Management Class 2

1
Management - Class 2

• Chapter 3,4, 5

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Chapter 3Decision Making

• Spell out what triggered the problem.
• List at least four ways to define the problem,
  and choose the best definition.
• Propose at least five objectives for the person
  making the decision
• Recommend at least four possible alternative
  solutions
• Develop a Consequences Matrix for the decision
• Develop a Decision Matrix for the decision.

3
Management Functions

• Planning is setting goals and deciding on
  courses of action, developing rules and
  procedures, developing plans (organizational,
  employee), and forecasting (predicting)
• Organizing
• Leading
• Controlling

4
Decision Making

• Problem is a discrepancy between a desirable
  and an actual situation.
• Decision a choice from among the available
  alternatives.
• Three Degrees of Uncertainty
• Certainty the condition of knowing in advance
  the outcome of a decision.
• Uncertainty the absence of information about a
  particular area of concern
• Risk the chance that a particular outcome will
  or will not occur.
• Decision making is the process of developing and
  analyzing alternatives and making a choice.
• Define the problem
• Clarify your objectives
• Identify alternatives
• Analyze the consequences
• Make a choice
• Judgment the cognitive or thinking aspects of
  the decision-making process.

5
Classical Approach

• Assumptions on how managers make decisions.
• They have complete or perfect information about
  the situation.
• Could distinguish perfectly between the problem
  and its symptoms.
• Could identify all criteria and accurately weigh
  all the criteria according to their preferences.
• Knew all alternatives and could assess each
  against a criterion.
• Could make an optimal choice, without being
  confused by irrational thought processes.
• Reality
• No one has perfect knowledge of all the options
• Not enough time
• Can not unemotionally analyzed every single
  option.

6
Administrative Approach

• Decision makers try to be rational.
• Most people quickly reach a point of information
  overload
• They begin making errors by incorrectly
  identifying some of the information
• Give approximate responses.
• Lack the time to evaluate alternative
• Can not determine what the real problem is.
• Bounded Rationality the boundaries on rational
  decision making imposed by ones capacity for
  processing information.
• As rational as their unique values, abilities,
  and limited capacity for processing information
  permits.
• Satisfice they look for solutions until they
  find a satisfactory one.
• Risk Tolerance Cost vs Benefit

7
The 101 Dumbest Moments in Business

• In a perfect world, businesses would be run with
  the utmost integrity and competence. But ours is,
  alas, an imperfect world.
• By Jim Carvell, Adam Horowitz, Thomas Mucha, Apri
  l 2002 Issue
• 1. Houston, We Have a Problem, Part 1 Enron
  states billions of dollars in extra revenue
  through aggressive accounting and complicated
  off-the-books partnerships managed by its own
  executives, all the while ignoring warnings from
  its employees and enriching its top executives at
  the expense of its investors and workforce. And
  it assumes none of this will ever come to light.
• 2. A dozen Burger King marketing execs suffer
  first- and second-degree burns while walking over
  hot coals as part of a team-building retreat in
  October. One of the injured, a VP for product
  marketing aptly named Dana Frydman, tries to put
  a positive spin on having her feet flame-broiled
  like so much ground chuck. "It made you feel a
  sense of empowerment and that you can accomplish
  anything," she tells the Miami Herald.
• 3. Banana Republic co-founders Mel and Patricia
  Ziegler start ZoZa, an "athletic formalwear"
  retailer, in late 2000. Mel says he expects sales
  to reach 1 billion within seven years. Gary
  Rieschel of Softbank Venture Capital invests
  16.5 million, telling Business Week, "If you
  have guts and you have capital, how can you not
  be optimistic about the consumer market?" Here's
  how ZoZa's designers revamp its spring 2001
  line, intentionally making their dresses two
  sizes smaller than labeled. Even the svelte are
  outraged, and ZoZa's merchandise return rate
  soars to 80 percent. The company shuts down in
  May 2001, proving that, if the dress doesn't fit,
  you must, uh, quit.

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The 101 Dumbest Moments in Business

• 5. Proving the old business-school saw that "any
  idiot can sell a dollar for 80 cents,"
  online-currency company Flooz.com in July
  launches a special offer whereby American Express
  platinum cardholders can buy 1,000 of Flooz
  currency for just 800.
• 6. A month later, Flooz.com ceases processing
  transactions. It declares bankruptcy in November,
  leaving those who bought Flooz currency stuck
  with worthless e-dollars.
• 21. NBC and the World Wrestling Federation plow
  100 million into creating the XFL. The March 17
  game between the Birmingham Thunderbolts and the
  Las Vegas Outlaws scores a 1.6 Nielsen rating,
  believed to be the lowest ever for any prime-time
  network program. The league folds after one
  season.
• 27. Mobile Office Enterprise unveils the Express
  Desk, which attaches a notebook computer to the
  steering wheel of a car. For use only while
  parked, of course.

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The 101 Dumbest Moments in Business

• Part 2 Not to be outdone, Eli Lilly sends a mass
  e-mail in July to users of its antidepressant
  Prozac but neglects to use the "bcc" header,
  further depressing its customers by disclosing
  their online identities to one another.
• 31. An FBI investigation reveals that, since
  1995, McDonald's (MCD) prize contests, including
  its popular Monopoly game, have been rigged by
  eight individuals, including one who worked for
  the firm McDonald's hired to run the contests.
  The eight allegedly conspired to corner the
  market on the winning game pieces without
  enduring that arduous eating-food-from-McDonald's
  step.
• 39. After filing for Chapter 11, declaring their
  intention to liquidate the company's assets, and
  ending health-care benefits for retirees,
  Polaroid executives file a request in bankruptcy
  court to distribute an estimated 19 million in
  "stay bonuses" to the company's top 45
  executives.
• 40. The Newspaper Association of America names
  Kmart its "Retailer of the Year" on Jan. 21,
  2002, one day before the company files for
  bankruptcy protection under Chapter 11.

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The 101 Dumbest Moments in Business

• 58. Houston, We Have a Problem, Part 9
  (Not-Quite-So-Innocent Bystander Department) In
  a tearful interview on NBC's Today, Linda Lay,
  wife of Enron CEO Kenneth Lay, proclaims,
  "Everything we had was mostly in Enron stock....
  We are struggling for liquidity." Reporters soon
  note that the Lays have 8 million in stock in
  other companies and 25 million in real estate
  holdings.
• 59. In October, Global Crossing forgives
  two-thirds of a 15 million loan it made to newly
  appointed CEO John Legere when he worked for the
  company's Asian subsidiary. He also receives a
  3.5 million signing bonus, despite the fact that
  he is already employed by Global Crossing. Of
  course, the 13.5 million is pocket change for
  Global Crossing founder and chairman Gary
  Winnick, who -- despite the fact that his firm
  has never earned a penny of profit -- has already
  sold 734 million worth of stock in the
  soon-to-be-bankrupt company.
• 66. Having already earned the public's enmity by
  declaring bankruptcy rather than negotiating with
  the government during California's electricity
  shortage, Pacific Gas Electric shores up its
  public image by awarding 17.5 million in
  retention bonuses to its executives.
• 76. Houston, We Have a Problem, Part 10 As Enron
  swirls into bankruptcy, it pays out 55 million
  in bonuses to about 500 of its employees -- about
  110,000 apiece -- in order to retain their
  services. This is in stark contrast to the 4,500
  severance package offered to 5,100 laid-off Enron
  workers.

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The 101 Dumbest Moments in Business

• 90. Houston, We Have a Problem, Part 12 In his
  testimony before Congress, Jeffrey Skilling
  claims that he is unable to recall a board of
  directors committee meeting in which records show
  that he had approved several partnership deals,
  in part because "the room was dark, quite
  frankly, and people were walking in and out of
  the meeting."
• 95. Having lured Mariah Carey with a 21 million
  signing bonus and an 80 million, five-album
  recording contract, EMI decides, after only one
  album, to pay her 28 million to go away. The net
  result EMI pays 49 million for the soundtrack
  to Glitter.
• 63. Bottling the Stench of Death and Calling It
  Perfume Philip Morris also attempts to counter
  antismoking measures in the Czech Republic by
  commissioning an economic analysis of the
  "indirect positive effects" of early deaths --
  savings on health care, pensions, welfare, and
  housing for the elderly. The company later
  apologizes.

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Types of Decisions

• Programmed- can be solved using rules and
  procedures that can be laid out in advance.
• Policy, procedures, and rules manuals
• Facilitates the routine and standardization of
  decisions
• 90 of all management decisions are programmed
• managers subordinates these decisions
• Usually lower-level managers address these
• Nonprogrammed can not be preplanned. They
  require considerable intuition, creativity, and
  decision-making prowess
• Upper managers address these.
• Strategic decisions managers want to analyze
  these decisions carefully, and weigh their
  options and pro and cons.

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Decision-Making Process

• Decision making is the process of developing and
  analyzing alternatives and making a choice.
• Define the problem
• Write down the initial assessment of the problem
• What triggered the problem ?
• Why do I want to solve this problem?
• What triggered this problem?
• What is the relationship between the trigger and
  the problem?
• Clarify your objectives
• Write down all the concerns you hope to address
  through your decision.
• Convert your concerns into specific, concrete
  objectives
• Separate ends from means to establish your
  fundamental objectives
• Clarify what you mean by each objective
• Test your objectives to see if they capture your
  interest
• Identify alternatives
• Analyze the consequences
• Make a choice

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Decision-Making Process

• Identify Alternatives What are my options?
• Generate as many alternatives as you can yourself
• Expand your search by asking other people
• Know when to stop
• Analyze the consequences Pro/Cons
• Forecast future events once the decision has been
  made or not made.
• Lets you quantify realities
• Eliminate any clearly inferior alternatives
• Organize your remaining alternatives into a
  Consequences table.
• Make a Choice
• Review the consequences of each alternative, and
  choose the alternative that maximizes your
  benefits.
• If Choice does not solve the problem repeat.

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Make Better Decisions

• Increase your knowledge
• Ask WHO, What, Where, When, Why, HOW?
• Get experience
• Use consultants
• Do your research
• Force yourself to recognize the facts when you
  see them
• Base your decision on an objective review of the
  facts as they really are.
• Knowledge management to any efforts aimed at
  enabling the companys managers and employees to
  better utilize the information available in their
  company.
• Only 2 of companys information is written down
• Intuition is a cognitive process whereby a
  person instinctively makes a decision based on
  their accumulated knowledge and experience.
• you can usually tell when a decision fits with
  your inner nature, because it brings an enormous
  sense of relief.
• Good decisions Tranquilizers
• Bad decisions anxiety
• Concerns with intuition
• Intuition sometimes cloud our decision-making
• Tends to make you overconfident
• Does not stand up to Challenges

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Make Better Decisions

• Your Mood
• Is it conducive to making a decision.
• When people feel down they become aggressive
  and destructive
• When people feel up they become more tolerant
  and subjective.
• Be Creative
• Decision making is not a mechanical process
• Creativity the process of developing original,
  novel responses to a problem
• Brainstorm
• Suspend Judgment on suggested alternatives
• More Points of Views are better
• Provide Physical Support for Creativity
• Encourage anonymous inputs
• Reward effort
• Decision Tree a technique for facilitating how
  decisions under conditions of risk are made,
  whereby an expected value and gain or loss can be
  applied to each alternative.

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Psychological Traps

• Decision Making Shortcuts
• Heuristics decision-making shortcuts, rules of
  thumb.
• Anchoring unconsciously giving too much weight
  to the first information you hear.
• Psychological Set the tendency to focus on a
  rigid strategy or point of view when solving a
  problem.
• Perception the selection and interpretation of
  information we receive through our senses and the
  meaning we give to the information.
• Stress feeling a decision has to be made now.
• Peer Pressure do it this way because your
  friend did it that way

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Basic Planning ProcessChapter 4

• Develop a usable plan for an organization
• Write an outline of the required business plan,
  and provide specific examples of its components
  functional plans.
• Express the necessary plan in descriptive,
  graphic, and financial formats.
• Explain what the manager did right and did wrong
  with respect to setting goals for subordinates.
• Explain the forecasting tools, you think the
  manager should use and why.

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Nature/Purpose of Planning

• Plan a method for doing or making something,
  consisting of a goal and a course of action.
• It identifies future goals, sequence of steps in
  reaching those goals, and a time frame for those
  steps
• It answers what, when, who, how much.
• Planning the process of setting goals and
  courses of action, developing rules and
  procedures, and forecasting future outcomes.
• Goal a specific result to be achieved the end
  result of a plan.
• Objectives specific results toward which effort
  is directed.

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Management Planning Process

• Goals of Planning
• Deciding ahead of time
• what needs to be done
• Time to research options
• Identify sequence of steps in reaching the goals
• Anticipate consequences of each step
• Provides direction and a sense of purpose.
• Provides a unifying framework in which to measure
  decisions
• Facilitates control
• Set standards
• Measure performance against those standards
• Identify and correct deviations

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Planning Process

• Planning steps
• Planning process is a logical process
• Setting objectives
• Analyzing situation
• Making forecasts
• Determining alternative course of action
• Evaluate options (alternatives)
• Choose and Implement the Plan
• Corp. Planning includes
• Hierarchical aspect
• Upper management approves long-term plans
• Departments creates their budget and sub-plans to
  accomplish the long-term plan
• Department interaction and compromise

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Albert Dunlap

• 1994 Journal of Business Strategy selected him as
  a Strategist to Watch
• As CEO of Scott Paper
• Laid off 11,200 people in about one year (1/3 of
  the work force)
• 71 of the headquarter staff
• 50 of management
• 20 of the hourly employees
• Scott Paper lost US market share in 3 major
  products
• In Britain market share went from 31.5 to 26.4
  in 2 years
• Sold Scott paper to rival Kimberly-Clark
• Dunlap compensation in salary and stock approx
  100 million
• CEO of Sunbeam
• Day one stock raised 49 for the quarter 63
• In 4 months reduced employee by 6,000 ½ of
  the work force. The largest reduction ever
  announced.
• 8 companies - 6 are gone
• Short term results at the expense of long-term
  health of the company

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Management

• U.S companies are most likely to have senior
  management that has not worked in front-line
  positions and who, therefore, have little
  appreciation for or understanding of the work
  like of rank-and-file people or concern for their
  welfare.
• Studies show that a financial orientation, with
  its emphasis on financial controls and ,
  frequently, on the short-term, relates negatively
  to doing the things that need to be done to
  achieve profits through the effective management
  of peop0le and t\of the employment relation that
  links them to the organization
• A Balance score card approach in which
  financial measures are only part of a system that
  also measures customers, employees, and the
  organizations activities that permit it to
  compete effectively in the future

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10 Reason Why Smart Organizations Sometimes Do
Dumb Things

• The desire to do what everyone else is doing and
  to follow the crowd
• Managerial career pressures, derived from the
  need to make the numbers and to have a track
  record that makes one mobile, pressures that
  create an emphasis on short-term, financial
  results.
• A belief in leader ship and tendency to overvalue
  things we have helped produce,
• Demands for accountability and reproducibility in
  results and decisions that destroy the benefits
  of expertise.
• Career trajectories who gets promoted rewards
  financial rather than human resources.
• Excessive focus on measuring costs often
  short-term costs
• Obsession with mean or tough management.
• Management education and training focus on
  finances and accounting rather than on human
  resources.
• Normative and economic value placed on being a
  skilled analyst on knowing compared to value
  placed on being able to manage people.
• Capital market primacy over other stakeholders
  and demands for short-term performance that make
  long-term investments in people more difficult.

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Business Plan

• Co. business plan provides a comprehensive
  overview of the firms situation today and of its
  companywide and departmental goals and plans for
  the next three to five years
• Contains
• Executive summary a brief summary of the plan,
  including a snapshot of the business environment,
  the companys goals, competitive strengths. As
  well financial situation.
• Description of the business
• A mission statement
• What business are we in
• Who we are
• What we do
• And Where we are headed
• Marketing plan a plan for marketing your
  products/services.
• Nature of your product/service
• The pricing and promoting strategies
• Selling and delivering of goods/service
• 4-P product, price, promotion, and place)

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Business Plan

• Financial plan
• Profit and Loss compares sales with the
  expenses incurred to generated theses sales
• Revenues, expenses and net income
• Balance Sheet show what the company owns who
  they owe- and how much the shareholders own
• Cash Flow sources and usage of cash
• Pro forma future projected statements
• Management and/or personnel plan
• detailed monthly schedule showing specific job
  titles for you will be hiring and when.
• Any lay offs.
• Specific duties of employees
• Executive Action Assignment Plan targets each
  department needs to achieve if that long-term
  goal is to met.

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Types of Plans

• Format variety
• Descriptive plans- state in words what is to be
  achieved, by who, and when as well as cost.
• Budgets- financial terms
• Graphic plans- uses charts or graphical networks
• Covers a period of time
• Tactical plans (functional plans) marketing,
  production, and personnel plans.
• Shows each department's role in the companys
  strategic plan
• Operational plans first-line managers focus on
  short-term plans
• Focus on detailed day-to-day planning
• One-time projects presents in an orderly
  fashion all steps in a major one-time project.
• Standing Plans to be used repeatedly as the
  need arises.
• Policies- set board guidelines
• Procedures- spell out what to do if a specific
  situation arises
• Rules- a highly specific guides to action

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Goals

• Defined - a specific result to be achieved the
  end result of a plan.
• Goals must be
• Specific and clearly stated the end results
• Attainable
• Relevant and clearly derived from crucial needs
• Timely and reflect deadlines and milestones
• 4 point model
• action/verb
• single measurable result
• Target date/time span
• Cost in time and /or energy
• Motivational Goals
• Assign Specific Goals
• Assign Measurable Goals - express goals in
  quantitative terms, and include target dates or
  deadlines
• Assign Challenging but Doable Goals- goals must
  be designed to show obtainable improvements
• Encourage Participation
• Creates a sense of ownership in the goals
• Reduces resistance
• Tend to be more difficult than assigned goals

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Management by Objectives

• Created by Peter Drucker the goal of each
  managers job must be defined by the contribution
  they make to the success of the larger unit of
  which they are part.
• 5 steps
• Set organization goals top management sets
  strategic goals for the company.
• Set department goals depart heads and
  supervisors set subordinates goals
• Set Individual goals with a timetable for
  accomplishing those goals.
• Give Feedback periodically review the
  subordinates performance.
• Disadvantage
• Time consuming

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Forecasting Developing Planning Premises

• Forecast to estimate or calculate in advance or
  to predict. Usually by on companys sales
• Quantitative Forecasting- time-series methods and
  causal models
• Time series a set of observations taken at
  specific times, usually at equal intervals.
• the data is plotted on a graph to see trends
• Identifies irregular and seasonal patterns and
  allow managers to identify fundamental trends
• Casual forecasting develop a forecast based on
  the mathematical relationship between a company
  factor and variables management believes
  influences or explain the cap any factor.
• Qualitative forecasting uses human judgment
• Used when no hard data and numbers are available.
  

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Marketing Research

• Defined procedures used to develop and analyze
  customer related information that helps managers
  make decisions.
• Primary Data information specifically collected
  to solve a current problem.
• Sources mail and personal surveys
• Secondary data information collected or
  published already
• Sources - libraries, trade association, company
  files and sales reports.
• Competitive Intelligence (CI) a systematic way
  to obtain and analyze public information about
  competitors.
• Internet and CI
• Ethics and CI as long as the firm publicly
  lists the information on the WEB, it is Ethical

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Chapter 5 Strategic Management

• Develop a workable strategic plan for an
  organization using SWOT analysis
• Identify a companys current corporate
  strategies, and list its strategic options.
• Develop a vision and mission statement.
• Accurately identify a companys core
  competence.
• Explain each of the strategic planning tools you
  think the CEO should use, and why.

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Knowing Your Business

• What is our business and what should it be?
• What is the structure?
• What are the products or services?
• Determines what type of employees is hired
• Who your clients/customers will be
• Who are your competitors
• How much money is needed
• How will the company compete?
• What kind of marketing/promotions.
• Where will you conduct business.
• Who are your competitors
• What should our current basic course of action
  for the company.
• Defining our mission statement -a statement that
  broadly outlines in todays terms the
  enterprises purpose and serves to communicate
  who the organization is, what it doses, and
  where its headed.
• What is our future plans.
• Setting strategic plans assessing your
  situation today, predicting the future
  opportunities, threats, strengths weakness and
  identifying the course of action.
• Includes setting objectives
• Creating a course of action- creativity and based
  on predicting the future.

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Strategic Management Process

• Define the business, develop a vision and its
  mission.
• A company must
• define the product scope in the range and
  diversity of products.
• Review the vertical integration supply chain
• Analysis the geographic scope
• Identify how the company competes.
• Perform external and internal situation audits.
• The purpose is to choose a direction for the firm
  that makes sense in terms of
• the external opportunities and threats
• the internal strengths and weaknesses
• Translate the mission into strategic goals
• Interpret the mission and strategic goals into
  specific and attainable goals for managers.

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Strategic Management Process

• Generate and select strategies to reach strategic
  goals
• Strategy is a course of action which show how
  the enterprise will move from the business of to
  day to the business of tomorrow given the
  opportunities and threats and its internal
  strengths and weaknesses.
• Reviewing required staffing, fixed assets
  (buildings new or closing old), and product
  lines.
• Implement the strategy into actions and results
• Involves applying all the management functions
  planning, organizing, leading and controlling.
• The company must be consistent, focus,
• Evaluate performance the current results with
  the goals.
• Are there adjustments that are needed
• Or Strategies that need to be revised or
  eliminated?
• The review process is an ongoing process. Always
  review the competitive environment, demographics,
  companys culture and focus.

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Types of Strategies

• Corporate-Level identifies the corporations
  portfolio of businesses and who these businesses
  work and fit together.
• Concentration the business offers one product
  or product line.
• Market Penetration aggressively marketing and
  selling the firm products.
• Geographic expansion expanding companys
  product into new geographic areas (global)
• Product Development improve companys product
  for current markets
• Horizontal integration acquiring ownership or
  control of competitors in the same or similar
  markets, with the same or similar products.
• Advantages- Concentrate on the business it know
  well.
• Disadvantage putting all ones eggs in one
  basket
• Vertical Integration owning or controlling the
  products or services from beginning to end.
• Backward integration when the retail company
  buy the distribution chain.
• Forward integration when the manufacturer buys
  the retail outlets

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Types of Strategies(continued)

• Diversification is a strategy of expanding into
  related or unrelated products or market segments
• Related Diversification expanding into other
  industries in which a firms lines are related or
  kind of fit.
• Conglomerate expanding into unrelated products
  or markets.
• Status Quo A more conservative approach in
  which no change in strategy is advisable.
• Investment Reduction (defensive) are corrective
  actions.
• Retrenchment a reduction of activities or
  operations. Reducing employment, downsizing,
  closing facilities.
• Divestment selling or liquidating individual
  businesses.
• Liquidation the selling or abandonment of
  nonviable businesses.
• Strategic Alliances Joint Ventures formal
  agreements between two or more separate
  companies, the purpose of which is to enable the
  organizations to benefit from complementary
  strengths.
• Joint Venture joint ownership and operation of
  a business.

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Types of Strategies(continued)

• Competitive as a plan to establish a profitable
  and sustainable competitive position against the
  forces that drive industry competition.
• Specifies how the company will compete
• Cost leadership- (price) -aims to be the low-cost
  leader in an industry.
• Differentiation-(uniqueness) - seeks to be unique
  in its industry along some dimensions that are
  valued by buyers
• Focus (service) - selects a narrow market
  segment and serving those customers in that
  niche better or more cheaply than anyone else
• Force Competitive strategy (size) a basis on
  which to identify a relative superiority over
  competitors. Like castle moats, these advantages
  can help stop or delay new competitors from
  entering the marketplace.
• Threat of entry -
• Rivalry among competitors
• Price competition, advertising battles and
  increase costumer service.
• Pressure from substitute products -
• Buyers bargaining power -
• Suppliers bargaining power -
• Functional - are the basic operating policies
  for departments.

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Strategic Planning Methods

• Strategies should
• Capitalize on evolving opportunities and address
  potential threats.
• Be achievable.
• Capitalize on companys strengths and avoid the
  firm's current weaknesses.
• In response to competitors potential moves
• Strategic planning tools
• Market research
• SWOT (strength, weaknesses, opportunities, and
  threats)
• Strength/weakness financial resources,
  companys stability, economies of scale, and
  proprietary technology.
• Opportunities Weakening competition, economic
  changes.
• Treats government laws, raising sales of
  substitutes

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Strategic Planning Methods

• Environmental Scanning
• Economic trends the level of economic activity
  and the flow of money, goods, and services.
• Competitive trends actions taken or to be taken
  by current and potential competitors.
• Political trends actions of local, nations, and
  foreign governments
• Technological trends development of new or
  existing technology.
• Social and demographic trends the way people
  live and the nature of the people in a society.
  Including what they value.
• Geographic trends Climate, natural resources.
• Benchmarking- carefully analyzing the practices
  of other companies that already excel in that
  area and then comparing the results to your
  company.

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Strategic Planning Methods

• TOWS Matrix to help visualize what strategies
  to use to address the firm's SWOT.

• Portfolio Analysis The BCG Matrix helps
  managers to identify the relative attractive of
  each of a firms business.
• Growth rate of the business
• Businesss market value

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• Portfolio Analysis The BCG Matrix helps
  managers to identify the relative attractive of
  each of a firms business.
• Growth rate of the business
• Businesss market value

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Predicting the Unpredictable

• Scenarios a hypothetical sequences of events
  constructed for the purpose of focusing attention
  n causal processes and decision points. Purpose
  is to shake management out of its traditional
  ways of thinking.
• They answer two kinds of questions
• 1. Precisely how might some hypothetical
  situation come about, step by step, and
• 2. what alternatives exist, for each situation at
  each step, for preventing, diverting or
  facilitating the process.

45
Strategic Planning

• Core Competencies the collective learning in
  the organizations especially (knowing) how to
  coordinate diverse production skills and
  integrate multiple streams of technologies.
• Achieving Strategic Fit all the firms
  activities must be tailored to its strategy, by
  ensuring that the firms functional strategies
  support its corporate and competitive strategies.
• Stretch and Leverage resources supplementing
  what you have and doing more with what you have.