NEW STRAMA MIDTERM LECTURE 1

• Stakeholders

  
  

  Any group or individual who can affect or is affected by the achievement of a firm's objectives.
• Identifying different stakeholders

  1. Who are they?

  2. What do they want?

  3. How are they going to try to get in?
• Types of stakeholders

  • Customers
  • Shareholders
  • Employees
  • Suppliers
  • Bankers
  • Community groups
  • Pressure groups
  • Environmental groups
  • Employee unions
• Stakeholder interests

  The foundation of corporate strategy, representing "what we are" and "what we stand for" as a company
• Organizational functions

  • Operations
  • Marketing
  • Human resources
  • Finance
• Operations function

  • Deals with the day-to-day operations of the system to ensure appropriate systems and procedures are in place and consistent quality of service and products is delivered
• Marketing function

  • Deals with the management of demand by developing and implementing appropriate pricing policies and running marketing campaigns and programs through various channels
• Human resources function

  • Carries out analysis of how human assets add value and contribute to competitive advantage, responds to employee selection and recruitment, and addresses employee needs and wants
• Finance function

  • Concerned about identifying main sources of funding and financing operations in a cost-effective way, analyses how financial resources add value and contribute to competitive advantage
• Tangible assets

  Assets that can be seen in the form of plant, equipment, and/or land
• Intangible assets

  Assets associated with company know-how and skill sets
• Core capabilities

  Areas that a company does exceedingly well
• Distinctive competencies

  Areas and activities that a company excels at and is better than its competitors
• Research-based view (RBV)

  • Competitive advantage comes from a firm's unique tangible and intangible resources that are valuable, rare, inimitable, and non-substitutable
• Organizational structure

  The coordination of workflow and communication, and management of authority relationships in an organization
• Types of organizational structure

  • Functional structure
  • Multidivisional structure
  • Matrix structure
• Centralized structure

  Decision-making power and responsibility held by top management, tendency toward standard strategy formation with rigid, control-oriented implementation
• Decentralized structure

  Organizational members at lower levels given responsibility to make decisions, strategy development responsibility of people from different levels, strategy implementation based on free flow of communication and performance-related incentives
• Levers of control

  • Diagnostic systems
  • Interactive systems
  • Belief systems
  • Boundary systems
• Diagnostic systems

  • Focus attention on goal achievement, give managers opportunity to measure outcomes and compare results with preset goals
• Interactive systems

  • Give managers tools to impose consistency and guide creative search processes, connect tactical day-to-day actions and creative experiments into a cohesive pattern that responds to strategic uncertainties
• Belief systems

  • The explicit set of organizational definitions formally communicated by senior managers through mission statements and creeds
• Boundary systems

  • Ensure employees work within the acceptable domain of organizational activity
• Boundary systems

  • Ensure that employees work within the acceptable domain of organizational activity
• Four levels of control

  • Diagnostic Systems
  • Interactive Systems
  • Belief Systems
  • Boundary Systems
• Diagnostic Systems

  • Focus attention on goal achievement for the business and for each individual in the business
  • Give the opportunity to the managers to measure outcomes and compare results with preset profit plans and performance goals
• Interactive Systems

  • Give managers tools to impose consistency and guide creative search processes
  • Managers use one system interactively such as profit planning systems that report planned and actual revenues and expenses and the intelligence systems that report information about social, political, and technical business issues
  • Tactical day-to-day actions and creative experiments can be connected into a cohesive pattern that responds to strategic uncertainties
• Belief Systems

  • The explicit set of organizational definitions formally communicated by senior managers through mission statements and credos that give basic values, purpose, and direction
  • Management's vision, expressed in the mission statements and credos, motivates organizational participants to search for and create opportunities to accomplish the overall mission of the organization
• Boundary Systems

  • Ensure that organizational members' activities fall within the acceptable domain of activity
  • Without boundary systems, creative opportunity-seeking behavior and experimentation can dispel the resources of the organization
  • Ensure that employees work within the acceptable domain of organizational activity
• Diagnostic control systems are the benchmarks used to measure the outputs of employees against preset goals and targets
• Interactive systems

  
  

  such as profitability and revenue reports, are used in order to be able to discuss the ongoing performance interactively and to influence and encourage the activities of employees
• Belief systems such as mission statements are used to guide and inspire employees
• These systems are usually used to give a sense of belonging to an organization and pride in what employees strive to achieve
• Leaders

  • Have skills, ability, and vision to nurture and enable the organization to develop a business strategy, identify the resources required, and nurture other employees to turn their ideas into business reality
  • Can facilitate organizational learning by bringing business opportunities to the attention of other organizational members and networking externally with both suppliers and customers
  • Are creative and good reflectors
  • Assess the risks involved in working with foreign operations
  • Employ a "hands-on" management style in bringing a business idea into successful creation by considering the cross-cultural obstacles in different country markets
• Leadership styles

  • Authoritative
  • Persuasive
  • Consultative
  • Participative decision-making
• Regardless of the leadership style adapted, to a large degree success in decision-making and the implementation of strategy depends very much on the background, skills, and abilities of the leader
• There is relatively high turnover in leadership positions in H&T organizations
• When a new CEO begins working, it is possible that there will be changes in organizational direction, structure, and culture
• It may therefore be essential to educate them in strategic management practices
• Organizational culture

  A holistic, historically determined, socially constructed, shared organizational variable made up of symbols, heroes, rituals, and values