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Unformatted text preview: Keeping Firm Competitive
How Strategic Management Fits In “It “It is not the strongest firms that survive, but the most adaptive” -- Samsun Corp FORTUNE FORTUNE 500 --50 --50 years old --1877 --1877 firms have appeared --Only --Only 71 have appeared each year The The World is Flat by Thomas Friedman Speed of Change
Competitors Competitors are not
Just Just around corner But But anyone around world Bought Bought books off Internet? And And we are just warming up!!!!!! Every Every agribusiness manager goal that wants to stay in business must be: “How do I enhance by firm’s competitive edge today in this today larger, faster moving more competitive market environment?” 1 Strategic Management
What What businesses must do to stay in business Strategic Management Flow Chart
Maximize Long Run Stock Price Profits by Profitably Satisfying Customer Needs Strategic Management Flow Chart
Company’s Financial Performance Financial Performance
High profit Product value Customer service 2 Strategic Management Flow Chart
Developing a Sustainable Competitive Advantage From Higher Prices or Lower Costs
Both Necessary but Not Sufficient Operational Efficiencies Efficiencies (Lowest Cost) Strategic Positioning Positioning (Differentiated Products) Generic Building Blocks of Competitive Advantage
Superior Quality Superior Efficiency Competitive Advantage
• Low Cost • Differentiation Superior Customer Responsiveness Superior Innovation
Source: Hill & Jones, Strategic Management Three Parts of Strategic Plan
Mission/Vision Mission/Vision Statement
--Values --Values --Purpose --Purpose ---Objectives Strategic Strategic Plan
--Threats --Threats and Opportunities (External) --Strengths --Strengths and Weaknesses (Internal) Implementation Implementation Plan 3 Universal Mission Statement
“To improve the economic well-being and wellquality of life of all stake-holders” stakeStephen Covey, Principle-Centered Leadership, pg 295-301 Are You First Choice?
Do you provide highest return on invested capital? Are You First Choice
Does Does products offer best value
• Totally & completely fill needs 4 Are You First Choice?
Obtain Obtain greatest job satisfaction Place Place where values match own values Opportunity Opportunity to realize full potential Make Make customers’ lives better Implementation Value
A great strategic plan without flawless execution great
Like Like no plan Three Three ways to measure strategic plan’s success if your first choice of : --Employees --Employees --Customers --Customers --Investors --Investors Highest ROIC in Industry Strategic Planning Process Develop Marketing Plan Develop Strategic Assess Internal Environment Assess External Environment Set Purpose & Objectives Define Values 5 Context in Which Competitive Strategy is Formulated
Personal Values Of Key Implementers External Company Factors Company Strengths & Weaknesses Competitive Strategy Broader Societal Expectations Internal Company Factors Industry Opportunities & Threats (Economic & Technical) Source: Porter, Competitive Strategy Porter’s Five Forces Model
Potential Entrants Threat of New Entrants Bargaining Power Of Buyers Industrial Competitors Suppliers
Rivalry among Existing Firms Buyers Bargaining Power of Suppliers Substitutes Threat of Substitute Products or Services Source: Porter, Competitive Strategy 6 ...
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- Fall '09