Management & Organization-1

Year-1, Term-1

Pramela Nair – pramela.nair@fhrinstitute.sr

Doctoral candidate (Info. Sys. & Tech.)
MBA (Finance) & B. E. (Computer Science)
 Course Overview

Lecture Activities / Chapters

1 Overall Case
2 Ch.1
3 Ch.9 - Par. 9.1 / 9.5 / 9.6
4 Ch.2
5 Ch.3

Ch.6 - Par. 6.6

6 Ch.3

Ch.6 - Par. 6.6

7 Repetition (previous weeks)

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Literature – Course Book

Organisation & Management

An International Approach

Jos Marcus & Nick van Dam

Noordhoff Uitgevers
Third Edition (2015)
ISBN: 978-90-01-85022-7

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 Post-Discussion Case: Strategic
Management in Healthcare Suriname

Health care sector under pressure:

Ministry of Public Health and National Hospitalboard (council) have a strategic
counsel regarding the future of hospital care in Suriname. Patrick Pengel who is the
minister of Public health took the initiative to talk to the hospital directors to be able to
analyse the strategic management and processes within the hospital.

The current situation in hospitals should be analysed internally and externally to be

able to form a clear future perspective and strategy accordingly. Next to a situation
analysis and having a strategy, planning and implementation is as important as the
two mentioned before. It is important to design and coordinate information systems.

During the meeting it appears that the Ministry of Public Health approached strategic
management in a classical way where as the hospitals took a modern approach. Mr.
Pengel clearly recognizes a difference in both the approaches.

[Case based on, source: Herald, 4 November, 2017]

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 Learning Goals - Case

1. What are the different phases in the strategic management

process? G1
2. What is the relationship between strategic management and
implementation of strategy? G2
3. What is a situational analysis? G3
1) Internal? 2) External
4. What are the different approaches to strategic
management? G4 & G5
1) Modern 2) Classical 3) Are there more approaches?
5. How is strategic management shaped in the business
world? G6 & G7
6. What is the importance of well designed and coordinated
information systems? G8

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Organisation and Management
An International Approach

Chapter 3 –Strategic management

 The strategic
management process
• Strategy is a plan that states what an organisation needs to do to
reach its goals

• Strategic management carefully considers the most appropriate

responses to the environmental and maintains the standards and
skills needed for possible future changes

– Two approaches
• classical approach; strategic management = strategic
planning – analyse, form, plan, implement
• modern approach; strategic management = strategic thinking

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 Vision
• A vision is the general idea or representation of the future of the
organisation
 vision = mission + principles

• Vision is a tool at the core of the 7-S model

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 Goal setting and strategy
• Based on its vision, an organisation can define its goals

• Organisational goal setting shows the relationship between the organisation, its
environment and its employees
– Goals are often linked with:
• Balancing interests
• Profitability & quality
• Effectivity and efficiency
• Image
• Code of conduct

• Mere ad-hoc decision making - ‘If you don’t know where you’re going, any road will
take you there.’

• Key question: to what extent will the set goals be achieved using the chosen strategy?

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 The classical approach
to strategic management

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 Critical observations concerning
the classical approach

• Mintzberg’s ‘The Rise and Fall of Strategic Management’

– Strategy is more a pattern of action than a fixed plan

– Strategy is intended
– Unexpected factors will influence results
– The ultimate strategy = intended strategy plus a
number of unexpected factors

– Human intuition is difficult to replace, even with AI.

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 Situational analysis
• Situational analysisis focusses on determining the current
profile of the organisation
– Definition of the current vision, aims and strategy
– Internal analysis
– External analysis

• A key tool is the SWOT analysis

– S = Strenghts
– W = Weaknesses
– O = Opportunities
– T = Threats
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 Internal analysis
• Self knowledge is crucial in the process of strategic management
– Realistic choices linked to outcomes
– Using accurate data and a critical approach

• An internal analysis (strengths and weaknesses) can be carried out:

– By functional area
• marketing, finance, production etc.
– By results
• financial strength or capacity of various activities

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 Internal analysis by
results (1)
• Strategic Business Units (SBU’s) are ‘autonomous’ enterprises
within a corporate group

• In portfolio analysis, the various SBUs are categorised in a matrix

and analysed according to a number of economic criteria
– Boston Consulting Group (BCG) matrix
• Turnover (relative market share)
• Market developments (market growth)
• Monetary flow (cashflow, net profit, depreciation)

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 Internal analysis by
results (3)
• Applying the portfolio technique makes demands on the
organisation and management of a company

– Organisation
• organisational units need to coincide with the SBU’s
• align financial reports to the needss of the SBU’s
• connect information systems to the SBU’s

– Management
• Have the right manager in the right place

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 External analysis

• Structure of external components

– Internal environment
• Expressed as strengths and weaknesses
– Tasks within the business
– Competitive environment & Porter’s five forces
– Macro-environment
• Expressed as opportinities and threats

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 Tasks within the
business

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 Competitive
environment
• Carry out analysis by asking the following questions:

– Who are our competitors?

– What information about our competitors do we need?
– How intense is the competition?
– What competitive advantages do we have that allow us to
make our mark on the various markets?

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 Who are our
competitors?
• Defining the industry sector
– An industry sector is made up of a group of businesses that
produce similar products, often using the same sort of
technology

• There are two ways of identifying competitors within your sector:

– Customer and potential cutomer approach

– Strategic groups; groups of organisations with similar features

and competitive strategies
• For example BMW and Audi

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 What information about our
competitors do we need?

• Sub-questions
– What are the past and present strategies adopted by our
competitors?
– What are our competitors’ strengths and weaknesses?
– How large and profitable is each competitor?
– What corporate culture do our competitors have?

• Follow-up questions
– Which strategic decissions are our competitors most likely to
take?
– Where and to what extent are our competitors vulnerable?
– What defensive actions can we expect our competitors to take?

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 Strategy formation
• Strategy formation consists of three
phases

– Determining a view of the future

– Developing various strategies
– Evaluating the options and selecting a
strategy

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 Determining a view of
the future
• Will the organisation be able to reach its
future goals by using its current strategy?

– If not (completely) achievable, either the goals

or the strategy need to be amended
– Consider the speed of change in the sector

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 Developing different
strategies (1)
• Strategies dependent on the market share of the organisation
– Market leaders
– Challengers

– Followers
– Specialists

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 Developing different
strategies
• In a turbulent environment, vulnerability issues can be
dealt with by a turbulent situation strategy
– Immunisation; make oneself impervious to attack
– Adaptation; react to changes (flexibility)
– Manipulation; Full or partial recovery of influencial
economic power within a turbulent environment
– Innovation; anticipate changes in the environmrnt and
develop novel aspects

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 Planning cycle
Output of strategic management is a plan

Implementation stages use increasingly shorter time frames

•Strategic planning takes place at the highest level

– Two to three year cycle with annual reassessment

•Operational planning involves annually setting budgets, sales

targets etc. then dividing them into months or weeks

•Function specific planning ranges from daily work plans to monthly

production plans, liquidity plans and even staffing plans.

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 Problems surrounding strategic
management
• Problems
a) Insufficient commitment on the part of managers and staff
b) Unsatisfactory knowledge and preparation of the strategic management
process
c) Insufficiently explained strategy
d) Poor support from data systems
e) A rapidly changing environment

• Solutions
1. Provide good training and preparation for all involved parties
2. Create teams from different departments and let them work on strategic
plans
3. Develop detailed, realistic and supported action plans
4. Develop integrated information systems
5. Ensure systems are flexible to facilitate future changes

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 Pre-Discussion Case
Health care is under pressure (continued):
Week 6
During the consultations that the Ministry of Health and the National Hospital
Council (NHC) have, that the exchange of information should be improved, the
information roles of the hospital managers and the ministry are being reviewed:
sender, communicator, spokesperson and strategy maker.

Who fulfills which role is the question?

The proposal is to address the following issues in a separate information

strategy session:
•To map the information needs of the actors within the healthcare sector;
•Define the roles well;
•To categorize the information requirement to the management level where the
decision-making takes place:
i) strategic, ii) tactical and organizational, and iii) operational;
The requirements that the information must meet to define.
The results of the session will be included in the improvement of the
current information system.

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 Preparation for next
class – chapter 6
• 6.1 – The Manager – G1
• 6.2 – The manager within the organization – G2
• 6.2.1 - The manager’s task – G3
• 6.2.2 & 6.2.3 – Top managers & Middle Management – G4
• 6.2.4 – Managers in government – G5
• Female managers – Research from internet and prepare your own
material – G6
• 6.6 – Management and information: pg 332 & 333 (until Operational
information) – G7
• 6.6 – Management and information: pg 333 to 335 (after Operational
information) – G8

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 Learning goals to be discussed
at the end of class

• What is the role and tasks of the

manager in an organization?
• How can you improve the
communication of information?
• What kind of information is relevant?
• Determine the level of organization for
decision-making..

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