LEVELS OF STRATEGY zCORPORATE zBUSINESS (SBU) zFUNCTIONAL (OPERATIONAL)

GENERIC STRATEGIES Cost Leadership Differentiation Focus Cost Focus COMPETITIVE ADVANTAGE Low Cost Differentiation Broad Target Narrow Target MARKET SCOPE Michael E. Porter, Competitive Advantage

CORPORATE STRATEGY zOVERALL, GRAND STRATEGY zPORTFOLIO STRATEGY yBCG MATRIX yGE BUSINESS SCREEN

BENCHMARKING zCOMPARE TO “BEST IN CLASS” zBASED ON KEY SUCCESS FACTORS

TYPES OF PLANS zSTRATEGIC zOPERATIONAL zTACTICAL zGOALS/OBJECTIVES zPOLICY zPROCEDURE zRULE

GOAL SETTING

SINGLE, SPECIFIC TOPIC zNot a vague abstraction yWe will maximize profits. yWe will be the best. yBetter: We will increase profits by 10%.

FOCUS ON RESULT, Not on Activity zActivity will not result in goal yExample: Goal is to increase advertising expenditure by 15% in zGoal is result of activity yBetter: Advertising will be increased by 15% in 1996 in order to increase market share from 8% to 10%.

MEASURE WHEN FEASIBLE zMust at least be verifiable

HAVE A DEADLINE

GOALS zSETTING GOALS zNETWORK OF GOALS zMULTIPLE GOALS zSET PRIORITIES

GOALS zSTATED GOALS zREAL GOALS

MBO zA PLANNING TOOL zMOTIVATIONAL TOOL zCONTROL TOOL

POLICY zGUIDELINE TO AUTHORITY zUSE TO DELEGATE AUTHORITY

PROCEDURE zGUIDE TO ACTION zSERIES OF STEPS zNO AUTHORITY zUSUALLY A STANDING PLAN

TYPES OF BUDGETS zCASH zEXPENSE zSALES zCAPITAL EXPENDITURE

BASE OF BUDGET zINCREMENTAL zZERO BASE

FORECASTING zQUANTITATAIVE METHODS yTIME SERIES yREGRESSION... zQUALITATIVE METHODS yJURY OF OPINION ySALES FORCE COMPOSITION yCUSTOMER

OTHER TYPES OF PLANS zSINGLE USE zSTANDING zCONTINGENCY (ALTERNATIVE) zFLEXIBLE zDIRECTIONAL zSPECIFIC

SCHEDULING zGANTT CHART zLOAD CHART zPERT

OTHER TOOLS zBREAK EVEN ANALYSIS zLINEAR PROGRAMMING zQUEUING THEORY zPROBABILITY THEORY zSIMULATION

LENGTH OF PLAN zSHORT TERM yUSUALLY ONE YEAR OR LESS zLONG TERM yUSUALLY FIVE YEARS yCOMMITMENT CONCEPT ySUNK COSTS

IMPLEMENTATION PLANS zWHO zWHAT zWHEN zWHERE zHOW zSUPPLIERS zCOORDINATION zWHAT TO MEASURE/CONTROL

“PLAN OF ACTION” OUTLINE zState Goal zWay(s) to accomplish it yAccomplishment interfere with another? zDate(s) to be finished zProblems I may encounter/create? zSuppliers, sources of help zCoordinate with??? zThings to monitor, measure

IMPLEMENT THE PLAN zACTION PLANS zTIME MANAGEMENT yIMPORTANT TASKS yURGENT TASKS

LEVEL IN ORGANIZATION zHIGHER LEVEL IN ORGANIZATION ySTRATEGIC yLONGER TERM yMORE DIRECTIONAL zLOWER LEVEL IN ORGANIZATION yOPERATIONAL, TACTICAL ySHORTER TERM yMORE SPECIFIC

ENVIRONMENTAL UNCERTAINTY zMORE UNCERTAIN yDIRECTIONAL ySHORTER TERM zMORE CERTAIN ySPECIFIC yLONGER TERM

COMPANY LIFE CYCLE zFORMATION yMORE DIRECTIONAL zGROWTH ySHORTER TERM yMORE SPECIFIC zMATURITY ySPECIFIC yLONGER TERM zDECLINE ySHORTER TERM yMORE DIRECTIONAL