❖ Weaknesses (things done poorly or not at all) can place the firm at a competitive disadvantage.
• Steps 2 and 3 combined are called a SWOT analysis. (Strengths, Weaknesses, Opportunities, and Threats)
implementation, and evaluation.
Types of Organizational Strategies
• Tell what strategies each level of management is typically responsible for.
• Describe the three major types of corporate strategies. • Explain the three growth strategies. • Discuss when organizations might pursue a stability
strategy. • Describe two renewal strategies.
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8–3
L E A R N I N G O U T L I N E (cont’d)
Follow this Learning Outline as you read and study this chapter.
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8–4
L E A R N I N G O U T L I N E (cont’d)
Follow this Learning Outline as you read and study this chapter.
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8–6
Why Strategic Management Is Important
1. It results in higher organizational performance.
The Strategic Management Process
• List six steps in the strategic management process.
• Explain why it’s important to know an organization’s mission.
• Describe what managers do when they do external and internal analyses.
❖ Focuses on identifying opportunities and threats
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8–8
Strategic Managemyright © 2005 Prentice Hall, Inc. All rights reserved. *
8–10
Strategic Management Process (cont’d)
• Step 5: Implementing strategies
➢ Implementation: effectively fitting organizational structure and activities to the environment
• Corporate Strategies
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8–9
Strategic Management Process (cont’d)
• Step 4: Formulating strategies
➢ Develop and evaluate strategic alternatives ➢ Select appropriate strategies for all levels in the
Strategic Management in Today’s Environment (cont’d)
• Discuss the implications of dynamic and uncertain environments on organizational strategy.
• Explain the rule of three and its significance to strategic management.
➢ The environment dictates the chosen strategy; effective strategy implementation requires an organizational structure matched to its requirements.
• Step 6: Evaluating Results
➢ Goals: the foundation for further planning
❖ Measurable performance targets
• Step 2: Conducting an external analysis
➢ The environmental scanning of specific and general environments
• Define strategic management.
• Explain why strategic management is important.
• Discuss what studies of the effectiveness of strategic management have shown.
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LEARNING OUTLINE
Follow this Learning Outline as you read and study this chapter.
The Importance of Strategic Management
organization that provide relative advantage over competitors ➢ Match organizational strengths to environmental opportunities ➢ Correct weaknesses and guard against threats
4. It is very much involved in the managerial decision-making process.
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8–7
Strategic Management Process
2. It requires that managers examine and adapt to business environment changes.
3. It coordinates diverse organizational units, helping them focus on organizational goals.
• Step 3: Conducting an internal analysis
➢ Assessing organizational resources, capabilities, activities, and culture:
❖ Strengths (core competencies) create value for the customer and strengthen the competitive position of the firm.
• Explain the role of resources, capabilities, and core competencies in the internal analysis.
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Copyright © 2005 Prentice Hall, Inc. All rights reserved. *
8–5
Strategic Management
• The set of managerial decisions and actions that determines the long-run performance of an organization.
➢ How effective have strategies been? ➢ What adjustments, if any, are necessary?
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8–11
Organizational Strategies
level strategies. • Explain Porter’s five forces model. • Describe three generic competitive strategies. • Tell what it means to be stuck in the middle. • Define functional-level strategies.