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Elaboration of all lectures of Strategy including my notes. Includes screenshots of models from the powerpoint slides with accompanying explanations.
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Strategie- Boek versie 7 (versie 6/5 heeft andere readings)
- Open boek tentamen (digitaal boek kan ook)
- Opdrachten en tentamen zijn in Nederlands
- Open boek tentamen (60%)
- Business Case assignment (40%) (moet gemiddeld minimaal 5.5)
- Annual report assignment (pass-no pass)
What is strategy about?
→ it is about dilemma’s and paradoxes
Identifying the strategy issues
Understanding the assignment
Identifying the strategic issues
See de Wit & Meyer, p. 7
Two ways of viewing strategic questions:
- Tools-driven (e.g. SWOT, PESTL, BCG)
- Problem-driven
Problem-driven approach used. Key strategy issues are identified and examined from the perspective
of the most appropriate theories.
- Strategizing = cognitive processes of individual strategists
- Missioning and visioning = purpose as the impetus for strategy activities
- Strategy content = combined decisions and choices that lead a company into the future
- Strategy process = the manner in which strategies come about
- Strategy context = set of circumstances under which the strategy content and the strategy
process are determined
Dimensions of strategy and the organizational purpose
,Managing strategy paradoxes
Strategy tensions as puzzles, dilemmas, trade-offs and paradoxes
Six different ways of dealing with a paradox
- Navigating – focus on one contrary element at a time (e.g. seeking synergies, then looking for
responsiveness)
- Parallel processing – separate the contrary demands in different internal or external
organizational units (e.g. improving existing products, meanwhile developing new generation
of products)
- Balancing – trade off elements of the opposing demands (e.g. following industry rules vs.
changing others)
- Juxtaposing – manage opposite demands (e.g. competing and collaborating (Apple vs.
Samsung))
- Resolving – develop a new systhesis between competing demands (e.g. shareholder vs
societal value)
- Embracing – embrace and actively use the tension as a source of creativity and opportunity
(e.g. assigning opposite personalities in management team)
(Voor de readings – zie ppt 1, slide 23 t/m 26)
Lecture 2 – Missioning & Visioning
Ronald Coase on Why Firms Exist
- The main reason why it is profitable to establish a firm would seem to be that there is a cost of
using the price mechanism.
- The size of firm is not its output (Q) but the number of transactions or activities within its
boundaries.
- Firms exist in order to economize on buying and selling everything.
- Firms exist to reduce transaction costs.
‘Existence of Firm (1972)
- Firms are formed when benefits can be obtained from individuals working as a team.
- Sometimes the sum of what individuals can produce as a team is greater than the sum of what
they can produce alone
- Why doesn’t the firm expand forever?
Joods gezegde ‘Ik wens u veel personeel’
Defining Organizations
What do we mean by an ‘Organization’?
An organization is an association of productive assets (including people) who voluntary come together
to accomplish a set of goals.
In the case of the business organization this goal means gaining an economic advantage.
For these productive assets to come together to occur it must be ‘worth it’ for people and others to be
involved with the organization.
,Corporate Mission
Elements
Functions of corporate mission
- Direction
- Legitimization
- Motivation
De ene organisatie is de andere niet, bijv. cultuurverschillen. Waar sta je voor? Wat wil je uitdragen?
Elements of a strategic vision:
- Envisioned contextual environment
- Envisioned industry environment
- Desired future organizational position
- Time horizon
Een strategie helpt je bij het vinden van de stip op de horizon (werkt als een soort kompas, wijst altijd
dezelfde kant op).
Corporate mission and strategic vision
- Corporate mission outlines the
fundamental principles guiding
strategic choices
- Strategic vision outline the desired
future at which the company hopes to
arrive
- The corporate mission and strategic
vision together send the firm in a
particular direction.
, Organizational purpose
‘Failure comes only when we forget our ideals and objectives and principles’
→ Jawaharlal Nehru (1889-1964), first prime minister of India
Corporate governance
Functions of corporate governance:
- Forming function
- Performance function
- Conformance function
Forms of corporate governance:
- Board structure – two-tier or one-tier
- Board membership – composition of the board
- Board tasks – tasks and authority of the board may vary
→ Zorg dat de missie en visie er komen, dat het geïmplementeerd gaat worden en gehandhaafd. Dat
is de raad van bestuur dat het samen doet met raad van commissarissen/raad van toezicht
(afhankelijk van het soort organisatie).
Anglo-saxes: one-tier board (raad van bestuur & raad van commissarissen in één)
Nederland: two-tier board (raad van bestuur & raad van commissarissen/toezicht)
Executive: bezig met de dagelijkse gang van zaken (operationeel)
Non-executive: raad van toezicht bijvoorbeeld, ondersteunend
Two-tier versus one-tier board structure
Two-tier board: traditioneel Nederlands
(bijvoorbeeld board RU)
What is performance?
An important question in the study of firms is:
→ what is performance?
In athletics, it’s straightforward
- The person who runs 100 meters the fastest
- The person who jumps the highest
- The team who wins the World Cup in Soccer
(Je kunt wereldkampioen worden als je heel slecht speelt, als je die doelpunten maar maakt. Bij
bedrijven is dat anders).
For firms it’s when the company successfully formulates & implements a value-creating strategy
Managing the paradox of profitability and responsibility
‘A business that makes nothing but money is a poor kind of business’ – Henry Ford (1863-1947),
American industrialist
Dealing with the paradox
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