STRATEGIC MANAGEMENT and BUSINESS POLICY

Transcription

1 CD STRATEGIC MANAGEMENT and BUSINESS POLICY r.nnpprrhs xjui l\j\jkjlo Thomas L. Wheelen University of South Florida J. David Hunger Iowa State University Prentice Hall Upper Saddle River, New Jersey 07458

2 Contents PART ONE Introduction to Strategie Management and Business Policy 1 Chapter 1 Basic Concepts of Strategie Management The Study of Strategie Management 2 Phases of Strategie Management 3 Benefits of Strategie Management Globalization and Electronic Commerce: Challenges to Strategie Management 5 Impact of Globalization 5 Impact of Electronic Commerce 5 ^ GLOBAL ISSUE: Regional Trade Associations Replace National Trade Barriers Theories of Organizational Adaptation Creating a Learning Organization Basic Model of Strategie Management 9 Environmental Scanning 9 Strategy Formulation 10 Strategy Implementation 15 Evaluation and Control 16 Feedback/Learning Process Initiation of Strategy: Triggering Events 16 v/e INTERNET ISSUE: Triggering Event at Sun Microsystems Strategie Decision Making 18 What Makes a Decision Strategie 18 Mintzberg's Modes of Strategie Decision Making 18 Strategie Decision-Making Process: Aid to Better Decisions Impact ofthe Interneton Strategie Management 22 Chapter 2 Corporate Governance and Social Responsibility Corporate Governance: Role of the Board of Directors 26 Responsibilitiesof the Board 27 Members of a Board of Directors 29 THEORY AS IT APPLIES: Agency Theory Versus Stewardship Theory in Corporate Governance 30 xi

3 CONTENTS < GLOBAL ISSUE: POSCO Adds a Non-Korean Director 32 Nomination and Election of Board Members 33 Organization of the Board 34 Trends in Corporate Governance Corporate Governance: Role of Top Management 36 Responsibilities of Top Management Social Responsibilities of Strategie Decision Makers 38 Responsibilities of a Business Firm 38 Corporate Stakeholders Ethical Decision Making 41 Some Reasons for Unethical Behavior 41 Encouraging Ethical Behavior Impact of the Internet on Corporate Governance and Social Responsibility 45 ys INTERNET ISSUE: Governments Act to Protect Society by Regulating the Internet 46 PART ENDING VIDEO CASE: Newbury Comics, Inc. 50 PART TWO Scanning the Environment 51 (_ Chapter 3 Environmental Scanning and Industry Analysis Environmental Scanning 52 Identifying External Environmental Variables 52 ^ GLOBAL ISSUE: Identifying Potential Markets in Developing Nations 58 Identifying External Strategie Factors Industry Analysis: Analyzing the Task Environment 60 Porter's Approach to Industry Analysis 60 Industry Evolution 64 Categorizing International Industries 64 International Risk Assessment 65 Strategie Croups 66 Strategie Types 66 Hypercompetition 67 Using Key Success Factors to Create an Industry Matrix Competitive Intelligence Forecasting 71 Danger of Assumptions 71 Useful Forecasting Techniques 72

4 CONTENTS XHt 3.5 Synthesis of External Factors EFAS Impact of the Internet on Environmental Scanning and Industry Analysis 74 4/C INTERNET ISSUE: Competitor Information Available on the Internet 76 Chapter4 Internal Scanning: Organizational Analysis A Resource-Based Approach to Organizational Analysis 81 Using Resources to Gain Competitive Advantage 82 Determining the Sustainability of an Advantage Value Chain Analysis 84 Industry Value Chain Analysis 84 Corporate Value Chain Analysis Scanning Functional Resources 87 Basic Organizational Structures 87 Corporate Culture: The Company Way 88 Strategie Marketing Issues 89 4g GLOBAL ISSUE: ABB Uses Corporate Culture as a Competitive Advantage 90 Strategie Financial Issues 91 Strategie Research and Development (R&D) Issues 92 Strategie Operations Issues 95 Strategie Human Resource Management (HRM) Issues 97 Strategie Information Systems/Technology Issues 99 i;/^ INTERNET ISSUE: The Growing Global Internet Economy The Strategie Audit: A Checklist for Organizational Analysis Synthesis of Internal Factors IFAS Impact of the Internet on Internal Scanning and Organizational Analysis 102 PART ENDING VIDEO CASE: Newbury Comics, Inc. 106 PART THREE Strategy Formulation 108 Cltapter 5 Strategy Formulation: Situation Analysis and Business Strategy Situation Analysis: SWOT Analysis 109 Generating a Strategie Factors Analysis Summary (SFAS) Matrix 110 Finding a Propitious Niche 112 <i GLOBAL ISSUE: SAB Defends Its Propitious Niche Review of Mission and Objectives Generating Alternative Strategies Using a TOWS Matrix 114

5 CONTENTS 5.4 Business Strategies 115 Porter's Competitive Strategies 117 Cooperative Strategies 126 -t/il INTERNET ISSUE: Business to Business at Cisco Systems Impactof the Internet on Business Strategy 131 Chapterß Strategy Formulation: Corporate Strategy Corporate Strategy Directional Strategy 138 Growth Strategies 138 THEORY AS IT APPLIES: Transaction Cost Economics Analyzes Vertical Growth Strategy 141 International Entry Options 143 ^ GLOBAL ISSUE: Wal-Mart Enters International Markets 144 Controversies in Directional Growth Strategies 146 Stability Strategies 146 Retrenchment Strategies Portfolio Analysis 151 BCG Growth-Share Matrix 151 GE Business Screen 153 International Portfolio Analysis 154 Advantages and Limitations of Portfolio Analysis Corporate Parenting 156 Developing a Corporate Parenting Strategy 156 Parenting-Fit Matrix 157 Horizontal Strategy and Multipoint Competition Impact of the Internet on Corporate Strategy 159 $% INTERNET ISSUE: Global Online Population 160 Chapter 7 Strategy Formulation: Functional Strategy and Strategie Choice Functional Strategy 165 Core Competencies 165 The Sourcing Decision: Where Should Functions Be Housed? 166 Marketing Strategy 168 Financial Strategy 169 Research and Development (R&D) Strategy 170 Operations Strategy 171

6 CONTENTS XV ^ 5 GLOBAL ISSUE: International Differences Alter Whirlpool's Operations Strategy 172 Purchasing Strategy 173 Logistics Strategy 174 i/c INTERNET ISSUE: Staples Uses Internet to Replenish Inventory from 3M 175 Human Resources Management (HRM) Strategy 175 Information Systems Strategy Strategies to Avoid Strategie Choice: Selection of the Best Strategy 177 Constructing Corporate Scenarios 178 Process of Strategie Choice Development of Policies Impact of the Internet on Functional Strategy 185 PART ENDING VIDEO CASE: Newbury Comics, Inc. 190 PART FOUR Strategy Implementation and Control 191 Chapter S Strategy Implementation: Organizing for Action Strategy Implementation Who Implements Strategy? What Must Be Done? 194 Developing Programs, Budgets, and Procedures 194 Achieving Synergy How Is Strategy to Be Implemented? Organizing for Action 197 Structure Follows Strategy 197 Stages of Corporate Development 198 Organizational Life Cycle 201 INTERNET ISSUE: The Founder of the Modem Blocks Transition to Stage II 202 Advanced Types of Organizational Structures 204 Reengineering and Strategy Implementation 207 Designing Jobs to Implement Strategy 208 THEORY AS IT APPLIES: Designing Jobs with the Job Characteristics Model International Issues in Strategy Implementation 209 Stages of International Development 210 Centralization Versus Decentralization 210 # GLOBAL ISSUE: FedEx Provides the Infrastructure for Companies to Become Global Impact of the Internet on. Organizational Design and Structure 21,2

7 3 Strategy Implementation: Staffing and Directing Staffing 218 Staffing Follows Strategy 219 Selection and Management Development 221 Problems in Retrenchment 222 International Issues in Staffing Leading 225 Managing Corporate Culture 225 Action Planning 229 Management By Objectives 231 Total Quality Management 232 International Considerations in Leading 232 # GLOBAL ISSUE: Cultural Differences Create Implementation Problems in Merger Impact of the Internet on Staffing and Leading in Organizations 235 Static Intranet Applications 235 Dynamic Intranet Applications 236 %/ m. INTERNET ISSUE: Virtual Teams Use the Net to Operate at Long Distance 236 Advantages and Disadvantages of Intranets Evaluation and Control Evaluation and Control in Strategie Management Measuring Performance 243 Appropriate Measures 243 Types of Controls 243 Activity-Based Costing 245 Primary Measures of Corporate Performance 246 i/fc INTERNET ISSUE: "Eyeballs" and "MUUs": Questionable Performance Measures 248 Primary Measures of Divisional and Functional Performance 252 International Measurement Issues 254 ^J GLOBAL ISSUE: The Impact of Piracy on International Trade Strategie Information Systems 256 Enterprise Resource Planning (ERP) 256 Divisional and Functional IS Support Problems in Measuring Performance 257 Short-Term Orientation 258 Goal Displacement 258

8 CONTENTS XVÜ 10.5 Guidelines for Proper Control Strategie Incentive Management Using the Strategie Audit to Evaluate Corporate Performance Impact of the Internet on Evaluation and Control 262 Appendix 10.A Strategie Audit of a Corporation 265 PART ENDING VIDEO CASE: Newbury Comics, Inc. 274 PART FIVE Other Strategie Issues 277 Chapter 11 Strategie Issues in Managing Technology and Innovation Roleof Management Environmental Scanning 280 External Scanning 280 Internal Scanning 283 Resource Allocation Issues Strategy Formulation GLOBAL ISSUE: Impact of R&D on Competitive Advantage in China 285 Product Versus Process R&D 285 Technology Sourcing 286 Importance of Technological Competence 288 Product Portfolio Strategy Implementation 290 Developing an Innovative Entrepreneurial Culture 290 Organizing for Innovation: Corporate Entrepreneurship Evaluation and Control 294 N/3^ INTERNET ISSUE: Software Company Challenges Hackers to Attack Its Product Impact of the Internet on Managing Technology and Innovation 296 Chapter 12 Strategie Issues in Entrepreneurial Ventures and Small Businesses Importance of Small Business and Entrepreneurial Ventures 301 %g GLOBAL ISSUE: Entrepreneurship: Some Countries Are More Supportive ThanOthers 302 Definition of Small-Business Firms and Entrepreneurial Ventures 303 The Entrepreneur as a Strategist Use of Strategie Planning and Strategie Management 304 Degree of Formality 304 Usefulness of Strategie Management Model 305 Usefulness of Strategie Decision-Making Process Issues in Corporate Governance 308

9 CONTENTS 12.4 Issues in Environmental Scanning and Strategy Formulation 309 Sources of Innovation 309 Factors Affecting a New Venture's Success 311 INTERNET ISSUE: Web Site Provides Local Business a Global Presence Issues in Strategy Implementation 313 Substages of Small Business Development 313 Transfer of Power and Wealth in Family Businesses Issues in Evaluation and Control Impact of the Internet on Entrepreneurial Ventures and Small Businesses 318 Chapter 13 Strategie Issues in Not-For-Profit Organizations Why Not-For-Profit? 325 (^ GLOBAL ISSUE: Which Is Best for Society: Business or Not-For-Profit? Importance of Revenue Source 326 Sources of Not-For-Profit Revenue 327 Patterns of Influence on Strategie Decision Making 327 Usefulness of Strategie Management Concepts and Techniques Impact of Constraints on Strategie Management 329 Impact on Strategy Formulation 330 Impact on Strategy Implementation 331 Impact on Evaluation and Control Populär Not-For-Profit Strategies 332 Strategie Piggybacking 332 Mergers 333 Strategie Alliances Inipact of the Internet on Not-For-Profit Organizations 335 Taxation 335 Improvement of Government Services 335 Impact on Other Not-For-Profit Organizations 336 i/c INTERNET ISSUE: The Not-For-Profit Organizations That Rule the Internet 336 PART SIX Introduction to Case Analysis 341 Chapter 14 Suggestions for Case Analysis The Case Method Researching the Case Situation 342

10 CONTENTS XtX 14.3 Financial Analysis: A Place to Begin 342 Analyzing Financial Statements 343 Common-Size Statements 346 Z-Value, Index of Sustainable Growth, and Free Cash Flow 346 Useful Economic Measures 347 ^ GLOBAL ISSUE: Why Consider Inflation in Case Analysis? Format for Case Analysis: The Strategie Audit Impact of the Internet on Case Analysis 351 Finding a Company's Web Site 351 <^X INTERNET ISSUE: Top 10 Internet Scams 352 Using a Search Engine 352 Finding More Information 352 Appendix 14.A Resources for Case Research 355 Appendix 14.B Suggested Case Analysis Methodology Using the Strategie Audit 357 Appendix 14.C Example of Student-Written Strategie Audit 361 Name Index 1-1 Subject Index 1-13