Business policy and strategic Management Strategy and Strategic Management Strategic intent- Vision, Mission, goals and objectives SWOT Analysis Environmental appraisal Organizational Appraisal Corporate level strategy Business level strategy Strategic Analysis and choice Porter’s competitive Analysis Value chain Analysis

Need of BPSA Enormous change is taking place in Business Environment both internal and external. Competition is almost cut throat in all sectors Considering the changes and competition organization need t formulate the strategies an polices which will help them to survive in the market. Crunch of the resources required for the business. Need strategies to utilize the resources at optimum level.

Business policy “Guidelines which business need to follow considering the impact of internal and external environmental factors.” Importance For learning the course For understanding the business environment For Understanding the organization For personnel Development

Purpose of Business Policy To integrate the knowledge gained in various functional areas of Management To adopt a generalist approach to problem solving To understand the complex interlink ages operating within an organization

Strategy Definitions The determination of the basic long term goals and objectives of an enterprise and the adoption of the course of action and the allocation of resources necessary for carrying out these goals The unified , comprehensive and integrated plan designed to assure that the basic objectives of the enterprise are achieved.

Different Levels of Strategy Corporate office SBU A SBU B Personnel Production Finance SBU C Corporate level Strategies Business unit Level Strategies Functional Level Strategies

Strategic Management Definitions A stream of decisions and actions which leads to the development of an effective strategy or strategies to help achieve corporate objectives…….Glueck The process which deals with the fundamental organizational renewal and growth with the development of strategy, structure , and system necessary to achieve such renewal and growth, and with the organizational system needed to effectively manage the strategy formulation and implementation processes……Hofer and others

Strategic Implementation Strategic Evaluation Strategic Management Process Establishing Strategic Intent ( Vision, Mission, Goals and Objectives) Formulation of Strategies ( Environmental Appraisal, Organizational Appraisal) ( SWOT Analysis Porters competitive Analysis, value Chain) Strategic Analysis and Choice (BCG matrix, Nine cell Matrix, Experience Curve Industry Analysis, Competitive Analysis Strategic Implementation Strategic Evaluation

grand strategies Stability explanations Retrenchment

Strategies and tactics Strategic Intent Vision Mission Goals Objectives Strategies and tactics

vision “ to be in the future” Description of something in the future Mental perception of the kind of environment organization aspires to create within a broad time of horizon and the underlying conditions for the actualization of this perception

Benefits of Vision Inspiring and exhilarating Helps to create shared sense of purpose Vision which is unique, competitive an original make sense in the marketplace. Foster risk taking and experimentation Foster long term thinking Clear the objectives of the organization

Process on Envisioning Core Ideology Envisioned future Tata Steel “ Tata steel enters the mew millennium with the confidence of a learning, knowledge based and happy organization. We will establish ourselves as a supplier of choice by delighting our customer with our service and our product”

Mission what is our business? what to do? What should it be? Definition “Essential purpose of the organization ,concerning particularly why it is in existence, the nature of the business it is in, and the customers it seeks to serve and satisfy

Characteristics of a Mission Statement It should be feasible It should be precise It should be clear It should be motivating It should be distinctive It should indicate major component of strategy It should indicate how objectives are to be accomplished.

United Trust of India Mission: “To keep the common man in sharper focus, to encourage saving and investment habits among them.”

Goals And Objectives Goals Goals denote what an organization hopes to accomplish in a future period of time. This is stated broadly Objectives These are the ends that specify how goals shall be achieved Objectives makes the goals operational Objective need to be stated in quantity They are measurable and comparable

Role of objectives I t defines he orgnisation’s relationship with the environment It helps to pursue its vision and mission Provides the base of strategic decision making It provides the standards for the performance appraisal

Characteristics of objectives objectives should be understandable objectives should be concrete and specific objectives should be related to a time frame objectives should be measurable and controllable objectives should be challenging objectives should be correlated with each other objectives should be set within constraint

Issues in objective setting Specificity Multiplicity Periodicity Variability Reality Quality

What objective are set Market standing Innovation Productivity Physical and financial resources Profitability Manager performance and development Worker performance and attitude Public responsibility

How objectives formulated The forces in the environment Realities of enterprise’s resources The value system of top executives Awareness of the management

Examples of Objectives Corporate level 1.to Increase the profit level by 5 % at the end of two year Business Unit level 1.to Increase the profit level of the unit by 10 % at the end of two year Functional level To increase the sales of product by 12 % by the end of two year To reduce the manpower cost by 15% of the last year

Critical Success Factor(CSF) The factors which are crucial for organizational success Toothpaste: four qualities-form, flavour,foam and freshness Shoe: High manufacturing qualities, cost efficiency, sophisticated retailing. Automobile: High technology- mileage, low maintains “Key success factors”