Business policy and strategic Management

1. Business policy and strategic Management • Strategy and Strategic Management • Strategic intent- Vision, Mission, goals and objectives • SWOT Analysis • Environmental appraisal • Organizational Appraisal • Corporate level strategy • Business level strategy • Strategic Analysis and choice • Porter’s competitive Analysis • Value chain Analysis

2. Need of BPSA • Enormous change is taking place in Business Environment both internal and external. • Competition is almost cut throat in all sectors • Considering the changes and competition organization need t formulate the strategies an polices which will help them to survive in the market. • Crunch of the resources required for the business. Need strategies to utilize the resources at optimum level.

3. Business policy “Guidelines which business need to follow considering the impact of internal and external environmental factors.” • Importance • For learning the course • For understanding the business environment • For Understanding the organization • For personnel Development

4. Purpose of Business Policy • To integrate the knowledge gained in various functional areas of Management • To adopt a generalist approach to problem solving • To understand the complex interlink ages operating within an organization

5. Strategy Definitions • The determination of the basic long term goals and objectives of an enterprise and the adoption of the course of action and the allocation of resources necessary for carrying out these goals • The unified , comprehensive and integrated plan designed to assure that the basic objectives of the enterprise are achieved.

6. Different Levels of Strategy Corporate level Strategies Business unit Level Strategies Functional Level Strategies

7. Strategic Management Definitions • A stream of decisions and actions which leads to the development of an effective strategy or strategies to help achieve corporate objectives…….Glueck • The process which deals with the fundamental organizational renewal and growth with the development of strategy, structure , and system necessary to achieve such renewal and growth, and with the organizational system needed to effectively manage the strategy formulation and implementation processes……Hofer and others

8. Strategic Management Process

11. Strategic Intent

12. vision “ to be in the future” • Description of something in the future • Mental perception of the kind of environment organization aspires to create within a broad time of horizon and the underlying conditions for the actualization of this perception

13. Benefits of Vision • Inspiring and exhilarating • Helps to create shared sense of purpose • Vision which is unique, competitive an original make sense in the marketplace. • Foster risk taking and experimentation • Foster long term thinking • Clear the objectives of the organization

14. Process on Envisioning • Core Ideology • Envisioned future • Tata Steel “ Tata steel enters the mew millennium with the confidence of a learning, knowledge based and happy organization. We will establish ourselves as a supplier of choice by delighting our customer with our service and our product”

15. Mission • what is our business? • what to do? • What should it be? • Definition “Essential purpose of the organization ,concerning particularly why it is in existence, the nature of the business it is in, and the customers it seeks to serve and satisfy

16. Characteristics of a Mission Statement • It should be feasible • It should be precise • It should be clear • It should be motivating • It should be distinctive • It should indicate major component of strategy • It should indicate how objectives are to be accomplished.

17. United Trust of India Mission: “To keep the common man in sharper focus, to encourage saving and investment habits among them.”

18. Goals And Objectives Goals • Goals denote what an organization hopes to accomplish in a future period of time. This is stated broadly Objectives • These are the ends that specify how goals shall be achieved • Objectives makes the goals operational • Objective need to be stated in quantity • They are measurable and comparable

19. Role of objectives • I t defines he orgnisation’s relationship with the environment • It helps to pursue its vision and mission • Provides the base of strategic decision making • It provides the standards for the performance appraisal

20. Characteristics of objectives • objectives should be understandable • objectives should be concrete and specific • objectives should be related to a time frame • objectives should be measurable and controllable • objectives should be challenging • objectives should be correlated with each other • objectives should be set within constraint

21. Issues in objective setting • Specificity • Multiplicity • Periodicity • Variability • Reality • Quality

22. What objective are set • Market standing • Innovation • Productivity • Physical and financial resources • Profitability • Manager performance and development • Worker performance and attitude • Public responsibility

23. How objectives formulated • The forces in the environment • Realities of enterprise’s resources • The value system of top executives • Awareness of the management

24. Examples of Objectives Corporate level • 1.to Increase the profit level by 5 % at the end of two year Business Unit level • 1.to Increase the profit level of the unit by 10 % at the end of two year Functional level • To increase the sales of product by 12 % by the end of two year • To reduce the manpower cost by 15% of the last year

25. Critical Success Factor(CSF) • The factors which are crucial for organizational success • Toothpaste: four qualities-form, flavour,foam and freshness • Shoe: High manufacturing qualities, cost efficiency, sophisticated retailing. • Automobile: High technology- mileage, low maintains “Key success factors”