Strategic Management

Session 2:

Managing Strategically

Managing Strategically

Managing Strategically: Making decisions and implementing strategies that develop and maintain Competitive Advantage (The Holy Grail of Strategy!)

- Recognise the impact of dynamic External Factors

- Capitalise on organisational Resources and Capabilities

Managing Strategically

Competitive Advantage (or Competitive Edge)

- Sets an Organisation apart from competitors

- Having something other competitors don’t have

- Doing something better than other organisations

- Doing something that other organisations cannot do

- Necessay for long-term success and survival

Managing Strategically

Industrial Organization (I/O) View

Focus of the strategic analysis is external:

- Structural Forces (Industry Characteristics)

- Competitive Environment

- Michael Porter

Managing Strategically

Resource-Based View (RBV) Exploiting resources successfully helps to develop and

maintain competitive advantage:

- Differences in organisational culture, business experiences, assets and capabilities

- Link internal assets and capabilities with the environment- Key assets (resources) give a firm sustainable competitive

advantage: Financial, Physical, Human, Intangible, Structural-Cultural

- Ideally the resources must be unique

Managing Strategically

Guerilla ViewCompetitive advantage is only temporary!

Changes that characterize the environment:- Continual- Radical- Revolutionary

Successful organisations must be adept at:- Rapid and repeated disruptions of the current situation- Radical surprises keep competitors off balance!