Strategy and Competitive Advantages
Built by Stambaugh/2009 Failing to plan is planning to fail!
Jeff [email protected]
http://faculty.mwsu.edu/business/jeff.stambaugh
Strategy Intro
Built by Stambaugh/2009
■ What great companies first come to mind?■ What bad companies first come to mind?■ And now the key question … what made the great
great and the bad bad?
Failing to plan is planning to fail!
Strategy is …
Built by Stambaugh/2009
■ Ongoing processes of:■ Analysis (Chapters 2-4)■ Decisions (Chapters 5-8)■ Actions (Chapters 9-12)
■ To achieve a sustainable competitive advantage (why some firms outperform others over time)
■ What is strategy to Porter?
Failing to plan is planning to fail!
Strategy Attributes
Built by Stambaugh/2009
■ Directs organizations toward goals & objectives■ Multiple “masters” (Stakeholders)■ Short and long-term perspectives■ Tradeoffs between effectiveness and efficiency
■ Ambidexterity: take care of the present AND position your firm for the future
Failing to plan is planning to fail!
My Take on Strategic Process
Built by Stambaugh/2009
Vision
Analysis
Formulation (Decision)
Implementation (Action)
Assess Performance
Failing to plan is planning to fail!
My Take on Strategic Process
Built by Stambaugh/2009
Vision
Analysis
Implementation (Action)
Assess Performance
Formulation (Decision)
Failing to plan is planning to fail!
The Devil Wears Prada
Built by Stambaugh/2009
■ Roll the film■ Analysis■ Formulation■ Implementation
Failing to plan is planning to fail!
Last spring, Starbucks fired its CEO (Jim Donald) and brought back the former CEO (Howard Schultz).
Starbuck’s stock price was down as the growth rate and earnings were down this year, something Donald blamed on the slowing economy and high coffee prices. Schultz
(who was still the Chairman of the Board) faulted Starbuck’s strategy and thus fired Donald. Starbucks’
stock price rose 8% upon news of Donald’s firing. According to the book this represents which view of
leadership
50%
50%1. Romantic view of leadership
2. External view of leadership
0 of 5
Strategy Can
Built by Stambaugh/2009
■ Set firm direction■ Focus effort and provide coordination■ Define the organization■ Provide consistency■ Get you ready for unforeseen challenges
Failing to plan is planning to fail!
Stakeholder GroupsFIGURE 1.4
• Stakeholders: Individuals and groups with an interest in a firm’s performance and an ability to influence its actions
• Firms & stakeholders need each other (Symbiosis)• Dilemma—satisfying one stakeholder’s needs may come at expense of another• CSR and Triple Bottom Line (financial, social, and environmental)
• Fortune Link• Best Employers Link• Yahoo Finance
Copyright 2006: Thomson Business and Professional Publishing. All Rights Reserved. From Hitt, et al Understanding Business Strategy
Strategic Coherence
Built by Stambaugh/2009
Hierarchy of Goals
Company visionCompany vision
Mission statementsMission statements
Strategic objectivesStrategic objectives
Failing to plan is planning to fail!
Do Vision / Mission Statements Really Matter?
Built by Stambaugh/2009
■ How many of you know your company’s vision / mission statement?
■ Does that matter ?
■ What understanding the vision can do—the Men’s Wearhouse example
■ Vision / Mission statements can make a difference, especially in times of turmoil or as a compass!
■ Starbucks: Establish Starbucks as the premier purveyor of the finest coffee in the world while maintaining our uncompromising principles while we grow
Failing to plan is planning to fail!
Good “SMART” Objectives
Built by Stambaugh/2009
■ S – Specific■ M – Measurable■ A – Appropriate■ R – Realistic■ T – Time-bound
Failing to plan is planning to fail!
Takeaways
Built by Stambaugh/2009
Strategy is a dynamic process seeking a sustainable competitive advantage Strategy changes are inevitable
Analysis—Formulation—Implementation Stakeholders: who matters and how much do they
matter Value of a direction and how to set good goals
Failing to plan is planning to fail!
Next Class
Built by Stambaugh/2009
■ Read Chapter 2 & Andy Grove Excerpt■ ST2 Due
Failing to plan is planning to fail!
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