Strategic Management – Tutorial 1 Questions
1. What do we mean by strategy? How is the business model different from strategy?
Strategy is a set of actions that managers take to increase the company's performance relative to rivals. Sustain over a long period of time. Competitiveness.
A business model represents the company as it is now at present. A business model shows facts and figures of the company how they are spending their money, and what goals the company has functions e.g. financial. Daily running of firm. What defines the company. Independent of competitors. Current set up.
Strategy shows what the company will want to look like in the future, and how to get there. It focuses on the company’s differences and similarities with rivals, and the strategy is how to exceed the rival’s company performance to create competitive advantage. How going to be successful in the future.
2. What are the strengths of formal strategic planning? What are the weaknesses?
Formal routine that can be taken seriously, and becomes a habitual process.
Push managers to think outside the box if given a set time
SWOT – check out competitors, if regularly they can check out competition always on top of their game
You can plan contingencies sensibly and properly, and therefore are less panicked when certain things happen out of the blue
Makes time for those who are not as loud, to speak.
Make sure there is no digression when in meetings – gives the meeting a sense of direction
May help with conflicts, as people have to work together and come to a conclusion on what the strategies are going to be in a civilized way.
Quality of progress being made can be seen here
Ongoing process, monitor, evaluate
Costly and time consuming – may spend so much time but still goes wrong
Prescriptive in nature
There is excessive formalization in the process
Lack of flexibility
Agreement may not be made if a lot of people
Often fails because don’t plan for uncertainty and lose touch with operating realities
Don’t let lower level managers potentially speak?
Cognitive Biases, if you don’t have consultant.
3. Pick the current or a past president of the United States and evaluate his performance against the leadership characteristics discussed in the text. On the basis of this comparison, do you think that the president was/is a good strategic leader? Why?
To be a good leader you should have:
Vision – clear and compelling
Eloquence – so you can be able to communicate and energize people
Meggie Foster 1216174
Consistency – make sure you stick to the plan or if there are changes make sure everyone knows and agrees
Commitment – Lead by actions, words, lead by example
Being well informed – So people can take you seriously and you can come to concrete and fair judgments
Willingness to delegate and empower – as overloaded need to be ale to trust employees to give them workload, helps them to be motivated also.
The astute use of power – attempt to build consensus with decisions and be democratic, not to become a dictator.
Emotional intelligence – to gain respect through self-awareness, self-regulation, motivation, empathy and social skills
George W Bush
Vision – unclear, he came to running for president because his father had been previously and wanted to be the same as him. His vision had no direction during the campaign, as it was just mainly to slander Al Gore without giving any concrete plans of his own. Even if George W Bush had a vision or not, in one's opinion, after 9/11 everyone's plan changed anyway so it wouldn't have made any difference.
Eloquence – internationally mocked for his incompetent lexicon
Consistency – Very bad, lead the west in to Iraq without serious consideration or proof there were weapons of mass destruction.
Commitment – Questionable, he didn’t deal with even internal affairs swiftly or with decent leadership e.g. Hurricane Katrina