Lecture 2.docx - What does a strategy making process/execution entail(The model below is important for exam 1 2 3 4 5 Developing a strategic vision a

Lecture 2.docx - What does a strategy making...

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What does a strategy making process/execution entail? (The model below is important for exam) 1. Developing a strategic vision, a mission statement, and a set of core values 2. Setting objectives for measuring the firm's performance and tracking its progress 3. Crafting a strategy to move the firm along its strategic course and achieve its objectives 4. Executing the chosen strategy efficiently and effectively 5. Monitoring developments, evaluating performance, and initiating corrective adjustments Note: strategies 1, 2 and 3 are considered strategy making and 4 and 5 are where execution occurs. Additionally stages 1 and 4 must be revised in light of the actual performance, changing conditions and new opportunities A company’s strategic plan lays out its future direction, performance targets, and strategy. Stage 1: Developing a strategic vision, mission statement and a set of core values Developing a strategic vision: A strategic vision describes management’s aspirations for the company’s future and the course and direction charted to achieve them. Delineates management’s aspirations for the firm to its stakeholders Provides direction: “where we are going” Sets out the compelling rationale (strategic soundness) for the firm’s direction Uses distinctive and specific language to set the firm apart from its rivals Why communicate the vision? (A little important) Fosters employee commitment to the firm’s chosen strategic direction Ensures understanding of its importance Motivates, informs, and inspires internal and external stakeholders Demonstrates top management support for the firm’s future strategic direction and competitive efforts An effectively communicated vision is a valuable management tool for enlisting the commitment of company personnel to engage in actions that move the company forward in the intended direction.
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Putting the strategic vision in place: Put the vision in writing and distribute it. Hold meetings to personally explain the vision and its rationale. Create a memorable slogan or phrase that effectively expresses the essence of the vision. Emphasize the positive payoffs for making the vision happen. Why a sound, well-communicated strategic vision matters? It crystallizes senior executives’ own views about the firm’s long-term direction. It reduces the risk of rudderless decision making. It is a tool for winning the support of organization members to help make the vision a reality. It provides a beacon for lower-level managers in setting departmental objectives and crafting departmental strategies that are in sync with the firm’s overall strategy. It helps an organization prepare for the future.
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