Lecture one: the nature of strategic management & Strategic thinking: learn how to develop business visions and

missions What is Strategy means? Long-term vision or long -term plan. How to achieve objectives. To define the term strategy we should know: In any organization, you have two types of decisions: operational or strategic decisions Operational decision characteristics: o o o o o Day to day Short-term Tactical Routine Functional

Strategic decisions characteristics: 1-It deals with the long-term direction of the organization Ex: Dell transformation 2-Concerns with scope or the area of activity of the organization, single area or diversified /portfolio Ex: bahgat group 3-you should gain/create a competitive advantage, some edge over your competitors 4-should fit into dynamic/changing environment, it has to be flexible to fit into 5-you need to utilize the organizational resources or competencies. 6-outcome meets value/objectives of stake-holders, fulfill the aim of stake holder of the organization Strategy term: It is the direction and the scope of the organization over the long term in a way helps the organization to gain competitive advantage in a dynamic environment using competences and resources to meet the values and the objective of its stakeholders.

Read the table in the terminology paper Mission: refers to one question "what is our business?" it describes what the org is doing now? Vision: refers to one question "what is the org will become?" "What do we want to become?". a dream Goal/Target: aim Quantified target with precise time and quantity it became an objective. Strategic capability to gain competitive advantage or edge Strategy to help me achieving my objective Strategic thinking: characteristic: input to strategic plan based on high element of analysis and intuition (previous experience). Examples: Mahateer Mohamed, Micheal Dell, Jack Welch, ect. Strategic planning: determining thinking long-term how the organization should look like Operational planning: procedures or action to execute the strategic planning Strategic thinking: starting point of strategic planning and it is the framework of accomplishment both All of this is the first step to the vision. What is Strategic management? Framework of strategic management It is based on four different stages: 1- environmental scanning: organization surrounded by internal and external environment First layer of the external environment: society or mega environment: general factors or PEST factors (political, economic, social, technological) Out reach of this layer/outcome of scanning the first layer: opportunities and threats Second layer: TASK environment, industry factors: suppliers, consumers, competitive, stakeholders, labor union In the external environment the outreach: opportunities and threats

2- last layer: internal environment You get to scan all the recourses structure and the competencies inside the boundary of the organization. Outcome: Strengths and weakness of the organization. SWOT or SWOC (challenges) Stage two: After defining SWOT, it is time to formulate strategy Strategy formulation or planning Anatomy of strategic planning: VMOSA stands for the following To go for the strategic planning you should have vision, mission, and objectives from mission, to achieve it you should have strategy, through actions and tactics. Strategy implementation: Action stage Easy to keep planning but hard to implement. Introduce new strategy to change so it will pump into resistance Stage four: corrective action Evaluating and comparing the actual result with the plan Strategic management: it is an art and science of studying the organizational environments and formulating and implementing and evaluating strategies the proper strategy that would help to achieve the organization's long-term objectives. Following the model is not a full guaranteed success; it is only to avoid deviation out the right way Strategic questions: very important: 1- Where are we now in the present time? Answer: found in environmental scanning (internally and externally), strategic audit, situational analysis, or environmental analysis. 2- Where do we want to go? Answer in strategic planning stage 3- How to go there? Answer in efficient strategy implementation. 4- Are we there yet? Answer in strategy evaluation and control.

Having a vision is the starting point of the strategic thinking, which is the main input toward the strategic planning. Its limit is imagination not knowledge Bernard show: some people see things as they are and they ask why, I dream things never were and I say why not Examples: BMW vision: "we will be the standard." what do want to be? They are tackling the future time Mercedes vision: "we are the standard." We already are we are looking for more. While Mission statement answers the question: "what are we doing?" Describes the biz the organization is conducting Mission statement has to meet nine different components: "what the organization is doing now? 123456789Who are customers you are serving? What are you providing, in terms of products and services In which market are you competing? Technology updating Does the organization Concern with survive ,growth or making profit Organization's Believes ,values, ethical priority What is the competitive advantage of the organization Does it concern with the environment concern Employees as a valuable assets or not

Examples: P&G, 57357