8/6/2019 Strategies Policies

1/14

STRATEGIES,POLICIES

&

PLANNING PREMISES

8/6/2019 Strategies Policies

2/14

STRATEGY

Derived from greek word: startegos meaning general

It deals with the determination of long term objectives,thecourse of action and the allocation of resources to

achieve objectives.

POLICY

These are the general statements or guidelines which

direct the manager in decision making

They ensure that decisions fall within certain limits

Essence of policy is discretion.

8/6/2019 Strategies Policies

3/14

Corporate startegy:Should the firm enter into strategic alliances

How should the firm be structured

what businesses should the firm be in?How should the firm allocate its resources among

existing businesses?

How diversified should the corporation's business

be?

Business level strategyApplicable to those org. which have different businesses & each business

is separate entity.eg. Reliance Ltd. In textile,petrochemicals etc.

Functional level strategyApplicable to single function or activities there in.

Eg. Marketing function involving operational activities like sales

promotion,advertisement etc.

8/6/2019 Strategies Policies

4/14

STRATEGIC PLANNING PROCESS

INPUTSPeople

Capital

Managerial

&

Technical

skills

Goals of

claimant

PresentExternal

env

Purpose

&major

obj of

enterprize

Topmgt.

orientation Opportunity

&

threats

Dev ofAlternative

startegies

Forecast

Of futureenv

Weakness

&strengths

Resourceaudit

Enterprizeprofile

control

Evaluation

&

Strategic

Choice

(risk,timing,competitor)

Medium

&

Short

Range

planning

Implem-

entation

Contingency

plan

feedback

8/6/2019 Strategies Policies

5/14

8/6/2019 Strategies Policies

6/14

MAXI-MAXI

MAXI-MINI

MINI-MAX

MINI-MIN

8/6/2019 Strategies Policies

7/14

make products at low cost

8/6/2019 Strategies Policies

8/14

ROLE OF STRATEGYIt provides clarity in direction of activitiesIncreases org. effectiveness

Reduces role conflict & role ambiguity thus

giving satisfaction

Helps in gaining competitive advantage

8/6/2019 Strategies Policies

9/14

Successful implementation of

strategies Communicating strategies to all key decision makingmanagers

Ensuring action plans contribute to and reflect majorobjectives & strategies

Reviewing startegies regularly

Develop contingency plans

Make organization structure fit planning needs

Creating company climate that forces planning

Managers should be prepared for startegic planning

Provide sufficient information for planning

Link b/w planning and control is insufficient

8/6/2019 Strategies Policies

10/14

PORTER GENERIC STARTEGY

OVERALL COST LEADERSHIP

Aims at reductions in cost

Low cost structure compared to

competitors

'cost advantage' is the focus

DIFFERENTIATIONOffer something unique

allows companies to desensitizeprices

Innovations require investment

& should be difficult to copy

FOCUSED STRATEGY

Concentrate on special group, product,specific region instead of

focus on total industry

8/6/2019 Strategies Policies

11/14

PREMISING & FORECASTING

Planning premises is anticipated environment in whichplans are expected to operate.These include

assumptions or forecasts of the future and known

conditions that will affect the operations of plans.

Forecasting means making assumptions about future.

VALUES AND AREAS OF FORECASTING

This compels thinking ahead, looking to the future, and providing for it.

Discover areas where necessary control is lacking.Participation throughout the organization helps to unify and coordinate

plans

Areas for forecasting include economic, social, political/legal and

technical.

8/6/2019 Strategies Policies

12/14

Types of Premises

External premises:

The external environment constituting of economic,political,legal, technological, sociocultural & competitive

factors which are not under direct control of org & provide

threats and oppertunities.

Internal premises:It is related to the internal factors of the org like org.

structure,mgt. systems which are the strengths or weakness of

the org.

Tangible:can be expressed in quantitative terms

Intangible premises:cannot be expressed in quantity like company image

C

ontrolable & uncontrolable premises

8/6/2019 Strategies Policies

13/14

ForecastingProcess of estimating the relevant events of the future

based on the analysis of past and present

importance limitations

Promotion of org Based on assumptions

Essential for planning Merely trends based on past &

present

Provides oppertinities for coordination

& control

Timely & costly

Reduce risk

8/6/2019 Strategies Policies

14/14

Techniques of forecasting