Strategic Management

2

The Dynamics of Strategic Planning

• Strategy large-scale action plan that sets the

direction for an organization

• Strategic management process that involves managers from all

parts of the organization in the formulation and the implementation of strategies and strategic goals

3

The Strategic Management Process

4

APPROACHES TO STRATEGIC PLANNING

1Business-

Led

2Method-Driven

3Admin

4Organizational

5Technology

UnderpinningAssumption

Business Plansand NeedsShould DriveIS Plans

FormalizedPlanningMethodology

Use Firm’sMethodology

ContinuousShared PlanningActivities

Quality Business/InformationModeling

Emphasis ofApproach

Use BusinessPlans to LeadDevelopment ofIS Plans

Selection ofBest Method/Best Consultant

Project ROI User/ISCooperation andLearning

Creation ofBusiness Process/InformationModels

Slogan BusinessDrives IS

PlanningNeeds aMethod

Follow theRules

Themes withTeams

Model theBusiness

Key toSuccess

OperationalizedBusiness Plan

IntegratedStrategic,Tactical, andImplementationMethodology

EffectiveSteeringCommittee

ExperiencedUsers and ISPersonnel

Quality BusinessProcessReengineeringPrograms

Problem Business PlanQuality

Availability ofMethodologies

Tactical Tactical Difficult

ContinuousShared PlanningActivities

User/ISCooperation andLearning

Themes with

ExperiencedUsers and ISPersonnel

Tactical

5

StrategicBusiness V ision

Strategic Business Planning (Transform ation) Fram ework

O rganizationVision

O rganizationStrategy

ISStrategy

ExistingIS /IT

Strategy

ExistingO rganizational

Form

O rganizationRedesign

HRInitiatives

IS /ITDevelopment

B usiness Transform ation Planning

C hange M anagem ent Process

Vision

Planning

Delivery

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Strategic P lanning M ethodology

INTERVIEW ING ANALYSIS & PLANNING STRATEGY

DEVELOPMENT

M issionStatem ent

B usinessPlan

M IS Strategy

O rganizationStrategy

Serv ice LevelStrategy

M arketingStrategy

O perationsStrategy

M anagem entSty le

TechnologyStrategy

IT /IS Strategic Planning

O BJECTIVES: Social Economic Medical

Resources: Economic Medical

Enterprise Assessm ent

Research

Service Availability Survey

Products Availability Survey

Market Structure Survey

EconomicAnalysis

byService

&product

A ssessm ent C riteria

M arketSegm entation

A nalys is

C om petitivepositionA nalys is

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A n a lysis

A n a lysis

Producing an In tegra ted Business /Techno logy S tra teg ic P lan

C o m p e tito rsB u sin e ssP ro file s

C u rre n tT e ch n o lo g y

A rch ite ctu re s

C u rre n tA p p lica tio nP a cka g e s

U tilize T e a m 'sT e ch n o lo g yB a ckg ro u n d

U tilize T e a m 'sIn d u stry

K n o w le d g e

M a n a g e m e n tIn te rvie w s

T e ch n o lo g yS ta ff

In te rvie w s

U se rIn te rvie w s

D ra ftB u sin e ss

P la n

P re lim in a ryT e ch n o lo g y

P la n

P L A N N IN G

W O R K S H O P

P re lim in a ryB u sin e ss

P la n

D ra ftT e ch n o lo g y

P la n

T e ch n o lo g yM a n a g e m e n t

In te rvie w s

M a n a g e m e n tIn te rvie w s

B u d g e t &Im p a ct

A n a lysis

B u d g e t &Im p a ct

A n a lysis S tra te g icT e ch n o lo g y

P la n

S tra te g icB u sin e ss

P la n

Crossim pact

analysis

Crossim pact

analysis

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The Contingency Theory of Management

Environm ent: In terna l & Externa l

Technology: In terna l & Externa l

Product/Service

Structure

DesiredMgmt/Org

Style

-H ierarica l(C om m and)

-D em ocra tic(S hared Leadersh ip)

-P artic ipa tive (S e ll)

P roduction R & DE ngineering

Stable TurbulentDynamic

AutocraticLeader

Empow eringLeader

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Common Grand Strategies

• Growth strategy involves expansion/technology diffusion

• Stability involves little or no significant change

• Defensive involves reduction in the organization’s

efforts

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SWOT Analysis Tool

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Porter’s Five Competitive Forces

1. Threat of new entrants/technologies

2. Bargaining power of suppliers

3. Bargaining power of buyers

4. Threat of substitute products or services

5. Rivalry among competitors

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Porter’s Four Competitive Strategies

• Cost-leadership strategy keep the costs, and hence prices, of a

product or service below those of competitors and to target a wide market

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Porter’s Four Competitive Strategies

• Differentiation strategy offer products that are of unique and

superior value compared to those of competitors but to target a wide market

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Porter’s Four Competitive Strategies

• Cost-focus strategy keep the costs of a product below those of

competitors and to target a narrow market

• Focused-differentiation offer products that are of unique and

superior value compared to those of competitors and to target a narrow market

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The Product Life Cycle

Stage 1: Introduction the new product is introduced into the

marketplace

Stage 2: Growth most profitable stage period in which customer demand

increases, the product’s sales grow, and competitors may enter the market

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The Product Life Cycle

Stage 3: Maturity period in which the product starts to fall out

of favor and sales and profit begin to fall off

Stage 4: Decline period in which the product falls out of

favor and the organization withdraws from the marketplace