Strategic Management Chapter 1

Front 1

Strategic Management

Back 1

Set of managerial decisions and actions that determine the long-term performance of a corporation

Front 2

Phases of strategic management

Back 2

-Basic Financial Planning
-Forecast Based Planning
-Externally Oriented (Strategic) Planning
-Strategic Management

Front 3

Basic Financial Planning

Back 3

In this phase, managers initiate serious planning when requested to propose the following year's budget.

Front 4

Forecast Based Planning

Back 4

In this phase, managers attempt to propose five-year plans and consider projects that may take more than one year.

Front 5

Externally Oriented (Strategic) Planning

Back 5

In this phase, planning is taken out of the hands of lower level managers. Top management takes control of planning by initiating strategic planning in an attempt to increase its responsiveness to market change & competition by thinking strategically

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Strategic Management

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In this phase, top management forms planning groups of managers and key employees at many levels, from various departments and workgroups.

Front 7

Benefits of Strategic Planning

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-Clearer sense of strategic vision for the firm.

-Sharper focus on what is strategically important.

-Improved understanding of a rapidly changing environment.

Front 8

Globalization

Back 8

The integrated internalization of markets and corporations

Front 9

Impact of globalization

Back 9

As more industries become global, strategic management is becoming an increasingly importantway to keep track of international developments and position a company for long-termcompetitive advantage.

Front 10

Environmental Sustainability

Back 10

The use of business practices to reduce a company’s impactupon the natural, physical environment.

Front 11

Basic Model of Strategic Management

Back 11

-Environmental scanning

-Strategy formulation

-Strategy implementation

-Evaluation and control

Front 12

Basic Elements ofthe StrategicManagementProcess

Back 12

Front 13

Strategic Management Model (Extended)

Back 13

Front 14

Environmental Scanning

Back 14

The monitoring, evaluating, and disseminating of informationfrom the external and internal environments to key people within the corporation.

The simplest way to conduct environmental scanning is throughSWOT analysis.

Front 15

SWOT Analysis

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-An acronym used to describe the particular Strengths,Weaknesses,Opportunities, and Threats that are strategic factors for a specific company.

-The external environmentconsists of variables (Opportunities and Threats) that are outside the organization.

-The internal environment of a corporation consists of variables (Strengths andWeaknesses) that are within the organization itself.

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Strategy Formulation

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The development of long-range plans for the effective managementof environmental opportunities and threats, in light of corporate strengths and weaknesses(SWOT).

It includes defining the corporate mission, specifying achievable objectives, developingstrategies, and setting policy guidelines.

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Mission

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Mission

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Vision

Back 18

Vision

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Effect of climate change: six categories of risk

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-Regulatory Risk

-Supply chain risk

-Product and technology risk

-Litigation risk

-Reputational risk

-Physical Risk

Front 20

Regulatory risk

Back 20

Government policies in place to prevent company activities that cause pollution by companies