Business Strategy : Business Strategy Business Strategy : Business Strategy Corporate Culture : Corporate Culture Corporate Culture : Corporate Culture The beliefs and values shared by people who work in an organisation
How people behave with each other
How people behave with customers/clients
How people view their relationship with stakeholders
People’s responses to energy use, community involvement, absence, work ethic, etc.
How the organisation behaves to its employees – training, professional development, etc. Corporate Culture : Corporate Culture May be driven by:
Vision – where the organisation wants to go in the future
Mission Statement – summary of the beliefs of the organisation and where it is now Corporate Culture : Corporate Culture May be reflected in:
Attitude and behaviour of the leadership
Attitude to the role of individuals in the workplace – open plan offices, team based working, etc.
Logo of the organisation
The image it presents to the outside world
Its attitude to change Corporate Culture : Corporate Culture What corporate culture do you think the following businesses have managed to develop? Strategic Planning : Strategic Planning Strategic Planning : Strategic Planning First Stage of Strategic Planning may involve:
Thinking about what the business might need to do 10–20 years ahead
Thinking about key strategic themes that will inform decision making
“The thicker the planning document, the more useless it will be”
(Brent Davies: 1999) Taking time to think and reflect may be more important than many businesses allow time for!
Copyright: Intuitives, http://www.sxc.hu Strategic Planning : Strategic Planning The Vision
Communicating to all staff where the organisation is going and whereit intends to be in the future
Allows the firm to set goals
Aims and Objectives:
Aims – long term target
Objectives – the way in which you are going to achieve the aim Strategic Planning : Strategic Planning Example:
Aim may be for a chocolate manufacturer to break into a new overseas market
Develop relationships with overseas suppliers
Identify network of retail outlets
Conduct market research to identify consumer needs
Find location for overseas sales team HQ Strategic Planning : Strategic Planning Once the direction is identified:
Develop and introduce strategy
Evaluation is constant and the results of the evaluation feed back into the vision Analysis : Analysis SWOT : SWOT Strengths – identifying existing organisational strengths
Weaknesses – identifying existing organisational weaknesses
Opportunities – what market opportunities might there be for the organisation to exploit?
Threats – where might the threats to the future success come from? PEST : PEST Political: local, national and international political developments – how will they affect the organisation and in what way/s?
Economic: what are the main economic issues – both nationally and internationally – that might affect the organisation?
Social: what are the developing social trends that may impact on how the organisation operates and what will they mean for future planning?
Technological: changing technology can impact on competitive advantage very quickly! PEST : PEST Examples:
Growth of China and India as manufacturing centres
Concern over treatment of workers and the environment in less developed countries who may be suppliers
The future direction of the interest rate, consumer spending, etc.
The changing age structure of the population
The popularity of ‘fads’ like the Atkins Diet
The move towards greater political regulation of business
The effect of more bureaucracy in the labour market Five-Forces : Five-Forces Developed by Michael Porter: forces that shape and influence the industry or market the organisation operates in.
Strength of Barriers to Entry - how easy is it for new rivals to enter the industry?
Extent of rivalry between firms – how competitive is the existing market?
Supplier power – the greater the power, the less control the organisation has on the supply of its inputs.
Buyer power – how much power do customers in the industry have?
Threat from substitutes – what alternative products and services are there and what is the extent of the threat they pose? Required Inputs : Required Inputs Changing strategy will impact on the resources needed to carry out the strategy:
Specifically the impact on:
Land – opportunities for acquiring land for development – green belt, brownfield sites, planning regulations, etc.
Labour – ease of obtaining the skilled and unskilled labour required
Capital – the type of capital and the cost of the capital needed to fulfil the strategy Evaluation : Evaluation Evaluation : Evaluation Data from sales, profit, etc. used to evaluate the progress and success of the strategy and to inform of changes to the strategy in the light of that data Information from a wide variety of sources can help to measure and inform the impact and direction of the strategy.
Copyright: Mad7986, http://www.sxc.hu Types of Strategy : Types of Strategy Types of Strategy : Types of Strategy Competitive Advantage – something which gives the organisation some advantage over its rivals
Cost advantage – A strategy to seek out and secure a cost advantage of some kind - lower average costs, lower labour costs, etc. Types of Strategy : Types of Strategy Market Dominance:
Acquisitions – mergers and takeovers
New product development: to keep ahead of rivals and set the pace
Contraction/Expansion – focus on what you are good at (core competencies) or seek to expand into a range of markets? Types of Strategy : Types of Strategy Price Leadership – through dominating the industry – others follow your price lead
Global – seeking to expand global operations
Reengineering – thinking outside the box – looking at news ways of doing things to leverage the organisation’s performance Types of Strategy : Types of Strategy Internal business level strategies –
Downsizing – selling off unwanted parts of the business – similar to contraction
Delayering – flattening the management structure, removing bureaucracy, speed up decision making
Restructuring – complete re-think of the way the business is organised