This document contains the management tutorial notes including all the information out of the powerpoint presentations. This was used at the management part of the course Advanced Management and Marketing. It contains notes of the whole book: Fundamentals of strategy (4th edition) by Gerry Johnson,...
Summary: Fundamentals of Strategy, ISBN: 9781292209067 Advanced Management and Marketing (Management part) (BMO21306)
Volledige samenvatting Advanced Management and Marketing
Summary Fundamentals of strategy (4th Edition)
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Management, Economics and Consumer Studies
Advanced management and marketing (MST21306)
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Advanced Management and Marketing – MST-21306
MANAGEMENT
Tutorial 1 - Introduction
Aim of the course
1. Assess complex strategic and marketing problems.
• Selecting and applying concepts and methods to markets, firm capabilities and customers.
2. Logically develop options for management at different:
• Levels of analysis: PMC, SBU, corporate, international, innovation,
• And different functional areas (esp., strategy, marketing, innovation),
3. Assess the implementation trajectory of chosen strategies, and
4. Understand, reflect and reflect on the concepts and models.
You are expected to be able to:
• Judge the value of management and marketing models for, resp. strategic and marketing decision-making;
• Evaluate strategic and marketing positioning of companies;
• Analyze the strategy: business environment, resources & capabilities, and stakeholders;
• Apply strategy concepts and models to develop and analyse options for business and corporate
strategies, relating them to the scope of the company, and infer implementation issues;
• Analyze marketing plans for (new) products, brands and markets;
Tutorial 2 – Chapter 1 & 2
CHAPTER 1: Introduction
Learning outcomes
• Summarise the strategy of an organisation in a ‘strategy statement’.
• Distinguish between corporate, business and functional strategies.
• Identify key issues for an organisation’s strategy according to the Exploring Strategy Framework.
Topic & object AMM
• This course focuses on advanced themes in management and marketing
• Object: the problems of (top-)managers: decision-makers in a complex setting, appointed to solve
open-ended, multi-faceted problems
Understand:
1. What is strategy for?
2. Purpose of Strategy; key terms
3. Levels of strategy
4. Fundamentals of Strategy (FoS)-framework
1. WHAT IS STRATEGY FOR?
Definitions of strategy
• “The determination of the long-run goals and objectives of an enterprise and the adoption of courses
of action and the allocation of resources necessary for carrying out these goals” - Alfred D. Chandler
• “Competitive strategy is about being different. It means deliberately choosing a different set of
activities to deliver a unique mix of value” – Michael Porter
• “A firm’s theory about how to gain competitive advantages” – Peter Drucker
• “A pattern in a stream of decisions” – Henry Mintzberg
• “The long-term direction of an organization” – Exploring Strategy
What is strategy? Strategic decisions are likely to …
• Be complex in nature
• Be made in situations of uncertainty
• Affect daily decisions
• Require an integrated approach (thus inside & outside an organisation)
• Involve considerable change
1
,Defining strategy? (p.5)
• The long term → 3 horizons
• Direction → follow objectives OR an emerging coherent pattern
• Of the organization → firms as discrete entities OR relates internal and external persons and groups
Defining strategy? (e.g. Tesla)
• The long term → 3 horizons
• Direction → from e-cars to diverse solar power offerings
• Of the organization → co-founder CEO Eberhard fired
by Elon Musk. External funders and media crucial.
2. PURPOSE OF STRATEGY; KEY TERMS
What is Strategy for? (p. 7-9)
• To define and express the motivating purpose of an
organization to stakeholders. (Montgomery, 2008)
• Four ways to define an organization’s purpose:
- Mission Statement
- Vision Statement
- Statement of Corporate Values
- Statement of Objectives (Collins & Porras, 2002)
Mission statements
• To provide employees and stakeholders with clarity about what the organization is fundamentally
there to do.
• “The overriding purpose of the organization.”
• What would be lost if the organization did not exist? (Why?) What business are we in? How do we
make a difference?
• “Be healthy and fit”
Vision statements (or strategic intent)
• A vision statement is concerned with the future the organisation seeks to create.
• Desired future state of the organisation. What do we want to achieve?
• Spotify: To become the operating system of music.
• “Run the New York-marathon”
Statement of values
• The underlying and enduring core ‘principles’ that guide an organisation’s strategy and define the way
that the organisation should operate.
• Values do NOT change with circumstances.
• Google: ‘Don’t be evil’
• “Train a lot, without putting the body at risk”
Statement of objectives (p. 8-9)
• Statements of specific outcomes that are to be achieved
• Often financial; market-based; competitive advantage; triple Bottom Line
• “Loose 5 kilos by Sept. 1st, and run the NY-marathon next year”
Strategy statements
Three main themes:
• The fundamental goals (mission, vision, objectives) of the organisation.
• The scope or domain of the organisation’s activities.
• The particular advantages or competitive superiority. (Collis & Rugstad, 2008)
Examples: Ideally in max 35 words (Collis & Rugstad, 2008)
• Ikea: ‘To create a better everyday life for the many people [by offering] a wide range of wel-designed,
functional home furniture products at prices so low that as many people as possible will be able to
afford them.’
2
,• Vice media: To build the world’s largest online media group, focused on youth and with competitive
advantages in terms of the diversity of international range of our business and the strength of our
relationships with key partners’ (p.9)
3. LEVELS OF STRATEGY
Levels of Strategy
• Corporate-level strategy is concerned with the overall scope of an organisation and how value is
added to the constituent business units.
• Business-level strategy is concerned with the way a business seeks to compete successfully in its
particular market. → competitive strategy.
• Functional strategy is concerned with how different parts of the organisation deliver the strategy
effectively in terms of managing resources, processes and people
Three levels of Strategy (Tesla)
4. FUNDAMENTALS OF STRATEGY (FoS)-FRAMEWORK
Strategy development processes
• The rational-analytic view sees strategy development as a linear, planned process, typically led by top
management.
• The emergent view sees strategy development as incremental adaptation, often inspired by actions
low down in the organisation.
• Both views have validity, and it is unwise to rely on just one.
Educational approach of FoS
• Exploring strategy.. includes understanding the strategic
position of a organisation, assessing strategic choices
for the future, and managing strategy in action Iteratively
& feedback loops
What is strategic position?
The strategic position is concerned with the impact on
strategy of ....
• the macro-environment,
• the industry environment,
• the organisation’s strategic capability (resources and
competences),
• the organisation’s stakeholders and the organisation’s
culture.
Strategic position
Fundamental questions for strategic position:
• What are the macro-environmental opportunities and threats?
• How can the organisation manage industry forces?
• What resources and capabilities support the strategy?
• How are stakeholders aligned to the organisational purpose? How does culture fit the strategy?
3
, What are Strategic Choices?
Strategic choices involve the options for strategy in terms of directions in which strategy might move, and
the methods by which strategy might be pursued.
• Business strategy and models (Ch. 6),
• Corporate strategy and diversification (Ch. 7),
• International strategy,
• Entrepreneurship strategies, and
• Acquisitions and alliances.
Tesla: Is producing batteries distracting car production?
Strategic choice
Fundamental questions for Strategic choice:
• How should individual business units compete?
• Which businesses to include in the portfolio?
• Where should the organisation compete internationally?
• Is the organisation innovating appropriately?
• Should the organisation buy other companies, form alliances or go it alone?
Strategy in Action: How to put strategy into practice?
See figure at the right.
What is Strategy in in Action?
Strategy in action is concerned with how chosen
strategies are actually put into practice.
• Structuring an organisation,
• Systems of implementation, and
• Leading strategic change (all Ch. 8).
Strategy in action
Fundamental questions for strategy in action:
• Which strategies are suitable, acceptable and feasible?
• What kind of strategy-making process is needed?
• What are the required organisation structures and systems?
• How should the organisation manage necessary changes?
• Who should do what in the strategy process? Which people and what activities?
Common elements of a strategic plan:
• The strategy statement
• Mission, vision, values and objectives
• Macro-environmental analysis
• Industry analysis
• Capability analysis
• Strategic options, and proposed strategies
• Key actions
CHAPTER 2: The Business Environment
Learning goals
Scrutinize firm-environment: What is potentially of major influence?
• Macro → Understand (issues with) gathering and selection of broad factors that impact almost all firms
• Meso/Industry -level → Analyze influences on your industry (Static or dynamic.)
• Micro → Recognize what dominates the direct/task environment, finding an opt out!
Why? Identify key impactful firm-external items, either positive (opportunities) or negative (threats).
4
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