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Basic knowledge of management Chapter 9 Strategic Management
Basic knowledge of management: Chapter 9 summarizes the knowledge of strategic management, including the meaning of strategic management, the characteristics of strategic management, the evolution of strategic management, the classification of the Mintzberg School of Strategy, the process of strategic management, etc. Let's learn together.
Edited at 2023-03-15 16:49:54
- cáncer de pulmón
El cáncer de pulmón es un tumor maligno que se origina en la mucosa bronquial o las glándulas de los pulmones. Es uno de los tumores malignos con mayor morbilidad y mortalidad y mayor amenaza para la salud y la vida humana.
- diabetes
La diabetes es una enfermedad crónica con hiperglucemia como signo principal. Es causada principalmente por una disminución en la secreción de insulina causada por una disfunción de las células de los islotes pancreáticos, o porque el cuerpo es insensible a la acción de la insulina (es decir, resistencia a la insulina), o ambas cosas. la glucosa en la sangre es ineficaz para ser utilizada y almacenada.
- sistema digestivo
El sistema digestivo es uno de los nueve sistemas principales del cuerpo humano y es el principal responsable de la ingesta, digestión, absorción y excreción de los alimentos. Consta de dos partes principales: el tracto digestivo y las glándulas digestivas.
Basic knowledge of management Chapter 9 Strategic Management
- cáncer de pulmón
El cáncer de pulmón es un tumor maligno que se origina en la mucosa bronquial o las glándulas de los pulmones. Es uno de los tumores malignos con mayor morbilidad y mortalidad y mayor amenaza para la salud y la vida humana.
- diabetes
La diabetes es una enfermedad crónica con hiperglucemia como signo principal. Es causada principalmente por una disminución en la secreción de insulina causada por una disfunción de las células de los islotes pancreáticos, o porque el cuerpo es insensible a la acción de la insulina (es decir, resistencia a la insulina), o ambas cosas. la glucosa en la sangre es ineficaz para ser utilizada y almacenada.
- sistema digestivo
El sistema digestivo es uno de los nueve sistemas principales del cuerpo humano y es el principal responsable de la ingesta, digestión, absorción y excreción de los alimentos. Consta de dos partes principales: el tracto digestivo y las glándulas digestivas.
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- Outline
Chapter 9 Strategic Management
strategic management meaning
First proposed: In 1976, Ansoff proposed the term "strategic management" for the first time in "From Strategic Planning to Strategic Management"
1965 Ansoff "Strategic Business Management"
Enterprise strategic management elements
1||| Product and market areas
2||| Growth direction
3||| Competitive Advantage
4||| synergy
Five stages of strategic management: strategic analysis, strategy formulation, strategy evaluation, strategy implementation, and strategic control
elements of strategic management
Strategic thinking: It is the basic idea that guides strategy formulation and implementation. It is the soul of the entire strategy and has a commanding role in goals, priorities, stages, and countermeasures.
Strategic goals: They are the core of strategic decision-making and the core of strategic management.
Whether the strategic goals are correct directly affects the success or failure of strategic management.
Strategic focus: the key departments, parts, and links that affect the goals
Strategic priorities are hierarchical, and different strategic levels have their own strategic priorities.
strategic stage
strategic countermeasures
1||| Foresight
2||| Targeted
3||| multiplicity
4||| flexibility
The essence of strategic management
1||| Strategic management is an integrated management theory and the highest level theory
2||| Strategic management is the activity and skill of top managers of enterprises
3||| The purpose of strategic management is to adapt to changes in the external environment
Characteristics of strategic management
Comprehensiveness: Strategic management pays attention to the contribution of each department to the organization's mission and goals.
Long-term nature: The cycle of strategic management is 3-5 years (traditional strategy is 1-2 years); it is a continuous cycle process
Programmatic: The organizational strategy determines the strategic goals and development direction. It is a general and guiding provision and a rough design for the future of the organization.
It is the science and art of decision-making: science refers to the objective regularity that reflects management; art lies in application and practice; science and art must be combined
Strategic management is necessary as long as the organization exists
The subject is senior management
The evolution of strategic management
1||| long term planning era
Time: 1950s-1960s
Main contents: Forecasting the environment; developing long-term plans
Format: Trend Extrapolation
Three assumptions in the era of long-term planning
1||| Environmental changes are predictable
2||| Enterprises can predict changes in the environment and even change the environment
3||| Businesses respond to environmental changes by developing long-term plans
2||| strategic planning era
Time: 1960s-1970s
Main content: Adapt to environmental changes; formulate long-term development strategies
The environment is a linear change
3||| strategic management era
Time: 1970s-present
main content
1||| Anticipate and adapt to circumstances
2||| Discover opportunities and threats
3||| Pay equal attention to implementation and formulation
Mintzberg School of Strategy Classification
Illustrative school ("definite design")
1||| design school
2||| planning school
3||| positioning school
Operational school ("Entrepreneurs learn to understand the cultural environment of power")
1||| entrepreneurial school
2||| Know the school
3||| learning school
The fifth discipline ("I care about team building")
1||| self
2||| mind
3||| Establish a shared vision
4||| team
5||| system
4||| school of power
5||| cultural school
6||| environmental school
comprehensive school
1||| structural school
strategic management process
一、 Strategic Analysis
1. Meaning of strategic environment analysis: Organizational strategy analysis is also called strategic environment analysis, which analyzes and combines internal conditions and the organization’s external environment.
Combining internal conditions: Understanding (organizational culture and strengths) and (the responsibilities they place on managers) is key to identifying organizational strengths and weaknesses
Technical factors in strategic environmental analysis include
1||| Create new knowledge and transform it into new output institutions and activities
2||| Innovation for the purpose of creating new technologies
3||| Create resource-based innovation
Strategic Environmental Analysis Techniques and Methods
1||| Strategic Element Evaluation Matrix Method
2||| SWOT analysis
2. SWOT model (Harvard University, USA - Andrews - "Corporate Strategy Concept" Design School)
SO model: Use organizational advantages to combine external opportunities—expansion strategy/growth strategy
ST model: Use organizational advantages to avoid and mitigate external threats - diversification strategy/competitive strategy
WO model: Use external opportunities to make up for internal weaknesses - turnaround strategy/transfer strategy
WT model: both to resist external threats and to reduce internal disadvantages - contraction strategy/defense strategy
3. Boston Matrix (BCG)/Four-Quadrant Analysis/Business Unit Portfolio Analysis Method
The Boston Consulting Group proposed; X-axis: market share (corporate strength); Y-axis: sales growth rate (market gravity)
1||| Star product (★)
(development) strategic goals
1||| High market share, high growth rate
Invest a lot of money
2||| Problem: Increase market share and aim for long-term interests
Measures: Growth Strategy: Expanding Economic Scale and Market Opportunities
3||| Adopt business unit format
4||| Operator: Production technology, sales
2||| Jinniu products (￥)
(maintain) strategic goals
1||| High market share, low growth rate
High profit margins and low debt ratios bring investment to the company
2||| Also known as "high-profit products"
3||| Problem: Declining market share
Measures: Stabilization Strategy
The market share of Jinniu products declines and a harvesting strategy is adopted
As the market share of Jinniu products increases, market segmentation is adopted to maintain the existing market share or delay the decline of the share.
4||| Adopt business unit format
5||| Operator: Marketing person
3||| Problem products/toddler products (.)
(harvest) strategic goals
1||| Low market share-high growth rate
Low profit margin, high debt ratio, and insufficient capital supply
2||| Question: A high growth rate indicates that the product has good prospects and great opportunities; a low market share indicates that there is a problem with the marketing of the product
measure
Good development prospects: growth strategy
Poor development prospects: contractionary strategy
3||| Adopt the form of think tank and project team
4||| Operator: Have planning ability, talent, and dare to take risks
4||| Slim dog products (×)
(give up) strategic goals
1||| Low market share-low growth rate
Low profit margin, high debt ratio, loss or capital preservation status
2||| Also known as "recession strategy"
3||| Measures: austerity strategy
1||| First, the batch size should be reduced and gradually withdrawn, and double-low products should be eliminated.
2||| Then redirect the remaining resources to other products
3||| Finally, the thin dog products were merged with other business units
4. Macro-environmental analysis method (PEST)
Macro-environmental analysis method (PEST) is a method for corporate strategy consultants to help companies review their external macro-environment
P Politics; E Economy; S Society; T Technology
二、 strategy formulation
Contents of strategy formulation
1||| Determine organizational goals and mission
1. organizational mission means
1||| What contribution does the organization make to whom?
2||| What services does the organization provide to whom?
3||| What is the level of contribution and service?
2. Fundamental Questions about Organizational Mission
The primary issue of organizational mission is to determine the scope of the organization’s business activities
Organizational survival is the prerequisite for the organization to fulfill its mission
In the process of development, a successful organization will gradually reflect the purpose of the organization's mission
3. Organizational goals are the embodiment of the organization’s mission
Characteristics of organizational goals
1||| concretize
2||| Number of
3||| layering
4||| challenge
5||| ...
2||| Make strategic choices
Broad strategic options include:
1||| Develop strategic plan
2||| Choose a plan
There are six criteria for strategic choice in a narrow sense
1||| Is there consistency within the strategic portfolio?
2||| Does the strategy match the resources the organization has?
3||| Are strategies consistent with the environment?
4||| Are the risks that the strategy may encounter appropriate?
5||| Does the strategy have a clear timeline?
6||| Is the strategy feasible?
Steps in strategy development:
1||| Identify and qualify existing strategies (a prerequisite for formulating new strategies)
2||| Analyze the organization’s external environment and its internal capabilities
3||| Prepare strategic plan
4||| Evaluate and compare strategic options
5||| Determine strategic plan
Strategy formulation occupies the primary position in the strategic management process and is the starting point of strategic activities
How to formulate strategy:
1||| top-down approach
2||| Bottom-up approach (democracy first, centralization later)
3||| top-bottom combination method
4||| strategic group approach
三、 strategic evaluation
Principles of strategic evaluation (“one has one, two complements each other”)
1||| consistency principle
2||| suitability principle
3||| validity principle
4||| principle of rationality
5||| Stakeholder Attraction Principle
Stakeholders are related to (whether the relevant stakeholders are critical) and (whether the environment is determined)
Stakeholders are not critical and the environment is highly uncertain: cross-domain management
Stakeholders are critical and the environment is highly uncertain: stakeholder partnerships
Key stakeholders, low environmental uncertainty: stakeholder management
stakeholder management
1||| Identify external stakeholders
2||| Determine true potential benefits for stakeholders
3||| Determine how critical a stakeholder is to the organization
4||| Determine appropriate management tools to manage
The most critical issue in solving the problem of managing stakeholder relations is to choose scientific and reasonable specific ways to manage stakeholders.
Stakeholders are not critical and the environment is low-uncertain: scan and monitor the environment
Stakeholder response is evaluated in five ways
1||| Are there high financial risks?
2||| Are there any changes in the number of employees?
3||| Is training and redundancy required?
4||| Are there community issues?
5||| Reactions of other organizations to the organization's strategic choices
Basic factors affecting strategic evaluation
1||| The evaluator’s values and behavioral preferences
2||| Tools and methods used by evaluators
3||| Information and materials held by the evaluator
4||| Evaluator time limit
Steps of strategic evaluation and control
1||| Determine the evaluation object
first step
2||| Choose assessment focus
3||| design evaluation metrics
4||| Develop evaluation criteria
5||| Determine frequency of assessment
6||| Feedback assessment information
四、 strategy implementation
Consider three factors
structure follows strategy
Chandler: Strategy can directly determine the structure of an organization
acculturation strategy
resources around strategy
Types of strategy implementation
1||| Command type
2||| transformational
3||| Collaborative: Inspiration
4||| Cultural Type: Guidance
5||| Growth type: Encouragement, proposing strategies from the bottom up
Principles of Strategy Implementation ("Visual Authority")
1||| goal consistency principle
2||| principle of moderate rationality
3||| unity of command principle
4||| contingency principle
五、 strategic control
Control process: 1. Establish standards; 2. Measure effectiveness; 3. Correct deviations
The need for strategic control
1||| Actions are taken that are inconsistent with the strategic plan (actions that are inconsistent with the plan)
2||| The strategic plan is partially or entirely incompatible with the internal and external environment (the plan is incompatible with the environment)
Types of strategic control:
1||| avoidance control
Take appropriate measures in advance to eliminate inappropriate behavior, so that inappropriate behavior can be avoided without direct control.
2||| Follow-up control (pre-event control)
Predict the results of strategic actions before the strategic results are generated, compare the predicted results with the expected results, and correct any deviations in a timely manner if any.
3||| On-off control (on-off control)
4||| Feedback control (after-the-fact control)
Strategic control methods:
1||| prior control
2||| ex post control
3||| Control at any time (process control)
Three basic systems of strategic control
1||| strategic control system
2||| business control system
3||| job control system
organizational strategy
Meaning of organizational strategy: Organizational strategy is an overall action plan based on the market scope and direction based on the SWOT model in order to achieve organizational goals.
Five basic elements of organizational strategy: 1. Strategic vision (long-term goals), 2. Goals and objectives, 3. Resources, 4. Business and 5. Organization
organizational strategic leadership
Organizational strategic leadership: It is the process by which senior managers lead all personnel to achieve the organizational mission and goals under certain conditions.
Organizational strategic leadership is the key to achieving the organization's mission and goals
Organizational strategic leadership must handle the following relationships well
1||| Alignment of organizational goals and organizational capabilities
2||| Match external environment with internal capabilities
3||| The interaction between immediate survival and future development
4||| Linking strategy formulation and strategy execution
5||| Strategic rigidity and strategic flexibility are compatible
organizational strategic level
Level 1: Overall organizational strategy (corporate strategy)
Overall strategic meaning: The top management determines "what fields to enter and what kind of business to do"
The overall strategy must be coordinated with the dynamic external environment
dynamic external environment
1||| general environment
2||| industrial environment
3||| The competitive environment
overall strategy
1. Growth strategy: for business expansion
（1） integrated strategy
1||| Vertical integration: Expansion of the same industrial chain or service chain
Forward integration: sell it yourself
Backward integration: own raw materials, own production
2||| Horizontal integration: expansion within organizational space, acquisitions, mergers
（2） intensive strategy
1||| Market penetration strategy: a single product to increase the market share of the product
2||| Market development strategy: Use original products to develop new markets
3||| Product development strategy: develop new products in existing markets
Advantages of Intensive Strategy
1||| 生产专业化
2||| 经营目标集中
3||| 集中利用组织资源
4||| 管理方便简单
5||| 取得规模经济效益
（3） Diversification Strategy
1||| Related Diversification/Concentric Diversification: Achieving company growth through mergers or acquisitions of businesses in related industries
2||| Unrelated diversification/centrifugal diversification: Achieve company growth through mergers or acquisitions of unrelated industries and different businesses
2. Stability strategy: maintaining current resources and goals
1||| pause strategy
2||| No growth strategy
3||| Maintain profit strategy
4||| Implement strategy carefully
The organization's implementation of a stability strategy is not a strategy of non-development or growth (it is not a strategy of maintaining the original state of the organization), but a development strategy that pursues (stable and balanced).
3. Contraction strategy: downsizing or canceling certain businesses is a short-term crisis, just to survive the crisis.
1||| turnaround strategy
2||| divestment strategy
3||| liquidation strategy
4||| acquired
Second level: business unit strategy (competitive strategy/business strategy)
Business unit strategic meaning: SBU (Business Unit) is equivalent to each business unit; competition between SBUs
The third level: functional strategy
The most important thing is marketing strategy
New trends in strategic management
1||| The means are complicated
2||| Content expansion
3||| process flexibility
4||| Diversification of subjects
The positive effects of strategic management ("Excellence is development and control")
1||| Provide strategic development direction
2||| Guide resource allocation priorities
3||| Strengthen the organization's ability to adapt to the environment
4||| Setting the standard for excellence
5||| Provides a basis for control and evaluation
Shortcomings of strategic management
1||| Poor management awareness
2||| Strategic structure lags behind
3||| Strategy implementation rigidity
Lack of sensitivity to external environment
4||| Missing evaluation mechanism
Strategic assessment is a means, not an end, and should run through the process of strategy implementation.
5||| Lack of organizational strategic management capabilities
6||| Strategic planning is divorced from reality
The strategic plan is inconsistent with the organization’s own strength, target consumers, and internal and external environment
7||| Ineffective implementation of organizational strategy
Improvements in strategic management
1||| Establish organizational vision
2||| Strengthen the concept of organizational strategic management
3||| Improve organizational strategic management capabilities
4||| Carry out organizational strategic management and publicity work
5||| Clarify the strategic focus of the organization
6||| Ensure effective implementation of organizational strategies
7||| maintain strategic control
"When the time comes, the official can pronounce a (heavy) curse"
measure
Mintzberg divided typical strategic decision-making models into
1||| entrepreneurial model
2||| Adaptation mode
3||| planning model
complementary strategies
1. Strategic alliance: It is a network-type alliance formed by two or more organizations for a certain purpose.
2. business strategy
1||| conservative strategy
Senior staff are composed of engineers and cost experts
2||| risky strategy
Senior staff are composed of marketing and R&D experts
3||| analytical strategy
Made up of various people
3. market positioning strategy
1||| Head-on positioning strategy: face strong enemies head-on and compete with them
Advantages: The competition process is eye-catching and quickly known
Disadvantages: higher risk
2||| Avoid strong positioning strategy: avoid strong enemies
3||| Repositioning strategy: The initial strategy is unreasonable and unscientific, so re-formulate it
4||| Consumer preference strategy: Make product choices based on consumer preferences
4. Positioning strategy: emphasizes that enterprises should adapt to the external environment
5. Planned strategy: emphasizes that business managers must lead consciously
6. Strategic strategy: emphasizes strategy as a means to threaten or defeat competitors
7. Model strategy: emphasizing that strategy focuses on action
8. Harvest strategy: investing money to maximize short-term returns
9. Offensive strategy: pursuit of fast, flexible, complex and loose structure, low division of labor, few rules and regulations, and decentralization
10. Defensive strategy: Strict control that pursues stability and relatively stable benefits, with a high degree of specialization and division of labor, a high degree of standardization, many rules and regulations, and a high degree of centralization.
Management by objectives pays special attention to: employees’ contribution to the organization
Strategic change is more of an incremental change
Toft believes that strategic management has many constraints in the public sector
The short-term nature of government tenure
Steps to compare control
Determine control standards
Measure actual work
Identify deviations and correct deviations
Porter’s three major competitive strategies
1||| Cost leadership strategy
Reduce prices through low costs, so the main measure to implement a cost leadership strategy is to first reduce costs
Use the lowest competitive price to provide products accepted by customers
Scope of application
1||| There are a large number of price-sensitive users
2||| No differentiation between products
3||| Users have no requirements for brands
4||| Low conversion costs for consumers
Consumer switching cost: the one-time cost incurred when a consumer switches from one product or service provider to another, which can be time, emotion, energy, etc.
Types of cost leadership strategies
1||| Simplified product type
2||| Improved design
3||| Material saving type
4||| Reduce labor costs
5||| Production innovation and automation
2||| Differentiation Strategy
Differentiation strategy types
1||| Product differentiation
2||| Service differentiation
3||| Personnel differentiation
4||| Image differentiation
Differentiated strategic risks
1||| lose some customers
2||| Customers are less sensitive to differentiating factors
3||| A lot of imitation makes differentiation become no longer differentiated.
4||| Too much differentiation
Premise: in a large area
3||| centralization strategy
Cost concentration: seeking cost advantages in market segments
Difference concentration: seeking differentiated advantages in market segments
Premise: within a narrow range