1、STRATEGYlIn Greece:Strategos means arts and science that a general command and direct army.lIn Ancient ChinaBesiege Wei rescue ZhaoPretend to advance along one path while secretly going along another;do one thing under cover of another.Macro levelEnterprise levelNational EconomyLocal EconomyIndustri
2、al EconomyCorporate StrategySBUs StrategyFunctional StrategyP ig m e n tsM a r k e tin gR&DF in a n c eM a n u fa c r u r in gF e r tiliz e r sD y e sC h e m c o r pCorporateSBUsFunctionsThe way a company creates value through the configuration and coordination of its multi-market activities.Corpora
3、te Strategy is?Address the Questions？How to achieve sustainable competitive advantage in given product/marketWhere should we compete？（Which markets，and which segments should we concentrate on？）Competitive StrategyWhat products should we compete with？How will we gain sustainable competitive advantage
4、 in these chosen markets？?123is concerned with interpreting the role of the function or department in delivering the competitive strategy Functional strategyMarketing strategyFinancial strategyPersonnel strategyAnd so forthEvery Competitive Strategy Can be Translated into Congruent X StrategieslKenn
5、eth R.Andrews lH.I.Ansoff lH.Mintzberg lOur definitionlThe Concept of Corporate Strategy,1971lStrategy is target,intent,purpose,and the model of which a firm formulates main policies and plan in order to achieving the target.The model defines the business scope which the firm is doing,and should do.
6、The model also defines the business type which the firm is in,and should be in.lCorporate Strategy,1965lThe strategy is a common business line throughout the firms business,products and market.It defines the basic nature of the business that a firm is doing,and plans to do.See MorelMarket and Produc
7、tslGrowth VectorlCompetitive AdvantagelSynergy:Total outcome are more than sum of all parts.SupposeOiCost of Product i Si Sales of Product i(ROI)-Return on InvestmentSuppose ROI of Company i product Pi is as followROI=Si-OiIiST=S1+S2+S3+SnOT=O1+O2+O3+OnIT=I1+I2+I3+In(ROI)T=ST-OTITSS=STIs ITOs OTScal
8、e Effect(ROI)S (ROI)T ST，OT，IT is Sum of Small companys sales,cost and investmentSs，Os，Is Sales,cost and investment of big firmSupposelSales Synergy:from share brand,channellOperating SynergylInvestment SynergylManagement SynergylThe Rise and Fall of Strategic Planning,1994lPlanlPloylPatternlPositio
9、nlPerspective lA strategy is an integrated and coordinated set of commitments and actions designed to exploit core competencies and gain a competitive advantage.Strategy FormulationStrategy ImplementationSee DetailEnvironmentConditionStrategic IntentStrategic MissionStrategy FormulationStrategy Impl
10、ementationCorporate Level StrategyBusiness Level StrategyOrganizational Structure and ControlsCorporate GovernanceStrategic Competitiveness Above-Average ReturnsfeedbackPerspectives and Enterprise CultureVisionMissionGoalsSWOTStrategy FormulationAlternativesSelectionStrategicPlanStrategy Imple-menta
11、tionStrategic ControlFeedback PerformancelChapter 1 An Introduction to Corporate StrategylChapter 2 The External EnvironmentlChapter 3 The Internal ConditionlChapter 4 Corporate Level StrategylChapter 5 Acquisition and Restructuring StrategylChapter 6 Business Level Strategy lChapter 7 Cooperative S
12、trategylChapter 8 Corporate GovernancelChapter 9 Organizational Structure and ControlslChapter 10 Corporate Entrepreneurship and Innovation Chapter1GlobalizationCompetitionPressure to ChangePhysical resourcesHuman resourcesInformation resourcesWorld marketCore businessesOutsourcingBPRTechnology and
13、Technological ChangesRapid technological changeRapid technology diffusionsDramatic changes in information technologiesIncreasing importance of knowledgeThe Competitive LandscapeThe Global EconomyPeople,goods,services,and ideas move freely across geographic bordersSignificant opportunities emerge in
14、multiple global marketsMarkets and Industries become more internationalizedlA firm is viewed as a bundle of market activities and a bundle of resources.(in the lesson)lMarket activities are understood through application of the I/O model.lThe development and effective use of a firms resources,capabi
15、lities,and competencies is understood through application of the resources-based model.lCombination of the two models,firms can increase the probability of achieving strategic competitiveness and earning above-average returns(AARs).lThe external environment was thought to be the primary determinant
16、of strategies firms selected to be successful.lIndustry chosen has a stronger influence on the firms performance than do the choices managers make inside their organizations.The External EnvironmentThe general environmentThe industry environmentThe competitive environment1.Study the external environ
17、ment,especially the industry environment.An Attractive IndustryAn industry whose structural characteristics suggest AARsStrategy FormulationSelection of a strategy linked with AARs in a particular industryAssets and SkillsAssets and skills required to implement a chosen strategyStrategy Implementati
18、onSelection of strategic actions linked with effective implementation of the chosen strategySuperior ReturnsEarning of AARs2.Locate an industry with high potential for AARs.3.Identify the strategy called for by the attractive industry to earn AARs.4.Develop or acquire assets and skills needed to imp
19、lement the strategy.5.Use the firms strengths to implement the strategy.The I/O ModellEach organization is a collection of unique resources and capabilities that provides the basis for its strategy and is the primary source of its returns.lThe differences in firms performances across time are driven
20、 primarily by organizations unique resources and capabilities rather than by an industrys structural characteristics.lResources may not be highly mobile across firms.lThe differences in resources form the basis of competitive advantage.ResourcesInputs into a firms production process1.Identify the fi
21、rms resources.Study its strengths and weaknesses as compared to those of competitors.CapabilityCapacity of an integrated set of resources to integratively perform a task or activityCompetitive AdvantageAbility of a firm to outperform its rivalsAn Attractive IndustryAn industry with opportunities tha
22、t can be exploited by the firms resources and capabilitiesStrategy Formulation&ImplementationStrategic actions taken to earn AARsSuperior ReturnsEarning of AARs2.Determine the firms capabilities.What do the capabilities allow the firm to do better than its competitors？3.Determine the potential of th
23、e firms resources and capabilities in terms of a competitive advantage.4.Locate an attractive industry.5.Select a strategy that best allows the firm to exploit its resources and capabilities relative to opportunities in the external environment.The R/B ModellStrategic intent is the leveraging of a f
24、irms internal resources,capabilities,and core competencies to accomplish the firms goals in the competitive environment.lStrategic intent implies a significant stretch of an organizations resources,capabilities,and core competencies.lStrategic intent exists when all employees and levels of a firm ar
25、e committed to the pursuit of a specific performance criterion.lIt seems like a dream,unrealistic goal,imagination.lTo become a high-performance multinational energy companynot the biggest,but the best.(Unocal Corporation)lTo be the top performance in everything the company does.(Philips Petroleum C
26、ompany)lTo catch up with and beat Caterpillar.(Komatsus)lTo beat Xerox.(Canon)lTo become second Ford.(Honda)lThe strategic mission is a statement of a firms uniques purpose and the scope of its operations in product and market terms.lIn some firms,mission is called vision.lTo put a car in every home
27、.(Ford)lA computer in every home.(Apple)lA computer on every desk,and every home,running on Microsoft software.(Bill Gates)lPortable communications.(Motorola)Strategic IntentWinning competitive battles through deciding how to leverage resources,capabilities,and core competenciesStrategic MissionAn a
28、pplication of strategic intent in terms of products to be offered and markets to be served lProfitability:lProductivity:lMarket Status:lR&D:lOrganizational Change:lHuman ResourceslSocio Responsibility MSAMS-Absolute MSRMS-Relative MSSales of the industryAMS=Sales of the companyX 100%Sales of the lar
29、gest oneRMS=Sales of the companyX 100%numerator is unchangedDenominator:if the companys sales is the biggest,the denominator must be the second one.Return on Capital 12%Return on Sales 8%Turnover Rate of Capital 1.5 ProfitRevenue 3m RevenueTotal Capital 2m Fixed AssetsCurrent AssetsSalesCostFixed Co
30、stVariable CostProfit&TaxFixed CostVariable CostProfit&Taxl1.The Idea of Adapting Environmentl2.The Idea of Competitive Advantagel3.The Idea of Reengineeringl4.The Idea of Strategic Alliancel5.The idea of Organization Learning GlobalizationNetworkPhysical ResourcesHuman ResourcesInfo.ResourcesIntern
31、etWorldwide MarketGlobal ProcurementGlobal LogisticslMichael EPorter put forward to the concept:it is from low cost or differentiation.lThe advantages can come from internal and external.lBased on external condition include:natural environment,natural resources,transportation,information communicati
32、on,economic base,public relation.lFormed by internal：decision making ability of top management,innovation ability of technician and engineers,marketing ability of marketer,competence of employee.Core BusinessCustomer OrientationOrganization FlatEnvironment changeBPRCompetitive AdvantageResources Foc
33、us onCompetition PressureVariety of NeedsNetworkBPRBPRNothing changed except in todays society.change lRCoase said：there are two systems can be used to configuration and coordination resources:lThrough market:by use of the price as a tool to accomplish a set of market transactions.lThrough organizat
34、ion:a coordinator within organization to direct production.lBoth mechanisms cost money.So,which one is used depends on which has the lower cost.Whether a company will expand or reduce its businesses depend on the save of transaction cost.lTheFifthDiscipline ArtsandPracticesofTheLearningOrganization(
35、Peter Senge,1990)lTo bring peoples creativity into play is the key successful factor in the 21st.It is also the key point of the management efforts.lOrganization learning is an unremitting process.It is the process which an organization ceaselessly acquire lore,and pass lore each other in the organi
36、zation,and create new lore by various ways and manners in order to boost up organizational abilities and improve organizational behavior and performance.lThree Key Points of Organization Learning：1.The organization can ceaselessly acquire lore and accumulate lore2.The organization can pass lore each
37、 other in the organization3.The organization can create new lore By studying the internal environment,Firms determineWhat they can doBy studying the external environment,Firms identifyWhat they might choose to do lGeneral External Environmental AnalysislIndustry Environment AnalysisEconomicDemograph
38、icSocioculturalPolitical/LegalGlobalTechnologicalGeneral EnvironmentlThe general environment is composed of elements in the broader society that can influence an industry and the firms within it.lThe industry environment is the set of factors the threat of new entrants,suppliers,buyers,product subst
39、itutes,and the intensity of rivalry among competitors that directly influences a firm and its competitive actions and responses.Definitions of general and industry environmentDemographic Segment Population sizeAge structureGeographic distributionEconomic cycleInterest and Inflation ratesTrade defici
40、ts or surplusesBudget deficits or surplusesAntitrust lawsTaxation lawsDeregulation philosophiesWomen in the workforceWorkforce diversityAttitudes about quality of work lifeProduct innovationsProcess innovationsApplications of knowledgeEconomic SegmentPolitical/Legal SegmentSociocultural SegmentTechn
41、ological SegmentGlobal SegmentImportant political eventsCritical global marketsEthnic mixIncome distributionPersonal saving ratesBusiness saving ratesGross domestic productLabor training lawsEducational philosophies and policiesConcerns of environmentShifts in work&career preferanc Shifts in prefere
42、nces in products and service characteristicsFocus of private and govern-ment supported R&D expenditurNew communication technologyNewly industrialized countriesDifferent cultural and institu-tional attributeslRevivelBoomlStagnancylCrisisABlRevivelBoom lWeaklSoft LandfalllIdentifying early signals of
43、environmental changes and trendslDetecting meaning through ongoing observations of environmental change and trendslDeveloping projections of anticipated outcomes based on monitored changes and trendslDetermining the timing and importance of environmental changes and trends for firms strategies and t
44、heir managementScanningMonitoringForecastingAssessingChinalNot directly mention key pointlAsk questions or have requirements by a subtle waylPraising grouplSaying words to boost harmoniouslSomething have not been express are also very importantlUsually not to say“No”，instead of changing other topic
45、or give a blurry answerlHaving a expression for the most important thing in the lastlGuangxi is the first thing in allfirstly discussed topic is about private things before discussing businesslSynthesizing different ideas，struggle to be consistent lPerson and mind cannot be separatedlDumbness does n
46、ot mean disagreeAmericanlDirectly mention key pointlBluntly discussing requirements and problem being facedlPraising individuallPrecisely saying what one wants to saylWhat one say is the most importantlDirectly say“No”lHaving a expression for the most important thing in the beginninglRules are the m
47、ost important，firstly discussing business than private lMaking ideas diversely，struggle to have the best onelPerson and mind can be separated lDumbness means disagreelAn industry is a group of firms producing products that are close substitutes.lThe industry environment is the set of factors the thr
48、eat of new entrants,suppliers,buyers,product substitutes,and the intensity of rivalry among competitors that directly influences a firm and its competitive actions and responses.lIndustry environment has a more direct effect on strategic competitiveness and AARs.IndustryCompetitorsThe Threat of Entr
49、yAbsolute cost advantagesGovernment policyEconomies of scaleCapital requirementsBrand identitySwitching costsAccess to distributionExpected retaliationThe Threat of SubstituteRelative price/performanceSwitching costsBuyer propensity toSupplier PowerSupplier concentrationImportance of volume to suppl
50、ierDifferentiation of inputs Impact of inputs on cost of differentSwitching costs of supplier/firmsPresence of substitute inputsThe Degree of RivalryIndustry growthProduct differencesBrand identitySwitching costExit barriersInformational complexity Buyer PowerBargaining leverage Price sensitivityBuy
