THE CONCEPT OF STRATEGY

The four elements of a successful strategy are:

A simple, consistent, long-term goal
Profound understanding of the competitive environment
Exploitation of internal strengths, while protecting areas of weakness
Effective implementation

GENERAL GIAP AND THE VIETNAM WARS

Their success was not attributed to overwhelmingly superior resources.
The military, human and economic resources of North Vietnam were
dwarfed by those of the US and South Vietnam. Yet, with the U.S.
evacuation from Saigon in 1975, the worlds most powerful nation was
humiliated by one of the worlds poorest.
It is a classic example of how a sound strategy pursued with total
commitment over a long period can succeed against vastly superior
resources.
The key was Giaps strategy of a protracted war of limited
engagement. With the U.S. constrained by domestic and international
opinion from unleashing its full military might, the strategy was
unbeatable once it began to sap the willingness of the U.S. government to
persevere with a costly, unpopular foreign war.
Their strategy:
o Goal: Reuniting Vietnam under communist rule and expelling a
foreign army from Vietnamese soil
o Understanding the enemy and the battlefield conditions:
Appreciation of the political predicament of U.S. presidents in their
need for popular support in waging a foreign war.
o Resource optimization: Carefully designed to protect against his
armys deficiencies in arms and equipment while exploiting the
commitment and loyalty of his troops.
o Effective implementation: Their capacity to reach decisions,
energy in implementing them, and ability to foster loyalty and
commitment among subordinates.

BASIC FRAMEWORK FOR STRATEGY ANALYSIS

The industry environment:
o Competitors, customers, suppliers
The firm:
o Goals and values
o Resources and capabilities
o Structure and systems
Similar to SWOT
The task of business strategy, then, is to determine how the firm will
deploy its resources within its environment and so satisfy its long-term
goals, and how to organize itself to implement that strategy.
Strategic Fit: For a strategy to be successful, it must be consistent with
 the firms external environment, and with its internal environment its
goals and values, resources and capabilities, and structure and systems.

WHAT IS STRATEGY?

Strategy is the means by which individuals or organizations achieve their

objectives
Not a plan but direction: One might not write detailed strategic plans
but can possess clear ideas of what one wants to achieve and how one
can achieve it.
Religion is so strategic
2 basic questions of strategy:
o Where to compete: Corporate Strategy (CEO)
Industry
Products
Target customers
Geographies
Activities
o How to compete: Business or Competitive Strategy (Divisional
management)
Differentiation
Cost
The challenge of ambidexterity:
o Work = Competing in the present
o MBA = Preparing for the future
How Strategy is made:
o Intended strategy: Conceived of by the top management team
o Realized strategy: Portion of intended strategy that is
implemented (10-30%)
o Emergent strategy: Result of individual managers interpretation
of strategy and adaptation to changing external circumstances.
Thus strategy is adjusted and revised in light of experience
Planned emergence: The combination of design and emergence. The
balance depends on the stability and predictability of a companys
business environment. The more the unpredictability, the greater the
dependence on principles and not specific decisions

IDENTFYING A COMPANYS STRATEGY

Strategy is located in:

The heads of CEOs and Senior Managers

Speeches and written documents: Board minutes, strategic planning
documents (objectives, scope and advantage), mission and vision
statement, core values, websites, investor reports, annual reports, press
releases
Management decisions: Capital expenditure, technology and patents, new
product releases, major investment projects, new hires at top
management
MULTIPLE ROLES OF STRATEGY

Supports decision-making
Coordinates staff
Sets targets for the future that motivates staff: Strategic intent creates an
extreme misfit between resources and ambitions. Top management then
challenges the organization to close the gap by building new
competitive advantages. Resource scarcity may engender ambition,
innovation, and a success-against-the-odds culture. Big, Hairy,
Audacious Goals.

THE ROLE OF ANALYSIS IN STRATEGY FORMULATION

Without analysis, strategic decisions are susceptible to power
battles, individual whims, fads and wishful thinking.
Analysis provides frameworks for organizing discussion, processing
information and opinions and assisting consensus.
The purpose of strategy analysis is not to provide answers but to
help us understand the issues.