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A Brief History Of Strategic Thought

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For students to understand the role of corporate reputation as a ... Early proscriptive models, eg gap analysis. The Two Planning Flows. VISION. STRATEGY ... – PowerPoint PPT presentation

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Title: A Brief History Of Strategic Thought


1
A Brief History Of Strategic Thought
  • Corporate Reputation and Competitiveness
  • Gary Davies Session 1

2
Course Aims and Outcomes
  • Course Aims
  • For students to understand the role of corporate
    reputation as a strategic framework.
  • Learning Outcomes
  • Students will understand how to define and
    measure the reputation of an organisation, how to
    manage a corporate reputation and what linkages
    there are between reputation and company
    performance

3
Lecture Aims
  • To review the development of Strategic Thinking
    and to locate Reputation within this
  • To make the case for Reputation as a Strategic
    Framework

4
What is Strategy?
  • Strategy is about matching the competencies of
    the organization to its environment.
  • A Strategy describes how an organization aims to
    meet its objectives.
  • A successful Strategy is one that achieves an
    above average profitability in its sector.

5
Early Tools
  • Anecdotal comment (war stories) from captains of
    industry
  • Simple frameworks SWOT, PEST
  • Early proscriptive models, eg gap analysis

6
(No Transcript)
7
The Two Planning Flows
VISION
OBJECTIVE
MODEL
STRATEGY
GOAL
TACTICS
BUDGET
STRATEGIC
FINANCIAL
8
The Five Forces Model
NEW ENTRANTS
CONSUMERS
SUPPLIERS
CUSTOMERS
RIVALRY
Adapted from Porter 1988
SUBSTITUTES
9
Generic Strategies
  • The idea that strategic frameworks and options
    can be defined that fit all companies/organisation
    s in all circumstances
  • Porters 3 generic strategies Cost leadership,
    Focus, Differentiation

10
The PIMS Paradigm
Market Structure
Market Differentiation
Market Growth Rate
Purchase Quantity
Strategy and Tactics
Performance
Competitive Position
Relative perceived quality
Relative market share
Relative capital intensity
Adapted from Buzzel Gale (1987)
Relative cost
11
The New Economy
  • Growing emphasis on the service sector and
    manufacturers adding value by adding services
    e.g. IBM selling solutions
  • Need to define new models to guide the management
    of service business

12
The Serqual Gaps Model
Expected Service
CUSTOMER
Perceived Service
Service Delivery
External Communications to Customers
Service Quality Specification
PROVIDER
Management Perceptions of Customer Expectations
13
Dimensions of Service Quality
  • Access (can the customer obtain the service
    easily) Credibility (can you trust the company?)
    Knowledge (does the supplier understand the
    customers needs?)
  • Reliability (is the service dependable and
    consistent?)
  • Security (is the service free from risk?)
    Competence (how knowledgeable and skilled are
    staff?)

14
Dimensions of Service Quality
  • Communication (is the service well explained?)
  • Courtesy ( are staff considerate and polite)
    Responsiveness (are staff quick to respond?)
  • Tangibles associated with the service
    (buildings, uniforms).

15
The Service Profit Chain
Employee Retention
Revenue Growth
External Service Value
Internal Service Quality
Employee Satisfaction
Customer Loyalty
Customer Satisfaction
Employee Productivity
Profitability
Source Adapted from Heskett et al (1994)
16
People Management
People Satisfaction
Policy Strategy
Customer Satisfaction
Leadership
Business Results
Processes
Impact on Society
Resources
Results
Enablers
The Business Excellence Model
17
Concern about Strategic Models
  • Can you plan a modern, complex company from the
    top even using a strategic planning team as
    advisors?
  • Why do strategic models conflict (PIMS and stuck
    in the middle)?
  • Should strategy start from the market place not
    from the strategy team? Isnt it time we
    distinguished between strategic analysis and
    strategy itself?

18
Emergent Strategy
  • Henry Mintzbergs thinking that few strategies
    come from the top and that most emerge changes
    our view of strategising.
  • The role of senior manager changes from deciding
    what to do and finding someone else to do it to
    coach, filter, enabler.

19
Top down v Bottom up?
The Customer
Staff
Management
Management
Staff
The Customer
20
MARKET-FOCUSSED COMPANIES
Understanding the Customer Direct customer
contact at many levels Widely disseminated and
understood research on who the core customer is
and on the market structure, e.g. on market
segmentation Responsiveness of the organisation
to customer needs Regularly receive and act upon
customer satisfaction surveys Responsive to
customer complaints and suggestions Track key
customer data on company image
21
MARKET-FOCUSSED COMPANIES
Provision of real value for money Monitor aspects
of quality relevant to the marketplace Conduct
comparative surveys of competitive prices and
services Reward inside the organisation based on
performance with customers Source Corporate
Strategy, Richard Lynch, Pitman 1997, p.198
22
CUSTOMER FOCUS
  • Customer focus goes beyond market focus. The
    company is managed totally from the customers
    point of view. Key features of customer focused
    companies are
  • The business is led by someone who is a fanatic
    about the customer and able to model the desired
    behaviours
  • Customer facing employees are empowered to react
    to what the customer wants.

23
CUSTOMER FOCUS cont
  • Employees have a stake in the business (usually
    share or other form of ownership)
  • Employees feel trusted to run the business.
  • Customers are regularly asked for ideas as to how
    the business should be run.
  • Achieving a customer focus is a cultural issue
    (not an organisational issue). Changing to a
    customer focus is neither easy nor comfortable.

24
Mission and Vision
PURPOSE ( Why the Company Exists)
COMPANY VALUES (What senior management believe in)
STRATEGY (The commercial rationale)
STANDARDS and BEHAVIOUR (Policies and behaviour
patterns that guide how the company operates)
The Ashridge model from Campbell Tawaday (1990)
25
Analysis and Implementation
Model One Two discrete stages
Analysis
Implementation
Analysis
Time
Implementation
Model Two Two overlapping stages
26
A New Approach?
  • Should meet the basics of strategy link to
    profit, clear direction etc
  • Should be generic (applicable to any
    organisation)
  • Should reflect the trend towards service business
  • Should be bottom up/emergent in focus
  • Should be implementable

27
Aims and Objectives
  • To present the case for Reputation as a paradigm
    for managing the strategic direction of an
    organisation
  • To explore how reputation management has emerged
    from PR and Communications
  • To demonstrate how Reputation can meet the
    criteria for being a strategic tool

28
What is Strategy?
  • Strategy is about matching the competencies of
    the organization to its environment.
  • A Strategy describes how an organization aims to
    meet its objectives.
  • A successful Strategy is one that achieves an
    above average profitability in its sector.

29
What Is Reputation?
  • The net result of the interaction of all the
    experiences, impressions, beliefs, feelings and
    knowledge that people have about an organisation

30
The Corporate Reputation Chain
Other External Stakeholders Suppliers, Investors
Recruitment

Satisfaction
Satisfaction
Customer
Employee
Reputation
View
View
Retention
Loyalty
Identity
Image
Revenue
31
Agreeableness
Enterprise
Competence
Corporate Personality
Chic
Ruthlessness
Machismo
Informality
The 7 Dimensions of Corporate Personality
32
Summary
  • Reputation can be considered as a useful
    strategic framework
  • It is particularly useful for service companies
  • It can be used to direct the strategy for no for
    profit as well as for profit seeking organisations
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