PRESENTATION SLIDES

To accompany:

Contemporary Strategy

Analysis

(6

th

edition, Blackwell Publishing, 2008)

Robert M. Grant

Robert M. Grant

Assisted by Kate Grant

The Concept of

Strategy

The Concept of

Strategy

• The role of strategy in success
• A framework for strategy analysis
• The evolution of strategic management
• Corporate strategy and business strategy
• Strategy making: Design or process?
• The role of strategy

OUTLINE

OUTLINE

Components of

Success

Components of

Success

MADONNA

GIAP & NORTH

VIETNAMESE

LANCE ARMSTRONG

GOALS

Single-minded quest
for stardom.

Reunification of
Vietnam under
Communist rule.

Winning the Tour de
France

UNDER-
STANDING
THE
ENVIRONMEN
T

Identified emerging
trends in popular
culture. Understood
key success factors
in showbiz

Intimate
knowledge of
terrain
Understanding
U.S. political
system.

Diagnosis of the
physical,
psychological and
strategic
determinants of
individual and team
performance

RESOURCE
APPRAISAL

Recognized limited
raw talent. Exploited
strengths in self-
promotion, product
development &
relationship
management

Recognized
economic and
military
weaknesses and
core political
strengths

Systematic
development of
individual stamina
and team
capabilities

IMPLEMENT-
ATION

Commitment and
discipline.
Charismatic
leadership. Team
building. Attention to
detail.

Tight control.
Long-term
commitment.
Effective
propaganda.
Inspirational
leadership.

Clear delineation of
individual roles.
Alignment of
incentives with
team goals.
Nurturing esprit de
corp

Successful

Strategy

Long-term,

simple and

agreed

objectives

Profound

understanding

of the

competitive

environment

Objective

appraisal of

resources

What Makes a Successful

Strategy?

What Makes a Successful

Strategy?

EFFECTIVE IMPLEMENTATION

What is Strategy?

What is Strategy?

• Distinguishing strategy from tactics

:

– Strategy is the overall plan for deploying

resources to establish a favorable position.

– Tactic is a scheme for a specific maneuver.

• Characteristics of strategic decisions:

– Important.
– Involve a significant commitment of

resources.

– Not easily reversible.

The Evolution of Strategic

Management

The Evolution of Strategic

Management

DOMINANT

THEME

1950s

1960s-early 70s

Mid-70s-mid-80s Late 80s –1990s

2000s

Budgetary

Corporate

Positioning

Competitive Strategic

planning &

planning

advantage

innovation
control

Financial

Planning

Selecting

Focusing on Reconciling

control

growth

&-

sectors/markets. sources of

size with

diversification Positioning for competitive

flexibility &

leadership

advantage

agility

Capital

Forecasting.

Industry analysis

Resources

&

Cooperative

budgeting.

Corporate

Segmentation capabilities. strategy.

Financial

planning.

Experience curve

Shareholder

Complexity.
planning

Synergy

Portfolio analysis

value.

Owning

E-commerce. standards.
— Knowledge Management

—

Coordination

Corporate

Diversification.

Restructuring.

Alliances &

& control by

planning depts.

Global strategies. Reengineering.

networks

Budgeting

created. Rise of

Matrix structures

Refocusing.

Self -organiz

systems

corporate

Outsourcing. ation

& virtual

planning

organization

MAIN

ISSUES

KEY

CONCEPTS

&

TOOLS

MANAGE-

MENT

IMPLIC-

ATIONS

The Basic Framework

Strategy: the Link between

the Firm and its

Environment

The Basic Framework

Strategy: the Link between

the Firm and its

Environment

THE FIRM

• Goals &
Values

• Resources &
Capabilities
• Structure &
Systems

THE FIRM

• Goals &
Values

• Resources &
Capabilities
• Structure &
Systems

THE
INDUSTRY
ENVIRONMENT

• Competitors
• Customers
• Suppliers

THE
INDUSTRY
ENVIRONMENT

• Competitors
• Customers
• Suppliers

STRATEGY

STRATEGY

STRATEGY

Sources of Superior

Profitability

RATE OF

PROFIT ABOVE

THE

COMPETITIVE

LEVEL

How do

we make

money?

INDUSTRY

ATTRACTIVENES

S

Which

businesses

should we

be in?

COMPETITIVE

ADVANTAGE

How should

we

compete?

CORPORATE

STRATEGY

BUSINESS

STRATEGY

Strategy Making : Design or

Process?

Strategy Making : Design or

Process?

Strategy as

Design

Planning and

rational choice

INTENDED
STRATEGY

Many decision makers

responding to multitude of

external and internal forces

REALIZED

STRATEGY

EMERGEN

T

STRATEGY

Strategy as

Process

Mintzberg’s Critique of Formal Strategic Planning:

•The fallacy of prediction – the future is unknown

•The fallacy of detachment -- impossible to divorce
formulation from
implementation

•The fallacy of formalization --inhibits flexibility,
spontaneity,
intuition and learning.

Mintzberg’s Critique of Formal Strategic Planning:

•The fallacy of prediction – the future is unknown

•The fallacy of detachment -- impossible to divorce
formulation from
implementation

•The fallacy of formalization --inhibits flexibility,
spontaneity,
intuition and learning.

Strategy Making Processes

within the Company: Multiple

Roles of Strategy

Strategy Making Processes

within the Company: Multiple

Roles of Strategy

Strategy as Decision
Support

Strategy as Coordination
and Communication

Strategy as Target

Improves the
quality
of decision making

Creates consistency
and unity

Improves perform-
ance by setting
high aspirations

The Role of Analysis

The Role of Analysis

• Strategy analysis improves decision

processes, but doesn’t give answers.

• Strategy analysis assists us to identify

and understand the main issues.

• Strategy analysis helps us to manage

complexity.

• Strategy analysis can enhance flexibility

and innovation by supporting learning.