1. Power point presentation
Strategic management
Power point presentation
DR. Shareef Mahgoub

2. Strategic Management Process
1.4

3. Planning Serves as a guide for making decisions
The act of setting goals, developing strategies, outlining tasks, creating timelines
Each part of a business develops its own plan to guide its operations
All plans must work together toward the business’ overall goals.

4. Importance of Planning
Most important function of management
The difference between higher profits or huge loses, expansion or failure
All managers are involved with planning in some way
Deciding to expand and build a new building to deciding on work schedules

5. Importance of Planning
Mangers use their plans to determine whether the business is making progress
It encourages managers to be more specific in their decisions
Planning in a large business is like a jigsaw puzzle. All the pieces must work together
Coordination to avoid conflict & missed opportunities
Sharing plans between departments helps each see how their plans effect another

6. Levels of Planning Managers plan on two levels
Strategic planning (upper management)
Long term
Provides broad goals & direction for the entire business
Operational (mid-level management)
Short term
Identifies specific activities for EACH area of the business

7. Setting Goals 1. Specific & Meaningful 3. Clearly Communicated
You will never know when you have arrived if you don’t know where you are going.
Goal – Is a specific statement of a result the business expects to achieve
Characteristics of Effective Goals:
1. Specific & Meaningful Clearly Communicated
2. Achievable (realistic) Consistent with each other
and overall company

8. Operation Planning Determines the:
How it will be done
Who will do it
What resources are needed to do it
Operational plans direct the day-to-day activities of a business

9. Planning Tools Budgets – most widely used tool Schedules – deadlines
Standards – Quality, Quantity, Time, Cost
Policies – general rule for the whole business
Procedure – steps followed to perform certain work
Research – Gathering information

10. What is Strategic Management?
Application of the basic planning process at the highest levels of the company
Top management sets goals for the performance of the company
Carefully formulating, implementing, and evaluating plans and strategies

11. What is Strategic Management?
Most important part is developing strategic plans
Plans must remain current as changes occur inside and outside the company
Involves many levels of management
Top level formally develops basic plans
Different departments may be asked to develop plans for their own areas
A solid plan guarantees that plans are coordinated and are supported by everyone in the company

12. Strategic Management Approach
Three phases critical to the success of the process
Formulation
Developing the strategic plan
Implementation
Putting the formulated plan to work
Evaluation
Continuously evaluating and updating the strategic plan

13. Formulating Strategy
Developing the grand- and business-level strategies to be used by the company
Company’s strengths/weaknesses and threats/opportunities shape the strategies
First step is to understand the current position of the company
Identify mission, identify past and present strategies, diagnose the company’s past and present performance, set objectives for the company’s operation

14. Formulating Strategy Identify the mission statement
Outlines why the company exists
Describes the company’s basic products and/or services and defines markets and sources of revenue
Designed to accomplish several goals and ensures a common purpose within the company

15. Identifying Past and Present Strategies
Companies need to understand and appreciate their corporate history
Strategic managers should ask
Has past strategy been developed?
If not, can past history of the company be analyzed to identify the strategy that has evolved?
If yes, has the strategy been recorded in writing?

16. Diagnosing Past and Present Performance
A corporate planner must decide if past strategies worked and if strategic changes are needed by asking:
How is the company currently performing?
How has it performed during the past few years?
Is the performance trend moving up or down?

17. Setting Goals
Concise statements that provide direction employees and set standards for achieving the company’s strategic plan
Established in many areas (see handout)
Goals must be reevaluated as the environment and opportunities change
Multiple goals are used to reflect the desired performance

18. Policies, Procedures, and Rules
Policies are broad general guides to action that establish boundaries within which employees must operate
“answering all written customer complaints in writing within 10 days”

19. Policies, Procedures, and Rules
Procedures are detailed series of related steps/tasks written to implement a policy
Define methods through which policies are achieved
“the customer service representative must note the complaint of Form 622 and forward the yellow copy of the form…”
Rules detail specific and definite corporate actions that employees must follow
Leave little doubt about what is to be done
“no smoking in the conference room”

20. Implementing Strategy
Action stage of strategic management
Managers determine and implement the most appropriate company structure, motivate employees, develop short-range goals, and establish functional strategies
Strategy must fit with current company policies
Or conflicting policies must be changed
Manufacturer of world-class pens and pencils
Policy of unconditionally guaranteeing its products for life
B/C customers have come to expect this policy, Cross would find this policy difficult to discontinue

21. Evaluating and Controlling the Strategic Plan
Process of continuously monitoring the company’s progress toward its long-range goals and mission
Managers should ask:
Does the grand strategy need revising?
Where are problems likely to occur?
Basic strategy evaluation strategies:
Review external and internal factors that are the bases for current strategies
Measure performance
Take corrective action

22. Strengths, Weaknesses, Opportunities, Threats
SWOT Analysis
Strengths, Weaknesses, Opportunities, Threats
Process that allows companies to evaluate overall health
Internal (SW) – Can Control
External (OT) – Can’t Control
Most important result of a SWOT analysis is the ability to draw conclusions about the attractiveness of the company’s situation and the need for strategic action

23. SWOT Analysis for Santa

24. Evaluating and Controlling the Strategic Plan
Emphasis is making the company’s managers aware of the problems that are likely to occur and of the actions to take if they do arise
Plan ahead and avoid disaster
Strategic planning and evaluation should be done on a predetermined schedule and as frequently as necessary, determined by internal and environmental factors