WGU c483 Principles of Management - 1: Strategic Planning

WGU c483 Principles of Management - 1: Strategic

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TONE84118Preview Princip 51 terms Sha What is Strategic Planning?Overview- The graduate can explain the strategic planning process.-The fundamental aspect of being in business and trying to figure out where we're going to be in the future Questions companies ask?

Describe the concepts of strategic vision (intent) STRATEGIC INTENT The foundation for the strategic management is laid by the hierarchy of strategic intent. The concept of strategic intent makes clear WHAT AN ORGANISATION STANDS FOR HARVARD Business Review, 1989 described the concept in its infancy HAMED AND PRAHALAD coined the term strategic intent. A few aspects

about strategic intent are as follows:

· It is an obsession with an organization.· This obsession may even be out of proportion to their resources and capabilities.· It envisions a derived leadership position and establishes the criterion; the organization will use to chart its progress.

· It involves the following:

• Creating and Communicating a vision
• Designing a mission statement
• Defining the business
• Setting objectives

Vision serves the purpose of stating what an organization wishes to achieve in the long run.Three Levels of Planning Hierarchy3 levels of management Strategic- top level/big picture Tactical- middle level/managerial level (2years) Operational- Front line workers/ dealing with customers (1 year) Decision Making Stages vs. Formal Planning Steps Both have six steps and you know correspond pretty much perfectly with each other.implementation = Excution

The Strategic Management ProcessWhat is swot analysis?Establishing Mission, Vision and GoalsMission vision goals Bloomberg news?Describe the concepts of missionA written declaration of an organization's core purpose and focus that normally remains unchanged over time. Properly crafted mission statements (1) serve as filters to separate what is important from what is not, (2) clearly state which markets will be served and how, and (3) communicate a sense of intended direction to the entire organization.A mission is different from a vision in that the former is the cause and the latter is the effect; a mission is something to be accomplished whereas a vision is something to be pursued for that accomplishment.The External Environment- Chapter 2External Environment Macroenvironment The Competitive Environment- Porter's 5 Forces-... 5 forces central= Rival firms

Understanding Porter's Five ForcesCompetitive Rivalry. This looks at the number and strength of your competitors.How many rivals do you have? Who are they, and how does the quality of their products and services compare with yours?Where rivalry is intense, companies can attract customers with aggressive price cuts and high-impact marketing campaigns. Also, in markets with lots of rivals, your suppliers and buyers can go elsewhere if they feel that they're not getting a good deal from you.On the other hand, where competitive rivalry is minimal, and no one else is doing what you do, then you'll likely have tremendous strength and healthy profits.Supplier Power. This is determined by how easy it is for your suppliers to increase their prices. How many potential suppliers do you have? How unique is the product or service that they provide, and how expensive would it be to switch from one supplier to another?The more you have to choose from, the easier it will be to switch to a cheaper alternative. But the fewer suppliers there are, and the more you need their help, the stronger their position and their ability to charge you more. That can impact your profit.Buyer Power. Here, you ask yourself how easy it is for buyers to drive your prices down. How many buyers are there, and how big are their orders? How much would it cost them to switch from your products and services to those of a rival?Are your buyers strong enough to dictate terms to you?When you deal with only a few savvy customers, they have more power, but your power increases if you have many customers.Threat of Substitution. This refers to the likelihood of your customers finding a different way of doing what you do. For example, if you supply a unique software product that automates an important process, people may substitute it by doing the process manually or by outsourcing it. A substitution that is easy and cheap to make can weaken your position and threaten your profitability.Threat of New Entry. Your position can be affected by people's ability to enter your market. So, think about how easily this could be done. How easy is it to get a foothold in your industry or market? How much would it cost, and how tightly is your sector regulated?It's Time to AnalyzeExternal Opportunities and Threats Analysis Internal Strengths and Weaknesses Analysis SWOT Analysis and Strategy FormulationHow is going to affect our strategy going forward?