Strategy Management ch.1-2
Lecture 1
A. Strategy concept
Strategy is...
… a unified, comprehensive, and integrated plan… designed to ensure
that the basic objectives of the enterprise are achieved.
… the creation of a sustainable competitive advantage.
… a broad formula for how a firm will compete, what its goals should be,
and what policies are needed to carry out those goals.
… the decision process that conjoins the firm’s capability with the
opportunities and threats in its environment.
… a conceptualization of long-term objectives, broad constraints and
near term plans set by the executive and currently in operation.
… a timed sequence of internally consistent and conditional resource
allocation decisions designed to fulfill an organization’s objectives.
Concept of strategy: multiple, there’s no agreement but there’s more of an overlap.
1.Unified, comprehensive, and integrated: perspective looking all departments, put
pieces together, advantage against rivals. Strategy is about being broad, not narrow.
2.Time matters when you act (1st mover, later less advantage). Internal, no
contradiction. Resources, put money where it does good.
3.Long-term: problem how long is long: RBV. top down. set by the executive: it
should always be like this, but they wish it was. Not always top down but bottom-up,
closer to manufacture and customer, bubbles to top, so the CEO knows what’s up.
Middle-up. middle manager, bigger picture, bottom only day to day. top only long
term. Middle: close to both big picture and details. get to the top and integrate all
perspectives.
4.Strategy as a decision process: cognitive actions. capabilities, swot, pestle.
5.Last one is most important: sustainable competitive advantage, he doesn’t love.
How long is long? worry about stagnation, it depends on culture. not a satisfying
answer theoretically. example of Barney: RBV shows how it can be sustainable, value
chain, competitors no longer compete with your actions, and go quiet. When do
companies go quiet? Once patents are published, they go around it. Go around
patents, trade secrecy: this is when they go silent, (secrecy) launching new. products.
delay competitors, work on first mover advantage for long. Sustainable by barney
looks at quite as competition, but the quiet is before the storm. Competitive aspect:
you can’t look only at top companies, don’t address what about SMEs.
How do you do it so its broader?
,Mintzberg: Five P’s for strategy
Simplifies strategy, desenrola um conceito complexo.
⇒ 1st formal Plan: top-down. Plans now change a lot, formal plans are not super
agile for industry that change a lot.
⇒ 2nd Ploy: maneuver, football maneuvers, that affect the result. plot twist. too
narrow though, one movement, ploy plays a role in strategy but not the
strategy itself.
⇒ 3rd Pattern: see it as a pattern: passed behaviors, recognizable pattern.
example: brick patterns, house. variation of colors (patterns). You look at past,
historical data, project where it might go, but not predict what will happen.\
Intended strategy: formal plan (a lot of it gets lost from top to bottom)
Emergent strategy: Tiny arrows: ploy, everyone goes right direction, pattern,
implement in formal plan. come from the bottom less attention. Combination of arrow:
pattern.
, ⇒ 4th Position: porter, 4 marketing mix.
Position: more threats, more strength, depression on profitability can kill you. that is
why it's inwards. This is our position, but we can move on advantages.
⇒ 5th Perspective: shared norms and values. Ikea: actions based on their
philosophy: affordable and not market pinpoints. white products: manage
efficiency and not strategy, change business models, rules meant to be
broken, easy to beat.
Teacher’s perspective vs Mintzberg
My View of Strategy
Means of achieving desired ends
•Goal-driven: need to think about it
•Implies a set of actions: do something about goals
Intentional
•not necessarily formal planning: if you don’t know what you are doing it doesn’t
work for us. Intentional yet unconscious strategy.
•not unconscious patterns of actions, etc.: it seems to be working, you see patterns
and results and act on these.
•but, emergent strategies are included: where strategy starts bubbling up and
emerges from the crowd (bottom-up).
*originate from unconscious/unintended actions in the past
*awareness of pattern → modify current/future intentions
Aided/Constrained by environment: try it in the environment, rivalry, other things. Can
help or hurt you: spotting leads, reading customer demand. Slow read on ev: failure.
Swot analysis, see + or -, changes of industry.
Aided/Constrained by own resources: can help, efficiency, effectiveness, low cost,
advantages, scope and scale. example: american factory, industry resources.
Changes in industry, answer to prices and demand, price importance stable, no need
for substitute. Secret: environment changes, but stay flexible. Some resources can
, hurt in the long run. Microsoft: program, money used as a flexible resource, rip, SMEs
IP versus their big power. Size and money, input, eventually become unprofitable,
which helped tiny companies. Having money started as a good and then a constraint.
Reciprocal influence between actor and environment: social enactment processes:
physiology, how all the interactions create different structures and processes. Social
enactment: industry exists because firms do similar things. Homogenous, no
boundaries, it exists due to interactions. change industry, social process changes.
Consultant actions: how it changes the environment for competitors. you can look at it
from a firm (actor) or external view(ev). Social exchange, everyone has some control on
their actions. be aware of everyone's actions, actors in the industry we compete in.
Red ocean vs blue ocean strategy.
B. Some issues in developing strategy
Issues faced in each phase:
⇒ 2nd: not a lot of change
⇒ 3rd: time, industry changes more, concise
⇒ 4th: more fuzzy, not concrete actions. example of politicians
Mission: actions to take for a firm. Predict too far, accuracy becomes very poor.
The figure represents different states of the firm.
Exam question: mission is philosophy form follows vs target, objective, vision:
these are part of states where firm is in time. Vision is very long term, further from
other twos.
Exams: importance on what is the axis: time. Other times can be investment, etc. Axis
tells what model means.
Lecture 1
A. Strategy concept
Strategy is...
… a unified, comprehensive, and integrated plan… designed to ensure
that the basic objectives of the enterprise are achieved.
… the creation of a sustainable competitive advantage.
… a broad formula for how a firm will compete, what its goals should be,
and what policies are needed to carry out those goals.
… the decision process that conjoins the firm’s capability with the
opportunities and threats in its environment.
… a conceptualization of long-term objectives, broad constraints and
near term plans set by the executive and currently in operation.
… a timed sequence of internally consistent and conditional resource
allocation decisions designed to fulfill an organization’s objectives.
Concept of strategy: multiple, there’s no agreement but there’s more of an overlap.
1.Unified, comprehensive, and integrated: perspective looking all departments, put
pieces together, advantage against rivals. Strategy is about being broad, not narrow.
2.Time matters when you act (1st mover, later less advantage). Internal, no
contradiction. Resources, put money where it does good.
3.Long-term: problem how long is long: RBV. top down. set by the executive: it
should always be like this, but they wish it was. Not always top down but bottom-up,
closer to manufacture and customer, bubbles to top, so the CEO knows what’s up.
Middle-up. middle manager, bigger picture, bottom only day to day. top only long
term. Middle: close to both big picture and details. get to the top and integrate all
perspectives.
4.Strategy as a decision process: cognitive actions. capabilities, swot, pestle.
5.Last one is most important: sustainable competitive advantage, he doesn’t love.
How long is long? worry about stagnation, it depends on culture. not a satisfying
answer theoretically. example of Barney: RBV shows how it can be sustainable, value
chain, competitors no longer compete with your actions, and go quiet. When do
companies go quiet? Once patents are published, they go around it. Go around
patents, trade secrecy: this is when they go silent, (secrecy) launching new. products.
delay competitors, work on first mover advantage for long. Sustainable by barney
looks at quite as competition, but the quiet is before the storm. Competitive aspect:
you can’t look only at top companies, don’t address what about SMEs.
How do you do it so its broader?
,Mintzberg: Five P’s for strategy
Simplifies strategy, desenrola um conceito complexo.
⇒ 1st formal Plan: top-down. Plans now change a lot, formal plans are not super
agile for industry that change a lot.
⇒ 2nd Ploy: maneuver, football maneuvers, that affect the result. plot twist. too
narrow though, one movement, ploy plays a role in strategy but not the
strategy itself.
⇒ 3rd Pattern: see it as a pattern: passed behaviors, recognizable pattern.
example: brick patterns, house. variation of colors (patterns). You look at past,
historical data, project where it might go, but not predict what will happen.\
Intended strategy: formal plan (a lot of it gets lost from top to bottom)
Emergent strategy: Tiny arrows: ploy, everyone goes right direction, pattern,
implement in formal plan. come from the bottom less attention. Combination of arrow:
pattern.
, ⇒ 4th Position: porter, 4 marketing mix.
Position: more threats, more strength, depression on profitability can kill you. that is
why it's inwards. This is our position, but we can move on advantages.
⇒ 5th Perspective: shared norms and values. Ikea: actions based on their
philosophy: affordable and not market pinpoints. white products: manage
efficiency and not strategy, change business models, rules meant to be
broken, easy to beat.
Teacher’s perspective vs Mintzberg
My View of Strategy
Means of achieving desired ends
•Goal-driven: need to think about it
•Implies a set of actions: do something about goals
Intentional
•not necessarily formal planning: if you don’t know what you are doing it doesn’t
work for us. Intentional yet unconscious strategy.
•not unconscious patterns of actions, etc.: it seems to be working, you see patterns
and results and act on these.
•but, emergent strategies are included: where strategy starts bubbling up and
emerges from the crowd (bottom-up).
*originate from unconscious/unintended actions in the past
*awareness of pattern → modify current/future intentions
Aided/Constrained by environment: try it in the environment, rivalry, other things. Can
help or hurt you: spotting leads, reading customer demand. Slow read on ev: failure.
Swot analysis, see + or -, changes of industry.
Aided/Constrained by own resources: can help, efficiency, effectiveness, low cost,
advantages, scope and scale. example: american factory, industry resources.
Changes in industry, answer to prices and demand, price importance stable, no need
for substitute. Secret: environment changes, but stay flexible. Some resources can
, hurt in the long run. Microsoft: program, money used as a flexible resource, rip, SMEs
IP versus their big power. Size and money, input, eventually become unprofitable,
which helped tiny companies. Having money started as a good and then a constraint.
Reciprocal influence between actor and environment: social enactment processes:
physiology, how all the interactions create different structures and processes. Social
enactment: industry exists because firms do similar things. Homogenous, no
boundaries, it exists due to interactions. change industry, social process changes.
Consultant actions: how it changes the environment for competitors. you can look at it
from a firm (actor) or external view(ev). Social exchange, everyone has some control on
their actions. be aware of everyone's actions, actors in the industry we compete in.
Red ocean vs blue ocean strategy.
B. Some issues in developing strategy
Issues faced in each phase:
⇒ 2nd: not a lot of change
⇒ 3rd: time, industry changes more, concise
⇒ 4th: more fuzzy, not concrete actions. example of politicians
Mission: actions to take for a firm. Predict too far, accuracy becomes very poor.
The figure represents different states of the firm.
Exam question: mission is philosophy form follows vs target, objective, vision:
these are part of states where firm is in time. Vision is very long term, further from
other twos.
Exams: importance on what is the axis: time. Other times can be investment, etc. Axis
tells what model means.
