NBS Strategic Management Division2004/5 Page 1 SM352 Strategy Introduction to Strategy

NBS Strategic Management Division 2004/5 Page 1

SM352 Strategy

Introduction to Strategy


Support Materials

Teaching and Learning Plan on blackboard – Week by week topics– Learning outcomes – Seminar topics – Directed learning


Aims of Unit

To develop the student's understanding of the concepts underlying the strategic management process through:– the application of a variety of frameworks

supporting strategic analysis– the identification and evaluation of strategic

options– explaining issues affecting the

implementation of strategic change


General Learning Outcomes

select and apply appropriate frameworks to analyse an organisation and its external environment.

identify, explain and evaluate the current objectives and strategies of an organisation.

identify and explain the major strategic issues that need to be addressed by top management.

propose and evaluate appropriate strategic options. understand and explain the process of strategy

implementation and the management of strategic change. write reports that present the results of student's analysis

and synthesis in a clear and concise manner. recognise that there are alternative models of strategic

process.


Teaching/Learning

formal lectures to introduce key theories and frameworks (1 hour each week, 24 weeks)

seminars to reinforce the lecture material (4 per semester)

the application of frameworks to organisations through case studies

student centred learning with support material


Assessment

Assignment, weighting 50%, issued in Semester 1 and submitted in December 2004

Examination weighting 50%, at the end of Semester 2


Set Text

Core Text:– Johnson, G, & Scholes, K. (2002) - Exploring

Corporate Strategy (6th edition). FT Prentice Hall, London.

– Journals (see L&TP).

Supporting Text:– Campbell, D., Stonehouse, G. & Houston, B.

(2002) - Business Strategy - An Introduction, 2nd Edition, Butterworth Heinemann, Oxford.


Why study strategy

“Strategy” is a core component of all general business courses

It integrates the learning about business functions in Years 1 and 2

It is the largest unit by “weight” in NBS apart from the UG Project


Evolution of Strategy

• Strategy– Sun Tzu’s (500BC) The Art of War. Referred to a “director of

strategic planning”– Frontinius (100AD) Strategy is everything achieved by a

commander, be it characterised by foresight, advantage, enterprise or resolution

– Derives from Athens – strategos who was the head of the tribe

– Increasing complexity required leadership and coordination and “the use of stratagems in war or business”

Strategem?– “a plan or trick to deceive the enemy”


Rational/Deliberate Approach

Created and developed using the work of Chandler, Sloan, Andrews, Porter.....– “Economic strategy will be seen as the match

between qualification and opportunity that positions a firm in its environment”

A clear process is followed and decisions are made in a “rational” manner:– Diagnosis Prescription Action



ExternalAnalysis

InternalAnalysis

SWOTKey

IssuesStrategicOptions

StrategyImplementation



Underlying premises:– Strategy formation should be a controlled,

conscious process of thought– Responsibility for control and

consciousness must rest with the Chief Executive

– The model of strategy formation must be simple



– Strategies should be unique: the best ones result from a process of creative design

– Strategies emerge from this design process fully formulated

– Strategies should be explicit and, if possible, articulated and should therefore be simple

– Only after these unique, complete, explicit and simple strategies are fully formulated can they then be implemented



This approach has dominated strategic thinking for many years:– the underlying concepts are simple– there are lots of analytical tools– it forces organisations to look both inside

and outside– it works (?)



Planning has evolved during the 20th century:– budgeting and financial control– long-range planning– business strategic planning– corporate strategic planning– strategic management


Chandler (1962)– “the definition of the basic long term goals

and objectives of an enterprise, and the adoption of courses of action and the allocation of resources necessary for carrying out those goals”


Andrews (1987)– “...a pattern of decisions...[which

represent]... the unity, coherence and internal consistency of a company’s strategic decisions that position a company in its environment and give the firm its identity, its power to mobilise its strengths, and increase its likelihood of success in the marketplace”


Ansoff and McDonnell (1990)– “...strategic management is a systematic

process for managing strategic change which consists of the following:

• positioning of the firm through strategy and capability planning

• real-time strategic response through issue management

• systematic management of resistance during strategic implementation”


Johnson and Scholes (2002)– “Strategy is the direction and scope of an

organisation over the long term, which achieves advantage for the organisation through its configuration of resources within a changing environment and to fulfil stakeholder expectations.”


Now

Future

DirectionMissionGoals

Objectives

External EnvironmentResources

Stakeholder Expectations


The Key Strategic Decisions

What Markets shall we be in?

How shall we compete in our Markets?

What Products/Services shall we offer?


Problems of Rational/Deliberate Approach

– the process can take a long time and ties up human and financial resources

– the process can become an end in itself– it is good at producing lists of information but not

so good at showing the way forward, especially in complex and dynamic situations

– many very successful strategies were arrived at by accident rather than design



ExternalAnalysis

InternalAnalysis

SWOTKey

IssuesStrategicOptions

StrategyImplementation

Documents

NBS Strategic Management Division2004/5 Page 1 SM352 Strategy Introduction to Strategy