Lecture 1. Strategic management

Июль 22, 2022

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Lecture 1. Strategic management

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2. Today’s Overview Introductions me, you, and etc. Module Outline what to expect, textbook, seminars, etc. Lecture
3. Introductions me and your other Tutors Oliver Laasch, Ernest Southworth, and Michal Lemanski Thomas Birtch, PhD
4. Module Outline what to expect 11 Lectures (face paced, interactive) 2 Seminars (case study presentations) 90
5. Module Outline (cont’d) textbook 15 Chapters (focus on key concepts, theories, and frameworks and their application)
6. textbook structure Module Outline (cont’d)
7. Module Outline (cont’d) Seminars - a chance to apply, re-inforce, and expand learning Presentations should be
8. Lecture 1 STRATEGIC MANAGEMENT AND STRATEGIC COMPETITIVENESS
9. Studying this chapter should provide you with the strategic management knowledge needed to: Define strategic competitiveness,
10. Definitions Strategic Competitiveness: is achieved when a firm successfully formulates and implements a value-creating strategy. Strategy:
11. The Strategic Management Process A rational approach to achieve strategic competitiveness and earn above-average returns Analysis
12. The Strategic Management Process (cont’d)
13. The competitive landscape Scarce financial capital and volatile markets Partnerships blur boundaries Conventional sources of competitive
14. The global economy Free movement across borders World’s largest single market is Europe Emergence and rapid
15. Technology & technological changes Technology diffusion and perpetual innovation Rapid response to competition Disruptive technologies creating
16. Vision and Mission Vision: the ideal for the organisation and its future direction (vision statements aimed
17. Vision Statements A carefully crafted vision statement can help communicate company's goals to employees and management
18. Vision Statements Purpose: Serve as foundation for a broader strategic plan Motivate existing/attract potential employees by
19. A precise description of what an organization does (i.e., describing the business the organization is in
20. Mission Statements (cont’d) Wal-Mart: “To give ordinary folk the chance to buy the same thing as
21. Mission Statements (cont’d) Purpose: To concisely describe the overall purpose of the organization Considers the organisation's
22. Stakeholders Stakeholders are individuals and groups who can affect and/or are affected by the vision and
24. Strategic leaders May be anywhere in the firm Will be decisive, committed to nurturing those around
25. The work of “effective” strategic leaders Distinguished by honesty, tenacity, and drive to accomplish more through
26. Predicting outcomes of strategic decisions The total profits earned in an industry at all points along
27. Takeaways The goals of strategic management process are strategic competitiveness and above-average returns. The current nature
28. HOMEWORK Read Chapter 1 and 2 of the textbook Come to class prepared to discuss/present answers
30. Скачать презентацию

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Today’s Overview
Introductions
me, you, and etc.
Module Outline
what to expect, textbook, seminars, etc.
Lecture

1
Strategic management and strategic competitiveness (Chapter 1)

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Introductions
me and your other Tutors
Oliver Laasch, Ernest Southworth, and Michal Lemanski
Thomas

Birtch, PhD (Cantab), MBA (MIT)
Affiliations with NUBS, CAM, MIT, CUHK, and others
Background in industry and government
Consulted and worked in over 30 countries
Serial entrepreneur
you

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Module Outline
what to expect
11 Lectures (face paced, interactive)
2 Seminars (case study

presentations)
90 minute exam (100%)

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Module Outline (cont’d)
textbook
15 Chapters (focus on key concepts, theories, and frameworks

and their application)

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textbook structure
Module Outline (cont’d)

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Module Outline (cont’d)
Seminars
- a chance to apply, re-inforce, and expand learning
Presentations

should be of a quality that could be delivered to C-suite level executives
in groups of about 5-6 students
max. 10 powerpoint slides (copies to be submitted to tutor)

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Lecture 1 STRATEGIC MANAGEMENT AND STRATEGIC COMPETITIVENESS

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Studying this chapter should provide you with the strategic management knowledge

needed to:
Define strategic competitiveness, strategy, competitive advantage, above-average returns, and the strategic management process.
Describe the competitive landscape and explain how globalization and technological changes shape it.
Describe vision and mission and discuss their usefulness.
Define stakeholders and describe their ability to influence organizations.
Describe the work of strategic leaders.
Explain the strategic management process.
Use the industrial organization (I/O) and resource-based models to explain how firms can earn above-average returns.

LEARNING OBJECTIVES

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Definitions
Strategic Competitiveness: is achieved when a firm successfully formulates and implements

a value-creating strategy.
Strategy: is an integrated and coordinated set of commitments and actions designed to exploit core competencies and gain a competitive advantage.
Competitive Advantage: a firm has a competitive advantage when it implements a strategy competitors are unable to duplicate or find too costly to imitate.
Above-average returns: are returns in excess of what an investor expects to earn from other investments with a similar amount of risk.
e.g., Apple vs. Xiaomi, Samsung vs. TCL, Lenovo vs. IBM

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The Strategic Management Process
A rational approach to achieve strategic competitiveness and

earn above-average returns
Analysis of external environment and internal organisation to identify opportunities and threats in the marketplace
Deciding how to use resources, capabilities, core competencies, and competitive advantage to pursue opportunities and overcome threats from external environment by cooperative strategies
Strategy implementation will require entrepreneurship and renewal – a dynamic process
All strategic processes will have “ethical” dimensions

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The Strategic Management Process (cont’d)

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The competitive landscape
Scarce financial capital and volatile markets
Partnerships blur boundaries
Conventional sources

of competitive advantage no longer effective
Managers need flexible mindset
Increasing government interference in markets
Hypercompetition – inherent market instability driven by global economy and rapid technological change

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The global economy
Free movement across borders
World’s largest single market is Europe
Emergence

and rapid predicted growth of BRIC economies
The march of globalisation – increasing economic interdependence and growing opportunities across country borders
Higher performance standards
Global market risks – acquiring local market knowledge, over-diversification

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Technology & technological changes
Technology diffusion and perpetual innovation
Rapid response to competition
Disruptive

technologies creating new industries and overturning old markets
The information age – global proliferation of computing power and its linkage through the Internet
Increasing knowledge intensity – survival in hypercompetition means acquiring, integrating, and applying knowledge for competitive advantage
Strategic flexibility required to respond to risk and uncertainty
Continuous learning

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Vision and Mission
Vision: the ideal for the organisation and its

future direction (vision statements aimed at hearts & minds; should be clearly tied to external environment and internal organisation of firm)
Mission: concrete view of the firm’s business, its customers, and how it will serve them (flows from vision & should provide direction for strategic action)
A vision statement versus a mission statement. Mission statements are present-based statements designed to convey a sense of why the company exists to both members of the company and the external community. Vision statements are future-based and are meant to inspire and give direction to the employees of the company, rather than to customers. A mission statement answers the question, "Why does my business exist?" while a vision statement answers the question, "Where do I see my business going?"

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Vision Statements
A carefully crafted vision statement can help communicate company's goals

to employees and management in a single sentence. Examples,
American Express: “To be the world's most respected service brand"
Caterpillar: “To be the global leader in customer value”
Ford: “To become the world's leading Consumer Company for automotive products and services.”
Kraft: “Helping People Around the World Eat and Live Better …”

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Vision Statements
Purpose:
Serve as foundation for a broader strategic plan
Motivate existing/attract potential employees

by clearly categorising goals
Focus company efforts on strategic opportunities and building competencies that advance the company's vision
Help companies differentiate from competitors.

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A precise description of what an organization does (i.e., describing the

business the organization is in and why the organization exists currently). Examples,
FedEx: “will produce superior financial returns for its shareowners by providing high value-added logistics, transportation and related business services through focused operating companies. Customer requirements will be met in the highest quality manner appropriate to each market segment served. FedEx will strive to develop mutually rewarding relationships with its employees, partners and suppliers. Safety will be the first consideration in all operations. Corporate activities will be conducted to the highest ethical and professional standards.”

Mission Statements

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Mission Statements (cont’d)
Wal-Mart: “To give ordinary folk the chance to buy

the same thing as rich people.”
Westin Hotels and Resorts: “In order to realize our Vision, our Mission must be to exceed the expectations of our customers, whom we define as guests, partners, and fellow employees.(mission) We will accomplish this by committing to our shared values and by achieving the highest levels of customer satisfaction, with extraordinary emphasis on the creation of value. (strategy) In this way we will ensure that our profit, quality and growth goals are met.”

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Mission Statements (cont’d)
Purpose:
To concisely describe the overall purpose of the organization
Considers

the organisation's products, services, markets, values, concern for public image, and priorities for survival
Changes to reflect new strategies
Enables management and employees to infer some order of priorities in how products and services are delivered
Clearly separates the mission of the organisation from other organisations.

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Stakeholders
Stakeholders are individuals and groups who can affect and/or are

affected by the vision and mission.
Stakeholder relationships must be managed for competitive advantage
Classifications of stakeholders:
Capital market stakeholders
Product market stakeholders
Organisational stakeholders
Societal stakeholders
Stakeholders’ objectives can conflict, so they must be managed and prioritised

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Strategic leaders
May be anywhere in the firm
Will be decisive, committed

to nurturing those around them, and helping the firm “create value” for stakeholder groups
Strategic leadership will be influenced by, and will itself influence, organisational culture.

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The work of “effective” strategic leaders
Distinguished by honesty, tenacity, and

drive to accomplish more through their people
Strategic leaders set the ethical tone of the business
They provide the vision and make it work

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Predicting outcomes of strategic decisions
The total profits earned in an

industry at all points along the value chain
Understanding these primary sources of profit by:
Defining boundaries of profit pools
Estimating size of pools
Estimating size of value chain activity in the pool
Reconciling these calculations
Other strategic outcomes
Identifying these primary sources enables leaders to select successful strategies

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Takeaways
The goals of strategic management process are strategic competitiveness and above-average

returns.
The current nature of competition is turbulent and chaotic.
Vision and mission are formed through study of internal and external environments
Stakeholder analysis and prioritisation is needed to maintain support of key groups
Strategic leaders enable the firm’s mission and vision, can be anywhere in the organisation, and calculate profit pools linking to value chain activities to predict outcomes of strategic decisions.

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HOMEWORK
Read Chapter 1 and 2 of the textbook
Come to class prepared

to discuss/present answers to the following “Apple” case study (handout) questions:
What is Apple’s strategy and competitive advantage? Has it achieved strategic competitiveness?
Describe Apple’s competitive landscape and explain how globalization and technological changes shape it?
Describe Apple’s vision and mission and discuss their usefulness?
Who are Apple’s stakeholders and describe their ability to influence organisations?
What are Apple’s primary sources of profit? Compare these to a competitor such as Xiaomi.

Lecture 1. Strategic management

Содержание

Today’s OverviewIntroductionsme, you, and etc.Module Outlinewhat to expect, textbook, seminars, etc.Lecture

Introductionsme and your other TutorsOliver Laasch, Ernest Southworth, and Michal LemanskiThomas

Module Outlinewhat to expect11 Lectures (face paced, interactive)2 Seminars (case study

Module Outline (cont’d)textbook15 Chapters (focus on key concepts, theories, and frameworks

textbook structureModule Outline (cont’d)

Module Outline (cont’d)Seminars- a chance to apply, re-inforce, and expand learningPresentations

Lecture 1 STRATEGIC MANAGEMENT AND STRATEGIC COMPETITIVENESS

Studying this chapter should provide you with the strategic management knowledge

DefinitionsStrategic Competitiveness: is achieved when a firm successfully formulates and implements

The Strategic Management ProcessA rational approach to achieve strategic competitiveness and

The Strategic Management Process (cont’d)

The competitive landscapeScarce financial capital and volatile marketsPartnerships blur boundariesConventional sources

The global economyFree movement across bordersWorld’s largest single market is EuropeEmergence

Technology & technological changes Technology diffusion and perpetual innovationRapid response to competitionDisruptive

Vision and Mission Vision: the ideal for the organisation and its

Vision StatementsA carefully crafted vision statement can help communicate company's goals

Vision StatementsPurpose:Serve as foundation for a broader strategic planMotivate existing/attract potential employees