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The first chapter of this book introduces strategic management, the set of decisions and actions that result in the design and activation of strategies to achieve the objectives of an organization. The chapter provides an overview of the nature, benefits, and terminology of and the need for strategic management. Subsequent chapters provide greater detail. The first major section of Chapter 1, The Nature and Value of Strategic Management, emphasizes the practical value and benefits of strategic management for a firm. It also distinguishes between a firms strategic decisions and its other planning tasks. The section stresses the key point that strategic management activities are undertaken at three levels: corporate, business, and functional. The distinctive characteristics of strategic decision making at each of these levels affect the impact of activities at these levels on company operations. Other topics dealt with in this section are the value of formality in strategic management and the alignment of strategy makers in strategy formulation and implementation. The section concludes with a review of the planning research on business, which demonstrates that the use of strategic management processes yields financial and behavioral benefits that justify their costs. The second major section of Chapter 1 presents a model of the strategic management process. The model, which will serve as an outline for the remainder of the text, describes approaches currently used by strategic planners. Its individual components are carefully defined and explained, as is the process for integrating them into the strategic management process. The section ends with a discussion of the models practical limitations and the advisability of tailoring the recommendations made to actual business situations.
Chapter One
Strategic Management
Possible?
Desired?
Strategy in Action
Strategic Blunder: Xeroxs Sale of Insider Information to Apple
In the early 1970s, Xerox developed world-changing computer technology, including the mouse and the graphical user interface. (Modern GUIs include Microsoft Windows and Mac OS X.) One of the devices was called the Xerox Alto, a desktop personal computer that Xerox never bothered to market. A decade later, several Apple employees, including Steve Jobs, visited the Xerox PARC research and development facility for three days in exchange for $1 million in Apples still privately held stock. That educational field trip was
Exhibit 1.1
well worth the price of admission (Apple stock was worth $3.5 billion in 2008), given that it helped Jobs build a company worth $110 billion in 2008. In the late 1980s, Xerox sued Apple for using GUI technology in its Macintosh computer, but the case was dismissedthe statute of limitations on the dispute had passed. Size of Blunder: $107 billion.
Source: Excerpted from Melanie Lindner, The 10 Biggest Blunders Ever in Business, Forbes, March 25, 2008, http:// www.msnbc.msn.com/id/23677510/
strategic management
The set of decisions and actions that result in the formulation and implementation of plans designed to achieve a companys objectives.
Part One
4. Analyze the companys options by matching its resources with the external environment. 5. Identify the most desirable options by evaluating each option in light of the companys mission. 6. Select a set of long-term objectives and grand strategies that will achieve the most desirable options. 7. Develop annual objectives and short-term strategies that are compatible with the selected set of long-term objectives and grand strategies. 8. Implement the strategic choices by means of budgeted resource allocations in which the matching of tasks, people, structures, technologies, and reward systems is emphasized. 9. Evaluate the success of the strategic process as an input for future decision making.
strategy
Large-scale, futureoriented plans for interacting with the competitive environment to achieve company objectives.
As these nine tasks indicate, strategic management involves the planning, directing, organizing, and controlling of a companys strategy-related decisions and actions. By strategy, managers mean their large-scale, future-oriented plans for interacting with the competitive environment to achieve company objectives. A strategy is a companys game plan. Although that plan does not precisely detail all future deployments (of people, finances, and material), it does provide a framework for managerial decisions. A strategy reflects a companys awareness of how, when, and where it should compete; against whom it should compete; and for what purposes it should compete.
Strategy in Action
Exhibit 1.2
Strategic Blunder: Seattle Computer Products Sale of the DOS Operating System
In 1980, Tim Paterson, a 24-year-old programmer at Seattle Computer Products, spent four months writing the 86-DOS operating system. Meanwhile, Bill Gates was on a hunt for operating software that Microsoft could license to IBM; Big Blue had the money and factories to build computers, but not the operating system to run them. Gates bought the DOS system for a pittance: $50,000. When Seattle Computer figured out what it had let slip through its fingers, it accused Microsoft of swindling the company by not revealing that IBM was its customer; Microsoft settled by compensating Seattle Computer an additional $1 million in 1986. Big deal the market for the rest of Microsofts cool software had been born, and there was no looking back. Arguably, this key deal ultimately propelled Microsoft to software dominationand its current $253 billion valuation. Size of Blunder: $253 billion.
Source: Excerpted from Melanie Lindner, The 10 Biggest Blunders Ever in Business, Forbes, March 25, 2008, http:// www.msnbc.msn.com/id/23677510/
Strategic Issues Often Affect the Firms Long-Term Prosperity Strategic decisions ostensibly commit the firm for a long time, typically five years; however, the impact of such decisions often lasts much longer. Once a firm has committed itself to a particular strategy, its image and competitive advantages usually are tied to that strategy. Firms become known in certain markets, for certain products, with certain technologies. They would jeopardize their previous gains if they shifted from these markets, products, or technologies by adopting a radically different strategy. Thus, strategic decisions have enduring effects on firms for better or worse. For example, Commerce One created an alliance with SAP in 1999 to improve its position in the e-marketplace for business to business (B2B) sales. After taking three years to ready its e-portals, Commerce One and SAP were ready to take on the market in 2002. Unfortunately, the market changed. The foolproof strategy got to the market too late and the alliance failed. For years, Toyota had a successful strategy of marketing its sedans in Japan. With this strategy came an image, a car for an older customer, and a competitive advantage, a traditional base for Toyota. The strategy was effective, but as its customer base grew older its strategy remained unchanged. A younger customer market saw the image as unattractive and began to seek out other manufacturers. Toyotas strategic task in foreign markets is to formulate and implement a strategy that will reignite interest in its image. Strategic Issues Are Future Oriented Strategic decisions are based on what managers forecast, rather than on what they know. In such decisions, emphasis is placed on the development of projections that will enable the firm to select the most promising strategic options. In the turbulent and competitive free enterprise environment, a firm will succeed only if it takes a proactive (anticipatory) stance toward change. Microsofts Bill Gates, who gained fame as a future-oriented strategic decision maker, often succeeds at the expense of short-sighted competitors as described in Exhibit 1.2, Strategy in Action. Strategic Issues Usually Have Multifunctional or Multibusiness Consequences Strategic decisions have complex implications for most areas of the firm. Decisions about such matters as customer mix, competitive emphasis, or organizational structure necessarily involve a number of the firms strategic business units (SBUs), divisions, or program units. All of these areas will be affected by allocations or reallocations of responsibilities and resources that result from these decisions. Strategic Issues Require Considering the Firms External Environment All business firms exist in an open system. They affect and are affected by external conditions that are
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Part One
largely beyond their control. Therefore, to successfully position a firm in competitive situations, its strategic managers must look beyond its operations. They must consider what relevant others (e.g., competitors, customers, suppliers, creditors, government, and labor) are likely to do.
Chapter 1
Strategic Management
EXHIBIT 1.3
Alternative Strategic Management Structures
Corporate/business level
POM/R&D strategies
Marketing strategies
Functional level
Corporate strategies
Corporate level
Business 1
Business 2
Business 3
Business level
POM/R&D strategies
Marketing strategies
Functional level
this text assumes the use of alternative 2. Moreover, whenever appropriate, topics are covered from the perspective of each level of strategic management. In this way, the text presents a comprehensive discussion of the strategic management process.
Corporate Managers
Business Managers
Functional Managers
Part One
formality
The degree to which participation, responsibility, authority, and discretion in decision making are specified in strategic management.
that this effort not only reduced costs but also enabled him to be closer to the front-line operations managers. Corporate-level decisions are often characterized by greater risk, cost, and profit potential; greater need for flexibility; and longer time horizons. Such decisions include the choice of businesses, dividend policies, sources of long-term financing, and priorities for growth. Functional-level decisions implement the overall strategy formulated at the corporate and business levels. They involve action-oriented operational issues and are relatively short range and low risk. Functional-level decisions incur only modest costs, because they depend on available resources. They usually are adaptable to ongoing activities and, therefore, can be implemented with minimal cooperation. For example, the corporate headquarters of Sears, Roebuck & Company spent $60 million to automate 6,900 clerical jobs by installing 28,000 computerized cash registers at its 868 stores in the United States. Although this move eliminated many functional-level jobs, top management believed that reducing annual operating expenses by at least $50 million was crucial to competitive survival. Because functional-level decisions are relatively concrete and quantifiable, they receive critical attention and analysis even though their comparative profit potential is low. Common functional-level decisions include decisions on generic versus brandname labeling, basic versus applied research and development (R&D), high versus low inventory levels, general-purpose versus specific-purpose production equipment, and close versus loose supervision. Business-level decisions help bridge decisions at the corporate and functional levels. Such decisions are less costly, risky, and potentially profitable than corporate-level decisions, but they are more costly, risky, and potentially profitable than functional-level decisions. Common business-level decisions include decisions on plant location, marketing segmentation and geographic coverage, and distribution channels.
entrepreneurial mode
The informal, intuitive, and limited approach to strategic management associated with ownermanagers of smaller firms.
planning mode
The strategic formality associated with large firms that operate under a comprehensive, formal planning system.
adaptive mode
The strategic formality associated with medium-sized firms that emphasize the incremental modification of existing competitive approaches.
Chapter 1
Strategic Management 9
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Top Strategist
Hewlett-Packards CEO Mark Hurd Leads a Strategic Turnaround
Mark Hurd took over as CEO of Hewlett-Packard (HP) in March 2005, when the company was floundering from predecessor Carly Fiorinas 2001 Compaq merger, a deal that fell substantially short of meeting its projected returns and resulted in a chaotic organizational structure. HP was also struggling to grow market share in the Dell- and IMB-dominated personal computer (PC) and corporate server markets. Between 2001 and 2005, HPs stock price and profit growth were flat. HPs turnaround began with retrenchment efforts, including reducing the workforce by 10 percent, freezing pension benefits, and raising executive accountability in budget management and sales issues. Hurd restructured the company into three main divisions: PCs, laptops, and handheld devices; printers and printing; and large-enterprise information technology (IT) services. HPs centralized sales and marketing force was then broken into corresponding divisions, removing redundant administrative layers and giving division heads control over their respective sales forces and budgets. In addition, significant investment was put into sales training and customer service.
Exhibit 1.5
In the 2005 annual report, Hurd wrote that the highly matrixed organization had contributed an excessive nine layers of management between the CEO and the customer and that utilizing a centralized sales team had given division heads control of only 30 percent of their budgets. Hurd therefore decentralized the HP structure, reducing the management layers between CEO and customer to six, and increased division-head budget control to 70 percent. Fewer sales layers enabled HP to form deals more quickly and win more bids because less time was tied in administrative issues. Decentralization allowed for individual cost structures to better line up with HPs competitive businesses, which utilized HPs scales in pricing, operating expenses, and costs of goods sold. Employing scales simplified the cost system, provided greater flexibility, and more accountability. Since turnaround efforts began in 2005, HP has demonstrated solid sales growth across all three divisions. By the end of 2007, gross profits rose by 25 percent and revenue rose by 20 percent to $104 billion. In market share of the personal computer global market, HP claimed the top position by 2007 with 17.6 percent to Dells 13.9 percent. By 2008, HP climbed to second place behind IBM in corporate server market share, with 28.3 percent to IBMs 31.9 percent.
Sources: J. Fortt, Mark Hurd, Superstar, Fortune, 157, no. 12 (2008), p. 35; A Fast Turnaround at Hewlett Packard: Quick, Easy Wins, or Long-Term Promise? Strategic Direction, 23, no. 2 (2007), p. 25; and P. Tam,
System RebootHurds Big Challenge at H-P: Overhauling Corporate Sales, The Wall Street Journal, April 3, 2006, P. A1.
management are similar to those of participative decision making. Therefore, an accurate assessment of the impact of strategy formulation on organizational performance requires not only financial evaluation criteria but also nonfinancial evaluation criteriameasures of behavior-based effects. In fact, promoting positive behavioral consequences also enables the firm to achieve its financial goals. However, regardless of the profitability of strategic plans, several behavioral effects of strategic management improve the firms welfare: 1. Strategy formulation activities enhance the firms ability to prevent problems. Managers who encourage subordinates attention to planning are aided in their monitoring and forecasting responsibilities by subordinates who are aware of the needs of strategic planning.
Chapter 1
Strategic Management 11
2. Group-based strategic decisions are likely to be drawn from the best available alternatives. The strategic management process results in better decisions because group interaction generates a greater variety of strategies and because forecasts based on the specialized perspectives of group members improve the screening of options. 3. The involvement of employees in strategy formulation improves their understanding of the productivity-reward relationship in every strategic plan and, thus, heightens their motivation. 4. Gaps and overlaps in activities among individuals and groups are reduced as participation in strategy formulation clarifies differences in roles. 5. Resistance to change is reduced. Though the participants in strategy formulation may be no more pleased with their own decisions than they would be with authoritarian decisions, their greater awareness of the parameters that limit the available options makes them more likely to accept those decisions.
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EXHIBIT 1.6
Strategic Management Model
Possible?
Desired?
strategic management process. (2) It is the outline for this book. This chapter provides a general overview of the strategic management process, and the major components of the model will be the principal theme of subsequent chapters. Notice that the chapters of the text that discuss each of the strategic management process components are shown in each block. (3) The model offers one approach for analyzing the case studies in this text and thus helps the analyst develop strategy formulation skills.
This section will define and briefly describe the key components of the strategic management model. Each of these components will receive much greater attention in a later chapter. The intention here is simply to introduce them.
Company Mission
The mission of a company is the unique purpose that sets it apart from other companies of its type and identifies the scope of its operations. In short, the company mission describes
Chapter 1
Strategic Management 13
the companys product, market, and technological areas of emphasis in a way that reflects the values and priorities of the strategic decision makers. For example, Lee Hun-Hee, the new chairman of the Samsung Group, revamped the company mission by stamping his own brand of management on Samsung. Immediately, Samsung separated Chonju Paper Manufacturing and Shinsegae Department Store from other operations. This corporate act of downscaling reflected a revised management philosophy that favored specialization, thereby changing the direction and scope of the organization. Social responsibility is a critical consideration for a companys strategic decision makers since the mission statement must express how the company intends to contribute to the societies that sustain it. A firm needs to set social responsibility aspirations for itself, just as it does in other areas of corporate performance.
Internal Analysis
The company analyzes the quantity and quality of the companys financial, human, and physical resources. It also assesses the strengths and weaknesses of the companys management and organizational structure. Finally, it contrasts the companys past successes and traditional concerns with the companys current capabilities in an attempt to identify the companys future capabilities.
External Environment
A firms external environment consists of all the conditions and forces that affect its strategic options and define its competitive situation. The strategic management model shows the external environment as three interactive segments: the remote, industry, and operating environments.
Long-Term Objectives
long-term objectives
The results that an organization seeks to achieve over a multiyear period.
The results that an organization seeks over a multiyear period are its long-term objectives. Such objectives typically involve some or all of the following areas: profitability, return on investment, competitive position, technological leadership, productivity, employee relations, public responsibility, and employee development.
generic strategies
Fundamental philosophical options for the design of strategies.
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grand strategies
The means by which objectives are achieved.
their firm possesses both low cost and differentiation competitive advantages as part of their overall generic strategy. They usually combine these capabilities with a comprehensive, general plan of major actions through which their firm intends to achieve its long-term objectives in a dynamic environment. Called the grand strategy, this statement of means indicates how the objectives are to be achieved. Although every grand strategy is, in fact, a unique package of long-term strategies, 15 basic approaches can be identified: concentration, market development, product development, innovation, horizontal integration, vertical integration, joint venture, strategic alliances, consortia, concentric diversification, conglomerate diversification, turnaround, divestiture, bankruptcy, and liquidation. Each of these grand strategies will be covered in detail in Chapter 7.
Short-Term Objectives
Short-term objectives are the desired results that a company seeks over a period of one year or less. They are logically consistent with the firms long-term objectives. Companies typically have many short-term objectives to provide guidance for their functional and operational activities. Thus, there are short-term marketing activity, raw material usage, employee turnover, and sales objectives, to name just four.
short-term objectives
Desired results that provide specific guidance for action during a period of one year or less.
Action Plans
Action plans translate generic and grand strategies into action by incorporating four elements. First, they identify specific actions to be undertaken in the next year or less as part of the businesss effort to build competitive advantage. Second, they establish a clear time frame for completion of each action. Third, action plans create accountability by identifying who is responsible for each action in the plan. Fourth, each action has one or more specific, immediate objectives that the action should achieve.
Functional Tactics
Within the general framework created by the businesss generic and grand strategies, each business function needs to undertake activities that help build a sustainable competitive advantage. These short-term, limited-scope plans are called functional tactics. A radio ad campaign, an inventory reduction, and an introductory loan rate are examples of tactics. Managers in each business function develop tactics that delineate the functional activities undertaken in their part of the business and usually include them as a core part of their action plan. Functional tactics are detailed statements of the means or activities that will be used to achieve short-term objectives and establish competitive advantage.
functional tactics
Short-term, narrow scoped plans that detail the means or activities that a company will use to achieve short-term objectives.
policies
Predetermined decisions that substitute for managerial discretion in repetitive decision making.
Chapter 1
Strategic Management 15
The minimum equity position required for all new McDonalds franchises. The standard formula used to calculate return on investment for the 6 strategic business units of General Electric. A decision that Sears service and repair employees have the right to waive repair charges to appliance customers they feel have been poorly served by their Sears appliance.
continuous improvement
A form of strategic control in which managers are encouraged to be proactive in improving all operations of the firm.
Strategic control is concerned with tracking a strategy as it is being implemented, detecting problems or changes in its underlying premises, and making necessary adjustments. In contrast to postaction control, strategic control seeks to guide action on behalf of the generic and grand strategies as they are taking place and when the end results are still several years away. The rapid, accelerating change of the global marketplace of the last 10 years has made continuous improvement another aspect of strategic control in many organizations. Continuous improvement provides a way for managers to provide a form of strategic control that allows their organization to respond more proactively and timely to rapid developments in hundreds of areas that influence a businesss success. In 2003, Yahoo!s strategy was to move into the broadband and Internet search markets. However, even in its early implementation stages the strategy required revisions. Yahoo! had formed an alliance with SBC to provide the broadband service, but SBC had such limited capabilities that Yahoo! had to find new ways to reach users. Yahoo! also needed to continuously improve its new Internet search market, given competitors upgrades and rapidly rising customer expectations. Additionally, for Yahoo! to increase its market share, it needed to continually improve its branding, rather than rely largely on its technological capabilities.
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stakeholders
Influential people who are vitally interested in the actions of the business.
feedback
The analysis of postimplementation results that can be used to enhance future decision making.
A process is the flow of information through interrelated stages of analysis toward the achievement of an aim. Thus, the strategic management model in Exhibit 1.6 depicts a process. In the strategic management process, the flow of information involves historical, current, and forecast data on the operations and environment of the business. Managers evaluate these data in light of the values and priorities of influential individuals and groupsoften called stakeholdersthat are vitally interested in the actions of the business. The interrelated stages of the process are the 11 components discussed in the previous section. Finally, the aim of the process is the formulation and implementation of strategies that work, achieving the companys long-term mission and near-term objectives. Viewing strategic management as a process has several important implications. First, a change in any component will affect several or all of the other components. Most of the arrows in the model point two ways, suggesting that the flow of information usually is reciprocal. For example, forces in the external environment may influence the nature of a companys mission, and the company may in turn affect the external environment and heighten competition in its realm of operation. A specific example is a power company that is persuaded, in part by governmental incentives, to include a commitment to the development of energy alternatives in its mission statement. The company then might promise to extend its research and development (R&D) efforts in the area of coal liquefaction. The external environment has affected the companys mission, and the revised mission signals a competitive condition in the environment. A second implication of viewing strategic management as a process is that strategy formulation and implementation are sequential. The process begins with development or reevaluation of the company mission. This step is associated with, but essentially followed by, development of a company profile and assessment of the external environment. Then follow, in order, strategic choice, definition of long-term objectives, design of the grand strategy, definition of short-term objectives, design of operating strategies, institutionalization of the strategy, and review and evaluation. The apparent rigidity of the process, however, must be qualified. First, a firms strategic posture may have to be reevaluated in response to changes in any of the principal factors that determine or affect its performance. Entry by a major new competitor, the death of a prominent board member, replacement of the chief executive officer, and a downturn in market responsiveness are among the thousands of changes that can prompt reassessment of a firms strategic plan. However, no matter where the need for a reassessment originates, the strategic management process begins with the mission statement. Second, not every component of the strategic management process deserves equal attention each time planning activity takes place. Firms in an extremely stable environment may find that an in-depth assessment is not required every year. Companies often are satisfied with their original mission statements even after a decade of operation and spend only a minimal amount of time addressing this subject. A third implication of viewing strategic management as a process is the necessity of feedback from institutionalization, review, and evaluation to the early stages of the process. Feedback can be defined as the analysis of postimplementation results that can be used to enhance future decision making. Therefore, as indicated in Exhibit 1.6, strategic managers should assess the impact of implemented strategies on external environments. Thus, future planning can reflect any changes precipitated by strategic actions. Strategic managers also should analyze the impact of strategies on the possible need for modifications in the company mission.
Strategy in Action
Strategic Blunder: The Merger of AOL and Time Warner
On February 11, 2000, Internet portal America Online, then valued at $108 billion, swallowed media stalwart Time Warner, worth $111 billion, for $164 billion in an all-stock deal. AOL owned 55 percent of the new, combined company; Time Warner, 45 percent. The tech wreck of 2001, followed by the rise of stiff competitors Yahoo! and Google, changed the competitive dynamics. As cultures clashed and the stock price tanked, the company in 2002 reported a one-time
Exhibit 1.7
write-off of $99 billionat the time, the largest corporate loss ever reported. At its nadir, the firm boasted a meager market cap of $48 billion$171 billion less than at the time of the merger. Time Warner was worth only $53 billion in 2008. Size of Blunder: $196 billion.
Source: Excerpted from Melanie Lindner, The 10 Biggest Blunders Ever in Business, Forbes, March 25, 2008, http:// www.msnbc.msn.com/id/23677510/
dynamic
The term that characterizes the constantly changing conditions that affect interrelated and interdependent strategic activities.
A fourth implication of viewing strategic management as a process is the need to regard it as a dynamic system. The term dynamic characterizes the constantly changing conditions that affect interrelated and interdependent strategic activities. Managers should recognize that the components of the strategic process are constantly evolving but that formal planning artificially freezes those components, much as an action photograph freezes the movement of a swimmer. Since change is continuous, the dynamic strategic planning process must be monitored constantly for significant shifts in any of its components as a precaution against implementing an obsolete strategy. An example of the potentially devastating consequences of such dynamism is seen in the failure of the merger between AOL and Time Warner, as described in Exhibit 1.7, Strategy in Action.
Summary
Strategic management is the set of decisions and actions that result in the formulation and implementation of plans designed to achieve a companys objectives. Because it involves long-term, future-oriented, complex decision making and requires considerable resources, top-management participation is essential. Strategic management is a three-tier process involving corporate-, business-, and functional-level planners, and support personnel. At each progressively lower level, strategic
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activities were shown to be more specific, narrow, short-term, and action oriented, with lower risks but fewer opportunities for dramatic impact. The strategic management model presented in this chapter will serve as the structure for understanding and integrating all the major phases of strategy formulation and implementation. The chapter provided a summary account of these phases, each of which is given extensive individual attention in subsequent chapters. The chapter stressed that the strategic management process centers on the belief that a firms mission can be best achieved through a systematic and comprehensive assessment of both its internal capabilities and its external environment. Subsequent evaluation of the firms opportunities leads, in turn, to the choice of long-term objectives and grand strategies and, ultimately, to annual objectives and operating strategies, which must be implemented, monitored, and controlled.
Key Terms
adaptive mode, p. 8 company mission, p. 12 continuous improvement, p. 15 dynamic, p. 17 entrepreneurial mode, p. 8 feedback, p. 16 formality, p. 8
functional tactics, p. 14 generic strategies, p. 13 grand strategies, p. 14 long-term objectives, p. 13 planning mode, p. 8 policies, p. 14 process, p. 16
1. Read an article in the business press about a major action taken by a corporation. Be prepared to briefly describe this action to your professor and to name the key strategic management terms that the author used in the article. 2. In what ways do you think the subject matter in this strategic managementbusiness policy course will differ from that of previous courses you have taken? 3. After graduation, you are not likely to move directly to a top-level management position. In fact, few members of your class will ever reach the top-management level. Why, then, is it important for all business majors to study the field of strategic management? 4. Do you expect outstanding performance in this course to require a great deal of memorization? Why or why not? 5. You undoubtedly have read about individuals who seemingly have given singled-handed direction to their corporations. Is a participative strategic management approach likely to stifle or suppress the contributions of such individuals? 6. Think about the courses you have taken in functional areas, such as marketing, finance, production, personnel, and accounting. What is the importance of each of these areas to the strategic planning process? 7. Discuss with practicing business managers the strategic management models used in their firms. What are the similarities and differences between these models and the one in the text? 8. In what ways do you believe the strategic planning approach of not-for-profit organizations would differ from that of profit-oriented organizations? 9. How do you explain the success of firms that do not use a formal strategic planning process? 10. Think about your postgraduation job search as a strategic decision. How would the strategic management model be helpful to you in identifying and securing the most promising position?