Strategy and Culture lecture student

Strategy and Culture lecture student - How do Organisations...

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1 Semester 2 2011 How do Organisations Decide What to do? Strategy and the Environment MGMT1001 (Semester 2, 2011) Semester 2 2011 2 Lecture content (in 3 parts) 1. How an organisation‟s external environment affects a company‟s business and its decisions 2. How companies make strategic decisions, the strategies that they can use and how these strategies may affect a company‟s performance 3. How a company‟s internal environment can help, hurt or create a company‟s strategy (strategy/Structure) Semester 2 2011 3 The Organisation Environment … is the set of forces and conditions which affect the way the organisation operates Forces and conditions can be OUTSIDE the organisation (the external environment) or „inside‟ the organisation (the organisational culture)
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2 Semester 2 2011 Components of the organisational environment Semester 2 2011 THE ‘GENERAL ENVIRONMENT’ Semester 2 2011 6 PESTLE analysis P olitical E conomic S ocial/ demographic T echnological L egal E nvironmental
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3 Semester 2 2011 THE ‘’SPECIFIC ENVIRONMENT’ Semester 2 2011 8 Environmental uncertainty Small number of external elements and elements are Elements remain the same or change slowly Large number of external elements and elements are Elements remain the same or change slowly Small number of external elements and elements are Elements change frequently and unpredictably Large number of external elements and elements are Elements change frequently and unpredictably Environmental dynamism Environmental complexity Stable Unstable Simple Complex Funeral companies Insurance companies Women’s fashion Software companies Semester 2 2011 9 Part 2 –What is strategic management? Strategy Direction in which an organisation intends to move and creation of a path by which it intends to get there. Strategic management The set of managerial decisions and actions that determines the long- run performance of an organisation. A process or approach to addressing the competitive challenges faced by an organisation.
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4 Semester 2 2011 Why is strategic management important? A strategy may lead to higher organisational performance Strategy helps coordinate diverse organisational units, helping them focus on organisational goals Strategy development requires an examination of the external environment and internal organisational characteristic Semester 2 2011 11 Strategy – decisions about competition Where to compete? In what market or markets (industries, products etc) will we compete? How to compete? On what criterion or differentiating characteristic(s) will we compete? Cost? Quality? Reliability? Delivery? With what will we compete? What resources will allow us to beat our competition?
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Strategy and Culture lecture student - How do Organisations...

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