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Program : MBA

Semester : IV

Subject Code : MB0052

Subject Name : Strategic Management & Business Policy

Unit Number : 1

Unit Title : Strategies

Lecture Number : 1

Lecture Title : Strategies

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Unit-1 Strategies

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Strategic management and business policy

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Objectives:

The objectives of this lecture are to:

• Explain the importance and scope of strategy.

• Recognise the function of business and SMART goals.

• Differentiate between the goals and objectives of the organisation.

• Describe the strategic intent using vision & mission statements.

• Explain the competencies and success factors in strategic decision

making.

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Lecture Outline

• Introduction

• Fundamentals of strategy

• Concepts and nature of strategy

• Scope and importance of strategy

• Objectives of business

• Difference between goals and objectives of business

• Strategic intent through vision & mission statements

• Core competencies & critical success factors in business

• Summary

• Check your learning

• Activity

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Introduction

• Strategy involves incorporation of organisational activities

• Strategy sets apart the scarce resources within its environment to

meet the organisational goals

• Strategy supports the organisations to achieve its future goals

• Without a reliable strategy, business cannot progress

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Fundamentals of strategy

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The fundamentals of strategy is to:

• Define the vision and mission of organisation

• Guide the organisation to achieve long term goal

• Meet up with the expectations of market and stakeholders

• Concentrate on priority issues to be successful in long term

• Enhance the position of organisation in market

• Prepare and implement strategic goals through strategic management

• Incorporate levels of strategies - Corporate, Business and Operational

strategy

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Unit-1 Strategies

Concepts and nature of strategy

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The concepts of strategy are:

• A plan to channel a course of action

• An elementary way to measure an organisation's performance

• A pattern to improve the performance

• A scheme to overcome competition

The nature of strategy is to:

• Capture the new opportunities and to adopt to the norms and systems

in organisations

• Provide structure for guiding a project

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Scope and importance of strategies

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The Scope of strategy are as follows:

•To introduce a mission and develop an overall strategy for an organisation

•To study and evaluate external environment

•SWOT analysis

•To increase resources and facilities

•To estimate and manage the targets

The importance of strategy are as follows:

•It provides a clear idea of the objectives

•It is important for the long term survival of an organisation

•It provides opportunity to grow and increase revenue

•It predicts the behavior of customers, competitors and employees

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Unit-1 Strategies

Objectives of Business

The objectives are as follows:

• Survival

• Profit maximisation

• Sales growth

• Setting goals - SMART

• Adopting tactics

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Unit-1 Strategies

Difference between goals and objectives of business

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Goals

Are long term

Are general intentions with broad outcome

Are intangible

Are abstract

Cannot be validated

Objectives

Are temporary

Are accurate statements with definite outcome

Are substantial

Are concrete

Can be validated

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Strategic intent through vision and mission statements

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• STRATEGIC intent defines goals of an organisation

• It motivates employees to work as a team

• It describes the purpose of an organisation

VISION AND MISSION

Vision defines purpose and principles in terms of values of

an organisation. It is a skeleton of strategic planning

Mission describes capabilities and reason for existence of

an oraganisation

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Unit-1 Strategies

Core competencies & critical success factors in business

• Core competencies are skills critical to achieve a competitive

advantage for a business

• It comprises essential skills like adding value to products and services

• Critical Success Factors (CSF) identifies and lists key factors to be

concentrated upon in an organisation

• CSF concentrates on key factors like industry, environment, strategic

and temporal

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Summary

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•Adopting strategic planning helps organisations to grow

•Objectives of strategy concentrates on survival of the fittest law

•Goals and objectives are two different prospectives of success in business

•Strategic intent defines the aim of vision and mission of an organisation

•Core competencies adds values to products and services

•CSF identifies key success factors in an organisation

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Check Your Learning

1. What is strategy?

Ans: Strategy is the method by which an organisation systematically

achieves its future objectives.

2. What is SWOT analysis ?

Ans: SWOT is a method used for assessment. It stands for strengths,

weaknesses, opportunities and threats.

3. What is CSF?

Ans: CSF is Critical Success Factors which identifies the key features for an

organisation to be successful.

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Unit-1 Strategies

Activity

A manufacturing company is planning to implement a new process to

produce products. Assume that you are the project manager. Research

and report to the management the steps involved in implementing the

strategy.

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