Strategic Management Model for Business Success

1. London Centre of Marketing ( LCM) Level: Postgraduate Diploma in Business Management & Marketing Module – Corporate and Business Management Lecturer : Dr. SAMTA RAI Dated – 24th Jan, 2011 Dr. Samta Rai 1 1

2. A model of the elements of strategic management Expectations & Purposes The Environment Resources & competencies The Strategic Position Corporate Level Strategies Strategy Into Action Organising Strategic Choices Managing Change Enabling Development Directions & Methods Business Level Strategies Dr. Samta Rai

3. LO3: Explain and assess the managerial processes needed to transform strategy into action and to evaluate strategy effectiveness • Intended versus emergent strategy development and other patterns of strategy • development Dr. Samta Rai 3 3

4. There are two broad explanations of strategy development, though they are not mutually exclusive. The first is associated with the idea of intended strategy: that strategies come about as a result of careful deliberation typically associated with top management decisions. This is sometimes known as the rational/analytic view of strategy development. The second view is that of emergent strategy: that strategies do not develop on the basis of some grand plan but tend to emerge in organisations over time. Dr. Samta Rai

5. Strategy Development Processes • Processes of intended strategy development • Strategy vision, leadership and command • Strategic planning • Externally imposed strategies • Processes of emergent strategy development • Logical incrementalism • Resource allocation routines • Cultural processes • Political processes • Challenges & implications • Intended & realised strategy • The learning organisation • Uncertain and complex conditions Dr. Samta Rai

6. Strategy development through resource allocation processes Corporate Level Discrepancy to be resolved Proposals in line with RAP Business Level Discrepancy to be resolved Proposals in line with RAP Operating Level Dr. Samta Rai

7. WHY CULTURE MATTERS/ The relationship between strategy and culture • A company’s culture can contribute - or hinder - successful strategy execution. • Beliefs & practices of a strategy may - or may not - be compatible with firm’s culture • Close match between culture & strategy adds significantly to effectiveness of strategy execution. • A strong strategy-supportive culture - • Provides system of informal rules & peer pressure • Motivates people to do their best • Provides structure, standards, & value system • Promotes strong company identification

8. WAL-MART’S CULTURE • Dedication to customer satisfaction • Zealous pursuit of low costs • Belief in treating employees as partners • Sam Walton’s ( founder) legendary frugality • Ritualistic Saturday morning meetings • Commitment of executives to visit stores, talk to customers, and solicit & act on employee suggestions

9. Cultural Web

10. Strategy development in environmental contexts Complex Simple Static • Historical analysis • Forecasting Decentralisation of organisations Scenario Planning Experience & Learning Dynamic

11. Some of the important terms – Intended strategy – is an expression of a desired strategy as deliberately formulated or planned by managers Emergent strategy - comes about through everyday routines, activities and processes in organisations leading to decisions that become the long-term direction of an organisation. Realised Strategy – the strategy actually being followed by an organisation in practice. Strategic planning – may take the form of systematised, step-by-step, chronological procedures to develop or coordinate an organisation’s strategy. Dr. Samta Rai

12. Some of the important terms – Resource allocation processes – explanation of strategy development is that realised strategies emerge as a result of the way resources are allocated in organisations. The political view of strategy development is that strategies develop as the outcome of processes of bargaining and negotiation among powerful internal or external interest groups ( or stakeholders). A cultural explanation of strategy development is that it occurs as the outcome of the taken-for-granted assumptions and behaviors in organisations. Dr. Samta Rai

13. Logical incrementalism – is the deliberate development of strategy by experimentation and learning from partial commitments. The Learning Organisation – is capable of continual regeneration from the variety of knowledge, experience and skills of individuals within a culture which encourages mutual questioning and challenge around a shared purpose or vision. Dr. Samta Rai

14. Case study – Boardroom Battles at Vodafone Dr. Samta Rai