Figure 2.1: The Five Stages of Strategic Management

1. Stage1 Stage 2 Stage 3 Stage 4 Stage 5 Develop a Strategic Vision (and Mission) Setting Objectives Craft a Strategy to Achieve Objectives and Vision Implement and Execute Strategy Monitor, Evaluate, and Take Corrective Actions Revise as Needed Figure 2.1: The Five Stages of Strategic Management

2. Stage 1: Strategic Vision • Purpose • Strategic Vision vs. Mission Statement • Importance • Communicating the Vision

3. Stage 2: Setting Objectives • Purpose • Objectives vs. Goals • Strategic vs. Financial • Short-term and Long-term • Balanced Scorecard • Strategic Intent • Importance

4. Stage 3: Crafting a Strategy • Purpose • What is Strategy? • 5 Definitions of Strategy • Importance • What to Look for?

5. Figure 1.1: Identifying a Company’s Strategy -- What to Look For Actions to strengthen bargaining position Actions to differentiate products Actions to build resources & capabilities Actions to lower costs Pattern of Actions That Define Strategy Actions and approaches used in functional areas Actions to alter geographic coverage Actions to pursue new opportunities or defend against threats Actions to merge or acquire rival companies Actions to form strategic alliances and collaborative partnerships

6. Two-Way Influence Two-Way Influence Two-Way Influence Figure 2.2: A Company’s Strategy-Making Hierarchy Corporate-Level Managers Corporate Strategy Business-Level Managers Business Strategies Functional Managers Functional-Area Strategies Operating Managers Operating Strategies

7. Corporate-Level Managers Two-Way Influence Two-Way Influence Two-Way Influence Business-Level Managers Two-Way Influence Two-Way Influence Two-Way Influence Functional Managers Two-Way Influence Two-Way Influence Two-Way Influence Plant Managers, Lower-Level Supervisors Uniting the Strategy Making Effort Corporate-wide Strategic Vision Corporate Level Objectives Corporate Level Strategy Business Level Strategic Vision Business Level Objectives Business Level Strategies Functional Missions Functional Objectives Functional Strategies Operating Missions Operating Objectives Operating Strategies

8. What is a Strategic Plan? Where firm is headed -- Strategic vision and business mission Short and long term performance targets -- Strategic and financial objectives Action approaches to achieve targeted results -- A comprehensive strategy

9. 3 Tests of a Winning Strategy • Goodness of Fit Test • How well is strategy matched to a firm’s internal and external situation? • Competitive Advantage Test • Does the strategy lead to a sustainable competitive advantage? • Performance Test • Does strategy boost firm performance?

10. Stage 4: Strategy Implementation Creating FITS • Internal Fits • People, competences, structure, policies/SOPs, best practices, support systems, rewards system, culture, budgets, and leadership. • External • Industry and macroenvironment.

11. Allocating Resources Building a Capable Organization Establishing Strategy- Supportive Policies Strategy Implementer’s Action Agenda Instituting Best Practices for Continuous Improvement Exercising Strategic Leadership Shaping Corporate Culture to Fit Strategy Installing Support Systems Tying Rewards to Achievement of Key Strategic Targets Figure 10.1: The Eight Componentsof Strategy Execution

12. Stage1 Stage 2 Stage 3 Stage 4 Stage 5 Develop a Strategic Vision (and Mission) Setting Objectives Craft a Strategy to Achieve Objectives and Vision Implement and Execute Strategy Monitor, Evaluate, and Take Corrective Actions Revise as Needed Figure 2.1: The Five Stages of Strategic Management

13. Other Strategy Issues • Business Model versus Strategy • Role of the Board of Directors • Linking Strategy with Ethics and Corporate Responsibility • Who Performs the 5 Tasks?