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Strategy:
It is derived from the Greek word “Strategos” which is used in military
terms.
Definition:
Strategic Management:
2. Formulating of strategies
3. Implementing of strategies
4. Evaluation of strategies
These four phases sequentially to each other & each phase provides a feedback to
previous phase.
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First Phase:
The first phase consists of establishing the strategic intent for the
organisation. Strategic intent is the hirerachy of the objectives of organisation. It consists
of vision, mission, objectives & business definition.
Second Phase:
Third Phase:
Fourth Phase:
The fourth phase is evaluation & control involves assessing how the
strategies are formulated & how effectively they are implementing. Examples of strategic
phases involved in financing of a business, pricing of a product, diversification of
organisation, restructuring of organisation.
5. Setting objectives
B. Formulating of Strategies:
C. Implementing of strategies:
1. Activating strategies
5. Operationalising strategies
Business Policy:
2. Integrated decision for the whole organisation after taking all the functional areas
in to a count such as mergers, acquisitions etc.
3. Where as functional areas decisions may be both long term & short term but where
as business policy decisions is always long term decisions. Business policy
decisions are usually taken by Top management.
5. Business policy is hence defined as the “study of the functions & responsibilities
of Top Management”. The crucial problems that effect success in the total
enterprise and the decisions that are determined the direction of the organisation &
shape its future.
Business policy is also concerned with “The mobilization of resources for the attainment
of goals in the face of completion”.
1. It is concerned with goals & objectives which affect the success of total enterprise.
Business policy focuses on strategic planning & strategic management. Its elements are
2. Environmental Analysis
3. Strategic alternatives
4. Swot analysis
5. Strategic analysis
6. Strategic implementation
7. Strategic evaluation
Six major operation are to be integrated into the business policy process. They are
1. Production
3. Finance
4. Personal
5. R & D
6. Legal
Production:
Marketing:
The marketing department will highlight the capabilities & limitations of the
product promotion. Physical distribution & personal etc.
Finance:
The finance department is responsible for both short term & long term financers at
competitive costs return on investments.
R&D is nerves system of the organisation. It plays vital role in translation vision in to
reality.
Legal:
The legal department should answer the questions relating to patent rights & liabilities.
Personal:
Importance :
Business policy course provides the knowledge and content based to people & enterprise.
Knowledge:
Analyzing alternatives
Business policy is used to achieve long term goals & objectives once the goal has
been indentified they are executed by operational mangers. Operational managers puts
additional responsibility on strategic manager to monitor and evaluate the performance in
the realization of goals. Goals & objectives are adjusted according to the changes in the
environment. Business policy is formulated by top management comprising of board of
directors & managing directors. Experts are back bone of effective business policy.
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Experts are needed to advised & assessed top management to take important role at
planning, execution, evaluation & control levels.
Knowledge generation
Skill creation
Every business practicing business policy to achieve long term goals & objectives
of the organisation which has to generate fresh knowledge through R&D and with
practice.
Take decisions
Business policy helps in the development of analytical ability, the ability to apply
theory in the practice improved mental ability & skill to find solutions for the complex
problems. Skills like technical skills, human skills, conceptual skills.
Business policy has created many benefits to the organisation in the modern times.
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Determine the corporate policies
Financial Strengths:
Higher performance firms resort to systematic planning to prepare them selves for
future fluctuations in external & internal environment. Most of the business failures like
liquidation on be avoided through business policy planning.
Non-financial benefits:
Represents the frame work for improve coordination & control of activities.
UNIT – II
STRATEGIC INTENT:
Mission: it is the founders intention at the outside of the organisation. What they want to
achieve.
Values: values manifest in what the organisation does as a group and how it operates.
Vission
Definition:
Nature:
Vission:
Passion less
Benefits of Vission:
Characteristics of Vission:
1. Directional: A well stated vission says something about company’s journey and
signals the king of business & strategic changes that will be fourth coming.
3. Flexible: A well stated vission is not a one’s- and- for- all- time- pronouncements-
vission. About the company’s future part may need to change as events.
5. Desirable: A well stated mission appeals to the long term interest of stake holders,
employees, customers.
6. Easy: A well stated vission is explained in less than 10 minutes & can be reduced
to communicate simple, memorable slogan.
The process of envisioning is difficult according to colleen & porras, a well conceived
vission consists of 2 major components core ideology & envision future.