Concept and Benefits

8/6/2019 Concept and Benefits

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BUSINESS POLICY ANDBUSINESS POLICY ANDSTRATEGIC MANAGEMENT!STRATEGIC MANAGEMENT!BUSINESS POLICY ANDBUSINESS POLICY ANDSTRATEGIC MANAGEMENT!STRATEGIC MANAGEMENT!

Presented by - Ms. Divyanshu Chauhan (faculty

Of JIMS Ghaziabad


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SOME COMMON TERMS

IN BPSM..BUSINESS POLICY

STRATERGY

VISION

MISSION

GOALS

OBJECTIVES


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BUSINESS POLICY:-Helps in understanding business

problems and finding solutionto them.


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STRATEGY:-

"An elaborate and systematic plan of action"Helps in understanding business environment on the

basis of which objectives are to be designed,alternatives have to be recognised,decision has tobe made as well implemented and finally the firm willhave to appraise the performance.


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Vision :"

The powerof imagination

"It's right out there atthe start; you have toimagine what yourfuture world is going

to look like, think outof the box,brainstorm, whatever.Think about how youwould like your worldto be and record it.

Visions are the"mission statements"of your Strategy.


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Mission.:Mission iswhat an organization isand why it exists.Mission is defined asEssential purpose of

the organization,concerningphilosophical questions like What is ourbusiness, the nature

of business it is in,who are our customersit looks to satisfy.


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Goal - "The state of affairs

that a plan is intended toachieve and that, whenachieved, terminates behaviorintended to achieve it"


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"A specific point in a plan, a waypoint on our

journey"

Objectives are a bit more specific than Goals,they are more near-term, and perhapstactical. Objectives are specific, require skill,and are characterized in the actual tasks we

carry out in pursuit of our goals

OBJECTIVES.


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BUSINESS

POLICY.!


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BUSINESS POLICY..! Business policy

provides a basicframework definingfundamental issues ofa company, itspurpose, mission andbroad businessobjectives and a setof guideline governing

the company's conductof business within itstotal perspective.


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Definitiono

fBusin

ess Policy! Business Policy defines the scope or spheres within which

decisions can be taken by the subordinates in anorganization.

It permits the lower level management to deal with theproblems and issues without consulting top levelmanagement every time for decisions.

Business policies are the guidelines developed by anorganization to govern its actions.

They define the limits within which decisions must be made. Business policy also deals with acquisition of resources with

which organizational goals can be achieved. Business policy is the study of the roles and responsibilities

of top level management, the significant issues affectingorganizational success and the decisions affectingorganization in long- run.


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Features of Business Policy An effective business policy must have

following features- Specific- Policy should be

specific/definite. If it is uncertain,then the implementation will becomedifficult.

Clear- Policy must be unambiguous. Itshould avoid use of jargons andconnotations. There should be no

misunderstandings in following thepolicy. Appropriate- Policy should be

appropriate to the presentorganizational goal.

Reliable/Uniform- Policy must beuniform enough so that it can beefficiently followed by thesubordinates.


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Simple- A policy should be simple and

easily understood by all in theorganization. Inclusive/Comprehensive- In order to

have a wide scope, a policy must becomprehensive.

Flexible- Policy should be flexible inoperation/application. This does notimply that a policy should be alteredalways, but it should be wide in scope

so as to ensure that the line managersuse them in repetitive/routinescenarios.

Stable- Policy should be stable else itwill lead to indecisiveness anduncertainty in minds of those who lookinto it for guidance


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STRATERY!


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Strategyisntthe

missionitstheplanthatallowsthecompanyto

accomplishthemission


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DEFINITION.! Goal-directed

decisions andactions in whichcapabilities andresources arematched with theopportunities and

threats in theenvironment.


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Why is strategic

management important? Gives everyone a role Makes a difference in

performance levels Provides systematic

approach touncertainties

Coordinates and

focuses employees


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Why Strategy? To change, an

organization needs Burning Platform Vision Leadership Strategic

Management

PoliticalManagement


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Difference between Policyand StrategyThe term policy should

not be considered assynonymous to the termstrategy. The difference

between policy and strategycan be summarized as.!


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Policy is a blueprint ofthe organizationalactivities which arerepetitive/routine innature. While strategyis concerned with

those organizationaldecisions which havenot been dealt/facedbefore in same form.

Policy formulation isresponsibility of top

level management.While strategyformulation isbasically done bymiddle levelmanagement


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Continued. Policy deals with routine/daily

activities essential foreffective and efficientrunning of an organization.While strategy deals with

strategic decisions. 4. Policy is concerned withboth thought and actions.While strategy is concernedmostly with action.

5. A policy is what is, orwhat is not done. While a

strategy is the methodologyused to achieve a target asprescribed by a policy.


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Strategy v/s strategicmanagement.!


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Strategy vs. Strategic

Management! Strategy

A series of goal-directed decisions

and actionsmatching anorganizationsskills andresources with theopportunities andthreats in its

environment

Strategicmanagement Analyze current

situation Developappropriatestrategies

Put strategies intoaction

Evaluate, modify,or change strategy


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Strategy vs. Strategic

Management Strategy involves

Organizationsgoals

Goal-orientedaction Related decisions

and actions Internal strengths External

opportunities andthreats

Strategicmanagement Planning

Organizing Implementing Controlling


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Basics of Strategic

Management! Four aspects that set strategic

management apart

InterdisciplinaryCapstone of the Business degree

External focus Competition

Internal focusFuture direction


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DISCUSSION

QUESTIONS. Activity 1 1. Ask the managers/employees of three organizations about their perception

regarding concept of strategy.

2.Explain the term BUSINESS POLICY

.

3.Discuss the nature of strategy.


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Questionnaire STRATERGY CHECKanalysis..

Read all the questionnaire very carefullyand analyze the responses given by therespondents and enlist various common

and unique responses given by therespondents and Give your conclusion andsuggestions.


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STRATEGIC

MANAGEMENTPROCESS.!


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Strategic Management

Process.!1)Analyzing

Current

Situation

2)Deciding

on

Strategies

3)Putting

Strategies

in Action

4)Evaluating and

Changing

Strategies

SituationAnalysis

StrategyFormulation

StrategyImplementation

StrategyEvaluation

External

Analysis

Internal

AnalysisFunctional Competitive

Corporate


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Process! Situation Analysis

Scanning & evaluating context

Internal and External environments Strategy formulation Functional Competitive

Corporate strategies


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Levels of strategy.!

Competitive:How are we going to competein our chosen business(es)?

Functional

What resources and capabilitiesdo we have to support thecorporate and competitive

strategies?

CorporateIn which direction are we going?

what business(es) are wein? Do we wantto beinthesame?


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Process Strategy implementation

Process of putting strategies into action

Consider implementation at each level Strategy evaluation

Was the strategy effective?

Close the loop


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Who does strategy? The Role of the Board of Directors

Elected representatives of the companys stockholders Legally obligated to represent and protect stockholders

The Role of Top Management Responsible for decisions and action of every employee Providing effective leadership

Other Organizational Employees Implement put the strategies into action and monitor

performance Evaluatedo the actual evaluations and take necessary

actions


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The Role of TopManagement.!

Effective

Strategic

Leadership

Exploiting andMaintaining

Core Competencies

DevelopingHuman Capital

Creating andSustaining Strong

Organizational Culture

EmphasizingEthical Decisions

and Practices

EstablishingAppropriately

Balanced Controls

DeterminingOrganizational

Purpose or Vision


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Principle.!

Effectivestrategy-making

begins with a vision of where

the organizationneedsto

head/lead!


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Benefits OF STRAREGY MAKING!

Establish themission

Formulatephilosophy

Establish policies Setting objectives Developing

strategy

Plan theorganizationalstructure

Provide personnel

Establishprocedures Provide facilities Provide capital

Set standards Establish programs

and plans Control

information Activate people

Documents

Concept and Benefits