E-Learning Strategic Management

E-Learning Strategic Management Priscilla Christianty Budiman 2001573524

SESI 13 – 16 (STRATEGY GENERATION & SELECTION)

The Strategy-Formulation Analytical Framework

Stage 1 - Input Stage :

Summarizes the basic input information needed to formulate strategies.

EFE Matrix, the IFE Matrix, and the Competitive Profile Matrix (CPM).

Stage 2 – Matching Stage : Focuses on generating feasible alternative strategies by aligning key external and internal

factors.

SWOT Matrix, the Strategic Position and Action Evaluation (SPACE) Matrix, the Boston Consulting Group (BCG) Matrix, the Internal-External (IE) Matrix, and the Grand Strategy Matrix.

Stage 3 - Decision Stage Reveals the relative attractiveness of alternative strategies and thus provides objective basis

for selecting specific strategies.

Quantitative Strategic Planning Matrix (QSPM).

Matching Stage A. SWOT MATRIX = helps managers to develop four types of strategies :

SO (strengths-opportunities) Strategies

WO (weaknesses-opportunities) Strategies

ST (strengths-threats) Strategies

WT (weaknesses-threats) Strategies

E-Learning Strategic Management

E-Learning Strategic Management Priscilla Christianty Budiman 2001573524

B. SPACE MATRIX

Two internal dimensions (financial position [FP] and competitive position [CP])

Two external dimensions (stability position [SP] and industry position [IP])

Most important determinants of an organization’s overall strategic position.

C. BCG MATRIX

Graphically portrays differences among divisions in terms of relative market share position

and industry growth rate.

E-Learning Strategic Management

E-Learning Strategic Management Priscilla Christianty Budiman 2001573524

Benefit : Draws attention to the cash flow, investment characteristics, and needs of an organization’s various divisions.

Quadrant 1 – Question Marks : Pursue Intensive Strategies (Market Penetration, Market Development, Product Development) or sell them.

Quadrant 2 – Stars : Represent the organization’s best long-run opportunities for growth and profitability.

Quadrant 3 – Cash Cows : Generate cash, should be managed to maintain their strong position for as long as possible.

Quadrant 4 – Dogs : Compete in a slow or no-market-growth industry, businesses are often liquidated, divested, or trimmed down through retrenchment.

D. INTERNAL-EXTERNAL (IE) MATRIX

Based on two key dimensions : IFE (x-axis) & EFE (y-axis) total weighted scores.

Three major regions :

(1). Grow and build

(2). Hold and maintain

(3). Harvest or divest

E-Learning Strategic Management

E-Learning Strategic Management Priscilla Christianty Budiman 2001573524

E. GRAND STRATEGY MATRIX

Based on two evaluative dimensions : competitive position and market (industry) growth.

Quadrant 1 : Continued concentration on current markets (market penetration and market development) and products (product development).

Quadrant 2 : Unable to compete effectively, need to determine why the firm’s current approach is ineffective and how to improve its competitiveness.

Quadrant 3 : Extensive cost and asset reduction (retrenchment) should be pursued.

Quadrant 4 : High cash-flow levels and limited internal growth needs, often can pursue related or unrelated diversification successfully.

Decision Stage

F. Quantitative Strategic Planning Matrix (QSPM)

E-Learning Strategic Management

E-Learning Strategic Management Priscilla Christianty Budiman 2001573524

Uses input from Stage 1 analyses and matching results from Stage 2 analyses to decide objectively among alternative strategies and indicate which strategies are best.

SESI 17 – 18 (STRATEGY IMPLEMENTATION)

Current Marketing Issues

To use multiple How to make channel of Less TV advertising To be a price

advertisements distribution Vs. more online leader or a price more interactive (exclusive advertising follower

dealerships)

Firms should provide incentives to consumers to share their thoughts, opinions, and

experiences on the company website (INTERACTIVE MARKETING).

The company website must not be all about the company—it must be all about the customer.

New Principles of Marketing

Interactive Marketing Redesigning websites to be more interactive.

Building new sponsorship programs and other enticements on websites.

Mixing editorial and advertising content on blogs.

[SEGMENTATION]

Market Segmentation

Subdividing market into distinct subsets of customers according to needs and buying habits.

Market segmentation allows a firm to operate with limited resources because mass production, mass distribution, and mass advertising are not required.

Directly affect marketing mix variables / 4P (Product, Place, Promotion, and Price).

E-Learning Strategic Management

E-Learning Strategic Management Priscilla Christianty Budiman 2001573524

Retention-Based Segmentation Tag #1 : Is this customer at high risk of canceling the company’s service?

Tag #2 : Is this customer worth retaining?

Tag #3 : What retention tactics should be used to retain this customer?

Alternative Bases for Market Segmentation 1. GEOGRAPHIC Region (North America, Europe, Asia Pacific), Country Size, City Size, Density (Urban & Sub-

Urban), Climate (Northern).

Price charged on a product / service depends on the customers’ purchasing power

in a country / city.

2. DEMOGRAPHIC Age, Gender, Family Size, Family Life Cycle (Young, Single, Married, No Children),

Income, Occupation, Education, Religion, Race, Nationality.

3. PSYCHOGRAPHIC Social Class (Lower-Middles, Upper-Middles), Personality.

4. BEHAVIORAL Use Occasion (Regular Occasion / Daily Life), Benefits sought (Quality, Service,

Economy), User Status (First-time User, Potential User).

NOTES : ALL FOUR ALTERNATIVE BASES MUST BE CONSIDERED BEFORE STRATEGY IMPLEMENTATION.

[POSITIONING]

Product Positioning Aim to reflect how a firm’s products or services compare to competitors’ on dimensions most

important to success in the industry.

An Effective Product Positioning Strategy Meets 2 Criteria : It uniquely distinguishes a company from the competitors.

It leads customers to expect slightly less service than a company can deliver.

E-Learning Strategic Management

E-Learning Strategic Management Priscilla Christianty Budiman 2001573524

Product Positioning Maps

A Product Positioning Map (Perceptual Map) help firms to know its competitors that operate in the same industry / level.

Benefit : Firms could select which strategy is best for them to implement, gaining

Competitive Advantage.

Evaluating the Worth of a Business

Three main approaches : What a firm owns

What a firm earns

What a firm will bring in the market

E-Learning Strategic Management

E-Learning Strategic Management Priscilla Christianty Budiman 2001573524

SESI 19 – 20 (STRATEGY EXECUTION)

The Nature of Strategy Implementation

Positioning forces Managing forces before the action before the action

Focuses on Focuses on effectiveness efficiency

Strategy Strategy Formulation Implementation

Intellectual Operational Process Process

Requires good Requires special intuitive & motivation &

analytical skills leadership skills

Resource Allocation Central management activity that allows for strategy execution.

Strategic management enables resources to be allocated according to priorities established by annual objectives.

Types of Resources

Managing Conflict Avoidance : Includes such actions as ignoring the problem in hopes that the conflict will resolve

itself or physically separating the conflicting individuals.

E-Learning Strategic Management

E-Learning Strategic Management Priscilla Christianty Budiman 2001573524

Defusion : Includes playing down differences between conflicting parties while accentuating similarities and common interests.

Confrontation : Holding a meeting at which conflicting parties present their views and work through their differences.

Organizational Structure Structure largely dictates how objectives and policies will be established.

Structure dictates how resources will be allocated.

1. FUNCTIONAL STRUCTURE Groups tasks and activities by business function (production/operations, marketing,

finance/accounting).

2. DIVISIONAL STRUCTURE Functional activities are performed both centrally and in each separate division.

Groups tasks and activities by geographic area, product or service, customer, process.

E-Learning Strategic Management

E-Learning Strategic Management Priscilla Christianty Budiman 2001573524

3. SBU (STRATEGIC-BUSINESS-UNIT) STRUCTURE Groups similar divisions into strategic business units and delegates authority and

responsibility for each unit to a senior executive who reports directly to the chief executive officer.

Facilitate strategy implementation by improving coordination.

4. MATRIX STRUCTURE Most complex of all designs.

Depends upon both vertical and horizontal flows of authority and communication.

To be effective : participative planning, training, clear mutual understanding of roles and responsibilities, excellent internal communication, and mutual trust and confidence.

E-Learning Strategic Management

E-Learning Strategic Management Priscilla Christianty Budiman 2001573524

Restructuring Vs. Reengineering

RESTRUCTURING : Reducing the size of the firm in terms of number of employees, number of divisions or units, and number of hierarchical levels in the firm’s organizational structure. (Downsizing, rightsizing, or delayering).

REENGINEERING : Reconfiguring or redesigning work, jobs, and processes for the purpose of improving cost, quality, service, and speed. (Process management, process innovation, or process redesign).

Managing Resistance to Change

FORCE CHANGE STRATEGY Involves giving orders and enforcing those orders.

EDUCATIVE CHANGE STRATEGY

One that presents information to convince people of the need for change.

SELF-INTEREST CHANGE STRATEGY One that attempts to convince individuals that the change is to their personal

advantage.

SESI 21 – 22 (STRATEGY MONITORING)

The Nature of Strategy Evaluation

Strategy evaluation includes three basic activities :

1. Examining the underlying bases of a firm’s strategy. 2. Comparing expected results with actual results. 3. Taking corrective actions to ensure that performance conforms to plans.

The Process of Evaluating Strategies

Strategy evaluation should initiate managerial questioning of expectations and assumptions, should trigger a review of objectives and values, and should stimulate creativity in generating alternatives and formulating criteria of evaluation.

Evaluating strategies on a continuous rather than on a periodic basis allows benchmarks of progress to be established and more effectively monitored.

Strategy-Evaluation Framework

E-Learning Strategic Management

E-Learning Strategic Management Priscilla Christianty Budiman 2001573524

Measuring Organizational Performance Strategists use common quantitative criteria to make three critical comparisons :

1. Comparing the firm’s performance over different time periods. 2. Comparing the firm’s performance to competitors’. 3. Comparing the firm’s performance to industry averages.

The Balanced Scorecard

1. How well is the firm continually improving and creating value along measures such as

innovation, technological leadership, product quality, operational process efficiencies,

and so on? 2. How well is the firm sustaining and even improving upon its core competencies and

competitive advantages? 3. How satisfied are the firm’s customers? Aims to balance long-term with short-term concerns, to balance financial with nonfinancial

concerns, and to balance internal with external concerns.

Measurement scale used by firms to make improvements and create added value, as well as to measure whether they have the capabilities to sustain in one industry.