costs
5. Access to distribution channels
6. Cost disadvantages due to size
7. Government policies
Rivalry among Existing Firms

• In most industries, corporations are mutually dependent.

• A competitive move by one firm can be expected to have a noticeable effect on its
competitors and thus may cause retaliation.
1. Number of competitors
2. Amount of fixed costs
3. Rate of industry growth
4. Capacity
5. Diversity of rivals
6. Product or service characteristics
7. Height of exit barriers
Threat of Substitute Products or Services
Substitute product

• a product that appears to be different but can satisfy the same need as another product

• The identification of possible substitute products means searching for products that can
perform the same function, even though they have a different appearance.
The Bargaining Power of Buyers
Bargaining power of buyers

• ability of buyers to force prices down, bargain for higher quality and play competitors
against each other
• Large purchases, backward integration, alternative suppliers, low cost to change
suppliers, product represents a high percentage of buyer's cost, buyer earns low profits,
product is unimportant to buyer
The Bargaining Power of Suppliers

• Refers to the pressure that suppliers can put on companies by raising their prices,
lowering their quality, or reducing the availability of their products.
• A buyer or a group of buyers is powerful if some of the following factors hold true:
1. Industry is dominated by a few companies
2. Unique product or service
3. Substitutes are not readily available
4. Ability to forward integrate
5. Unimportance of product or service to the industry
Relative Power of Other Stakeholders
1. Government
2. Local communities
3. Creditors
4. Trade associations
5. Special interest groups Unions
6. Shareholders.
Industry Evolution
Fragmented industry

• no firm has a large market share and each firm only serves a small piece of the total
market in competition with other firms
Consolidated industry

• domination by a few large firms, each struggles to differentiate products from its
competition
Categorizing International Industries
1. Multi-domestic industries
specific to each country or group of countries
2. Global industries
operate worldwide with multinational companies making only small adjustments for
country-specific circumstances
3. Regional industries
multinational companies primarily coordinate their activities within regions
Strategic Groups

• a set of business units or firms that pursue similar strategies with similar resources

Strategic Types
4. Defenders
focus on improving efficiency
5. Prospectors
focus on product innovation and market opportunities
6. Analyzers
focus on at least two different product market areas
 7. Reactors
lack a consistent strategy-structure-culture relationship
Нурercompetition

• Market stability is threatened by short product life cycles, short product design cycles,
new technologies, frequent entry by unexpected outsiders, repositioning by incumbents
and tactical redefinitions of market boundaries as diverse industries merge.
Using Key Success Factors to Create an Industry Matrix
Key success factors

• variables that can significantly affect the overall competitive positions of companies
within any particular industry

Industry matrix

• summarizes the key success factors within a particular industry

Competitive intelligence

• a formal program of gathering information on a company's competitors

• also called business intelligence

Sources of competitive intelligence:

• Information brokers

• Internet

• Industrial espionage

• Investigatory services

Useful Forecasting Techniques

STRATEGY FORMULATION
Strategy formulation is the development of long- range plans for the
effective management of environmental opportunities and threats, in
light of corporate strengths and weaknesses (SWOT).

MISSION STATEMENT
A mission statement is used by a company to explain, in simple and concise terms, its purpose(s)
for being. The statement is generally short, either a single sentence or a short paragraph.
Example of Mission Statement:
Walmart (WMT): We save people money so they can live better.
Starbucks (SBUX): To inspire and nurture the human spirit-one person, one cup, and one
neighborhood at a time.
Tesla (TSLA): To accelerate the world's transition to /sustainable energy.

Vision Statement
Describes what a company desires to achieve in the future
Example of Vision Statement:
Microsoft's Vision
"To create local opportunity, growth and impact in every community and country around the
world."

BUSINESS STRATEGY
  focuses on improving the competitive position of or business unit's products or services
within the specific industry or segment that the company or business unit serves. How
should we compete?

COMPETITIVE STRATEGY

 is defined as the long term plan of a particular company in order to gain competitive
advantage over its competitors in the industry.

COMPETITIVE ADVANTAGE

 is what makes an entity's products or services desirable to customers than that of any
other rival.

Michael Porter two " generic" competitive strategies

Lower cost strategy
• The ability of a company or a business unit to design, produce, and market comparable
product more efficiently than its competitors.
Differentiation strategy
• The ability of a company to provide unique and superior value to the
buyer in terms of product quality, special features, or after-sale service.

Porter's Generic Strategies

Broad:

 Cost Leadership
 Differentiation

Low Cost (Source)

Narrow:

 Cost Focus
 Differentiation Focus

Differentiation (Source)
Michael Porter two " generic" competitive Strategies
Lower cost strategy
• The ability of a company or a business unit to design, produce, and market a comparable
product more efficiently than its competitors.

Differentiation strategy
• The ability of a company to provide unique and superior value to the buyer in terms of product
quality, special features, or after-sale service.
Cost Leadership
Cost leadership is a business strategy wherein a business firm tries to become the market leader
by operating at the lowest cost amongst all the firms in business.

Differentiation
Doing something unique/different /more efficient to make customer pay more.
Achieved by:

 Higher quality
 Better brand value
 Wider distribution

Cost focus- is a low-cost competitive strategy that focuses on a

particular buyer group or geographic market and attempts to serve only
this niche, to the exclusion of others

Differentiation Focus- In using differentiation focus, a company or business unit seeks

differentiation in a targeted market segment.

Corporate strategy- is primarily about the choice of direction for a firm as a whole and the
management of its business or product portfolio.

3 Key Issues

 Firm's directional strategy- the firm's overall orientation towards growth, stability or
retrenchment.
 Firm's portfolio strategy- the industries or markets in which the firm competes
 Firm's parenting strategy- the manner in which management coordinates activities and
transfers resources and cultivates capabilities among product lines and business units
Directional Strategy
3 Grand Strategies
Growth Strategies

 Concentration or diversification
 Internal development or acquisitions, mergers, or alliances

Stability Strategies

 Status quo

Retrenchment Strategies

 Contraction

Growth Strategies
2 Basic Forms
Concentration
Vertical Growth

 this may be done in order to reduce costs, gain control over a scarce resource, guarantee quality
of a key input, or obtain access to potential customers.

Horizontal Growth

 expanding the business in different areas.

Diversification
Concentric Diversification (RELATED)
Conglomerate Diversification (UNRELATED)

Vertical Growth
Vertical Integration
 the degree to which a firm operates vertically in multiple locations on an industry's value chain
from extracting raw materials to manufacturing to retailing.

Backward integration

 More specifically, assuming a function previously provided by a supplier

Forward Integration

 a function previously provided by a distributor

Vertical Integration Continuum

Full integration

 a firm internally makes 100% of its key supplies and completely controls its distributors.

Taper integration

 (also called concurrent sourcing), a firm internally produces less than half of its own
requirements and buys the rest from outside suppliers (backward taper integration).

Quasi- integration

 a company does not make any of its key supplies but purchases most of its requirements from
outside suppliers that are under its partial control (backward quasi- integration).

Long term contract

 are agreements between two firms to provide agreed-upon goods and services to each other for a
specified period of time.

International Entry Options for Horizontal Growth:

Exporting

 shipping goods produced in the company's home country to other countries for marketing.

Licensing

 Under a licensing agreement, the licensing firm grants rights to another firm in the host country
to produce and/or sell a product.

Franchising

 Under a franchising agreement, the franchiser grants rights to another company to open a retail
store using the franchiser's name and operating system.
 Joint Ventures

 Forming a joint venture between a foreign corporation and a domestic company is the most
popular strategy used to enter a new country.

Acquisitions

 A relatively quick way to move into an international area is through acquisitions- purchasing
another company already operating in that area.

Green-Field Development

 If a company doesn't want to purchase another company's problems along with its assets, it may
choose green-field development and build its own manufacturing plant and distribution system.

Production Sharing

 Coined by Peter Drucker, the term production sharing means the process of combining the higher
labor skills and technology available in developed countries with the lower-cost labor available
in developing countries. Often called outsourcing.

Turnkey Operations

 Turnkey operations are typically contracts for the construction of operating facilities in exchange
for a fee.

BOT Concept

 The BOT (Build, Operate, Transfer) concept is a variation of the turnkey operation.

Management Contracts

 A large corporation operating throughout the world is likely to have a large amount of
management talent at its disposal.

Diversification

 According to strategist Richard Rumelt, companies begin thinking about diversification when
their growth has plateaued and opportunities for growth in the original business have been
depleted.

Two Basic Diversification Strategies

 Concentric (Related) Diversification

 Growth through concentric diversification into a

related industry may be a very appropriate
corporate strategy when a firm has a strong
competitive position but industry attractiveness is
low.

Conglomerate (Unrelated) Diversification

 diversifying into an industry unrelated to its

current one.

CONTRAVERSIES IN DIRECTIONAL GROWTH

STRATEGIES

Although research in not in complete agreement, growth into areas

related to a company's current product lines is generally more successful
than in growth into completely unrelated areas

Cisco's three criteria for takeover:

 It must be relatively small

 It must be comparable in organizational culture
 It must be physically close to one of the existing
affiliates

Stability Strategies
A corporation may choose stability over growth by continuing its current
activities without any significant change in direction.
Pause/proceed-with-caution strategy

 is, in effect, a timeout-an opportunity to rest before continuing a

growth or retrenchment strategy.

No-change strategy

 a decision to do nothing new-a choice to continue current

operations and policies for the foreseeable future.

Profit strategy

 a decision to do nothing new in a worsening situation but instead

to act as though the company's problems are only temporary.
Retrenchment Strategies
A company may pursue retrenchment strategies when it has a weak
competitive position in some or all of its product lines resulting in poor
performance-sales are down and profits are becoming losses.

Turnaround strategy

o emphasizes the improvement of operational efficiency

and is probably most appropriate when a corporation's
problems are pervasive but not yet critical.

Captive company strategy

o involves giving up independence in exchange for

security.

Sell-Out/Divestment Strategy
Sell-out strategy

o makes sense if management can still obtain a good price

for its shareholders and the employees can keep their jobs
by selling the entire company to another firm.

Divestment

o sell off a division with low growth potential.

Bankruptcy/Liquidation Strategy
Bankruptcy

o involves giving up management of the firm to the courts

in return for some settlement of the corporation's
obligations.

Liquidation

o is the termination of the firm.

Portfolio Analysis

 top management views its product lines and business units as a

series of investments from which it expects a profitable return.
  Resource commitment on the best products to ensure continued
success
 Resource commitment on new costly products high risk

Portfolio Analysis
because it tends to primarily view matters financially, it regards business
units and product lines as separate and independent.
It fails to deal with the question of:

 what industries a corporation should enter or

 with how a corporation can attain synergy among its product
lines and business units

These questions are addressed by;"Corporate Parenting Strategy"

CORPORATE PARENTING STRATEGY

views a corporation in terms of resources and capabilities that can be
used to build business unit value as well as generate synergies across
business units
Strategic factors

 Examine each business unit in terms of its strategic factors

Performance improvement

 Examine each business unit in terms of areas in which performance can be

increased

Analyze fit

 Analyze how well the parent corporation fits with the business unit

Balanced Scorecard Approach

 Finance
 Customer
 Internal business perspective
 Innovations and learning

STRATEGY

IMPLEMENTATION

Strategy Implementation
  A process by which strategies and policies or plans are put into
action through the development of programs, budgets and
procedures that they need to accomplish the strategic objectives
and goals that they plan and brainstormed.
 Sum total of activities and choices required for strategic plan
execution.
 Activities within a workplace or organization designed to
manage the activities associated with the delivery of a strategic
plan.

Key Implementation Questions:

1. Who carries out strategic plan?

2. What needs doing for alignment w/ strategy?
3. How is work coordinate?

DEVELOPING PROGRAMS, BUDGETS AND PROCEDURES

Strategy implementation involves establishing programs to create a

series of new organizational activities, budgets to allocate funds to the
new activities and procedures to handle the day-to-day details.

Programs

 A collection of tactics where a tactic is the individual action taken by the organization as
an element of the effort to accomplish a plan.
1. Is a statement of the activities or steps needed to accomplish a single-use?
2. The purpose of a program or a tactic is to make a strategy action-oriented.

Matrix of Change

 Brynjolfsson, Renshaw and Van Alstyne proposed a matrix of change to help managers
decide how quickly change should proceed, in what order changes should take place,
whether to start at a new site, and whether the proposed systems are stable and coherent.
 The matrix of change presents a way to capture connections between practices. It
graphically displays both reinforcing and interfering organizational activities. Armed with
this knowledge, a change agent can use automatic principles to seek points of leverage
and design a smoother transition.

The matrix of change can be used to address the following types of questions:

FEASIBILITY

 Do the proposed programs and activities constitute a coherent, stable system?

Are the current activities coherent and stable? Is the transition likely to be
difficult?
SEQUENCE OF EXECUTION

Where should the change begin? How does the sequence affect success? Are there reasonable
stopping points?

LOCATION

Are we better off instituting the new programs at a new site, or can we recognize the existing
facilities at a reasonable cost?

PACE AND NATURE OF CHANGE

Should the change be slow or fast, incremental or radical? Which blocks of current activities
must be changed at the same time?

STAKEHOLDERS EVALUATION

Have we overlooked any important activities or interactions? Should we get further input from
interested stakeholders?

Which new programs and current activities offer the greatest sources of value?

Budgets

A statement of a corporation's programs in terms of denominations.

Used in planning and controlling (budget lists) Helps formulate the company's activities,
allowing it to better understand priorities, figure out how resources can be allocated, and which
areas need to be reevaluated.

Procedures

Sometimes termed as Standard Operating Procedures (SOP) or also known as organizational

routines.

A system of sequential steps or techniques that describe in detail like how a particular task or job
is to be done?

Structure Follows Strategy

Is a business principle that states that the divisions, departments, teams, processes and
technology of an organization are designed to achieve a firm's strategy.
In classic study of large U.S. Corporations such as DuPont, General Motors, Sears and Standard
Oil, Alfred Chandler concluded that structure follows strategy is the changes in corporate
strategy which it lead to changes in organizational structure.

"Strategy can be defined as the determination of the long-term goals and objectives of an
enterprise, and the adoption of courses of action and the allocation of resources necessary for
carrying out these goals" - Alfred Dupont Chandler Jr. American Professor (1918-2007)

Chandler proposed the following as the sequence of what occurs:

1. New strategy is created

2. New administrative problems emerge
3. Economic performance declines
4. New appropriate structure is invented
5. Profit returns to previous level

LEVELS OF STRATEGY

The typical business firm usually considers three types of strategy:

 Corporate Strategy
1. Overall Direction of Company & Management of its Business
 Business Strategy
2. Competitive and Cooperative Strategies
 Functional Strategy
3. Maximize Resource Productivity

Stages of Corporate Development

Simple Structure (Stage I)

(Stage II) Functional Structure

Divisional Structure (Stage III)

(Stage IV) Beyond SBU's

Blocks to Changing Stages

 Loyalty to comrades
 Task oriented
 Single-mindedness
Working in isolation Organizational Life Cycle

The organizational life cycle describes how organizations grow, develop and eventually decline.
It is the organizational equivalent of the product life cycle in marketing.
Advanced Types of Organizational Structures

Matrix Structures

Functional and product forms are combined simultaneously at the same level of the organization.

Conditions for Matrix Structures include:

 Ideas need to be cross-fertilized across projects or products

 Scarcity of resources
 Abilities to process information and to make decisions needs to be improved

Network Structure

 Virtual elimination of in-house business functions.

 Composed of a series of project groups or collaborations linked by constantly changing
nonhierarchical, cobweb-like electronic networks.

Cellular/Modular Structure
Composed of cells (self-managing teams, autonomous business units, etc.) which can operate
alone but which can interact with other cells to produce a more potential and competent business
mechanism.

Reengineering and Strategy Implementation

 Michael Martin Hammer was a Jewish-American engineer, management author, and a

former professor of computer science at the Massachusetts Institute of Technology,
known as one of the founders of the management theory of Business process
reengineering.

Michael Hammer, who popularized the concept of reengineering, suggest the following
principles for reengineering:

 Organize around outcomes, not tasks

 Have those who use the output of the process perform the process
 Subsume information-processing work into real work that produces the information
 Treat geographically dispersed resources as though they were centralized
 Link parallel activities instead of integrating their result
 Put the decision point where the work is performed and build control into the process
 Capture information once and at the source

Process of Six Sigma

Six Sigma is an analytical method for achieving near-perfect results on a production line.
Another than that is a set of techniques and tools for process improvement. That normally, seek
to improve manufacturing quality by identifying and removing the causes of bad action and
minimizing the possible risk that may happen in the business processes. And also, emphasis on
reducing product variance in order to boost quality and efficiency.

4. DEFINE
5. MEASURE
6. ANALYZE
7. IMPROVE
8. ESTABLISH

Designing Jobs to Implement Strategy

Job Design

The study of individual tasks in an attempt to make them more relevant to the company and to
the employees.

Job Enlargement

Combining tasks to give a worker more of the same type of duties to perform.

Job Rotation

Moving workers through several jobs to increase variety.

Job Characteristics

Using task characteristics to improve employee motivation.

Job Enrichment

Altering the jobs by giving the worker more autonomy and control over activities.

International Issues in Strategy Implementation

Multinational Corporation (MNC)

A highly developed international company with a deep involvement throughout the world, plus a
worldwide perspective in its management and decision making.

International Strategic Alliances

Product-group Structure

 is a framework in which a business is organized in separate divisions, each focusing on a

different product or service and functioning as an individual unit within the company.

Geographic-area Structure

 organizes people within an organization by geographic location. This structure creates

specific divisions for each location. Each division acts as if it is its own company,
combining different types of personnel for various business functions.

HOW TO EXPERIENCE A SUCCESFUL STRATEGY IMPLEMENTATION?

1. Team Support
2. Execute your Plan
3. Clear Goals and Strategies
4. Determine Roles and Leadership
5. Frequent Communication
6. Honesty
7. Monitor and Encourage
 Importance of Strategy Implementation

 Strategy implementation is so important because it is an action, instead of words or

brainstorming. Additionally, it also helps to show the team that the strategies being
discussed are viable and puts them into action. Where it is also a great tool for team
development because everyone can participate. Strategy implementation depends on
thorough communication and the right tools to facilitate the strategy.

Mission Statement 1. It allows a company to state who they are, what they do and what
they like to become.
SWOT Analysis 2. One popular method of environmental scanning.
Electronic Commerce 3. It is the doing business transaction with the aid or interference of
technology.
Strategic Management 4. Involves setting objectives, analyzing the competitive
environment, analyzing the internal organization, evaluating strategies, and ensuring that
management rolls out the strategies.
Learning Organizations 5. It is a company that facilitates the learning of its members and
continuously transforms itself.
Globalization 6. It is the integration of different countries that conduct business
transactions.
Objectives 7. It is the set for short-term accomplishment of a company.
Business Strategy 8. Defines what the company needs to do to reach its goals, which can
help guide the decision-making process for hiring as well as resource allocation.
Business Policy 9. It is more on guidelines that facilitate to reach a predetermined objective both
in mode and manner formulated from the top to the lower level management.
Environmental Scanning 10. lt is the ongoing tracking of trends and occurrences in an
organization's internal and external environment that bear on its success, currently and in the
future.

strategic restructuring 11. We modify an existing strategy to renew its aspect that will fit the
situation that we have.
strategic direction 12. Pertains to the longer-term goals and objectives and defines the purposes
for which an organization exists and operates.
strategy implementation 13. Involves creating a pattern of decisions and actions that are intended
to carry out a plan.
Strategy 14. Is an organizational plan of action intended to accomplish goals.
strategy evaluation 15. It is an internal analysis tool wherein we check whether the steps taken by
the company provides the desired result or outcome.
strategic management 16. The process of setting goals, procedures, and objectives in order to
make a company or organization more competitive. Typically, strategic management looks at
effectively deploying staff and resources to achieve these goals.

Competitors 17. Is a person, business, team, or organization that competes against you or your
company.

multimedia trends 18. The following are factors of broad environment except.

strategic management process 19. Merely pertain in the actions, or procedure that the company
used to outperform their competitor in the market.

Competitive Intelligence 20. It refers to the ability to use, gather, analyze information collected
on competitors, customers, and other market factors.

Physical Risk 21. It may result from the involvement of physical stimuli such as noise, electric
shock, heat, cold, electric magnetic or gravitational fields, etc.

STEEP Analysis 22. Working through this analysis is a great way to ensure that you stay aligned
with the company's values.

Environmental Scanning 23. It is very important because it contributes to organizational

performance of a company.

Rivalry 24. It is the "against each other" spirit between two competing sides.

Threat of New Entrants 25. lt is the risk a new competitor creates for current companies within
an industry

Key Success Factors 26. By understanding this factors, you can easily determine the success of
an organization in an industry.
Strategic Groups 27. It is a concept used in strategic management that groups companies within
an industry that have similar business models or similar combinations of strategies.

Expert Opinion 28. lt is the scientific comments or views by a group of designated experts based
on a review of scientific evidence.

The Bargaining Power of Buyers 29. Refers to the pressure that customers/consumers can put on
businesses to get them to provide higher quality products, better customer service, and/or lower
prices.