Nick krest - Business Strategy Formulation and Implementation

1
Nick krest
Business Strategy Formulationand Implementation
2
Strategy Formulationand Implementation

• DISCUSS meaning, needs, benefits, approaches of
  strategic planning process for MNCs
• UNDERSTAND tension between pressures for global
  integration and national responsiveness 4 basic
  international strategy options
• IDENTIFY basic steps in strategic planning
• DESCRIBE how MNCs implement strategic plan
• REVIEW three major functions of marketing,
  production, finance used in strategic plan
  implementation
• EXPLAIN specialized strategies for emerging
  markets and international new ventures

3
Strategic Management

• Strategic Management the process of determining
  an organizations basic mission and long-term
  objectives, then implementing a plan of action
  for pursuing the mission and attaining objectives

4
Strategic Management

• Growing need for strategic management related to
  increasingly diversified operations in
  continuously changing international environment

5
Benefits of Strategic Planning

• 70 percent of 56 A.U MNC subsidiaries had
  comprehensive 5 to 10-year plans according to one
  study
• Evidence for effectiveness of planning is mixed.
  Strategic planning does not always result in
  higher profitability

6
Benefits of strategic management

• Establish the mission
• Formulate philosophy
• Establish policies
• Setting objectives
• Developing strategy
• Plan the organizational structure
• Provide personnel

• Establish procedures
• Provide facilities
• Provide capital
• Set standards
• Establish programs and plans
• Control information
• Activate people

7
STRATEGIC MANAGEMENT Types Of Strategies

• Strategy
• a comprehensive plan guiding resource allocation
  to achieve long-term organization goals.
• Strategic Intent
• focuses organizational energies on achieving a
  compelling goal.
• Competitive Advantage
• operating in successful ways that are difficult
  to duplicate

8
TYPES OF STRATEGIESCorporate Strategies

• Corporate Strategy
• Sets long-term direction for the total enterprise
• Business Strategy
• Identifies how a strategic business unit or
  division will compete in its product or service
  domain
• Functional Strategy
• Guides activities within one specific area of
  operations

9
TYPES OF STRATEGIESCorporate Strategies
10
TYPES OF STRATEGIESGrowth And Diversification
Strategies

• Growth Strategy
• Expansion through current operations
• Concentration
• Expansion within an existing business area
• Diversification
• Expansion occurs by entering new business areas
• Vertical Integration
• Expansion by acquiring existing suppliers or
  distributors

11
TYPES OF STRATEGIESRestructuring and
Retrenchment Strategies

• Retrenchment
• Changes operations to correct weaknesses
• Liquidation
• An extreme form of retrenchment wherein the
  business closes and sells off its assets
• Restructuring
• Reduces the scale or mix of operations
• Downsizing
• Decreases the size of operations
• Divestiture
• Sells off part of the organization to focus on
  core businesses

12
Steps to strategic management

• Environmental analysis
• Establish organizational direction
• Strategy formulation
• Strategy implementation
• Strategic control