ECB1SO
Strategy &
Organization
Brief summary
,Table of contents
Topic 1: Introduction to strategic management ....................................................................................... 3
Exogenous developments .................................................................................................................... 3
Internal decision making and competences ......................................................................................... 3
Topic 1: Different streams within strategic management ........................................................................ 3
Strategy according to different perspectives ....................................................................................... 3
Topic 2: External analysis ....................................................................................................................... 5
Topic 2: Industry analysis ....................................................................................................................... 6
Industry dynamics ............................................................................................................................... 7
Beyond industry effects ....................................................................................................................... 7
Topic 3: The resource based view ........................................................................................................... 8
Critiques on the RBV .......................................................................................................................... 8
Topic 3: Beyond resources ...................................................................................................................... 9
Dynamic capabilities Teece et al. (1997) ............................................................................................ 9
Micro foundations of dynamic capabilities ......................................................................................... 9
Topic 4: Organizational purpose ........................................................................................................... 10
Organizational member goals ............................................................................................................ 10
Which stakeholders matter? .............................................................................................................. 11
Shareholder versus stakeholder management .................................................................................... 11
Why are many multinationals still profit driven................................................................................ 11
Purpose and ownership...................................................................................................................... 11
Topic 5: Business strategy ..................................................................................................................... 13
SBU strategy...................................................................................................................................... 13
Interactive strategies with many firms competing firms ................................................................... 14
Topic 6: Corporate strategy and diversification .................................................................................... 15
Growth strategies: Ansoff matrix ...................................................................................................... 15
Topic 7: M&A’s .................................................................................................................................... 17
Corporate development ..................................................................................................................... 17
Elements of M&A strategy................................................................................................................ 17
Basic M&A theories and concepts .................................................................................................... 18
Three Basic markets .......................................................................................................................... 18
What type of M&A? .......................................................................................................................... 18
Topic 8: Behavioural economics ........................................................................................................... 21
Assumptions in behavioural theory ................................................................................................... 21
Systematic biases and heuristics........................................................................................................ 21
Implications for theory ...................................................................................................................... 21
1
,Topic 9: Agency theory ......................................................................................................................... 22
Central elements in agency theory .................................................................................................... 22
Rewards systems ............................................................................................................................... 22
Topic 10: Transactions cost theory........................................................................................................ 24
Dimensions of transactions: .............................................................................................................. 25
Which hierarchy to use? .................................................................................................................... 25
Topic 11: Motivation concepts .............................................................................................................. 26
Mazlow’s hierarchy of needs ............................................................................................................ 26
Theory X and Y (McGregor)............................................................................................................. 26
Herzberg two factor theory: .............................................................................................................. 26
McCelland’s theory of needs ............................................................................................................. 27
Self-determination theory (SDT) by Ryan and Deci ......................................................................... 27
The effect of saliency of an external stimulus on motivation at the workplace ................................ 27
Self-efficacy (Bandura): .................................................................................................................... 28
Goal setting theory (Locke):.............................................................................................................. 28
Equity/organizational justice theory .................................................................................................. 28
Topic 12: Foundations of organizational structure ................................................................................ 29
Basic design features ......................................................................................................................... 29
Ideal type characteristics of bureaucracy .......................................................................................... 31
Recent developments ......................................................................................................................... 32
New models ....................................................................................................................................... 32
Lean or agile approaches ................................................................................................................... 33
Topic 13: Organizational culture ........................................................................................................... 34
What is (an organizational) culture?.................................................................................................. 34
Levels of culture ................................................................................................................................ 34
Can culture be managed? .................................................................................................................. 34
The process of socialization .............................................................................................................. 35
Culture and organizational performance ........................................................................................... 35
Lessons .............................................................................................................................................. 35
2
, Topic 1: Introduction to strategic management
Exogenous developments
- Technological developments that are external to the firm (they have no control about these
developments).
- These external developments can be an opportunity as well as a threat.
Internal decision making and competences
- Managerial decision making processes.
- Internal strengths and weaknesses that empower or prevent firms to exploit certain
opportunities.
The SWOT model (Strength, weaknesses, opportunities and threat model)
What are the core strengths and what are the
main weaknesses? What are the opportunities and the threats they are facing. Combine these.
Topic 1: Different streams within strategic management
Strategy according to different perspectives
1. A long term plan (according to Alfred Chandler):
o The determination of the long-run goals and objectives of an enterprise and the
adoption of courses of action and the allocation of resources necessary for carrying
out these goals.
o Mainly relates to the strategic planning function of firms
o Strategic plans should include different time horizons
▪ Short term (Horizon 1), how do we defend and build our core business?
▪ Medium term (Horizon 2), how do we build emerging businesses?
▪ Long term (Horizon 3), how do we create new viable opportunities?
o Different levels:
o Corporate: Organization as a whole
o Business: Split into different businesses
o Operational: Within those smaller businesses departments
o Criticism such as: Can we make these long term plans?
3
Strategy &
Organization
Brief summary
,Table of contents
Topic 1: Introduction to strategic management ....................................................................................... 3
Exogenous developments .................................................................................................................... 3
Internal decision making and competences ......................................................................................... 3
Topic 1: Different streams within strategic management ........................................................................ 3
Strategy according to different perspectives ....................................................................................... 3
Topic 2: External analysis ....................................................................................................................... 5
Topic 2: Industry analysis ....................................................................................................................... 6
Industry dynamics ............................................................................................................................... 7
Beyond industry effects ....................................................................................................................... 7
Topic 3: The resource based view ........................................................................................................... 8
Critiques on the RBV .......................................................................................................................... 8
Topic 3: Beyond resources ...................................................................................................................... 9
Dynamic capabilities Teece et al. (1997) ............................................................................................ 9
Micro foundations of dynamic capabilities ......................................................................................... 9
Topic 4: Organizational purpose ........................................................................................................... 10
Organizational member goals ............................................................................................................ 10
Which stakeholders matter? .............................................................................................................. 11
Shareholder versus stakeholder management .................................................................................... 11
Why are many multinationals still profit driven................................................................................ 11
Purpose and ownership...................................................................................................................... 11
Topic 5: Business strategy ..................................................................................................................... 13
SBU strategy...................................................................................................................................... 13
Interactive strategies with many firms competing firms ................................................................... 14
Topic 6: Corporate strategy and diversification .................................................................................... 15
Growth strategies: Ansoff matrix ...................................................................................................... 15
Topic 7: M&A’s .................................................................................................................................... 17
Corporate development ..................................................................................................................... 17
Elements of M&A strategy................................................................................................................ 17
Basic M&A theories and concepts .................................................................................................... 18
Three Basic markets .......................................................................................................................... 18
What type of M&A? .......................................................................................................................... 18
Topic 8: Behavioural economics ........................................................................................................... 21
Assumptions in behavioural theory ................................................................................................... 21
Systematic biases and heuristics........................................................................................................ 21
Implications for theory ...................................................................................................................... 21
1
,Topic 9: Agency theory ......................................................................................................................... 22
Central elements in agency theory .................................................................................................... 22
Rewards systems ............................................................................................................................... 22
Topic 10: Transactions cost theory........................................................................................................ 24
Dimensions of transactions: .............................................................................................................. 25
Which hierarchy to use? .................................................................................................................... 25
Topic 11: Motivation concepts .............................................................................................................. 26
Mazlow’s hierarchy of needs ............................................................................................................ 26
Theory X and Y (McGregor)............................................................................................................. 26
Herzberg two factor theory: .............................................................................................................. 26
McCelland’s theory of needs ............................................................................................................. 27
Self-determination theory (SDT) by Ryan and Deci ......................................................................... 27
The effect of saliency of an external stimulus on motivation at the workplace ................................ 27
Self-efficacy (Bandura): .................................................................................................................... 28
Goal setting theory (Locke):.............................................................................................................. 28
Equity/organizational justice theory .................................................................................................. 28
Topic 12: Foundations of organizational structure ................................................................................ 29
Basic design features ......................................................................................................................... 29
Ideal type characteristics of bureaucracy .......................................................................................... 31
Recent developments ......................................................................................................................... 32
New models ....................................................................................................................................... 32
Lean or agile approaches ................................................................................................................... 33
Topic 13: Organizational culture ........................................................................................................... 34
What is (an organizational) culture?.................................................................................................. 34
Levels of culture ................................................................................................................................ 34
Can culture be managed? .................................................................................................................. 34
The process of socialization .............................................................................................................. 35
Culture and organizational performance ........................................................................................... 35
Lessons .............................................................................................................................................. 35
2
, Topic 1: Introduction to strategic management
Exogenous developments
- Technological developments that are external to the firm (they have no control about these
developments).
- These external developments can be an opportunity as well as a threat.
Internal decision making and competences
- Managerial decision making processes.
- Internal strengths and weaknesses that empower or prevent firms to exploit certain
opportunities.
The SWOT model (Strength, weaknesses, opportunities and threat model)
What are the core strengths and what are the
main weaknesses? What are the opportunities and the threats they are facing. Combine these.
Topic 1: Different streams within strategic management
Strategy according to different perspectives
1. A long term plan (according to Alfred Chandler):
o The determination of the long-run goals and objectives of an enterprise and the
adoption of courses of action and the allocation of resources necessary for carrying
out these goals.
o Mainly relates to the strategic planning function of firms
o Strategic plans should include different time horizons
▪ Short term (Horizon 1), how do we defend and build our core business?
▪ Medium term (Horizon 2), how do we build emerging businesses?
▪ Long term (Horizon 3), how do we create new viable opportunities?
o Different levels:
o Corporate: Organization as a whole
o Business: Split into different businesses
o Operational: Within those smaller businesses departments
o Criticism such as: Can we make these long term plans?
3
