Strategic+thinking +dr.behboudi-session3

Strategic Thinking

Session 3

AGENDA• Types of Strategic Analysis• Strategic Thinking Skills

Types of Strategic Analysis

• PESTLE• SWOT• EFE & IFE• GE MATRIX• SHELL MATRIX

Types of Strategic Analysis

• PESTLE AnalysisPoliticalEconomicSocialTechnologicLegalEnvironmental

Types of Strategic Analysis

• SWOTStrengthWeaknessOpportunityThreat

Types of Strategic Analysis

WO SO

WT STWeakness Strength

Threat

Opportunity

Types of Strategic Analysis

Cash Cow Star

Dog ?

Mar

ket G

row

th

Low High

Low

Eliminate

Keep Invest & Grow

Investigate

Types of Strategic Analysis

• GE Matrix

Low

Medium

High

Low Medium High

Industry Attractiveness

Business Strengths

Eliminate

Keep

Invest

Improve

Improve Improve

Eliminate Eliminate

Invest

Types of Strategic Analysis• GE Matrix

Low

Medium

High

Low Medium High

Industry Attractiveness

Business Strengths

Ad Gifts

Indoor Print

Full Service

Exhibitions

TVC Outdoor Print

Paper Print Offset Print

OutdoorMedia

Types of Strategic Analysis• Shell Matrix

Strong

Medium

Weak

Unattractive Average Attractive

Competitive Capabilities

Sector Profitability

Disinvest? Gradual Withdrawal

Take a Risk

Gradual Withdrawal

Maintain or Look forward

Try Harder

Cash Generator Looking for Growth

Maintain Leadership

Types of Strategic Analysis• Market-Product

Market Developmen

t

Diversification

Market Penetration

Product Developmen

t

Mar

ket S

cope

Customer Scope

Current New

New

Current

Types of Strategic Analysis

• EFE: External Factors Evaluation • IFE: Internal Factors Evaluation

Strategic Thinking vs. Strategic Planning

strategic thinking and planning are “distinct, but interrelated and complementary thought processes” that must sustain and support one another for effective strategic management. Graetz's model holds that the role of strategic thinking is "to seek innovation and imagine new and very different futures that may lead the company to redefine its core strategies and even its industry". Strategic planning's role is "to realize and to support strategies developed through the strategic thinking process and to integrate these back into the business".

Vision of the Future

Strategic Thinking:Only the shape of the future can be predicted.

Strategic Planning:A future that is predictable and specifiable in detail.

Strategic Formulation & Implementation

Strategic Thinking:Formulation and implementation are interactive rather than sequential and discrete.

Strategic Planning:The roles of formulation and implementation can be neatly divided.

Managerial Role in Strategy Making

Strategic Thinking:Lower-level managers have a voice in strategy-making, as well as greater latitude to respond opportunistically to developing conditions.Strategic Planning:Senior executives obtain the needed information from lower-level managers, and then use it to create a plan which is, in turn, disseminated to managers for implementation.

Control

Strategic Thinking:Relies on self-reference

Strategic Planning:Asserts control through measurement systems

Managerial Role in Implementation Strategic Thinking:All managers understand the larger system, the connection between their roles and the functioning of that system, as well as the interdependence between the various roles that comprise the system.

Strategic Planning:Lower-level managers need only know his or her own role well and can be expected to defend only his or her own turf.

Strategy Making

Strategic Thinking:Sees strategy and change as inescapably linked and assumes that finding new strategic options and implementing them successfully is harder and more important than evaluating them.

Strategic Planning:The challenge of setting strategic direction is primarily analytic.

Process and Outcome

Strategic Thinking:Sees the planning process itself as a critical value-adding element.

Strategic Planning:Focus is on the creation of the plan as the ultimate objective.

Key Skills in Strategic Thinking

Skill 1

Strategic thinkers have the ability to use the left (logical) and right (creative) sides of their brain. This skill takes practice as well as confidence and can be tremendously valuable.

Skill 2

They have the ability to develop a clearly defined and focused business vision and personal vision. They are skilled at both thinking with a strategic purpose as well as creating a visioning process. They have both skills and they use them to complement each other.

Skill 3

They have the ability to clearly define their objectives and develop a strategic action plan with each objective broken down into tasks and each task having a list of needed resources and a specific timeline.

Skill 4

They have the ability to design flexibility into their plans by creating some benchmarks in their thinking to review progress.

Skill 5

They are amazingly aware and perceptive.

Skill 6

They are committed lifelong learners and learn from each of their experiences. They use their experiences to enable them to think better on strategic issues.

Skill 7

The best and greatest strategic thinkers take time out for themselves.

Skill 8

They are committed to and seek advice from others.

Skill 9

They have the ability to balance their tremendous amount of creativity with a sense of realism and honesty about what is achievable in the longer term.

Skill 10

hey have the ability to be non-judgmental and they do not allow themselves to be held back or restricted by judging their own thinking or the thinking of others when ideas are initially being developed and shared.

Skill 11

They have the ability to be patient and to not rush to conclusions and judgments.

How to Develop Strategic Thinking Skills

How to develop your skills

• Challenge conventional thinking• Read the environment of today and anticipate the

environment of tomorrow• Weigh risks against the potential rewards• Understand the drivers, strengths, and vulnerabilities of any

situation or business condition• Articulate your strategies so everyone understands• Avoid costly mistakes using “what-if” thinking• Align strategic decisions with critical goals

Who is not a strategic thinker?

1.Wants to limit strategic conversations to senior management

2.Shuns thinking and perspectives from others 3.Doesn’t respect other business functions in the

organization 4.Has a reputation for poor strategic relationships

in the organization 5.Feels strategy is complex (or has to be complex

to be good)

Who is not a strategic thinker?6.Disconnects strategy from day-to-day organizational activities 7.Doesn’t understand his/her own personal limitations and

thus doesn’t compensate for the limitations with a strong, complementary team

8.Becomes easily focused on a personal view of ” reality” and can’t entertain alternative possibilities

9.Is uncomfortable considering multiple ideas and possibilities for addressing a situation

10.Won’t break or even bend an arbitrary rule that doesn’t make sense

Who is not a strategic thinker?11.Is unwilling to question the status quo 12.Is put off by questions from people considered

subordinates 13.Is quick to cut off exploration of multiple alternatives

in the interest of not over thinking things 14.Struggles to shift between taking time to explore new

ideas and then moving to prioritize ideas and make decisions

15.Automatically equates “strategic” with long- term and “tactical” with short-term

Who is not a strategic thinker?16.Struggles with the idea of serving those seen as

subordinates 17.Is reluctant to do homework to help prepare others to

make solid decisions and implement them successfully 18.Struggles to make challenging decisions 19.Spends too much time on easy, solvable issues that

don’t produce value for the organization or its customers 20.Spends more time talking than asking questions to

better understand situations

Who is not a strategic thinker?21.Shuts down when faced with dramatic changes to a

personal view of reality and/or what’s necessary to sustain that reality

22.Doesn’t function well when there are significant unknowns in a situation

23.Automatically views doing something new / different as better than doing the smartest thing

24.Automatically views doing the same thing as better than doing something different because of lesser perceived risk

25.Loses track of agreed to priorities – for whatever reason

Who is not a strategic thinker?26.Spends too time on things that don’t matter

for the organization 27.Struggles to generalize situations so they are

more understandable to non- experts 28.Is quicker to argue than finding ways to

agree 29.Tends to dominate conversations