A strategy is a set of actions through which an organization by accident or design

develops resources and uses them to deliver services or products.

Successful strategy gives an organization some quality that is unique and

distinctive.
It also means of renewing the competitive edge with external changes.

To restate strategy is set of actions arrived at by accident or design, meaning that

words like planning are missing. Many organizations are complex social systems
operating in unpredictable environments,
Not all plans are implantable and people may end up acting in ways that are
opportunistic or otherwise unplanned. The organizations eventual strategy is what
theorist call its realized strategy What it ends up doing- which may not be starts
out wanting to do.
The Development of resources: The knowledge and other resources that
organization acquire over time are vital elements in its strategy. No social system
are precisely alike, The interactions between the environment and individuals are
subtly different in every firm , so that every organization has an opportunity to
develop distinctive resources that it can employ to add value to its users.
However not all organizations succeed in doing this. Levels of motivation vary
across organizations and within an organization.
Delivering products and services that user find valuable: If an org. has to survive it
has to find a way to justify its existence. It must develop products and services and
find customers who think these are worth buying.
Meeting stake holders objective and constraints: A good strategy should
meet the objective of stake holders, i.e. in business it should earn profit.
Unique or distinctive features: To survive in this competitive world org. has to
be different from or perceived to be different from its competitors, such as a better
product or superior customer service, distinctive value chain, or stronger dealer
network.
Renewing advantage as the environment changes: As technology changes,
customers taste evolve s or regulatory environment changes or new competitive
threats such as globalization appearing org. have to learn to reinvent themselves.

Value Chain and Architecture: An Org. should Endeavour to produce its

products efficiently and with minimal cost.

The way an org. decides to undertake important activities at each stage in the
development production and delivery of its products is called its value chain. It also
determines the cost and effectiveness of delivery.

The way a product is manufactured as in bulk or customized.

The way the product is distributed and marketed.
Or The way the customers are looked after they have bought the product.

Design of value chain is one way in which an org. can make itself different from its
competitors.
Important set of decisions with in the value chain relates to an org. degree of
vertical integration, what it produces in house, how it can control delivery time and
quality to its own requirements, what it buys from outside, whether to use the firms
own resources or third party to distribute output.
Other important decisions relate to
a) Scale of operations
b) Scope of operations
c) Location.
THE BUSINESS ENVIRONMNET: A firms value chain can be looked as a link
in a more extensive chain which has raw materials such as wood, iron ore or
silicon and are transformed through addition of raw material and labor into
services and products.
Your product could be a raw material for the finished product or the finished
product or somewhere in between for, ex. Intel makes chips, which are used
in computers, which are used as servers for companies like Google etc.
So anything that affects any part of the system might impact you.
It is unpredictable because of large number of components but also because
each component is made of large number of individuals.
Competitors and collaboration: The amount of money that firm can make
is limited by no. of factors in the environment.
a) The amount consumers are willing or able to pay, governed by macro
economic factors like consumer spending power, social factors like
popular taste,
b) The cost of labor and raw material are set by markets or Govt. policies.
c) Firms suppliers and collaborators can affect the prices.

d) The policies and practices of competitors can influence how big a share of
particular market a firm can capture.
If a firm wants to make more money its options are limited. It can become
more efficient reducing the quantities of raw material and labor or finding
ways of using cheaper ones.
It can make its products more attractive so that customers are willing t
pay more for them.
It can use power over the other firms in the chain to drive down the prices
paid for input or to drive the prices it charges for its output.
It can collaborate with other firms in the chain to drive down the total cost
of delivery.
INDUSTRIES AND MARKETS: Markets can be further sub divided into
segments, such as same location or similarity in terms of age or
purchasing behavior.
It can also be segmented into geographic markets.
The output of several industries serving the same market is substitutes for
one another.
If they perform very much the same task they can be called closed
substitutes.
GLOBALIZATION: All org. face global competition. Large co. have
operations in multiple countries and have global brand s that can be
recognized the world over. Think of SONY, MACD, Nokia and Pepsi.
Their production centers may be a t great distance from the consumers
and so may be the procurement of raw material. This is called global
strategy.
Other co. may have different products for different markets. Ex. Retailing,
food and services industry.
The economics of industry could be such that global firm has no
advantage over local firm, for ex, a bus company.
Some org. manage their operations at regional level with local brands and
mange some aspects locally and other s globally which is termed as Trans
national strategy.
IMPACT OF ENVIRIONMENT: It is important for managers to understand
the environment in which they operate. In some industries firms that are
able to keep cost and prices low have the best chances of success; in
other industries sit would be those that are most creative or innovative.
In some markets success would come from an architecture that keep firms
close to changing customer taste in others it may be good contacts with
govt. that are vital.
Environmental factors also influence in the way the firm is able to source
its raw material.
How it distributes its goods and the impact it competitors and stake
holders have on what org. does.

Understanding these factors can make the difference e between success

and failure.