PowerPoint Presentation

StrategicDecision Making

MAGISTER PSIKOLOGIUNIVERSITAS PADJADJARANDr. SETYO RIYANTO, SE, MMANALISIS SWOTPOLRIMandiriProfesionalDipercaya

Your community is changingYour organization is changingYour strategy is changingAnd you?What are you changing?FORMULASI STRATEGIIMPLEMENTASI STRATEGIEVALUASI & KENDALIHASIL PENGAMATAN/STUDI LINGKUNGANEKSTERNALINTERNAL SDM Struktur Proses Leadership Infrastruktur Ideologi Sosial Politik Ekonomi Budaya KamdagriMisiTujuanStrategiKebijakanProgramAnggaranProsedurKinerjaUmpan balikMODEL MANAJEMEN STRATEGIWheelen & Hunger, 2012What is the difference between decision making and decision taking?

Decision making Decision making is a complex, cognitive process often defined as choosing a particular course of action. Websters definitionto judge or settleis another view of decision making. ORa systematic cognitive process in which there must be an identification of alternatives.6

Decision takingJudgments selected from two or more alternatives, it is final step of decision making.

7

Problem solving: - is part of decision making. A systematic process that focuses on analyzing a difficult situation, problem solving always includes a decision-making stepOR- is a process whereby a dilemma is identified and corrected.

Problem : - A present unsatisfactory state that needs to be changed to a desired state as soon as possibleOR- Some deviation from the expected standard which prevent the achievement of objectives.

8Strategic Management PrincipleEffective strategy-making begins with a vision of where the organization needs to head!9There are THREE main types of decision, namely: routine, adaptive, and innovative decisions.

A- Routine decisions: is the decision made when problems are relatively well defined and common and when established rules, policies, and procedures can be used to solve them. B- Adaptive decisions: is the decision made when problems and alternative solutions are somewhat unusual and only partially understood. C- Innovative decisions: is the decision made when problems are unusual and unclear and creative solutions are necessary. Types of decisions10DECISION

DECISIONSKualitas seorang PEMIMPIN ditentukan oleh seberapa baik dan berkualitasnya keputusan-keputusan yang ia hasilkan.INFORMATIONKeputusan yang baik akan sangat bergantung kepada kualitas informasi yang dimiliki oleh pengambil keputusanDATAKualitas informasi akan sangat bergantung kepada seberapa baik data diolah, sehingga menjadi sebuah informasi.Decision....

Decision....Merupakan hal yang sulit untuk memetakan seluruh elemen permasalahan secara konseptual

Tanpa dibantu oleh suatu pendekatan dan teknik pengambilan keputusan yang baik, hal-hal yang penting sering menjadi terabaikan.dan tidak jarang, hal-hal yang tidak penting justru ditonjolkan

Oleh karenanya, tetap menjaga berbagai elemen, kriteria serta alternatif berada pada track sesuai prioritasnya menjadi hal yang sangat penting.15Grand Strategy Polri Menuju 2025Tahap I (2005-2010) Membangun KepercayaanTahap II (2011-2015) KemitraanTahap III (2016-2025) Mengejar KesempurnaanSuccess failure status quo

16

Strategy FormulationMission StatementThe reason for the organizations existence in societyOperating ObjectivesSpecific results that organizations attempt to achieveA mission is at the very heart of the reason an organization exists. What is the mission statement of your college? Consider having the class develop a mission statement for your course or class.1718

Perubahan dipengaruhi oleh 4C:Change, Competitor, Customer, dan CompanyEffectivenessSource: Mc Kinsey, 2008Percent Rating Each Tool Extremelu or Very Effectiveof Analysis Tools

SWOT AnalysisA widely used tool for organizing and utilizing the pieces of data and information gained from the situation analysisEncompasses both internal and external environmentsAn assessment of the organizations strengths, weaknesses, opportunities, and threatsStrengthscompetitive advantages or core competenciesWeaknesseslimitations on competitive capabilityOpportunitiesfavorable conditions in the environmentThreatsconditions or barriers to reaching objectives

Analysis((SWOT))22Strength | Weakness |Opportunities |Threats((SWOT))

It defines the strengths, weaknesses, opportunities and threats that face an organization.It measures a unit, a proposition or idea.We have here strengths - weaknesses from internal factors and opportunities threats from external factors.It helps in decision making how the institution may use its strengths and opportunities to overcome weaknesses and threats.

SimplicityLower CostFlexibilityIntegration & SynthesisCollaborationMajor Benefits of SWOT AnalysisSTRENGTHOPPORTUNITIESTHREATWEAKNESSSWOTOverviewThe strategy is to look at the organizations current performance (strengths and weaknesses)

and factors in the external environment (opportunities and threats) that might affect the organizations future.

26

The SWOT matrixStrenghtsWeaknessOpportunitiesThreatINTERNALSWOT ANALYSISEXTERNALSWOT TemplateINTERNAL FACTOREXTERNAL FACTORAStrenghtsOpportunitiesBOpportunitiesWeaknessDStrenghtsThreatCWeaknessThreatA SWOT MATRIXSTRENGHTSWEAKNESSOPPORTUNITIESTHREATCONVERTCONVERTMATCHThe Four-Cell SWOT MatrixSource: Reproduced from Nigel F. Piercy, Market-Led Strategic Change. Copyright 1992, p. 371, with permission from Elsevier Science.The SWOT Matrix

31SSTRENGHTSWOTWEAKNESSOPPORTUNITIESTHREATInternalExternalSituational AnalysisStrengths

1.2.3.Opportunities

1.2.3.

Threats

1.2.3.Weaknesses

1.2.3.

SWTOInternal EnvironmentExternalEnvironmentSWOT AnalysisWhere are we now?Where do we want to go?How do we get there?((SWOT))Vision , Missionand GoalsstrategiesEnviromental ScanningInternal ScanningExternal Scanning

AnalysisCompetitorCustomerSupplierTechnology

PoliticalEconomicLegalSocioculturalAnalysisStrenghtsWeaknessOpportunitiesThreatsThe Scanning Process

((SWOT))analysis36SWOT analysis of strengths, weaknesses, opportunities, and threats.

37Planning: Focus and Time Strategic plansPlans that are organization-wide, establish overall objectives, and position an organization in terms of its environmentTactical plansPlans that specify the details of how an organizations overall objectives are to be achievedShort-term plansPlans that cover less than one yearLong-term plansPlans that extend beyond five yearsStrategic PlanningStrategic plans Apply broadly to the entire organizationEstablish the organizations overall objectivesSeek to position the organization in terms of its environment Provide direction to drive an organizations efforts to achieve its goals.Serve as the basis for the tactical plans.Cover extended periods of timeAre less specific in their detailsTactical PlanningTactical plans (operational plans)Apply to specific parts of the organization.Are derived from strategic objectivesSpecify the details of how the overall objectives are to be achieved.Cover shorter periods of timeMust be updated continuously to meet current challengesSpecific and Directional PlansSpecific plansPlans that have clearly defined objectives and leave no room for misinterpretationWhat, when, where, how much, and by whom (process-focus)Directional plansFlexible plans that set out general guidelinesGo from here to there (outcome-focus)Single-Use and Standing PlansSingle-use plansA plan that is used to meet the needs of a particular or unique situationSingle-day sales advertisementStanding planA plan that is ongoing and provides guidance for repeatedly performed actions in an organizationCustomer satisfaction policyDirectional versus Specific Plans

The Strategic Management Process

Analyze the EnvironmentEnvironmental scanningScreening large amounts of information to detect emerging trends and create a set of scenariosCompetitive intelligenceAccurate information about competitors that allows managers to anticipate competitors actions rather than merely react to them

SWOT: Identifying Organizational OpportunitiesEvaluating Organizational Strengths Using SWOT Analysis to Formulate StrategyEvaluating Organizational WeaknessEvaluating an Organizations Opportunities and ThreatsOrganizational strengthsare skills and abilities enabling an organization to conceive of and implement strategies.Common organizational strengthsare organizational capabilities possessed by numerous competing factors.Distinctive competenciesare useful for competitive advantage and superior performance.Imitation of distinctive competenciesis duplicating another organizations distinctive competencyEvaluating Organizational Strengths Using SWOT Analysis to Formulate StrategyEvaluating Organizational WeaknessEvaluating an Organizations Opportunities and ThreatsSustained competitive advantageoccurs when a distinctive competence cannot be easily duplicated.is what remains after all attempts at strategic imitations have ceased.Strategic imitation is difficult when:Distinctive competence is based on unique historical circumstances.Competitors do not understand the nature or character of a organizations competence.The competence is based on a complex phenomenon, such as organizational culture.Evaluating Organizational Strengths Using SWOT Analysis to Formulate StrategyEvaluating Organizational WeaknessEvaluating an Organizations Opportunities and ThreatsOrganizational weaknessesSkills and capabilities that do not enable an organization to choose and implement strategies that support its mission.Weaknesses can be overcome by:investments to obtain the strengths needed.modification of the organizations mission so it can be accomplished with the current workforce.Competitive disadvantageA situation in which an organization fails to implement strategies being implemented by competitors.Evaluating Organizational Strengths Using SWOT Analysis to Formulate StrategyEvaluating Organizational WeaknessEvaluating an Organizations Opportunities and ThreatsOrganizational opportunitiesAreas in the organizations environment that may generate high performance. Organizational threatsAre areas in the organizations environment that make it difficult for the organization to achieve high performance.Evaluating Organizational Strengths Using SWOT Analysis to Formulate StrategyEvaluating Organizational WeaknessEvaluating an Organizations Opportunities and ThreatsA strength is something an institution does well or a characteristic that enhances its competitiveness

Valuable competencies or know-howValuable physical assetsValuable human assetsValuable organizational assetsValuable intangible assetsImportant competitive capabilitiesAn attribute that places organization in a position of advantageAlliances or cooperative with other institutionsIdentifying Resource Strengthsand Competitive Capabilities52A weakness is something an institution lacks, does poorly, or a condition placing it at a disadvantageResource weaknesses relate toDeficiencies in know-how or expertise or competenciesLack of important physical, organizational, or intangible assetsMissing capabilities in key areasIdentifying Resource Weaknessesand Competitive DeficienciesThe opportunities most relevant to an institution are those offeringThe best prospects for long-term growthCompetitive advantageGood match with its benefit and organizational resource capabilitiesIdentifying an Institution OpportunitiesEvalutation and ControlStrategi ImplementionStrategi FormulationBasic Elements of the Strategic Management ProcessEnviromental Scanning55Identify the organizations current mission, goals, and strategiesExternal AnalysisOppotunitiesThreatsInternal AnalysisStrenghtsWeaknessFormulateStrategiesImplementStrategiesEvaluateResultsThe Strategic Management ProcessWHAT MIGHT WE DO?(external opportunitiesand threats)WHAT CANWE DO?(strengths andweaknesses)WHAT DO WEWANT TO DO?(organizational andindividual values)WHAT DO OTHERSEXPECT US TO DO?(stakeholder expectancies)Four Questions that Guide Strategic ChoicesSTRATEGY57WHAT MIGHT WE DO?(external opportunitiesand threats)WHAT CANWE DO?(strengths andweaknesses)WHAT DO WEWANT TO DO?(organizational andindividual values)WHAT DO OTHERSEXPECT US TO DO?(stakeholder expectancies)Four Questions that Guide Strategic ChoicesSTRATEGYWhat do we need to learn to care about?What newcapabilities do wewant to develop?How do wecreate newpossibilities?How do we partnerto build sharedexpectancies?58Decision Making and the Planning Process

59Help decision makers share and compare ideas Bring a clearer common purpose and understanding of factors for success Organize the important factors linked to organizations success and failure. Analyze issues that have led to failure in the pastProvide linearity to the decision making process allowing complex ideas to be presented systematically. Purpose of SWOT Analysis60Internal-External AnalysesInternal AnalysisExternal AnalysisExamine the capabilities of the organization by analyzing the organization's strengths and weaknesses.Look at the main points in the environmental analysis, and identify those points that pose opportunities for the organization, and those that pose threats or obstacles to performance61Strengths: Operational DefinitionSomething that we truly do well, Something that we excel at versus the competition, Something that we can build on; Something that truly differentiates our organization, A key metric that is improving, etc. S62A strength can be something very concrete like a large, growing customer base or less measurable: a well-run customer service department that keeps customers satisfied (thus helping both retention and new sales). Note that a STRENGTH can also be a weakness: e.g. youre Number One in your market is a STRENGTH, but if you are taking that for grantedthats also a weakness. Weakness: Operational DefinitionA real gap, a deficiency, a problem, or a key metric that is going bad; Something were not doing very well and that we should be doing better; Something thats dated that no longer applieseven though it used to; Something important that we really dont know or arent sure about. W63In fact, one good outcome of a SWOT is to discover what you really dont know and then do something about it. A weakness can be very tangible and concrete or it can be an attitude: e.g. a complete unwillingness to invest in any marketing initiatives or a lack of understanding what to do.Opportunity: Operational DefinitionA favorable external conditionSomething (that we havent acted on or taken advantage yet) that could impact us positively. New things that can be done to potentially improve the organizationthat turn into recommendations and actions. O64Threats: Operational DefinitionSomething external to the business that can potentially impact us negatively: competitors changing conditions, the overall politics, economy, culturegovernment regulations, etc. Part of the playing field that cant be ignored. Some internal threats, e.g. hanging onto the status quo when change is requiredT65What makes us stand out from competitors? What advantages do we have over other organizations?What are the major sources of our benefits?Do we have strong image? Do we have a pool of skilled employees?Is the morale of the employees high?Have we demonstrated the ability to adapt and change?Are we able to innovate?StrengthsQuestions:

66What do our society complain about? What are the least effective for the organization?In what areas is the organization not able to recover costs?Which are the weak image?Is the regulations effective?Is the organization not focused?Is the organization able to attract talent?What are our biggest expenditures?WeaknessQuestions:

67A favorable external conditionSomething (that we havent acted on or taken advantage yet) that could impact us positivelyNew things that can be done to potentially improve the organization-that turn into recommendations and actionsOpportunityQuestions:

68Are our competitors becoming stronger? Are there emerging trends that amplify our weaknesses? Do we see other external threats to the organization's success? Internally, do we have financial, development, or other problems? What obstacles do we face? Is changing technology threatening our position? What policies are local and national lawmakers backing? Do they affect our organization?

ThreatsQuestions:

69Environmental Scanning Employing the TOWS MatrixSO strategies using strengths to take advantage of opportunitiesWO strategies seizing opportunities to overcome weaknessesST strategies considering strengths as a way to avoid potential threatsWT strategies defensive acts to minimize weaknesses and avoid threats SO StrategiesWO StrategiesST StrategiesWT StrategiesINTERNALFACTORS(IFAS)EXTERNALFACTORS(EFAS)Strengths (S)Weaknesses (W)Opportunities (O)Threats (T)TOWS MatrixSource:Adapted from Long-Range Planning, April 1982, H. Weihrich, The TOWS MatrixA Tool for Situational Analysis p. 60. Copyright 1982, with kind permission from H. Weihrich and Elsevier Science Ltd. The Boulevard, Langford Lane, Kidlington OX5 1GB, UK.SO StrategiesUse S to take advantage of OWO StrategiesTake advantage of O by overcoming WST StrategiesUse S to avoid TWT StrategiesMinimize W and avoid TINTERNALFACTORS(IFAS)EXTERNALFACTORS(EFAS) (S) List 5-10Internal strengths(W)List 5-10 Internal Weakness(O)List 5-10External Opportunities(T)List 5-10External ThreatsTOWS MatrixSO Strategies Generate strategies here that use strengths to take advantage of opportunities ST Strategies Generate strategies here that use strengths to avoid threatsWO Strategies Generate strategies here that take advantage of opportunities by overcoming weaknessesWT Strategies Generate strategies here that minimize weaknesses and avoid threatsINTERNAL FACTORS (IFAS)EXTERNAL FACTORS (EFAS)Strengths (S) List 5 10 internal strengths hereWeaknesses (W) List 5 10 internal weaknesses hereOpportunities (O) List 5 10 external opportunities hereThreats (T) List 5 10 external threats hereTOWS MatrixSource:Adapted from Long-Range Planning, April 1982, H. Weihrich, The TOWS MatrixA Tool for Situational Analysis p. 60. Copyright 1982, with kind permission from H. Weihrich and Elsevier Science Ltd. The Boulevard, Langford Lane, Kidlington OX5 1GB, UK.73Environmental Scanning Converting Analysis into ActionSTRENGHTWEAKNESSOPPORTUNITIESTHREATOPPORTUNITIESSTRENGTHSTURNINGWEAKNESS74TOWS MatrixWeaknesses:1.2.3.Strengths:1.2.3.WO StrategiesTake advantage of opportunities by overcoming weaknesses

SO StrategiesUse strengths to take advantage of opportunitiesOpportunities:1.2.3.WT StrategiesDefensive strategies to minimize weaknesses andavoid threatsST StrategiesUse strengths to avoid threatsThreats:1.2.3.From Internal Analysis (IFAS)From External Analysis (EFAS)Source: WeihrichStrategic Business PlanningIdentifying Strategies75The TOWS tool combines the ingredients of SWOT (our assessment of the internal and external environments, which used the EFAS and IFAS tables) in a way that can suggest some strategies. It matches external opportunities and threats facing a particular company with that companys internal strengths and weaknesses to result in four sets of possible strategic alternatives.The strategies that result depend on the particular combination of resources and capabilities in each business. For instance, a business with a high degree of mechanical ability and desire to work in the field in an environment in which land is difficult to come by may consider being a custom farmer (a SO strategy). Or a business that continually is late in the field and not good with machinery should consider hiring a custom farmer, or renting out their land (a WT strategy).SO Strategies

ST Strategies

WO Strategies

WT Strategies

Source:Adapted from Long-Range Planning, April 1982, H. Weihrich, The TOWS MatrixA Tool for Situational Analysis. and Wheelen and HungerTOWS Matrix

Prentice Hall 2006GRAND STRATEGYSWOTAGRESSIVECONSERVATIVECOMPETITIVEDEFENSIVE

Contact http: www.setyo-riyanto.comfacebook.com/setyoriyantoTwitter: @setyoriyantosetyoriyanto@gmail.com+62 811 220 720PIN: 28F26DCD