The Stages of Corporate Strategy · PDF fileLearning Objectives 1 •Stages of Corporate...
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The Stages of Corporate Strategy Formulation
IPCC Paper 7B: Strategic Management
Chapter 4 Part-1
CA. Deepak S Mulchandani, Indore
Learning Objectives 1 •Stages of Corporate Strategy formulation
2 •Vision and Mission
3 •Objectives
4 •Crafting of strategy
5 •Implementation and execution
6 •Monitoring ,evaluation and controlling
Why Planning , when future is uncertain…?
Stage 1 •Developing a
Strategic Vision
Stage 2 •Setting
Objectives
Stage 3 •Crafting a
Strategy to Achieve the Objectives & Vision
Stage 4 • Implementing
& Executing the Strategy
Stage 5 •Monitoring
Developments, Evaluating performance and Making Corrective Adjustments
C o r p o r a t e S t r a t e g y F o r m u l a t i o n ! S t a g e s
Stage I : Developing a Strategic Vision
• Firstly, A Company must determine what directional path the company should take~!
• Secondly, What changes in the company’s Product – Market – Customer – Technology – Focus would improve its current market position and its Future Prospect...!
Mission & Strategic Intents
What is Mission?
The Role of the organization as seen by management is expressed in terms of Mission or Strategic Intent…
Importance? This is important because external stakeholders and managers in the organization need
to be clear about what the organization is seeking to achieve and, in broad terms, how it expects to do so.
Strategic Vision & Intent – Illustrated
Voice Courtesy : Moser Baer
Stage II : Setting Objectives-What are they
Corporate objectives flow from the mission and growth ambition of the corporation.
The managerial purpose of setting objectives is to convert the strategic vision into specific performance targets results and outcomes the management wants to achieve
The objective provides the basis for it major decisions of the firm and says the organizational performance to be realised at each level
Then use these objectives as yardsticks for tracking the company's progress and performance.
Objectives- How they should be and why they should be there
Characteristics of Objectives
Quantitative
Measurable
Realistic
Understandable
Challenging
Hierarchical
Obtainable
Congruent among organizational units
B e n e f i t s o f O b j e c t i v e s
P r o v i d e D i r e c t i o n
A l l o w S y n e r g y
A i d i n e v a l u a t i o n
E s t a b l i s h p r i o r i t i e s
R e d u c e u n c e r t a i n t y
M i n i m i z e c o n f l i c t s
S t i m u l a t e e x e r t i o n
Vision , Mission , Objective
Illustrated
Vision, Mission, Objective –Illustrated for a student Term Perspective
(I.e. the actual reason ,logic ) Catch phrase to remember
Vision To be a successful professional and have a good respected life
What I want ….!
Mission To achieve my vision I have decided to become a chartered accountant in my life
How will I get ….what I want
Objective My objective is to clear CA-IPCC exams in first attempt
What actually I have to do for what I want …!
Objectives Illustrated in a corporate scenario
Example : Kurkure set an objective for increasing its sales during festival times . A s sweets were preferred during festive days .The major player in the market was Cadbury Celebrations
T h e B a la n c e d Sc o r e c a r d Ap p r o a c h
Setting a combination of strategic and financial objectives
Tracking the achievement of such objectives
To deliver better financial results from operations is the achievement of strategic objectives that improve its
competitiveness and market strength.
Stage III : Crafting a Strategy to achieve the objectives and Vision
Stage III : Crafting a Strategy to achieve the objectives and Vision
A company's strategy is at full power only when its many pieces
are united.
Ideally, the pieces and layers of a company's strategy should fit
together like a jigsaw puzzle.
STRATEGIC DECISION
Organizational Strengths & Weaknesses
Competitor Strength & Weakness
Market Needs, Attractiveness and
Key Success
In making strategic decisions, inputs from a variety of assessments are relevant. However, The core of any strategic decision should be based on three types of assessments.
Stage IV : Implementing & Executing the Strategy
Stage IV : Implementing & Executing the Strategy
Managing strategy implementation and execution is an operations-oriented activity aimed at shaping the performance of core business activities in a strategy-supportive manner.
To convert strategic plans into actions and results, a manager must be able to perform following:
Motivate People
Build and Strengthen Core Competencies and capabilities
Direct Organizational Change
Stage V : Monitoring developments, evaluating performance and making corrective adjustments
• The fifth stage is the trigger point for deciding whether to continue or change the company's vision, objectives, strategy, and/or strategy-execution methods.
• A company's vision, objectives, strategy, and approach to strategy execution are never final. Managing strategy is an ongoing process, not an every now and then task.
• A company's direction, objectives, and strategy have to be revisited anytime external or internal conditions warrant.
• It is to be expected that a company will modify its strategic vision, direction, objectives, and strategy over time.
• Proficient strategy execution is always the product of much organizational learning. It is achieved unevenly – coming quickly in some areas and proving nettlesome and problematic in others.
Lesson Summary- Strategy Formulation Process
Forming of a vision Mission and strategic intent
Setting of objectives
Crafting of strategy
Implementing and executing it
Monitoring ,evaluating and making necessary adjustment wherever necessary
Thank You
End of Chapter-4 Part-1 of 3
Strategic Planning By
CA. Deepak S Mulchandani, Indore
Email: [email protected]