University of Amsterdam 2024/2025
Business Administration: Strategy (full time)
Master's in Business Administration
Semester 1, Block I - complete summary and studynotes
Pages: 62
Reading time: 180 min.
In plain English
Literature used: contemporary strategy analysis Grant 12th ed. 2024
,Chapter 1: Introducing Strategy
Strategy is defined as the long-term direction of an organization. A more extensive definition is: ‘Strategy is
the direction and scope of an organization over the long term, which achieves advantage in a
changing environment through its configuration of resources and competences with the aim of
fulfilling stakeholder expectations’.
Chandler: emphasizes a logical flow from the determination of goals and objectives to the
allocation of resources.
Mintzberg: uses the word ‘pattern’ to allow for the fact that strategies do not always follow a
deliberately chosen and logical plan, but can emerge in more ad hoc ways.
The three elements of strategy definition - long term, direction and organization - can each be
explored further.
-The long term. The importance of the long-term perspective is emphasized by the three horizons
framework, suggesting every organization to think of itself as compromising three types of
business defined by their ‘horizon’ in terms of years.
-Horizon 1 are current core activities
-Horizon 2 are emerging activities that should provide new sources of profit
-Horizon 3 are possibilities for which nothing is certain
-The strategic direction. Managers and entrepreneurs try to set the direction of their strategy
according to long-term objectives.
-Organization. Involve complex relationships, both internally and externally since they have many internal
and external stakeholders.
,Levels of Strategy
Inside an organization, strategies can exist at three main levels:
1. Corporate-level strategy is concerned with the overall scope of an organization and how value
is added to the constituent businesses of the organizational whole.
2. Business-level strategy is about how the individual businesses should compete in their particular markets.
3. Operational strategies are concerned with how the components of an organization deliver
effectively the corporate- and business-level strategies in terms of resources, processes and
people.
The need to link these three levels underlines the importance of integration in strategy. Each level
needs to be aligned.
David Collis and Michael Rukstad have argued that all entrepreneurs and managers should be able
to summarize their organization's strategy with a strategy statement. This should have three main
themes: the fundamental goals that the organization seeks, which typically draw on the
organization's stated mission, vision and objectives: the scope or domain of the organization's
activities: and the particular advantages or capabilities it has to deliver all of these.
Various contributing elements of a strategy statement are:
• Mission (goals and overriding purpose - ‘what business are we in?’)
• Vision (also relates to goals, refers to desired future state of the organization - ‘what do
we want to achieve?’)
• Objectives (‘what do we have to achieve?’)
• Scope (three dimensions: geographical location, customers or clients and extent of internal activities)
• Advantage (how the organization will achieve the objectives it has set itself in its chosen domain)
There are three main branches of strategy as a subject (fig 1.3):
Strategy context refers to both the internal and the external contexts of
organizations Strategy content concerns the nature of different strategies and their
probability of success Strategy process examines how strategies are formed and
implemented.
The Exploring Strategy Model (fig 1.4) includes understanding the strategic position of an
organization (context); assessing strategic choices for the future (content) ; and managing
strategy in action (process).
Elements of strategic management
1. The Strategic position is concerned with the impact on strategy of the external
environment, the organization’s strategic capability, the organization's goals and the
organization's culture.There are four factors of importance:
-Environment (opportunities and threats)
-Strategic capability (resources and competences / strengths and weaknesses)
-Strategic purpose (vision, mission and objectives)
-Culture (influencing strategic drift)
2. The Strategic choices involve the options for strategy in terms of both the directions in
which strategy might move and the methods by which strategy might be pursued. Typical
strategic choices are:
-Business strategy (how to compete at the individual business level: differentiation, cost focus etc.)
, -Corporate strategy and diversification (which businesses to include in the portfolio?)
-International strategy.
-Innovation and entrepreneurship (is the organization innovating appropriately?)
-Acquisitions and alliances
3. Managing strategy into action is about how strategies are formed and how they are
implemented, fundamental questions are about:
-Strategy evaluation (suitable, feasible)
-Strategy development processes
-Organizing
-Leadership and strategic change
-Strategy practice (who should do what in the strategy process?)
The exploring strategy model can be applied in many contexts, however in each context the
typical balance of strategic issues might differ. Issues arising from the exploring strategy model
can vary in three important contexts: 1. Small businesses - certainly need to attend closely to
the environment
2. Multinational corporations - positioning in a complex global marketplace is important
3. Public sector and not-for-profits - positioning issues of competitive advantage
will be important even in these contexts
Michael Porter (1996), ‘What is Strategy?’, Harvard Business Review
• in defense of criticism on positioning / cost efficiency vs product differentiation
• the ‘strategy’ of companies is often no more than competing for operational effectiveness
• managers fail to choose, neglecting trade-offs, focus too much on growth and measurable goals
• operational effectiveness is not strategy
• the essence of strategy is choosing to perform activities differently than rivals do
• a sustainable strategic position requires trade-offs
• strategy is the creation of a unique and viable position
A comprehensive assessment of an organization's strategy needs more than one perspective. The
strategy lenses are ways of looking at strategy issues differently in order to gain many insights.
The four lenses are: -Strategy as design (analysis and planning, top management responsibility)
-Strategy as experience (adaption, analysis and bargaining)
-Strategy as variety (focus on innovation, managing conditions)
-Strategy as discourse (language)
Business Administration: Strategy (full time)
Master's in Business Administration
Semester 1, Block I - complete summary and studynotes
Pages: 62
Reading time: 180 min.
In plain English
Literature used: contemporary strategy analysis Grant 12th ed. 2024
,Chapter 1: Introducing Strategy
Strategy is defined as the long-term direction of an organization. A more extensive definition is: ‘Strategy is
the direction and scope of an organization over the long term, which achieves advantage in a
changing environment through its configuration of resources and competences with the aim of
fulfilling stakeholder expectations’.
Chandler: emphasizes a logical flow from the determination of goals and objectives to the
allocation of resources.
Mintzberg: uses the word ‘pattern’ to allow for the fact that strategies do not always follow a
deliberately chosen and logical plan, but can emerge in more ad hoc ways.
The three elements of strategy definition - long term, direction and organization - can each be
explored further.
-The long term. The importance of the long-term perspective is emphasized by the three horizons
framework, suggesting every organization to think of itself as compromising three types of
business defined by their ‘horizon’ in terms of years.
-Horizon 1 are current core activities
-Horizon 2 are emerging activities that should provide new sources of profit
-Horizon 3 are possibilities for which nothing is certain
-The strategic direction. Managers and entrepreneurs try to set the direction of their strategy
according to long-term objectives.
-Organization. Involve complex relationships, both internally and externally since they have many internal
and external stakeholders.
,Levels of Strategy
Inside an organization, strategies can exist at three main levels:
1. Corporate-level strategy is concerned with the overall scope of an organization and how value
is added to the constituent businesses of the organizational whole.
2. Business-level strategy is about how the individual businesses should compete in their particular markets.
3. Operational strategies are concerned with how the components of an organization deliver
effectively the corporate- and business-level strategies in terms of resources, processes and
people.
The need to link these three levels underlines the importance of integration in strategy. Each level
needs to be aligned.
David Collis and Michael Rukstad have argued that all entrepreneurs and managers should be able
to summarize their organization's strategy with a strategy statement. This should have three main
themes: the fundamental goals that the organization seeks, which typically draw on the
organization's stated mission, vision and objectives: the scope or domain of the organization's
activities: and the particular advantages or capabilities it has to deliver all of these.
Various contributing elements of a strategy statement are:
• Mission (goals and overriding purpose - ‘what business are we in?’)
• Vision (also relates to goals, refers to desired future state of the organization - ‘what do
we want to achieve?’)
• Objectives (‘what do we have to achieve?’)
• Scope (three dimensions: geographical location, customers or clients and extent of internal activities)
• Advantage (how the organization will achieve the objectives it has set itself in its chosen domain)
There are three main branches of strategy as a subject (fig 1.3):
Strategy context refers to both the internal and the external contexts of
organizations Strategy content concerns the nature of different strategies and their
probability of success Strategy process examines how strategies are formed and
implemented.
The Exploring Strategy Model (fig 1.4) includes understanding the strategic position of an
organization (context); assessing strategic choices for the future (content) ; and managing
strategy in action (process).
Elements of strategic management
1. The Strategic position is concerned with the impact on strategy of the external
environment, the organization’s strategic capability, the organization's goals and the
organization's culture.There are four factors of importance:
-Environment (opportunities and threats)
-Strategic capability (resources and competences / strengths and weaknesses)
-Strategic purpose (vision, mission and objectives)
-Culture (influencing strategic drift)
2. The Strategic choices involve the options for strategy in terms of both the directions in
which strategy might move and the methods by which strategy might be pursued. Typical
strategic choices are:
-Business strategy (how to compete at the individual business level: differentiation, cost focus etc.)
, -Corporate strategy and diversification (which businesses to include in the portfolio?)
-International strategy.
-Innovation and entrepreneurship (is the organization innovating appropriately?)
-Acquisitions and alliances
3. Managing strategy into action is about how strategies are formed and how they are
implemented, fundamental questions are about:
-Strategy evaluation (suitable, feasible)
-Strategy development processes
-Organizing
-Leadership and strategic change
-Strategy practice (who should do what in the strategy process?)
The exploring strategy model can be applied in many contexts, however in each context the
typical balance of strategic issues might differ. Issues arising from the exploring strategy model
can vary in three important contexts: 1. Small businesses - certainly need to attend closely to
the environment
2. Multinational corporations - positioning in a complex global marketplace is important
3. Public sector and not-for-profits - positioning issues of competitive advantage
will be important even in these contexts
Michael Porter (1996), ‘What is Strategy?’, Harvard Business Review
• in defense of criticism on positioning / cost efficiency vs product differentiation
• the ‘strategy’ of companies is often no more than competing for operational effectiveness
• managers fail to choose, neglecting trade-offs, focus too much on growth and measurable goals
• operational effectiveness is not strategy
• the essence of strategy is choosing to perform activities differently than rivals do
• a sustainable strategic position requires trade-offs
• strategy is the creation of a unique and viable position
A comprehensive assessment of an organization's strategy needs more than one perspective. The
strategy lenses are ways of looking at strategy issues differently in order to gain many insights.
The four lenses are: -Strategy as design (analysis and planning, top management responsibility)
-Strategy as experience (adaption, analysis and bargaining)
-Strategy as variety (focus on innovation, managing conditions)
-Strategy as discourse (language)
