Strategic Management Lesson 1

Strategic Management Fundamentals

• Derived from the Greek word "strategos," referring to planning to compete against enemies.
• Involves long-term planning, typically spanning 5-10 years.
• Differentiates between strategies (long-term) and tactics (short-term).
• Focuses on the art and science of formulating and evaluating actions to achieve organizational objectives.

5 P's of Strategy by Henry Mintzberg

• Plan: Develop a concrete plan aimed at achieving success.
• Ploy: Tactics designed to outsmart competitors to become a market leader, defined as the entity with the highest market share.
• Pattern: Identify consistent behaviors that attract attention, such as limited editions or seasonal sales.
• Position: Understanding the organization's standing in the market, encompassing both business reputation and physical location.
• Perspective: Considering the viewpoints of stakeholders, including their mindset and predictions regarding future trends.

Benefits of Strategic Management

• Competitive Advantage: Fosters healthy competition and can enhance market share.
• Achieving Goals: Facilitates the accomplishment of strategic objectives.
• Sustainable Growth: Provides a realistic framework for tracking progress towards long-term targets.
• Cohesive Organization: Promotes unity and coordinated efforts within the organization.
• Increased Managerial Awareness: Encourages leaders to focus on the company’s long-term future.

Distinction Between Feasibility and Strategic Management

• Feasibility: Involves studying the potential for creating a new business.
• Strategic Management: Focuses on analyzing and enhancing existing businesses.

5 Processes of Strategic Management

• Identifying Direction: Establishing a clear mission, vision, goals, and objectives.
• Analyzing Resources:
  • Internal Factors: Assessing internal strengths and weaknesses that the organization can control.
  • External Factors: Identifying external opportunities and threats that are uncontrollable by the organization.
• Forming Strategies: Create strategies based on analytical frameworks like SWOT (Strengths, Weaknesses, Opportunities, Threats) and PESTEL (Political, Economic, Social, Technological, Environmental, Legal).
• Implementing Strategies: Actioning the developed plan to execute strategic initiatives.
• Evaluating Strategies: Assessing the effectiveness of implemented strategies to ensure alignment with objectives.

Globalization Overview

• Historical progression from colonialism to imperialism to globalization.
• Globalization involves interconnectivity transcending nation-states.

Globalization Definitions

• A concept defined by a cluster of economic and political frameworks shaped by international political economy interests.
• Globality represents a future social condition marked by dense economic and cultural connections, rendering political borders and economic barriers irrelevant.

Globalism Ideology

• Globalization viewed as an ideology promoting international integration.
• Five core claims of globalism include:
  • Globalization as a liberating force promoting global integration.
  • Perception of globalization as inevitable and irreversible.
  • Absence of centralized authority governing globalization.
  • Benefits of globalization purportedly accessible to all.
  • Globalization is seen as a means to enhance democracy worldwide.

Aspects of Globalization

• Cultural Globalization: Adoption of foreign cultures, exemplified by Westernized practices and cuisine such as samgyupsal.

• Economic Globalization: Focus on the trade of goods and services, illustrated by trends like dropshipping and overseas Filipino workers (OFWs).

• Political Globalization: Strengthened relationships between countries, as seen through organizations like ASEAN (Association of Southeast Asian Nations).

• Technological Globalization: Emphasis on advanced technology that facilitates communication and information transmission, exemplified by the internet.

• Financial Globalization: Growing use of digital financial services, including platforms like GCash, e-wallets, and PayMaya.