MGS 4999 Study Guide - Final Guide: Strategic Planning, Resource-Based View, Core Competency
22 May 2018
School
Department
Course
Professor
CH.1
AFI Strategy Framework (24-28)
· definition
· analysis - diagnosis of the competitive challenge and is accomplished through
strategic analysis of the firm’s internal and external environments
· formulation - guiding policy to address the competitive challenge is
accomplished through strategy formulation, resulting in the firm’s corporate, business,
and functional strategies
· implementation - a set of coherent actions to implement the firm’s guiding
policy. Is accomplished through strategy implementation
· Features
CH.2
Vision (4)
● Picture of what the firm wants to be and, in broad terms, what is ultimately wants
to achieve
Mission (10)
● A company’s mission statement typically focuses on its present business
purpose “Who we are and what we do”
Vision vs. Mission (12)
● Vision statements give what an organization wants to accomplish
● Mission statements give how the vision will be accomplished
Core values (13)
● Core values is to guide an organization to achieve its vision and fulfill its mission
○ Principles to guide behavior
○ Helps deal with complexity and conflict
○ Provides employees with a moral compass
● Requires the managerial ability to:
○ Anticipate and envision
○ Maintain flexibility
○ Empower others to create strategic change as necessary
Top down strategic planning (25-27)
· Definition: rational, data-driven strategy process
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● Detailed analysis of: price, costs, margins, market demand, head count,
and production runs
· shortcomings
● May not adapt well to change
● Formulation separate from implementation
● Information flows top down (one way)
● The leaders future vision can be wrong
Scenario Planning (28)
● · uses a top-down approach
● Asks “What if” questions
● Consider optimistic and pessimistic futures
○ Examples:
■ New laws restrict carbon emissions
■ Demographic shifts
■ Changing economic conditions
■ Technological advances
Strategy as Planned emergence (32)
● Top down and bottom up
○ Bottom up strategic initiatives emerge
○ Evaluated and coordinated by management
○ Relies on data, personal experience, deep domain expertise, and front
employees insights
CH.3
Industry Analysis (15)
● · method that identifies an industry’s profit potential and derives implications
for a firm’s strategic position
Five forces model (16-28) – very Important
● Threat of new entrants and substitutes, powers of buyers and suppliers,
rivalry among competitors
● Determine the profit potential of an industry and shape a firm’s competitive
strategy
· Conclusion (27,28)
CH.4
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Core competencies (3,5)
● Are unique strengths embedded deep within a firm and allows a firm to
differentiate its products and services from those of its rivals
○ Results in:
■ Creating higher value for the customer or
■ Offering products and services at lower costs
VRIO model (12-16)
● Resource is valuable if:
○ It enables the firm to exploit an opportunity
○ It enables the firm to offset a threat
○ It enables a firm to increase its economic value creation
● Resource is Rare if:
○ Only one or a few firms possess it
● Resources is costly to imitate if:
○ Firms that do not possess the resource are unable to develop or buy the
resource at a reasonable price.
● Isolating Mechanisms
○ Barriers to imitation
○ Protect resources, capabilities, or competencies that underline a firm's
competitive advantage
■ How?
● Social complexity
● Intellectual property protection
● Causal ambiguity
● Path dependence
● A resource is Organized to capture value if:
○ It has an effective organizational structure
○ It has coordinating systems
VRIO decision tree (17)
CH.6
Business level strategy
· 5 Business Level strategies (8)
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Document Summary
Analysis - diagnosis of the competitive challenge and is accomplished through strategic analysis of the firm"s internal and external environments. Formulation - guiding policy to address the competitive challenge is accomplished through strategy formulation, resulting in the firm"s corporate, business, and functional strategies. Implementation - a set of coherent actions to implement the firm"s guiding policy. Picture of what the firm wants to be and, in broad terms, what is ultimately wants to achieve. A company"s mission statement typically focuses on its present business purpose who we are and what we do . Vision statements give what an organization wants to accomplish. Mission statements give how the vision will be accomplished. Core values is to guide an organization to achieve its vision and fulfill its mission. Empower others to create strategic change as necessary. Detailed analysis of: price, costs, margins, market demand, head count, and production runs. The leaders future vision can be wrong.
