40 Questions
What is the primary purpose of a strategy according to Drucker's definition?
To achieve an objective
What is the main difference between Drucker's and Johnson, Scholes, and Whittington's definitions of strategy?
One emphasizes achieving objectives, while the other emphasizes achieving competitive advantage
What is the typical duration of formal strategic planning by large companies?
5-10 years
What is the main implication of the environment continually changing for an enterprise's strategy?
Strategies should be flexible and adaptable
What is the primary objective of a company, according to the text?
To maximize the wealth of its shareholders
What is competitive advantage achieved by doing?
Something better than competitors
What influences the strategic choices that an enterprise makes?
Both internal resources and external environment
What is the main goal of an enterprise's business activities, according to Johnson, Scholes, and Whittington's definition?
To fulfill stakeholder expectations
What is the primary objective of an entity, according to Johnson, Scholes and Whittington?
Fulfil stakeholder expectations
What is a key aspect of strategic decision-making, according to Johnson, Scholes and Whittington?
Allocating resources to different business activities
What is the primary focus of strategic management?
Achieving long-term goals and objectives
What is the main difference between strategic management and strategic planning?
Strategic management involves implementing change, while strategic planning involves formulating direction
What is an important aspect of strategic decision-making, according to Johnson, Scholes and Whittington?
Reflecting the values and expectations of individuals in positions of power
What is a key outcome of strategic management?
Achieving long-term success for the organisation
What is a key aspect of ensuring an entity's resource capability, according to Johnson, Scholes and Whittington?
All of the above
What is the primary focus of strategic planning, according to the content?
Formulating the long-term direction for an organisation
What is the benefit of understanding the underlying purpose of models and tools during revision?
To be able to anticipate which ones will be helpful in different situations
What is the purpose of the advance material in the Strategic Case Study exam?
To establish a picture of the organisation and its environment
What type of information can be expected in the unseen case study material?
Specific issues, plans, changes, decisions, opportunities, or challenges facing the company
How should you approach the unseen case study material during the exam?
Read the new material carefully and consider how it affects your previous opinions
What should you do when you receive the unseen case study material during the exam?
Spend some time considering how the new information affects your previous opinions
Why is it important to practice questions in advance?
To develop a better understanding of the case study and its context
What should you do when you encounter new information in the unseen case study material?
Amend your conclusions and findings in light of the new information
How can you enrich your answer to a question in the Strategic Case Study exam?
By using the information from both the advance and unseen materials
What is a major strategic choice that companies must make at the business strategy level?
Between a strategy of cost leadership and a strategy of differentiation
What is a key aspect of strategic choices at the corporate level?
Deciding on the products or services to sell
What is an important consideration when deciding on development directions and methods?
Whether to use internal growth or acquisitions
What is a key aspect of strategic choices at the business level?
Deciding on the company's competitive advantage
What is a key consideration when deciding on corporate level strategies?
The markets in which the company operates
What is a key aspect of strategic choices at the development direction and method level?
Deciding on the direction of growth
What is a key aspect of strategic choices involving international operations?
Deciding on the countries in which to operate
What is the purpose of analyzing the business environment in strategic management?
To assess the threats and opportunities that exist in the environment
What is a key aspect of making strategic choices?
Identifying different possible strategies
What is a threat in the context of strategic management?
A development in the environment that could threaten the entity's ability to achieve its objectives
What is the primary focus of an analysis of strategic capability?
The entity's strengths and weaknesses
What is the purpose of a mission statement?
To state the entity's purpose and reason for existence
What is an opportunity in the context of strategic management?
A development in the environment that might be exploited to improve the entity's ability to achieve its objectives
What is the primary focus of an analysis of strategic position?
The entity's purpose and mission statement
Why is it important to identify the entity's weaknesses?
To reduce or eliminate the weaknesses and improve the entity's ability to achieve its objectives
What is the purpose of assessing the entity's expectations and purposes?
To make decisions about the entity's objectives and purpose
Study Notes
The Strategic Case Study Exam
- The exam consists of two parts: advance material and unseen case study material
- The advance material provides background information on the organisation and its environment
- The unseen material deals with specific issues, plans, changes, decisions, opportunities, or challenges the company is currently facing
- Questions will relate directly to the unseen material, but also require the use of knowledge gained from the advance material
Approaching the Exam
- Read the new material carefully and consider how it affects previous opinions about the company
- Evaluate how the new information changes or supports previous conclusions
- Think about how business activities can contribute to the competitive advantage of the enterprise
Definition of Strategy
- Defined by Drucker as "a pattern of activities that seeks to achieve the objectives of the organisation and adapt its scope, resources and operations to environmental changes in the long term"
- Consists of organised activities, with the purpose of achieving objectives, and is long-term
- Defined by Johnson, Scholes, and Whittington as "the direction and scope of an organisation over the long term, which achieves advantage in a changing environment through its configuration of resources and competencies with the aim of fulfilling stakeholder expectations"
- Involves doing different things with different resources over time, adapting to environmental changes
Elements of Strategic Management
1. Strategic Position
- Involves an analysis of the business environment, including threats and opportunities
- Threats are developments that could threaten the entity's ability to achieve its objectives
- Opportunities are developments that might be exploited to improve the entity's ability to achieve its objectives
- Assessment of strategic capability involves analysis of strengths and weaknesses
- Strengths: what the entity is good at doing, and how to improve them
- Weaknesses: what the entity is bad at doing that its rivals can do better, and how to reduce or eliminate them
2. Strategic Choices
- Involves identifying alternative strategies and making choices
- Three aspects:
- Corporate level and international: decisions about what the entity should be doing, and international operations
- Business level strategies: choices between cost leadership and differentiation strategies
- Development directions and methods: directions in which the business should be directed, and how to achieve growth
3. Expectations and Purposes
- Involves making decisions about the purpose of the entity and what it is trying to achieve
- May involve a formal statement of purpose in the form of a mission statement
- Purpose may include providing returns to owners, increasing shareholder wealth, or fulfilling stakeholder expectations
Prepare for the strategic case study exam, which consists of two parts: advance material and unseen case study material. Learn how to approach the exam and answer questions effectively.
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