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Strategic Management What managers do to develop the organization’s strategies. Strategies The decisions and actions that determine the long-run performance of an organization. Why is Strategic Management Important It results in higher organizational performance. It requires that managers examine and adapt to business environment changes. It coordinates diverse organizational units, helping them focus on organizational goals. It is very much involved in the managerial decision-making process. Exhibit 8–1 The Strategic Management Process Exhibit 8–2 Components of a Mission Statement Exhibit 8–4 Levels of Organizational Strategy Strategic Management Today Strategic Flexibility New Directions in Organizational Strategies e-business customer service innovation Exhibit 8–7 Creating Strategic Flexibility How the Internet Has Changed Business The Internet allows businesses to: Create knowledge bases that employees can tap into anytime, anywhere. Turn customers into collaborative partners who help design, test, and launch new products. Become virtually paperless in specific tasks such as purchasing and filing expense reports. Manage logistics in real time Change the nature of work tasks throughout the organization. Strategies for Applying e-Business Techniques Cost Leadership On-line activities: bidding, order processing, inventory control, recruitment and hiring Differentiation Internet-based knowledge systems, on-line ordering and customer support Focus Chat rooms and discussion boards, targeted web sites Customer Service Strategies Giving the customers what they want. Communicating effectively with them. Providing employees with customer service training. Innovation Strategies Possible Events Radical breakthroughs in products. Application of existing technology to new uses. Strategic Decisions about Innovation Basic research Product development Process innovation First Mover An organization that brings a product innovation to market or use a new process innovations M
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