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Showing posts with the label STRATEGIC MANAGEMENT

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MANAGING PROJECTS

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Projects represent nonroutine business activities that often have long-term strategic ramifications for a firm. In this chapter, we examined how projects differ from routine business activities and discussed the major phases of projects. We noted how environmental changes have resulted in increased attention being paid to projects and project management over the past decade. In the second half of the chapter, we introduced some basic tools that businesses can use when planning for and controlling projects. Both Gantt charts and network diagrams give managers a visual picture of how a project is going. Network diagrams have the added advantage of showing the precedence between activities, as well as the critical path(s). We wrapped up the chapter by showing how these concepts are embedded in inexpensive yet powerful software packages such as Microsoft Project. If you want to learn more about project management, we encourage you to take a look at the Web site for the Proj...
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Corporate Governance and Business Ethics

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In this final chapter, we looked at stakeholder strategy, corporate governance, business ethics, and strategic leadership. The shared value creation framework and its relationship to competitive advantage. By focusing on financial performance, many companies have defined value creation too narrowly. Companies should instead focus on creating shared value, a concept that includes value creation for both shareholders and society. The shared value creation framework seeks to identify connections between economic and social needs, and then leverage them into competitive advantage. The role of corporate governance . Corporate governance involves mechanisms used to direct and control an enterprise in order to ensure that it pursues its strategic goals successfully and legally. Corporate governance attempts to address the principal–agent problem, which describes any situation in which an agent performs activities on behalf of a principal. Applying agency theory to...
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Organizational Design: Structure, Culture, and Control

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In this chapter, we studied the three key levers that managers have at their disposal when designing their firms for competitive advantage—structure, culture, and control. Defining organizational design and list its three components. Organizational design is the process of creating, implementing, monitoring, and modifying the structure, processes, and procedures of an organization. The key components of organizational design are structure, culture, and control. The goal is to design an organization that allows managers to effectively translate their chosen strategy into a realized one. H ow organizational inertia can lead established firms to failure. Organizational inertia can lead to the failure of established firms when a tightly coupled system of strategy and structure experiences internal or external shifts. Firm failure happens through a dynamic, fourstep process (see Exhibit 11.2 ). Defin ing organizational structure and describe its four elements...
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Global Strategy: Competing Around the World

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This chapter discussed the roles of MNEs for economic growth; the stages of globalization; why, where, and how companies go global; four strategies MNEs use to navigate between cost reductions and local responsiveness; and national competitive advantage. Globalization, multinational enterprise (MNE), foreign direct investment (FDI), and global strategy. Globalization involves closer integration and exchange between different countries and peoples worldwide, made possible by factors such as falling trade and investment barriers, advances in telecommunications, and reductions in transportation costs. A multinational enterprise (MNE) deploys resources and capabilities to procure, produce, and distribute goods and services in at least two countries. Many MNEs are more than 50 percent globalized; they receive the majority of their revenues from countries other than their home country. Product, service, and capital markets are more globalized than labor markets. The leve...
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Corporate Strategy: Mergers and Acquisitions, Strategic Alliances

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This chapter discussed two mechanisms of corporatelevel strategy (acquisitions and alliances). Mergers and acquisitions, and why firms would use either as a vehicle for corporate strategy. A merger describes the joining of two independent companies to form a combined entity. An acquisition describes the purchase or takeover of one company by another. It can be friendly or hostile. Although there is a distinction between mergers and acquisitions, many observers simply use the umbrella term “mergers and acquisitions,” or M&A. Firms can use M&A activity for competitive advantage when they possess a superior relational capability, which is often built on superior alliance management capability. Horizontal integration and evaluate the advantages and disadvantages of this corporate-level strategy . Horizontal integration is the process of merging with competitors, leading to industry consolidation. As a corporate strategy, firms use horizontal integration t...
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