Strategy

Prof. Harish Padmanabhan

Concept , Definition: Strategy.
Characteristics: Strategy
Levels of Strategy
SBU Level.
Concept : Strategy

The concept of Strategy is central to understanding the process

of strategic management.

The term „Strategy‟ is derived from Greek word “Strategos” or

“Stratosagein”, where “ Stratos” means “ army” agein” means
“to lead”

Strategy is referred to the science and art of defeating an enemy

through military force.
Concept : Strategy
Strategy defines the mission and direction of an enterprise to
deploy human and physical resources for achieving selected
target by facing difficulties in path.

Napoleon expanded the concept by including political and

economic maneuvers in order to improve the opportunities for
victory in war.

Strategy enables any enterprise to anticipate different functional

areas by determining how best can be achieved by opposing
pressure and competition by marshalling and utilizing of
resources for attaining objective.
 Strategy : Definition

“ The determination of the basic long-term goals and objectives of

an enterprise, and the adoption of the courses of actions and the
allocation of resources necessary for carrying out these goals.”

- Alferd D Chandler (1962)

 Strategy : Definition

“ The pattern of objectives, purpose, goals and the major policies

and plan for achieving these goals stated in such a way so as to
define what business the company is in or is to be and the kind
of company it is or is to be”

- Kenneth Andrews ( 1965 )

 Strategy : Definition

“ A unified, comprehensive and integrated plan designed to assure

that the basic objectives of the enterprise are achieved.”

- Prof. William F Glueck (1972)

 Unified means the plan joins all the parts of enterprise together.
 Comprehensive means all the major aspects of the enterprise.
 Integrated means all the part of the plan are compatible with
each other.
 Strategy : Definition

“ Strategy is a pattern in a stream of decisions and actions.”

- Henry Mintzberg (1987)

“ Strategy is the way in which management chooses to utilize the

firm‟s resources within its environment to reach its objectives.”
- Melvin J. Stanford
 Strategy : Definition

“ Strategy includes an awareness of goals, the unpredictability

and uncertainty of events and the need to take into account the
probable or actual behavior of others.”
- C Farland

“ Strategy is the forgoing of company missions, setting objectives,

formulating specific policies and programmes to achieve
objectives and assuming their proper implementation so that the
objectives of the organization will be achieved.”
- Steiner
Strategy : Features / Characteristics

Strategy is a direction, an aspired position to be

attained at the end of the plan period.

Strategic Plan is a long-term plan.

Strategic Plan is a shared plan.

Strategic Plan is a leader-driven plan.

Strategy : Features / Characteristics

Strategy concentrates on action.

Strategy is not scheduled or specific.

Strategy deals with those decision making which

have not encountered both.

Strategic Plan is a broad outline for deploying

resources.
Level of Strategy
Level of Strategy
 Corporate Strategy
Corporate-level strategy is senior management‟s game plan for
directing and running the organization as a whole; it cuts across
all of an organization‟s activities – it‟s different businesses,
divisions, product lines and technologies.

Elements / Task of Corporate strategy:

 Developing plans for managing the scope and mix of the firm’s
various activities in order to improve corporate performance .
 Providing for coordination among different businesses in the
portfolio.
 Establishing investment priorities and allocating corporate
resources across the company’s different activities.
SBU - Level

Organizational activities are divided into strategic subsystems

which have set products or services, competitors and a goal
distinct from those of other subsystems.

Strategies are formulated for each subsystem consistent with

corporate level strategies General Electrics pioneered in
formulating SBU level strategies.

SBUs are designed based on product differentiation, market

segments, distinctive competencies etc.

Strategies at the departmental level or functional level are

formulated in consistent with the SBU level strategy.
Functional / Operational Strategy

Functional area support strategies are the actions plans for

managing the principal subordinate activities within a business.

Operating-level strategy flowed directly from a higher-order

strategic requirement and that the operating strategy was
handled by managers in charge of carrying out day-to-day
details of specific functional activities.

Their role is to flesh out he business game plan, giving it more

substance, completeness and concrete meaning as applied to a
specific part of the business.
Department Functional Strategy

Production Flexible Manufacturing Process.

Lean Production, Six Sigma.
Marketing Customer Focus, Customization.
Rationalize Intermediaries
HRM Skill Building, Scientific Recruitment and
Selection Performance based Pay,
Self-managing Team, Employee to be
Customer Oriented.
R&D New Product and Service Design.

Adoption and updating to technology.

Capital Budgeting, Financial Leverages,
Finance Project Evaluation.
Thank - You