Strategic Management

STRATEGIC MANAGEMENT
AFTERSCHO☺OL
– DEVELOPING CHANGE MAKERS
CENTRE FOR SOCIAL ENTREPRENEURSHIP
PGPSE PROGRAMME –
World’ Most Comprehensive programme in social
entrepreneurship & spiritual entrepreneurship
OPEN FOR ALL FREE FOR ALL
10/14/09 AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS 1

STRATEGIC MANAGEMENT
Dr. T.K. Jain.

AFTERSCHO☺OL
Centre for social entrepreneurship
Bikaner M: 9414430763
tkjainbkn@yahoo.co.in
www.afterschool.tk, www.afterschoool.tk
What is strategic marketing
planning?
• Prepare strategic plans with references to
marketing plans. It includes the following :
• 1. PLC decisions (product life cycle)
• 2. market size decisions (what should be
the market size of the company)
• 3. 4p decisions (product, price, place,
promotion)
• 4. product line / product mix decisions
• 5. product positioning decisions.
Market Penetration Strategy
• When the basic objective of the firm is to
penetrate a market, the firm tries to keep
lower prices and enter the market. By
keeping the prices lower, the firm can
make an entry in the market and slowly
consolidate its position. It is the best
strategy to enter a market, capture huge
market share and later the firm can
increase the price.
Market segmentation strategy
• When a firm tries to differentiate between
different customers, it goes for
segmentation strategy. In segmentation,
the firm differentiates between different
markets on the basis of some
characteristics like consumption habits,
demographic or geographic factors, etc.
For example, a company may offer
different products to urban and rural
markets.
Concentric diversification…
• Diversification means that either technology or
product or markets are new. There are three types of
diversification : 1. concentric 2. horizontal 3.
conglomerate (totally unrelated)
• Concentric diversification: it means that there is a
technological similarity between the industries,
which means that the firm is able to leverage its
technical know-how to gain some advantage. For
example, a company that manufactures industrial
adhesives might decide to diversify into adhesives
to be sold via retailers. The technology would be the
same but the marketing effort would need to change.

Ancillarisation
• When a company promotes anciliaries and
oursources most of its work through
anciliaries, it is called ancilliarisation.

ANSOFF MATRIX
SAME PRODUCT NEW PRODUCT
SAME MARKET MARKET PRODUCT

PENETRATION DEVELOPMENT
NEW MARKET MARKET DIVERSIFICATION

DEVELOPMENT

BACKWARD INTEGRATION
• Vertical integration is the degree to which a firm
owns its upstream suppliers and its downstream
buyers. However to horizontal integration, which is a
consolidation of many firms that handle the same
part of the production process, vertical integration is
typified by one firm engaged in different parts of
production (e.g. growing raw materials,
manufacturing, transporting, marketing, and/or
retailing) There are three varieties: backward
(upstream) vertical integration, forward
(downstream) vertical integration, and balanced
(horizontal) vertical integration.

CONTINUED..
• Backward integration would take place
when the firm which manufactures finished
goods starts making raw material also. It
may happen when it controls subsidiaries
that produce some of the inputs used in
the production of its products. For
example, an oil marketing company may
own oil refinary, an oil exploration mine ;
an automobile company may own a tire
company
Continued…
• In forward integration, the firm takes over
the next chains to the consumers. it
controls distribution centers and retailers
where its products are sold. Balanced
vertical integration means a firm controls
all of these components, from raw
materials to final delivery.

Augmented marketing
• Augmented means value added. When
the company tries to augment its product,
it is adding value addition possibilities.
Accordingly we have augmented
marketing mix also, when companies also
add public relations, personnel, etc. in
their marketing mix. A generic product is a
bare product, which fulfills the core need.
Augmented product fulfills augmented
needs like status symbol etc
Place marketing
• There are 4 Ps, : product, price, place and
promotion. Place denotes the market that
is targetted by the company. Place
marketing means STP : (S for
segmentation, T for targetting, P for
positioning).

Enlightened marketing …
• When marketing takes up the following it is
called enlightened marketing :
• 1. green marketing
• 2. ethical marketing
• 3. societal marketing
• Green marketing means ecofriendly products
and services
• Ethical marketing means being truthful, fair
and honest in your policies
• Societal marketing means helping in social
development and transformation.
Relation between Promotion and
Communication
• Promotion focuses on popularising the
product, but communication is a tool which
is used in all the organisations in every
field. Communication will help an
organisation in all its work.

Production strategy formulation
• A company starts with decisions like make
or buy decision, then it take decisions like
location and layout decisions. They it may
have to take decision about plant capacity,
plant load, and it will have to prepare
master production schedule. It may also
prepare aggregate production plans and
detailed scheduling and despatching

What is the difference between
mission and vision
• Vision is what you see in the future. Vision is the
perspective about the ubusiness in next 5 or 10 years.
Vision is what the entrepreneurs see about the
organisation in next 5 years / 10 years.
• Mission is the ultimate purpose of the organisation.
• Example: We want to provide free management
education to over 1000 students in next 5 years (vision
of AFTERSCHO☻OL)
• MISSION : To build true enterprising and business
capabilities in the youth and help them in achieving their
dreams along with the goals for social development.

Strategy is partly proactive and
partly reactive, explain…
• Strategy is evolved out of history and
based on past, and links the present to the
future. Thus strategy create the future of
the organisation. It is proactive, because it
links the present to the future. It prepares
for the future. Due to change in
environment, strategy is also changed.
Strategy helps the organisation to adapt to
the changing environment, therefore it is
reactive.
Turnaround…
• To convert a sick unit into a profitable unit
is called turnaround. Here we try to build
profit making capability in an organisation.
We try to restructure, develop and
revitalise the organisation. We use tools
for cost cutting, better management, better
planning and better marketing.

Conglomerate …
• When a company wants to grow, it has
many options, it can go for expansion
(same business, same technology, same
products and markets). It can also go for
vertical and horizonal integration. It can
also go for conglomerate diversification
( when the firm adopts new business). It
may change technology / products /
markets and redefine its business in the
new sectors.
Explain how the concept of
strategic business units (SBUs)
is useful for a multi-business
enterprise?
• One organisation may be very large, where it

become conglomerage of diverse businesses,
each looking after distinct business. Each of
these may be called an SBU.
Portfolio management
• When a business operates in diverse
businesses, it has many portfolios. These are
distinct set of businesses, with a unique
combination of product, market and technology.
An SBU is one which serves a unique business
definition. The company has to decide which
business to strengthen and which business to
retrench. This is called portfolio management,
when we decide about allocation of resources
between various SBUs.
Discuss how the BCG growth
martix helps a firm in product
portfolio choice.
• BCG stands for Boston Consultancy Group.
BCG suggests that we should invest in an SBU,
which has high growth rate and high market
share (called STAR) We should withdraw from a
business which is in low market share and low
growth industry (called DOG). We should
strengthen or quit a business with high growth
but low market share (called QUESTION MARK)
and reap benefits from a business with high
market share but low growth rate (called CASH
COW)
TOWS matrix
• Analysing a business in terms of threats
(T), opportunities (O), Weaknesses (W)
and strengths (S) is called TOWS matrix.
Here we study the impact of the external
environment on the business.

Functional strategy
• We first of all prepare corporate strategy,
later we prepare functional and SBU level
strategy. In functional strategy, we prepare
strategies and policies for a particular
function like : market policies, financial
strategy etc. These help us in achieving
our objectives. Functional strategies have
to be within the broad corporate
guidelines.
Difference between 6 sigma and
TQM
• TQM is an overall philosophy for quality
management, HRD and organisational
improvement. TQM helps the organisation
to develop itself and bring quality at all
level. It uses many tools and techniques in
the process. 6 Sigma is a tool of quality
management, where we try to minimise
errors. The possibility of error is less than
3.4 per million after 6 sigma.
Value chain analysis
• In operations / production management,
we study value chain process. The value
chain starts from the suppliers and ends at
the level of ultimate consumer. We try to
see the possibility of value addition at
each step. Our objective is to maximise
the value addition possibility at each point
in the value chain.

BCG Matrix.
• It was proposed by Boston Consulting group. It
advocates that every organisation must allocate
resources properly. Different SBUs should be
divided in different groups like CASH COW, DOG,
STAR, QUESTION MARK. Funds must be withdrawn
from dogs and cash cows and must be invested in
stars and question mark. The business with high
growth rate and high market share is star, high
growth rate but low market share is question mark,
high market share but low growth rate is cash cow
and low market share and low growth rate is dog.

Porters Generic Strategies
• Michael Porter has given three generic
strategies :
• 1. differentiation
• 2. cost leadership
• 3. focus
• Besides, a company has four options :
• 1. expansion, 2. diversification 3. stability 4.
retrenchment.

Continued…
• Differentiation : make your product
different from those of competitors in
some unque sense
• Cost leadership: reduce your cost, and
reduce prices so that it is below the
prevailing cost and prices of competitors
• Focus : develop products and services
tailor made for the specific requirements of
the customers.
The SWOT analysis is a simple and
useful tool of environmental
analysis
• In this we study the environmental forces

and their impact on the business. Here we
study the impact of business on various
aspects. We are able to study the
strengths, weaknesses, opportunities and
threats regarding a business and decide
about strategy for the business.
Mergers and acquisition
• These help a company to progress. Here a
company acquires another company for
achieving market dominance and business
growth. Here the company tries to build
business growth through large scale operations.
Example: Mittal group took over Arcellor for its
growth. Merger means two companies combined
to form one company. Acquisition means
purchase of controlling stake in another
company.

Gap analysis
• Here the company tries to study the gap
between where the company should be
and where the company is likely to be.
The gap helps the company in formulating
strategy for bridging the gap. The
company can identify the gap and try to
bridge the gap.

Discuss the five forces model of
Porter with reference to the
automobile industry
• Suppliers : include suppliers of
components, technology, spare parts, etc.
• Substitute products : railways,
transportation system, air plane, new
alternative technologies are developing
like battery operated cars etc.
• Buyers : the lifestyle of buyers is changing
and they are becoming more demanding.
Continued…
• New entrants : many new companies are
planning to enter this industry.
• Competitors : all the players who are
operating in this industry are competitors like
Tata, Suzuki, Honda, etc.
• Every company should thoroughly analyse
these five forces affecting it before
formulating the strategy.

how the concept of strategic
business units (SBUs) is useful for
a multi-business enterprise
• An SBU is a distinct unit of an enterprise, which
is empowered to take strategic decisions
regarding products, markets, technologies and
services that it offers. It serves a unique set of
market or offers a unique product or has a
unique business definition. Business definition is
the description of products, markets,
technologies.
difference between strategic
alliances and joint ventures
• Strategic alliances are agreements with other
companies for sharing technology, resources,
products and processes
• Joint ventures are collaborations between
companies on important issues, where the two
companies work together for achieving some
common objectives. Joint ventures could be
based on equity participation or other means of
collaboration. It gives a new company which
operates over a long term period.
Mckinsey's framework.
• As per McKinsey, there are 7 important
factors which are interrelated and
interdependent regarding a business.
These factors are :
• 1. staff 3. shared values 3. system 4.
strategy 5. superordinate goals 6.
structure 7.style

Continued…

Benchmarking
• Benchmarking can be external or internal. In
internal benchmarking, we compare one
department / unit to another department / unit.
In external benchmarking, we identify a
comparison unit out of organisation. Here we
compare our company with any other company.
We look at the best practices and try to learn
them and implement in our company. It is a tool
for development of the company.

TQM
• Total quality management is the process of
inplementing quality at every process in the
organisation. Here we document all the
processes and train workers in that
process. We try to consider the customer
expectations and as per that we define our
quality standards and try to be consistent in
our quality implementation.

BPR
• Business process reengineering is the
process to study the processes and
redifining them. When existing business
processes become outdates / lenghy/ long
/ cumbersome, BPR is the best approach,
where we don’t repair/ modify them but
completely alter them. BPR uses latest
technology in its implementation process
and reshape the business processes.
SIX SIGMA
• Sigma stands for deviations. Standard deviations are
denoted by Sigma. Sigma of 1 denotes a standard
deviation. Sigma of 2 reduces the possibility of
errors – as there will be very less events out of the
range. Similarly 6 sigma reduces the possibility of
errors. a process must not produce more than 3.4
defects per million opportunities. A Six Sigma defect
is defined as anything outside of customer
specifications. A Six Sigma opportunity is then the
total quantity of chances for a defect. It is the
highest level of quality management tool. It uses
black belt training in quality management so that
people are able to manage the quality to the best
possible extent

Continued…
• A black belt in six sigma is an expert in
quality management, team building, team
work allocation, identification of deviations,
lean manufacturing, and in process
improvement.

Vision, mission and objective
• Vision : it is your understanding about your future. It
is the statement regarding where you want to be
after 5 years or after 10 years. It is futuristic. It is
your understanding about your future.
• Mission is the ultimate purpose of the organisation.
It is not time bound – but perennial in nature. It is the
basic guiding principle of the organistion.
• Objective is a time bound goal, that we want to
achieve. It is defined with reference to the
environment. It helps the organisation in achieving
its long term vision and journey. Generally
objectives are defined in time frame from 1 to 5
years It may be defined in terms of market share,
quantitative targets regarding sales etc.

Why such a programme?
• To promote people to take up entrepreneurship
and help develop the society
• To enable people to take up franchising and
other such options to start a business / social
development project
• To enable people to take up social development
as their mission
• To enable people to promote spirituality and
positive thinking in the world

Who are our supporters?
• Afterschoolians, our past beneficiaries,
entrepreneurs and social entrepreneurs
are supporting us.
• You can also support us – not necessarily
by money – but by being promotor of our
concept and our ideas.

About AFTERSCHO☺OL PGPSE – the
best programme for developing great
entrepreneurs
• Most flexible, adaptive but rigorous programme
• Available in distance learning mode
• Case study focused- latest cases
• Industry oriented practical curriculum
• Designed to make you entrepreneurs – not just an
employee
• Option to take up part time job – so earn while you learn
• The only absolutely free course on internet

Workshops from
AFTERSCHO☺OL
• IIF, Delhi
• CIPS, Jaipur
• ICSI Hyderabad Branch
• Gyan Vihar, Jaipur
• Apex Institute of Management, Jaipur
• Aravali Institute of Management, Jodhpur
• Xavier Institute of Management, Bhubaneshwar
• Pacific Institute, Udaipur
• Engineering College, Hyderabad

Flexible Specialisations:
• Spiritualising business and society
• Rural development and transformation
• HRD and Education, Social Development
• NGO and voluntary work
• Investment analysis,microfinance and inclusion
• Retail sector, BPO, KPO
• Accounting & Information system (with CA / CS /CMA)
• Hospital management and Health care
• Hospitality sector and culture and heritage
• Other sectors of high growth, high technology and social
relevance

Salient features:
• The only programme of its kind (in the whole world)
• No publicity and low profile course
• For those who want to achieve success in life – not just a
degree
• Flexible – you may stay for a month and continue the rest of the
education by distance mode. / you may attend weekend classes
• Scholarships for those from poor economic background
• Latest and constantly changing curriculum – keeping pace with
the time
• Placement for those who are interested
• Admissions open throughout the year
• Latest and most advanced technologies, books and study
material

Components
• Pedagogy curriculum and approach based on IIM Ahmedabad and ISB
Hyderabad (the founder is alumnus from IIMA & ISB Hyderabad)
• Meditation, spiritualisation, and self development
• EsGotitial softwares for business
• Business plan, Research projects
• Participation in conferences / seminars
• Workshops on leadership, team building etc.
• Written submissions of research projects/articles / papers
• Interview of entrepreneurs, writing biographies of entrepreneurs
• Editing of journals / newsletters
• Consultancy / research projects
• Assignments, communication skill workshops
• Participation in conferences and seminars
• Group discussions, mock interviews, self development diaryng
• Mind Power Training & writing workshop (by Dr. T.K.Jain)

Pedagogy
• Case analysis,
• Articles from Harvard Business Review
• Quiz, seminars, workshops, games,
• Visits to entrepreneurs and industrial visits
• PreGotitations, Latest audio-visuals
• Group discussions and group projects
• Periodic self assessment
• Mentoring and counselling
• Study exchange programme (with institutions out of India)
• Rural development / Social welfare projects

Branches
• AFTERSCHO☺OL will shortly open its
branches in important cities in India
including Delhi, Kota, Mumbai, Gurgaon
and other important cities.
Afterschooolians will be responsible for
managing and developing these branches
– and for promoting social entrepreneurs.

Case Studies
• We want to write case studies on social
entrepreneurs, first generation
entrepreneurs, ethical entrepreneurs.
Please help us in this process. Help us to
be in touch with entrepreneurs, so that we
may develop entrepreneurs.

Basic values at AFTERSCHO☺OL
• Share to learn more
• Interact to develop yourself
• Fear is your worst enemy
• Make mistakes to learn
• Study & discuss in a group
• Criticism is the healthy route to mutual support and
help
• Ask fundamental questions : why, when, how &
where?
• Embrace change – and compete with yourself only

www.afterschoool.tk
social entrepreneurship for better
society

Strategic Management

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STRATEGIC MANAGEMENT

10/14/09 AFTERSCHO☺OL's MATERIAL FOR PGPSE PARTICIPANTS 1

Dr. T.K. Jain.

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SAME MARKET MARKET PRODUCT

NEW MARKET MARKET DIVERSIFICATION

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• One organisation may be very large, where it

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• In this we study the environmental forces

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