Enduring character of an Organization

It provides a glue which binds the

organization together
• HP Way - A deep respect for the individual
Set of guiding principles
These originate from founder’s inner
belief
• P&G - Focus on product excellence
• Amazon - 12 principles
• 10 - 30 years BHAG
• Vivid description
 Stakeholders

Can affect development of the

firm’s vision and mission

Primary Are affected by the strategic

stakeholders outcomes achieved by the firm
(individuals,
groups and
Can have enforceable claims
organizations)
on the firm’s performance

Are influential when in control

of critical or valued resources

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 Classification of Stakeholders

Categories of
stakeholders

Capital market Product market Organizational

stakeholders stakeholders stakeholders

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 The Three Stakeholder Groups

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 Capital Market Stakeholders

Preservation
of investment

Conflicting
expectations of
Influence Risk/return
shareholders
and lenders

Enhanced wealth

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 Product Market Stakeholders

Types of product
market stakeholders

Host
Suppliers Customers Unions
communities

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 Organizational Stakeholders

Responsibilities of strategic leaders for development

and effective use of the firm’s human capital

Organizational
Education Strategic goals
culture and International
and skills of and global
ethical work assignments
employees standards
environment

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Strategic Intent
Strategic Management
 STRATEGIC INTENT

Strategic intent is like Marathon

comprising of multiple 400 meters sprint

One year challenge couldbe quality

Next year it is cost saving
 “This strategic intent usually incorporates stretch targets, which force companies to
compete in innovative ways”

Four techniques that Japanese companies use:

• Building layers of advantage

• Searching for “loose bricks,”

• Changing the terms of engagement

• Competing through collaboration.

 Strategic Models

Centers on the problem of Centers on the problem of

maintaining strategic fit leveraging resources
 Top management playbook

Create a sense One challenge Establish clear

of urgency – at a time milestones
Quasi crisis

Develop a Skill
competitor focus enhancement
at every level at every level
Process of Surrender

MISINTERPRETED RIVALS
Western managers often misinterpreted their rivals’ tactics. They
believed that Japanese and Korean companies were competing
solely on the basis of cost and quality

WEAK RESPONSE
Seldom was the full extent of the competitive threat appreciated—
the multiple layers of advantage,
1. the expansion across related product segments
2. the development of global brand positions
3. Imitating the currently visible tactics of rivals put Western
businesses into a perpetual catch-up trap.

Surrender was not inevitable, of course, but the attack was staged
in a way that disguised ultimate intentions and sidestepped direct
confrontation.