1. Strategic Management Today’s Class What is this class about?
Who is its teacher?
Who are its students?
What’s this class about (part 2)
What is the class structure?
5. What are some basic strategy concepts?

2. What is this class about?
Strategic Management
Today’s Class
What is this class about?
Who is its teacher?
Who are its students?
What’s this class about (part 2)
What is the class structure?
5. What are some basic strategy concepts?

3. What is this class about?
Strategy = how you achieve your goals
Example: your goal is to graduate from Hue College of Economics? How do you do that?
One strategy: take & pass the required classes
Example: your goal to make your business successful => more profitable
One strategy: raise prices
Another strategy: lower costs

4. What is this class about?
Developing a strategic perspective on business
A strategic perspective =
Top management perspective
The Big Picture

5. Strategic Management Who is its teacher? What is this class about?
Today’s Class
What is this class about?
Who is its teacher?
Who are its students?
What’s this class about (part 2)
What is the class structure?
5. What are some basic strategy concepts?

6. Who is your teacher? Richard Kernochan
Ph.D, 1997, in Strategic Management
Teach at California State University, Northridge
Taught classes in accounting, management, organizational theory, strategic management, international business and internships

7. Who is your teacher? Research interests Strategy implementation
Cross-cultural perspectives
Buddhism and teaching
Reflective Learning

8. Who is your teacher? 64 years old Married for 38 years One wife
Three daughters
Zen Buddhist
Lived in America, France, Iran, Greece, Turkey, Morocco – and now Vietnam

9. Who is your teacher?

10. Strategic Management Who are its students? What is this class about?
Today’s Class
What is this class about?
Who is its teacher?
Who are its students?
What’s this class about (part 2)
What is the class structure?
5. What are some basic strategy concepts?

11. Who are its students?
Highly skilled in rote learning: listening and repeating information
Wanting to become a part of doi moi, the new Vietnam economy:
Needing skills to succeed in that economy
Wanting skills to think differently, not just know course material
Success = what you know AND what you can do with it
Wanting to practice critical thinking skills
Critical thinking
Creative problem solving

12. Critical Thinking
Critical thinking = having a personal opinion or point of view, questioning “facts.”
Example:
Fact: Vietnam’s population is 84 million people
Critical Thinking Questions:
Is that good or bad?
Is that a lot or a little?
Is that too many or too few?

13. some guidelines for critical thinking.
1. Ask questions; be willing to wonder.
2. Define the problem.
3. Examine the evidence.
4. Analyze assumptions and biases

14. More guidelines for critical thinking
5. Avoid emotional reasoning.
6. Don’t use either/or thinking or overgeneralize.
7. Consider other interpretations.
8. Tolerate uncertainty.

15. Do you have the courage to be wrong?
Critical Thinking
Hard work
Scary work
You can be wrong, or not right
Takes courage to be wrong
Do you have the courage to be wrong?

16. Who are its students?
Some will be entrepreneurs; they will start their own businesses.
Entrepreneurs are people who think critically and see differently.
They see opportunity where others see risk or failure
They know how to fail and try again
They don’t like to work for other people
Most people are not entrepreneurs

17. Critical Thinking Question
What makes businesses successful?

18. What’s this class about (part 2)
Strategic Management
Today’s Class
What is this class about?
Who is its teacher?
Who are its students?
What’s this class about (part 2)
What is the class structure?
5. What are some basic strategy concepts?

19. What is this class about?
Strategy = how you achieve your goals
Example: your goal is to graduate from Hue College of Economics? How do you do that?
One strategy: take & pass the required classes
Example: your goal to make your business successful => more profitable
One strategy: raise prices
Another strategy: cut costs

20. Basic Strategy Concepts
Strategy = how you reach your goal, the set of actions you take to reach your goal
Plan for future action
Pattern of past actions
A goal makes your actions have a logical purpose
Logical purpose of actions = accomplish goal
Illogical actions are those that don’t accomplish goal

21. Business Goals
A business has many kinds of goals, here we deal mostly with economic goals:
Business success =
Business performance =
Profits
Why profits?
Because profits give you resources to grow
What are profits in your personal life?

22. What is this class about?
A strategic perspective on business =
Top management perspective
A strategic perspective =
The Big Picture

23. The Big Picture: the strategy model
Environ-ment
FIRM
Strategy

24. The Big Picture
Top Management understands or “sees” the 3 elements of the strategic perspective and their dynamic relationships
The 3 elements are:
the firm or business,
its context or environment
the firm’s strategy

25. The Big Picture: the strategy model
Environ-ment
FIRM
Strategy

26. The Big Picture is dynamic
Dynamic = everything is changing all the time
Change in the environment changes the firm or its strategy … or both or neither
Change in the firm changes the environment or its strategy … or both or neither
Change in the strategy changes the firm or the environment … or both or neither

27. The Big Picture: the strategy model
Environ-ment
FIRM
Strategy

28. How is this course organized?
Strategic Management
Today’s Class
What is this class about?
Who is its teacher?
Who are its students?
What’s this class about (part 2)
How is this course organized?
6. What are some basic strategy concepts?

29. Course Organization February 1-23 February 25-March 18 March 25
Textbook Chapters
3 group field research projects
February 25-March 18
Business simulation
March 25
Simulation debriefing
Review of course content

30. Course Topics What is strategy?
External Analysis of the outside environment
Internal Analysis of the company environment
Business-level strategy
Functional-level Strategy
Corporate and global/international strategies
Business simulation to practice strategy formulation and implementation

31. The Strategy Learning Challenge
The principal challenge in learning strategy is not learning the basic principles, or even the more sophisticated ones. The principle challenge in learning strategy is learning how to use it, learning how to act strategically at all times.

32. Additional course topics
Culture topics: explore similarities and differences between Western and Vietnamese thinking.
Critical Thinking topics: defending your personal thoughts/opinions on a variety of issues.
Language topics: practice speaking English

33. Course Grading Class Participation: 10% 3 Field Projects: 30%
Business Simulation: 20%
Final Examination: 40%

34. Field Projects Teams of 3-4 students.
We will assign different businesses to visit, investigate and compare.
Write a one-page report of your team’s most important conclusions regarding the businesses’ strategies.
Give a short team presentation.
Due: classes 3, 5 and 7

35. Business Simulation Business simulation is an online “game.”
This game is played by my strategy students in the United States as part of this course.
Your team (3 persons = best size) is one company competing with other companies in the international shoe market.
Your team will need access to the internet.
Logistics to be discussed later.

36. 6. What are some basic strategy concepts?
Strategic Management
Today’s Class
What is this class about?
Who is its teacher?
Who are its students?
What’s this class about (part 2)
How is this course organized?
6. What are some basic strategy concepts?

37. Today’s culture reflection
A student has the following statement on her account:
“You can make it (succeed) if you try”
What do you think about this statement and why?

38. Critical Thinking 2
Another way to say “you can make it if you try” is You can’t make it if you don’t try What do you think about this statement?

39. 6. What are some basic strategy concepts?
Strategic Management
Today’s Class
What is this class about?
Who is its teacher?
Who are its students?
What’s this class about (part 2)
How is this course organized?
6. What are some basic strategy concepts?

40. Hình thành (Formulation)
The Strategy Process
Hình thành (Formulation)   
Phân tích (Analysis) 
Thực hiện (Implementation) 

41. Rational Strategy Process
Strategy Formulation (thinking) Strategy Implementation (creating) Strategy Execution (doing)

42. Strategy Formulation Set Strategic goals (Mission, Vision, Values)
Analyze the company’s external environment
Analyze the company’s internal environment
Determine the strategies that best
maximize opportunities and minimize threats
Maximize strengths and minimize weaknesses
Levels of strategy to choose: Functional, Business, Corporate, International

43. External Analysis External Analysis assesses:
Purpose is to identify the strategic opportunities and threats in the organization’s operating environment that will affect how it pursues its mission.
External Analysis assesses:
Industry environment in which company operates
Competitive structure of industry
Competitive position of the company
Competitiveness and position of major rivals
The country or national environments in which company competes
The wider socioeconomic or macroenvironment that may affect the company and its industry
Social
Government
Legal
International
Technological

44. Internal Analysis Internal analysis includes an assessment of:
Purpose is to pinpoint the strengths and weaknesses of the organization. Strengths lead to superior performance and weaknesses to inferior performance.
Internal analysis includes an assessment of:
Quantity and quality of a company’s resources and capabilities
Ways of building unique skills
and company-specific or distinctive competencies
Building & sustaining a competitive advantage requires a company to achieve superior:
Efficiency
Quality
Innovations
Responsiveness to customers

45. Selecting Strategies
Functional strategies should be consistent with and support the company’s business level, corporate and global strategies.
Functional-level strategy – directed at operational effectiveness
Business-level strategy – businesses’ overall competitive themes
Global strategy – expand, grow and prosper at a global level
Corporate-level strategy – to maximize profitability and profit growth

46. Rational Strategy Process
Strategy Formulation (thinking)  Strategy Implementation (creating)  Strategy Execution (doing)

47. Strategy Implementation
Decide who will govern organization & how
Decide what the organization will value
Design organization structure
Design organizational culture
Design organizational controls

48. Strategy Execution
Ensure organizational actions execute desired strategy every time
Zero defects/failures

49. 2 Types of strategy processes: Rational Strategy Process
Strategy Formulation (thinking) Strategy Implementation (creating) Strategy Execution (doing)

50. 2 Types of strategy processes: Incremental Strategy Process
Strategy Formulation Strategy Implementation Strategy Execution (The real or observed strategic process)

51. Strategy Process Strategy is a verb, not a noun
The strategy process should never stop
The feedback loop – strategic planning is ongoing
Through controls, managers monitor strategy execution:
To determine if strategic goals and objectives are being achieved
To evaluate to what extent competitive advantage is being created and sustained

52. “The essence of strategy is creating tomorrow’s competitive advantage faster than competitors can copy the ones you have today.”
- Gary Hamel &
C. K. Prahalad
© RoyaltyFree/ Stockdisc/ Getty Images

53. Two types of strategy processes Two types of strategy outcomes
Intended (Rational)
Emergent (Incremental)
Two types of strategy outcomes
Realized
Unrealized

54. Planned, Deliberate, Emergent and Realized Strategies
Figure 1.6
Source: Adapted from H. Mintzberg and A. McGugh, Administrative Science Quarterly, Vol. 30. No. 2, June 1985.

55. Intended and Emergent Strategies
Intended or Planned Strategies
Strategies an organization plans to put into action
Typically the result of a formal planning process
Unrealized strategies are the result of unprecedented changes and unplanned events after the formal planning is completed
Emergent Strategies
Unplanned responses to unforeseen circumstances
Serendipitous discoveries and events may emerge that can open up new unplanned opportunities
Must assess whether the emergent strategy fits the company’s needs and capabilities
Can be retrospective: discover the strategy after you’re doing it

56. Planned, Deliberate, Emergent and Realized Strategies
Figure 1.6
Source: Adapted from H. Mintzberg and A. McGugh, Administrative Science Quarterly, Vol. 30. No. 2, June 1985.

57. Realized and Unrealized Strategy Outcomes
Realized Strategies
The product of whatever intended strategies are actually put into action and of any emergent strategies that evolve
Unrealized Strategies
Failed strategy implementation
Question: How often do companies fail to fully realize their strategies?

58. Planned, Deliberate, Emergent and Realized Strategies
Figure 1.6
 Rational Strategy Process 
Source: Adapted from H. Mintzberg and A. McGugh, Administrative Science Quarterly, Vol. 30. No. 2, June 1985.

59. Planned, Deliberate, Emergent and Realized Strategies
Figure 1.6
Incremental Strategy
Process
Source: Adapted from H. Mintzberg and A. McGugh, Administrative Science Quarterly, Vol. 30. No. 2, June 1985.

60. What is a rational strategy?
Strategy is one answer to the question: “What makes businesses succeed?
Strategy is a pattern of a firm’s actions.
Pattern means that an observer sees a logic to a set of actions.

61. What is Strategy?
The strategic logic of a firm’s actions is that an observer sees a cause (the firm’s actions) lead to an effect (the firm’s success)
Cause(s)  Effect; Actions  Success
Strategy is in the eye of the beholder, the person looking
Ultimately, strategy is a concept; an idea; a perspective, a way of looking at the world; a theory about what will succeed.

62. What is strategy? (Culture comment)
Causes  Effect; Actions  Success
Note Western bias towards simple explanations of complex problems
Can inaction  success?
What does this statement mean?
“Everyone’s a hero in a rising market.”
Let’s remember: culture affects how we see things.

63. The skill of Strategy Doing strategy is a process
Managing a process in an organization involves many skills
One of those skills is the strategic skill
The strategic skill = seeing the big picture
The hard part of learning strategy is learning to see strategically, and at all times

64. The Big Picture: the strategy model
Environ-ment
FIRM
Strategy

65. Critical Thinking Question
What do we see if a business has no strategy?