Strategic Concepts
Strategic Concepts
Strategic Concepts
STRATEGY
Reading Recommendations:
2. What is Strategy? Michael Porter, Harvard Business Review, 1996.
3. Marketing Myopia Theodore Levitt, Harvard Business Review, 1960.
4. Of Strategies, Deliberate and Emergent, Mintzberg & Waters, Strategic
Management Journal, 1985.
Definitions of Strategy
Oxford Dictionary: The art of war, especially the planning of movements of
troops and ships etc., into favorable positions; plan of action or policy in
business or politics etc.
Alfred D. Chandler Jr.: The determination of the long run goals and
objectives of an enterprise, and the adoption of courses of action and the
allocation of resources necessary for carrying out these goals.
Kenneth Andrews: Strategy is the pattern of objectives, purposes or goals
and the major policies and plans for achieving these goals, stated in such a
way as to define what business the company is in or is to be in and the kind
of company it is or is to be.
Historical Development - 2
Igor Ansoff argued, in response to Levitt, that a firms mission should exploit
an existing need in the market, rather than using the consumer as the
common thread in business. In reality a given type of customer will
frequently have a range of product missions or needs. Corporate Strategy,
1965.
Present
Mission
New
Mission
Present
Product
New
Product
Market
Penetration
Product
Development
Market
Development
Diversification
High
Growth
Slow
Growth
High
Share
Low
Share
Star
Question
Mark
Cash
Cow
Dog
In
St ten
ra de
te d
gy
Forms of Strategy
De
l ib
er
at e
St
ra
teg
y
Realized
Strategy
Unrealized
Strategy
Emergent
Strategy
**Normally
**Normallyemergent
emergentstrategy
strategycomes
comesfrom
from
learning
learningand
anddissemination
disseminationwithin
withinthe
theorganization.
organization.
9
RATE OF PROFIT
ABOVE THE
COMPETITIVE
LEVEL
Which industries
should we be in?
CORPORATE
STRATEGY
How do we make
money?
COMPETITIVE
ADVANTAGE
How should we
compete?
BUSINESS
STRATEGY
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Broad
Target
Competitive
Scope
Narrow
Target
Cost
Leadership
Strategy
Strategy3A
3A
Cost
CostFocus
Focus
Strategy
Strategy22
Differentiation
Differentiation
Strategy
Strategy3B
3B
Differentiation
Differentiation
Focus
Focus
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12
Achievement of Goals
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Thinking Strategically:
The Three Big Strategic Analysis Questions
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Strategic Control
Strategy
Formulation
Environment
Strategy
Strategy
Implementation
Organization
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Where to Compete?
Corporate
Strategy
How to Compete?
Business
Strategy
How to Contribute?
Functional
Strategy
Choice of Products
Choice of Markets
Choice of Competitors
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Vision
Goals
Objectives
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THEME &
ISSUES
CONCEPTS/
TECHNIQUES
IMPLEMENTATIONS
1950s
1960s
1970s
1980s
early
1990s
late
1990s
Financial
planning &
control
Corporate
planning
Corporate
strategy
Positioning
Quest for
competitive
advantage &
shareholder
value
Strategic
innovation
Budgeting
project appraisal
Forecasting &
investment
planning
Portfolio
planning.
Synergy
market
share
Analysis of
industry &
competition
Resource
analysis.
Case
competencies
Dynamic
sources of
advantage
Knowledge
management
cooperation
Emphasis on
financial
The rise of
Diversificorporate planning cation.
Industry and
market select-
Restructuring
BPR.
Virtual organization.
management
departments
& formal
planning
Refocussing
Outsourcing
Alliances
competing
for the future
Quest for
ivity. Active
global
asset
market share management
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