STRATEGIC MANAGEMENT NOV-DEC) 2012 REG-2009 PART A

1. What is Environmental Scanning?

Environmental scanning is the monitoring, evaluating, and disseminating of information from the external and internal environments to key people within the corporation. Its purpose is to identify strategic factors- those external and internal elements that will determine the future of the corporation.

2. What is Corporate Social responsibility ?

Actions that appear to further some social good, beyond the interests of the firm and that which is required by law.

3. Explain briefly about Industry Analysis. An industry is a group of firms producing a similar product or service, such as soft drinks
or financial services. An examination of the important stakeholder groups, such as suppliers and customers, in a particular corporations task environment is a party of industry analysis.

4. What are Core Competencies?

A unique ability that a company acquires from its founders or develops and that cannot be easily imitated. Core competencies are what give a company one or more competitive advantages, in creating and delivering value to its customers in its chosen field. Also called core capabilities or distinctive competencies. See also core rigidities.

5. What is a Business Strategy?

Business strategy is the objective of developing a firm-specific model that will allow a company to gain competitive advantage and its rivals in a market or industry.

6. What is Balanced score card?

Balanced scorecard combines financial measures that tell the results of actions already taken with operational measures on customer satisfaction, internal processes and the corporations innovation and improvement activities the drivers of futures financial performance.

7. Write a short note on Assessment Center.

The assessment center software Ingentis easy.pes was developed to support users to plan, organize and evaluate assessment and personnel development centers and to provide a user friendly interface for assessments input and postprocessing. Comprehensive statistic and evaluation possibilities make the product complete.

8. Define Politics and power.

The power motive is defined as the need to manipulate others and have superiority over them. Extrapolating from this definition of the need for power, power itself can be defined as the ability to get an individual or group to do somethingto get the person or group to change in some way. The individual who possesses power has the ability to manipulate or change others. Such a definition of power distinguishes it from authority and influence.

9. What is Corporate Entrepreneurship?

Corporate entrepreneurship is especially crucial for large companies, enabling these organizations that are traditionally averse to risk-taking to innovate, driving leaders and teams toward an increased level of corporate enterprising. In addition to the obvious benefits obtained through innovation, this approach also provides the organizational benefit of setting the stage for leadership continuity.

10.What are Private Nonprofit Corporations?

Religion Education Charities Clubs, interest groups, unions Health care

PART B 11 (a). Explain the Model strategic management. Strategic management consists of four basic elements: Environmental scanning Strategy formulation Strategy implementation

 Evaluation and control

Environmental scanning Strategy formulation
<<

Strategy implementation
<<

Evaluation and Control

11 (b). Enumerate the roles and responsibilities of Top level Management. Responsibilities of Top Management
Top management responsibilities, especially those of the CEO, involve getting things accomplished through and with others in order to meet the corporate objective. Top managements job is thus multidimensional and is oriented toward the welfare of the total organization. Specific top management tasks vary from firm to firm and are developed from an analysis of the mission, objectives, strategies, and key activities of the corporation. Tasks are typically divided among the member of the top management team. Provide Executive Leadership and Strategic Vision Executive leadership is the directing of activities towards the accomplishment of corporate objectives. Executive leadership is important because it sets the tone for the entire corporation. A strategic vision is a description of what the company is capable of becoming. It is often communicated in the mission statement. People in an organization want to have a sense of mission, but only top management is in the position to specify and communicate this strategic vision to the general workforce. 1. The CEO articulates a strategic vision for the corporation. The CEO envisions the company not as it currently is, but as it can become. The new perspective that the CEOs vision brings to activities and conflicts gives renewed meaning to everyones work and enables employees to see beyond the details of their own jobs to the functioning of the total corporation. In a survey of 1,500 senior executives from 20 different countries, when asked the most important behavioral trait a CEO must have, 98% responded that CEO must convey a strong sense of vision. 2. The CEO presents a role for others to identify with and to follow. The leader sets a an example in terms of behavior and dress. The CEOs attitudes and values concerning the

corporations purpose an activities are clear-cut and constantly communicated in words and deeds. People know what to expect and have trust in their CEO. Research indicates that businesses in which the general manager has the trust of the employees have higher sales and profits with lower turnover than do business in which there is a lower amount of trust. 3. The CEO communicates high performance standards and also shows confidence in the followers abilities to meet these standards. No leader ever improved performance by setting easily attainable goals that provided no challenge. The CEO must be willing to follow through by coaching people.

12 (a). Describe the steps in Industry analysis for Automobile Industry.

WHAT TO DO: Complete your industry analysis. WHY DO IT: Having done your preliminary analysis, you are now ready to do the full analysis. HOW TO DO IT: Step 1: Review the Autio framework and use it as a guide. It is not a questionnaire and your actual report should not be in this format. However, if you can complete an analysis using this framework and then write your industry report, you should have a robust and rigorous document. Step 2: Include Porter. Make sure your report includes a well-drawn, detailed and wellargued 5-forces diagram. Step 3: Your industry description must be both qualitative and quantitative . Explain the structure of the industry and identify the dominant companies. (A chart showing the relative size of dominant companies and their key differentiators is often a good idea.) How big is it? What is its growth and profitability over the last few years? A good analysis will have at least five years of data, though this may vary depending on the nature of the industry. Step 4: Do industry financial analysis. Financial performance in this section deals with the industry and not your specific company. How has the industry done in recent years and what are the projections for the future? This is an opportunity to use a chart to show financial performance of the industry over multiple years. Do not deal with quarters but

focus on annual performance. Good sources for this type of information are trade publications that are devoted to the specific industry, as well as newspapers and magazines devoted to business news, e.g. Financial Post, Report on Business, etc. There are many excellent resources available online through the Ryerson Library, and it is expected that you will use these resources. See the company analysis section for more guidance on finding financial sources and analyzing data. Step 5: Determine Competitive Strategies within the Industry.Clearly state how companies compete within the industry and identify the critical success factors in this industry. Tailor the Porter Model to the industry and integrate the complete figure of the model within the narrative of the paper. The following factors need to be included to produce a good analysis of the industry structure:

Determine if the analysis needs a specific market focus, e.g., analyzing GM Saturn for the North American automobile market Define the forces and include examples for each of the forces. Address the power implications for buyers and suppliers, and explain how the power changes or influences the relationships with the strategic business unit. Address barriers to entry and/or new substitutes. Analyze your findings, indicating what your analysis teaches you about this industry. Summarize your conclusions regarding the industry structure based on the Porter Competitive Model analysis.

Step 6: Identify Industry Trends and Emerging Opportunities . Strategies must evolve with the changing realities your company faces. What are the key trends that may shape the future prospects of companies in this industry? These trends may include economic, political, demographic, social and technological trends -- but dont try and discuss them all or it will be difficult to determine which ones are most important for your industry. What opportunities do these trends create? What threats do they pose? How do these affect strategic planning in the industry? Step 7: Identify the Importance of Information Technology to the Industry. This is a general perspective of the importance of information technology to the industry in general. Do not simply list applications. Take a systematic approach in discussing the major functions of the industry (core competencies) and conclude how many of them are using IT to play a major role. Step 8: Visual representation is important here -- use tables, graphs and simple pie charts -- but make sure they are clear, properly labeled and their significance is explained

in the text. Don't ask your reader to repeat the analysis you should have done.

12 (b). Describe the Internal Strategic factors for Organizational analysis.

In formulating a strategy, the strategic decision makers must also analyze conditions internal to the organization. An internal analysis leads to a realistic company profile, which is the determination of a firm's strategic competencies and weaknesses. The development of a company profile in four-step process: * In step 1, managers audit and examine key aspects of the business's operation, seeking to target key areas for further assessment. * Step 2 has managers evaluating the firm's status on these factors by comparing their current condition with past abilities of the firm. * In step 3, managers seek some comparative basis - linked to key industry or product/market conditions - against which to more accurately determine whether the company's condition on a particular factor represents a potential strength or weakness. * The final step in internal analysis is to provide the results, or company profile, as input into the strategic management process. This explains internal analysis as a process, but in practice, efforts to distinguish each step are seldom emphasized because the process is very interactive.

13 (a). Elaborate the component of Corporate Directional Strategies.

Directional strategy is the firms overall orientation toward growth, stability, or retrenchment. 1. Should we expand, cutback, or continure oru operations unchanged? 2. Should we concentrate our activities within our current industry or should we diversify into other industries? 3. If we want to grow and expand nationally and /or globally, should we do so through internal development or through acquisitions, merges or strategic alliances?

Features of Corporate directional strategies:

A corporations directional strategy is composed of three general orientations (sometimes called grand strategies):

Growth strategies expand the companys activities. Stability strategies make no change to the companys current activities. Retrenchment strategies reduce the companys level of activities.

Growth strategies:
Expand the companys activities. Concentration:
Vertical Integration Backward & Forward Integration. Horizontal Integration. Diversification: Concentric Diversification. Conglomerate Diversification.

International Entry Options:

Exporting. Licensing. Franchising. Joint Ventures. Acquisitions. Green-Field Development. Production Sharing.

Stability strategies:
Make no change to the companys current activities. Pause/Proceed with Caution Strategy

No Change Strategy Profit Strategy

Retrenchment strategies:
Reduce the companys level of activities. Turnaround Strategy. Captive company Strategy. Sellout / divestment Strategy. Bankruptcy / Liquidation Strategy.

13 (b). Explain the concept and application of Corporate Portfolio Analysis.

Portfolio analysis means top management views its product lines and business units as a series of investments form which it expects a profitable return companies with multiple product line or business units should be managed to boost overall corporate performance.

BCG GROWTH SHARE MATRIX

HIGH 20% 15% INDUSTRIAL GROWTH RATE 10% 5% LOW 0%

STARS QUESTION MARKS

CASH COWS HIGH

DOGS

LOW

MARKET SHARE GE Nine-Cell Matrix GENERAL ELECTRIC (GE) NINE CELL MATRIX INVEST HIGH SELECTIVE GROWTH INDUSTRY MEDIUM ATTRACTIVENESS LOW STRONG AVERAGE WEAK GROW OR LET GO GROW OR LET GO SELECTIVE GROWTH GROW OR LET GO

ZONE

STRATEGIC SINGAL Invest / Expand

GROW OR LET GO

Select/ Growth Harvest/ Divest

14 (a). Discuss the stages Organizational Life Cycle.

Stage I Stage II
Dominant Birth Growth Issue Popular Concentration Horizontal and vertical Strategies in Niche Integration Entrepreneur Likely Structure dominated

of

Corporate

development
Stage V
Death Liquidation or bankruptcy

in

Stage III
Maturity Concentric and Conglometrate diversification

Stage IV
Decline

Profit Strategy followed by Retrenchment Functional Decentralization Structural management into profit or surgery emphasized investment centres

Dismemberment of structure

LIFE CYCLE OF AN ORGANISATION

14 (b). Explain a realistic Model for Strategic Evaluation and Control Process.

Methods of Evaluation i. ii. iii. iv. v. Determine what to measure Establish standards of performance Measure actual performance Compare actual performance with standard Take corrective action

15 (a). Elaborate the organizational design for Corporate Entrepreneurship.

Organizational Designs for corporate entrepreneurship. ORGANISATIONAL DESIGN FOR CORPORATE ENTERPRENEURSHIP STRATEGIC IMPORTANCE
Very Important Unrelated OPERATIONAL RELATEDNESS 3 Special Business Units Uncertain 6 Independent Business Units 5 New Venture Division 2 Macro New Ventures Department Not Important 9 Complete SpinOff 8 Contracting 7 Nurturing And Contracting

2 New Product Partly Related Business Department 1 Strongly Related Direct Integration

15 (b). Strategic Management Process for Non-profit organization differ with other organization Discuss.
Entrepreneurs looking to start a new small business have a wide range of decisions to make before they begin. One of the most basic decisions is whether to enter the for-profit or nonprofit sector. For-profit and nonprofit organizations have much in common, but there are significant differences between the two. Familiarizing yourself with each type of organization can help you to decide which direction to take in your entrepreneurial career.

Significance The most fundamental difference between nonprofit and for-profit organizations is the reason they exist. For-profit companies are generally founded to generate income for entrepreneurs and their employees, while nonprofits are generally founded to serve a humanitarian or environmental need. Nonprofit organizations channel all of their income into programs and services aimed at meeting people&amp;#039;s unmet or under-met needs, such as food, water, shelter and education, or towards other issues such as deforestation and endangered species. Forprofit companies offer products and services that are valued in the marketplace, choosing to distribute profits between owners, employees, shareholders and the business itself. Features Sales revenue, in the form of cash and receivables, is the life-blood of for-profit organizations. These companies rely on earned income and credit arrangements with lenders and suppliers to finance their operations. Nonprofits, on the other hand, rely almost entirely on donations and grants from individuals, government entities and organizations. Nonprofit and for-profit organizations&amp;#039; income source determines, to a large extent, how the company can use its money. Since nonprofit income comes from donors, nonprofits are expected to utilize their funding in a way that maximizes benefits to their targeted recipients. Since for-profits earn their own income and pay their own debts, they have much more ethical leeway as to how they spend money. Tax and Liability Considerations For-profit companies are taxed in a number of ways, depending on their form of organization. Small businesses, for example, are usually sole proprietorships and partnerships. The IRS treats the income from proprietorships and partnerships as personal income, and the owners are held personally liable for all business debts. Nonprofit organizations can register for income-tax exemption under section 501(c)3 of the tax code. Contributors to nonprofit organizations are offered tax incentives for their donations as well. According to the Service Corps of Retired Executives (SCORE), nonprofit organizations are treated as legal entities for tax purposes, leaving company founders not liable for organizational debts. Hybrid Organizations Recent years have seen a melding of for-profit and nonprofit business models, as nonprofits seek to stabilize their income and for-profits seek to give something back to the community. Goodwill Industries, for example, is a nonprofit organization that accepts clothing donations, then sells the clothing in for-profit retail stores, using the income to grow the organization and fund programs and services for needy families. Chick-fil-A, as another example, is a for-profit restaurant chain that channels a large portion of its earned income into its own charitable activities. Human Resources Considerations Workforces look quite different between for-profit and nonprofit organizations. For-profit companies are staffed with salaried and hourly employees, with the occasional unpaid intern. Nonprofits, on the other hand, usually employ a small workforce and a large corps of volunteers. Procedures for hiring and firing, as well as employee motivation, communication and direction techniques vary considerably between salaried employees and volunteers.