1. Strategic Analysis and Action (5 th edition) © 2002 Pearson Education Canada Strategic Analysis and Action (5 th edition) Figures

2. Strategic Analysis and Action (5 th edition) © 2002 Pearson Education Canada General Manager Setting Direction vision mission values Implementing Change making it happen Creating Strategy determining the way forward Assessing Performance today and tomorrow The Job of the General Manager

3. Strategic Analysis and Action (5 th edition) © 2002 Pearson Education Canada Quadrant 1Quadrant 2 Quadrant 3Quadrant 4 complacent organization desired state crisis troubled organization Operating Performance Organizational Health + + – – three years ago tomorrow? today The Performance Matrix

4. Strategic Analysis and Action (5 th edition) © 2002 Pearson Education Canada Environment Purpose Core Beliefs & Values Mission Vivid Description Organizational Vision Tangible ImageGuiding Philosophy Collins and Porras Vision Framework Source : Copyright ©1991, by The Regents of the University of California. Reprinted from the California Management Review, Vol. 34, No. 1. By permission of The Regents.

5. Strategic Analysis and Action (5 th edition) © 2002 Pearson Education Canada Product Market Focus Goals Core Activities Value Proposition Business Strategy Components

6. Strategic Analysis and Action (5 th edition) © 2002 Pearson Education Canada Strategic Choice: Product/Market Scope Source : Ansoff, I., The New Corporate Strategy. Copyright © 1987, John Wiley & Sons, Inc. Reprinted by permission of John Wiley & Sons, Inc. DiversificationMarket development NEW Product developmentMarket penetration EXISTING MARKET NEWEXISTING PRODUCT

7. Strategic Analysis and Action (5 th edition) © 2002 Pearson Education Canada Product Market Focus Goals Core Activities Value Proposition Everyday low prices Always in stock Courteous, reliable Branded general merchandise Value-oriented customers Develop easier markets first: work from regional hubs Integrated logistics: supplier to checkout Intensely managed Local tailoring Dominate markets Lowest cost system High growth Do it Wal-Mart way The Wal-Mart Business Strategy

8. Strategic Analysis and Action (5 th edition) © 2002 Pearson Education Canada Product Market Focus Goals Core Activities Value Proposition Differentiation on product and service through a user-friendly graphic interface and integrated products Complete desktop solution 50% US; 50% foreign Education (50%MS); home Hardware, software, peripherals High end “Change the world through technology” R&DMnf’gDist’n Fully integrated Apple’s Strategy

9. Strategic Analysis and Action (5 th edition) © 2002 Pearson Education Canada Corporate, Business and Functional Strategy

10. Strategic Analysis and Action (5 th edition) © 2002 Pearson Education Canada Management Preferences Organization Resources StrategyEnvironment The Diamond-E Framework

11. Strategic Analysis and Action (5 th edition) © 2002 Pearson Education Canada Strategic Risks Source : Ansoff, I., The New Corporate Strategy. Copyright © 1987, John Wiley & Sons, Inc. Reprinted by permission of John Wiley & Sons, Inc. Internal capabilities develop inconsistently with strategy Strategic demands exceed the capacity to execute CAPABILITY RISKS Environmental changes make the strategy obsolete Errors in reading the environment cause strategic failure ENVIRONMENTAL RISKS LONG-TERMSHORT-TERM TIME HORIZON

12. Strategic Analysis and Action (5 th edition) © 2002 Pearson Education Canada WANT Management Preferences Individual NEED Environment Industry CAN Resource Capabilities and Organization Firm Strategic Tension The Strategic Analysis Triangle

13. Strategic Analysis and Action (5 th edition) © 2002 Pearson Education Canada The Process of Strategic Analysis

14. Strategic Analysis and Action (5 th edition) © 2002 Pearson Education Canada INDUSTRY COMPETITORS Rivalry Among Existing Firms POTENTIAL ENTRANTS SUPPLIERS BUYERS SUBSTITUTES Threat of new entrants Bargaining power of buyers Threat of substitute products or services Bargaining power of suppliers Porter’s Five Forces Model Source : Reprinted with the permission of The Free Press, a Division of Simon & Schuster, Inc., from COMPETITIVE STRATEGY: Techniques for Analyzing Industries and Competitors by Michael E. Porter. Copyright © 1980, 1998 by The Free Press.

15. Strategic Analysis and Action (5 th edition) © 2002 Pearson Education Canada Prisoner’s Dilemma Matrix I: $2,000 II: $2,000 I: $0 II: $10,000 Strategy B I: $10,000 II: $0 I: $6,000 II: $6,000 Strategy A Strategy BStrategy A FIRM TWO

16. Strategic Analysis and Action (5 th edition) © 2002 Pearson Education Canada Macro Forces Micro Forces PoliticalSocialTechnologicalEconomic SupplyDemandCompetition PEST Forces

17. Strategic Analysis and Action (5 th edition) © 2002 Pearson Education Canada Need for Local Responsiveness Low High Need for Global Integration Global Economies of scale Customers accept standardized products Multidomestic Locally tailored products Benefits of being local outweigh added costs Internalization: Global/Local Source : Reprinted with the permission of The Free Press, a Division of Simon & Schuster,Inc., from THE MULTINATIONAL MISSION by C.K. Prahalad and Yves L. Doz. Copyright © 1987 by The Free Press.

18. Strategic Analysis and Action (5 th edition) © 2002 Pearson Education Canada Internalization: Global/Local

19. Strategic Analysis and Action (5 th edition) © 2002 Pearson Education Canada How well does the strategy anticipate... Government Competition DemandSupply E.G., Customer needs and performance Market growth Buyer bargaining power E.G., Aggregate competitive conditions Individual competitor strategies E.G., Advances in product, process technology Supplier competence and bargaining power Competition for raw materials and people E.G., Industry support programs Economic and trade policy Regulation of structure and conduct Testing the Strategy-Environment Linkage Business Environment Analysis Model (BEAM)

20. Strategic Analysis and Action (5 th edition) © 2002 Pearson Education Canada Resource Analysis

21. Strategic Analysis and Action (5 th edition) © 2002 Pearson Education Canada Management Preferences Strategic Choices Organization, Resources & Capabilities Environment Indirect Role A management preferences filter through which the environment and resources are assessed. Direct Role The Indirect Role of Management Preferences

22. Strategic Analysis and Action (5 th edition) © 2002 Pearson Education Canada Management Preference Analysis

23. Strategic Analysis and Action (5 th edition) © 2002 Pearson Education Canada Strategy-Organization Analysis

24. Strategic Analysis and Action (5 th edition) © 2002 Pearson Education Canada Organizational Capabilities Behaviour Culture Leverage Point Leadership Behaviour Leverage Point Organization Structure Leverage Point Management Processes Organizational Capabilities Model

25. Strategic Analysis and Action (5 th edition) © 2002 Pearson Education Canada Basic Organization Structure (Partial)

26. Strategic Analysis and Action (5 th edition) © 2002 Pearson Education Canada Unrealized Strategy Realized Strategy Intended Strategy Emergent Strategy Intended and Emergent Strategy Source : Mintzberg, H.; Ahlstrand, B.; Lampel, J.; Strategy Safari, New York: The Free Press, 1998.

27. Strategic Analysis and Action (5 th edition) © 2002 Pearson Education Canada Creating a Change Plan Strategic Analysis and Action (5 th edition) © 2002 Pearson Education Canada

28. Time Good Poor Strategic Performance Anticipatory Change Reactive Change Crisis Change Urgency for Action: The Crisis Curve

29. Strategic Analysis and Action (5 th edition) © 2002 Pearson Education Canada Time Good Poor Strategic Performance Anticipatory Change Reactive Change Crisis Change Readiness for Change Strategic Capability Readiness for Change and Strategic Capability

30. Strategic Analysis and Action (5 th edition) © 2002 Pearson Education Canada Proactive Resistors Defensive Resistors Change Agents Change Agents in Waiting Bystanders Actively Opposed Neutral Strongly Supportive Commitment to Proposed Change No Yes Have Required Capabilities Assessing Potential Priority Targets