CHAPTER 7 Management Strategies

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CHAPTER 7SLIDE *CHAPTER 7 Management Strategies 7.1 The Building Blocks of Strategy 7.2 The Process of Strategic Management 7.3 Strategic Planning Tools

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CHAPTER 7SLIDE *LESSON 7.1 THE BUILDING BLOCKS OF STRATEGYGOALS Describe three levels of strategy. Discuss the advantages and risks of strategic management.

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CHAPTER 7SLIDE *THE ROOTS OF STRATEGYStrategy refers to the basic steps a manager must take to reach objectives. Strategic management is a process for identifying and furthering an organization’s mission.

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CHAPTER 7SLIDE *THREE LEVELS OF STRATEGYCorporate strategies – address the broad needs of the organization These strategies are long-range and formed at the highest level. They control the overall direction of the organization and are tied to the mission statement. Business strategies Functional strategies

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CHAPTER 7SLIDE *CORPORATE STRATEGIESGrowth strategies Help the organization decide the amount and direction of growth. Stability strategies Used when the organization is satisfied with its performance. Defensive strategies Used when the organization feels threatened by risk (usually from competitors). Combination Ex: building a new stadium could use growth strategy and defensive at the same time.

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CHAPTER 7SLIDE *BUSINESS STRATEGIESCost leadership Deliver the product or service more cheaply than the competitors. Differentiation Be unique in product or service. Focus Concentrate on a particular market segment and surround it with a quality product or service.

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CHAPTER 7SLIDE *FUNCTIONAL STRATEGIESDay-to-day operations Operational plan or tactical plans

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CHAPTER 7SLIDE *ADVANTAGES OF STRATEGIC MANAGEMENTUse of strategic management prevents problems before they happen. Strategic management reinforces the strength of group decision making. Managers and employees tend to become empowered with decision-making opportunities. Strategically managed firms usually do not have glaring weaknesses. The entire organization tends to react more rapidly to new opportunities and environmental changes.

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CHAPTER 7SLIDE *RISK OF STRATEGIC MANAGEMENTThe discipline involved in implementing strategic management may not be easy to accomplish. Strategic managers must be cautious of making extravagant promises. Managers and employees may expect immediate rewards for their roles in the strategic management process.

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CHAPTER 7SLIDE *LESSON 7.2 THE PROCESS OF STRATEGIC MANAGEMENTGOALS Identify the steps in strategic management. Explain the development phase of the strategic management process. Describe the action and review phases of the strategic management process.

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CHAPTER 7SLIDE *HOW DO MANAGERS PLAN?Formulate the mission Describe the market Set objectives Create and implement strategies Develop contingency plans

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CHAPTER 7SLIDE *MAJOR PHASES OF STRATEGIC MANAGEMENT PROCESSDevelopment Action Review

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CHAPTER 7SLIDE *DEVELOPMENTInitial strategic plan is developed. The mission of the organization reveals its purposes for being. Objectives are statements that reveal the priorities of the organization. Objectives must be consistent with mission. Objectives often conflict with one another and managers must resolve these conflicts.

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CHAPTER 7SLIDE *POLICIES, PROCEDURES, AND RULESPolicies are guidelines established to make decisions regarding specific, recurring situations. (Ex: Title IX) A procedure is a list of steps to be followed for performing certain work. (Ex: how to run ticket sales) Rules are a prescribed direction for conduct. (Ex: No jeans in the workplace, No cell phone use, etc..)

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CHAPTER 7SLIDE *ENVIRONMENTAL ANALYSISExternal environment – everything that lies outside an organization’s control. Gov’t regulations, economy, competition, technology, global affairs, society at large. Internal environment – factors that are under the control of the organization. Internal assessment is often difficult for managers. There may not be a system in place. Reports may not be complete, data may not be collected, falsifications may occur, or employees simply not care.

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CHAPTER 7SLIDE *COMPLETING THE DEVELOPMENT PHASEFormulate the organization’s mission Reviewing past and present strategies for success and failure Using strategic tools to assess the organization’s external and internal environments

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CHAPTER 7SLIDE *ACTION AND REVIEWAction Organizational structure Short-range goals or objectives Functional strategies Review Review Evaluation Control

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CHAPTER 7SLIDE *ULTIMATE PURPOSE OF STRATEGIC MANAGEMENTContinuously evaluate and respond to external and internal environmental changes Examine strategies for correct direction and successful results Organize people in the most effective and efficient manner

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CHAPTER 7SLIDE *LESSON 7.3 STRATEGIC PLANNING TOOLSGOALS Describe the major strategic planning tools available to managers. Explain how sports and entertainment managers may achieve strategic fit.

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CHAPTER 7SLIDE *THE PLANNING TOOL BAGEnvironmental scanning SWOT analysis Benchmarking Scenario building

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CHAPTER 7SLIDE *ENVIRONMENTAL SCANNINGSix major external environments that might create opportunities or pose threats to future planning: Demographic trends – Americans are aging, there are more women than men in U.S., Hispanic-American population has passed African-American population in numbers, people living longer. Economic trends (economy affects ticket sales, wages) Political trends (many businesses are regulated) Competitive trends (who are you competing with ?) Technological trends (big screens, instant replay) Cultural and lifestyle trends (viewers tastes change)

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CHAPTER 7SLIDE *SWOT ANALYSIS S Strengths (Player talent, popularity with fans, employee loyalty) W Weaknesses (Personnel problems, falling revenue, poor management decisions) O Opportunities (Internet, global expansion, improved economy) T Threats (Competition, lawsuits, labor troubles, declining popularity)

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CHAPTER 7SLIDE *BENCHMARKINGHave a specific problem in mind that should be compared to other organizations. Make sure that the correct “best practices” or benchmarks are identified. Do not expect too many answers from sensitive areas such as pricing, revenues, or managerial discipline. Keep the data received confidential to ensure that strategies can be built upon the information. (Ex: coaches copy plays)

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CHAPTER 7SLIDE *SCENARIO BUILDINGInvolves creating a hypothetical situation that is then used to aid decision-making efforts (What if?) Often reveals alternatives that would have gone unnoticed under other decision-making models. (used by military and law enforcement) Ex: Spring training, “What do you do when….” Tornado drills, fire drills

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CHAPTER 7SLIDE *A GOOD FITThe manager must strive for consistency and continuity in planning and strategic efforts.

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CHAPTER 7SLIDE *TYPES OF STRATEGIC FITMarket-related strategic fit Operational department fit Management fit

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Last Updated: 8th March 2018

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