Professional Documents
Culture Documents
Strategic Management
Submitted To:
Prof.Muhammad Ramzan
Submitted By:
Muhammad Umair
MC13-055
Muhammad Asif
MC13-056
Muhammad Adil
MC13-094
Muhammad Bilal
MC13-061
Ahsan Azeez
MC13-060
H.Muhammad Faisal
MC13-080
Table of content
Introduction
Importance of strategic management
Strategic management process
Types of strategies
Problem of implementing strategic management
Conclusion
and ruin. It allows a business to use forward thinking. In this process it shows
a business where they are currently, where they want to be and how to get
where they want to be.
A well-formulated strategy can bring various benefits to the organization in
present as well as in future.
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and strategies.
Every organization needs mission, goals, vision and strategies for effective working in
the market. One who dont focus on mission, goals, strategies and vision cannot survive for long
run business.
Mission:
STRATEGY:
Strategy is a high level plan to achieve one or more goals under conditions
of uncertainty. Strategy is important because the resources available to achieve these goals are
usually limited.
Goals & Objectives:
The purpose of goal-setting is to clarify the vision for
your business. This stage consists of identifying three key facets: First, define
both short- and long-term objectives. Second, identify the process of how to
accomplish your objective. Finally, customize the process for your staff , give
each person a task with which he can succeed. Keep in mind during this
process your goals to be detailed, realistic and match the values of your
vision. Typically, the final step in this stage is to write a mission statement
that succinctly communicates your goals to both your shareholders and your
staff.
Step 2: Doing an External Analysis:
The first part of the SWOT analysis, involves
managers identifying the business' opportunities and threats. In other words, managers are to
conduct an external analysis. The identified opportunities and threats are to be factored in when
developing strategies; that is, managers will seek to take advantage of opportunities and reduce
the risk of threats, in attempts to reach the business' goals outlined in the mission.
Opportunities:
Opportunities are the elements that the project could exploit to its advantage.
Examples of opportunities include:
Threats:
Threats are the elements in the environment that could cause trouble for the business or
project. External threats could be inflation, new legislation, or a new competitor in your market.
Internal threats could include a skill or staff shortage within your organization.
highlighting the business' competitive advantage. For strategies to be effective, the organization
must exploit and expand on its strengths, as well as reduce or eliminate its weaknesses; thus
furthering its competitive advantage, in order to achieve profitability.
Strengths:
Strengths are those features of the business which allow you to operate more
effectively than your competitors. For example, strength could be your specialist technical
knowledge. You need to consider your strengths from your own point of view and from that of
your customers' and clients'. You must be realistic and honest.
Weaknesses:
Weaknesses are areas capable of improvement. Are you lacking skills or new
products? Do you have a higher cost base or lower productivity than your competitors? You must
face any unpleasant truths about your business and be realistic.
The three main types of corporate strategies are growth, stability, and renewal.
Growth - A growth strategy is when an organization expands the number of markets served or
products offered, either through its current business or through new business. Because of its
growth strategy, an organization may increase revenues, number of employees, or market share.
Organizations grow by using concentration, vertical integration, horizontal integration, or
diversification.
Stability - A stability strategy is a corporate strategy in which an organization continues to do
what it is currently doing. Examples of this strategy include continuing to serve the same clients
by offering the same product or service, maintaining market share, and sustaining the
organization's current business operations. The organization does not grow, but does not fall
behind, either.
Renewal - When an organization is in trouble, something needs to be done. Managers need to
develop strategies, called renewal strategies that address declining performance. The two main
types of renewal strategies are retrenchment and turnaround strategies.
Business strategy:
Business strategy is primarily concerned with how a company
will approach the marketplace where to play and how to win. Where to play answers questions
like, which customer segments will we target, which geographies will we cover, and what
products and services will we bring to market. How to win answers questions like, how will we
position ourselves against our competitors, what capabilities we will employ to differentiate us
from the competition, and what unique approaches will we apply to create new markets.
Operational strategy:
Operational strategy is primarily concerned with accurately
translating the business strategy into a cohesive and actionable implementation plan. This
strategy answers the questions, which capabilities need to be created or enhanced, what
technologies do we need, which processes need improvement, and do we have the people we
need. The vast majority of business architects are currently working in the operational strategy
domain reaching up into the business strategy domain for direction.
Transformational strategy:
Transformational strategy is seen less often as it represents the
wholesale transformation of an entire business or organization. This type of strategy goes beyond
typical business strategy in that it requires radical and highly disruptive changes in people,
process, and technology. Few organizations go down this path willingly. Transformational
strategy is generally the domain of Human Resources, organizational development, and
consultants.
Competitive strategies:
Competitive strategies are the method by which you achieve a
competitive advantage in the market. There are typically three types of competitive strategies
that can be implemented. They are cost leadership, differentiation and a focus strategy. A mixture
of two or more of these strategies is also possible depending on your business' objectives and
current market position.
Cost leadership
The aim of this strategy is to be a low-cost producer relative to your competitors and is
particularly useful in markets where price is a deciding factor. Cost leadership is often achieved
by carefully selecting suppliers and production techniques to minimise production, distribution
and marketing costs. However you need to be aware of any serious loss in quality that may
render low cost ineffective.
Differentiation
A differentiation strategy seeks to develop a competitive advantage through
supplying and marketing a product that is in some way different to what the competition is doing.
If developed successfully this strategy can potentially reduce price sensitivity and improve brand
loyalty from customers.
Focus strategy
This strategy recognises that marketing to a homogenous customer group
may not be that effective a strategy for the product the business is selling. Instead the business
focuses its marketing efforts on a different selected market segments. That is, identify the needs,
wants and interests of the particular market segments and customise marketing techniques to
reflect those characteristics.
countries, seems to deal with its various economic crises through short-term measures, as can be
seen in the recent economic reforms. This often occur without adequate warning
to the organizations. This creates problems of planning. Most organizations see such
economic measures as a threat; rather than an opportunity for improving corporate
performance through a change in strategy.
Finally, the poor state of social infrastructure and political instability is another
problem to the organizations strategic management. In most cases, they are quickly
rendered obsolete and force the organizations to get back to the drawing board with high
losses and risks.
Conclusion
The strategic planning process does not end with the six step; it is an ongoing procedure that
manager must repeat. With each round, managers and employees gain experience and the step
become much easier. What does this strategic planning process lead to? It teaches business
owners a degree of discipline that is important to business survival. It helps them learn about
their businesses, their core competencies, their competitors and most important their customers.
It dramatically increase a business chances of survival in a hostile business environment.