Engineering Management (MS-401)

BS (Electrical Engineering) Program

8th Semester, Session-2011

Lecture # 07
Strategic Management
Chapter 5, 7 & 11 from Scholes

Approaches to Strategy Development

Products

Predictable/

Existing

Simple

/Existing

A,
Strategic Intent
Market Penetration

Complex/New
B,
Strategic Planning
Product Development

Environment/
Market

Unpredictabl
e/

new

C,
Incremental
Market Development

D,
Intrapreneurship
Diversification

Elements of Strategy
Strategy management includes
1. Strategic analysis of position of
organization
2. Making strategic choices for future
3. Managing the strategic implementation

Basic Model of Strategic Process

Strategic
Analysis

Strategic
Choice

Strategic
Implementation

Strategic Analysis
External Environment
Capabilities
Expectations & purpose

Strategic Choices
Basis of strategic choices
Strategic options
Evaluation & selection

Strategic Implementation
Organization structure & design
Resourcing & control
Managing change

Strategic Environmental Analysis

Increases quality of the strategic decision
Identifies
threats,
opportunities
and
environmental fit
Considers characteristics of the environment e.g.
its complexity, number of variables, rate of
change, quantity and cost of available
information
Evaluates internal environment
Helps in building competitive advantage

Understanding the Environment

Internal Environment
1. Cultural Frames of Reference
2. Cultural Web

External Environment
1. Porters 5 Forces Model
2. SWOT Analysis

Cultural Frames of Reference

Professional
(or institutional)

Functional/
divisional

Organisational

The
individual

National
(or regional)

Industrial/
sector
(recipe)

Cultural Web

Stories

Rituals
and
routines

Control
systems

Symbols

The
Paradig
m

Power
structures

Organisati
onal
structures

Porters 5 Forces Model

Risk of
Entrants

Bargaining
Power of
Suppliers

Rivalry
within
Industry

Threat of
Substitutes

Bargaining
Power of
Purchasers

SWOT Analysis (TOWS)

Strengths
Weaknesses
Opportunities
Threats
External & Internal factors need to be
considered

Helpful
Inte
rnal
Ori
gin

Ext
ern
al
Ori
gin

Harmful

Presentation # 02
Consider any Company, and
1.
2.
3.
4.
5.

Mention its current strategic approach

Discuss its Cultural Web
Analyze it in terms of Porters 5 forces Model
Perform a general SWOT analysis
In your opinion what could be their future
strategic approach to expand their business,
justify your answer.