1. Objectives and Plan for the Day
What is strategy? Foundation Concepts
Honda
Understanding Market Strategy
Industry forces
Partner’s HealthCare System (A)
Vertical Integration
When Outsourcing Goes Awry

2. What is strategy?
"The determination of the long run goals and objectives of an enterprise, and the adoption of courses of action and the allocation of resources necessary for carrying out these goals."
”A strategy is the pattern or plan that integrates an organization's major goals, policies, and action sequences into a cohesive whole. “
Sources: Alfred Chandler, Strategy and Structure: Chapters in the History of American Industrial Enterprise.. James Brian Quinn, Strategies for Change.

3. Does strategy matter?
Apple Computer
Madonna

4. The Context of Strategy
Industry
Opportunities
and Threats
Strengths
and
Weaknesses
Strategy
Personal
Values of
Key People
Broader
Societal
Expectations

5. Key Characteristics of Strategic Decisions
Important
Significant Commitment of Resources
Not Easily Reversible
Involves Choice

6. Common Elements in Successful Strategy
EFFECTIVE IMPLEMENTATION
Profound
understanding of
the competitive
environment
Long-term, simple
and agreed
objectives
Objective
Appraisal of
Resources
Commitment
in the face of
Uncertainty
Source: Adapted from Robert S. Grant,
Contemporary Strategy Analysis,
Basil Blackwell, 1991.

7. Effective Strategies Answer:
Where will we compete?
Industry/market analysis
How will we compete?
Cost vs. Differentiation
What do we need to do to achieve advantage?
Value chain alternatives
Strategic commitments
Who needs to be committed to the strategy?
Managing the process of strategy

8. More Than One Way to Formulate Strategy
Deliberate Choice
Deliberate Strategy
PLANNING
Chaotic Processes
Emergent Strategy
CRAFTING
Tensions in Strategy Formulation:
Problem of prediction -- future is unknown
Problem of detachment -- impossible to divorce
formulation from implementation
Problem of formalization -- formalization inhibits flexibility,
spontaneity, intuition, and learning

9. Uncertainty and Strategy
Useful prediction
Discrete scenarios
Continuous uncertainty
Formulation
Formal planning and Forecasting
Scenario analysis -- robust strategies, options
Emergent learning, flexibility

10. Levels of Strategy CORPORATE STRATEGY CORPORATE HEAD OFFICE BUSINESS
Division A
Division B
R & D
R & D
FUNCTIONAL
STRATEGIES
Personnel
Personnel
Finance
Finance
Production
Production
Marketing/Sales
Marketing/Sales
Source: Robert M. Grant,
Contemporary Strategy Analysis,
Basil Blackwell, 1991.

11. What makes for a successful strategy? An Ancient Perspective
Know the other and know yourself:
Triumph without peril
Know Nature and know the Situation:
Triumph completely.
Sun Tzu