STRATEGIC MANAGEMENT

PRESENTED BY –

SAI PATIL

TUSHAR SHRIVASTAVA

SAHIL JAIN

KENICHI OHMAE

Popularly known as “Mr. Strategy”

Chairman of McKinsey & Company ( Japan)

Author of 5 books including “The mind of the strategist“

PART 1

THE ART OF STRATEGIC THINKING

ANALYSIS : THE STARTING POINT

DETERMINING THE CRITICAL ISSUES

FAIL-SAFE METHODOLOGY

THE ISSUE DIAGRAM

THE PROFIT DIAGRAM

FOUR ROUTES TO STRATEGIC ADVANTAGE

FOCUSING ON KEY FACTORS

DISSECTING THE MARKET

HIGHTLIGHTING DIFFERENCES BETWEEN WINNERS AND LOSERS

IDENTIFYING THAT KFS (KEY FACTORS FOR SUCCESS) IS NOT ENOUGH

BUILDING ON RELATIVE SUPERIORITY

THE MECHANISM OF RELATIVE SUPERIORITY

PURSUING AGGRESSIVE INITIATIVES

Strategist weapons- strategic thinking , consistency and coherence

Challenge the prevailing assumptions by asking WHY?

Breakthrough the stalemated situations

EXPLOITING STRATEGIC DEGREES OF FREEDOM

SELECTING THE CRITICAL AXES

CASES IN POINT FIGHTING ON

MULTIPLE FRONTS EXPLOITING DEGREES

OF FREEDOM SEGMENTING BY

USER OBJECTIVE

THE SECRET OF STRATEGIC VISION

STRATEGIC TUNNEL VISION THE “AL OR NOTHING” FALLACY FLEXIBLEL THINKING PERILS OF PERFECTIONISM KEEPING DETAILS IN PERSPECTIVE FOCUS ON KEY FACTORS PROBING FOR KFS CHALLENGING THE CONSTRAINTS STRATEGIC SCHIZOPHRENIA A QUESTION OF ATTITUDE

PART 2

BUILDING SUCESSFUL STRATEGIES

THE STRATEGIC TRIANGLE

THE STRATEGIC 3 C’s Corporation Customers Competition

STRATEGIC PLANNING UNIT

BROAD PERSPECTIVE NEEDED

TESTING THE DECISION Reassessing the legitimacy of three C’s This is done by asking these questions:1. Are customer wants well defined and

understood?2. Is the business unit equipped to respond

functionally to the basic wants and needs of the customer in defined segments?

3. Do competitors have different sets of operating conditions that could give them a relative advantage over the business unit in question?

CUSTOMER BASED STRATEGIES

BASIC MODES OF MARKET SEGMENTATION: Segmentation by Customer Objectives (eg.

Coffee) Segmentation by Customer Coverage

RESEGMENTING THE MARKET

CHANGES IN CUSTOMER MIX Change occurs due to alterations in

demography, distribution channels, customer size etc.

Eg. Truck manufacturer The author quotes “very few companies lose

market share in head-on competition. In my experience, in the majority of instances a corporation looses share because of structural change i.e the faster growth of its weak segment compared with its strong segment”

KEEPING TABS ON TRENDS The author quotes:

“Customer based strategies are the basis of all strategy”

“ In a free, competitive economic world, there will be no stability in a corporation’s performance if it allows its attention to be diverted from the basic business mission of serving its customers”

CORPORATE BASED STRATEGIES

IDENTIFYING KEY FUNCTIONS Eg. Manufacturer of switches, timers and relays

SELECTIVITY AND SEQUENCING Eg. Japanese corporations

FUNCTIONAL STRATEGIES (casio v/s the competition) Optimizing functional performance

Improving cost effectiveness Reducing costs through overhead value analysis and zero based budgeting Exercise greater selectivity (cherry picking high impact operations) Sharing a key function

Avoiding the pitfalls

COMPETITOR BASED STRATEGIES

POWER OF AN IMAGE Eg. Sony and Honda in Japan

EXPLOITING TANGIBLE ADVANTAGES Eg. Toyota’s forklift truck business

CAPITALISING ON PROFIT AND COST-STRUCTURE DIFFERENCES

TACTICS FOR FLY WEIGHTS

PART 3

MODERN STRATEGIC REALITIES

UNDERSTANDING THE ECONOMIC ENVIORNMENT

CONTINUING LOW GROWTH MARKET MATURITY AND STRATEGIC STALEMENT UNEVEN DISTRIBUTION OF RESOURCES GROWING INTERNATIONAL COMPLEXITIES IRREVERSIBLE INFLATION DEVELOPING A STRATEGIC RESPONSE REPLACEMENT DEMAND INTERNATIONAL DISPLACEMENT NEW ECONOMIC ORDER ACCELERATED LIFE CYCLE

COPING WITH STRATEGIC CHANGE

FROM LABOUR TO CAPITAL INTENSIVE FROM MULTINATIONALS TO MULTILOCALS SHIFT FROM FIXED COST TO VARIABLE COST

GAME FROM STEEL TO ELECTRONICS SHIFT IN BUSINESS UNIT DEFINITION FROM INTERNATIONAL TO LOCAL FINANCIAL

MANAGEMENT FROM SYSTEMS TO HUMAN BEINGS ADDING IT ALL UP

JAPAN: MYTHS AND REALITIES

CONCEPT OF THE CORPORATION ORGANIZATION MEANS PEOPLE GOVERNMENT AS COACH, NOT CAPTAIN CHANGING THE BATTLEGROUND A SUCCESS RECIPE

FORESIGHTED DECISION MAKING

DEFINING THE BUSINESS DOMAIN CONSTRUCTING A STRATEGIC

SCENARIO CONFRONTING CRITICAL CHOICES PACING PROGRESS REALISTICALLY STICKING TO THE BASICS

A STRATEGIC SUCCESS FORMULA

SENSING THE LIMITS CONDITIONS OF CREATIVITY