AboutLeo Lingham Expertise In Managing a business, I can cover all aspects of running
a business--business planning, business development, business auditing, business communication, operation management, human
resources management , training, etc.
Experience 18 years of working management experience covering such areas
as business planning, business development, strategic planning,
marketing, management services, personnel administration.
PLUS
24 years of management consulting which includes business planning, strategic planning, marketing, product management, training, business coaching etc.
Question Q.1
A. Outline the investigation which a company should require to be undertaken before a decision is made whether to purchase a computer for commercial work within the company.
B. What do you understand by accreditation of prior learning?
Q.2
A. What is mean by batch production?
State the factors which must be taken into consideration to ensure that batches are set at an economic level.
B. Show how packaging has an important part to play in marketing.
Q.3
A. What is meant in a company balance sheet by:
(a) the equity of the company;
(b) debenture stock;
(c) preference shares?
B. What is meant by ‘leadership style’?
Q.4
A. How might further advances in computerization affect problems of centralization or decentralization?
B. Do you accept the view that the ultimate test of an organization’s strategy is financial performance?
Q.5
A. Consider the implications for a British business of the single European market.
B. Explain the term ‘cybernetics’.
Q.6
A. Draw an organization chart for a department concerned with management service.
B. How many managers deal with the problems of redundant staff?
C. Define automation and give an illustration of its use.
Answer
SADHANA,
HERE IS SOME USEFUL MATERIAL.
I HAVE ANSWERED Q2 [ A,B], Q3 [A,B] 4 B
OTHER ANSWERS COULD BE FITTED IN THE SPACE
PROVIDED.
IF YOU SEND THE UNANSWERED AGAIN,
I WILL HELP YOU.
REGARDS
LEO LINGHAM
=============================
Q.1
A. Outline the investigation which a company should require to be undertaken before a decision is made whether to purchase a computer for commercial work within the company.
B. What do you understand by accreditation of prior learning?
##########################################################3
Q.2
A. What is mean by batch production?
State the factors which must be taken into consideration to ensure that batches are set at an economic level.
Batch production is a manufacturing used to produce or process any product in BATCHES, as opposed to a CONTINUOUS PRODUCTION process, or a one-off production. The primary characeristic of batch production is that all components are completed at a workstation before they move to the next one. Batch production is popular in bakeries and in the manufacture of sports shoes, pharmaceutical ingredients, inks, paints and adhesives. In the manufacture of inks and paints, a technique called a colour-run is used. A colour-run is where one manufactures the lightest color first, such as light yellow followed by the next increasingly darker colour such as orange, then red and so on until reaching black and then starts over again. This minimizes the cleanup and reconfiguring of the machinery between each batch. White (by which is meant opaque paint, not transparent ink) is the only colour that cannot be used in a colour run due to the fact that a small amount of white pigment can adversely affect the medium colours.
There are inefficiencies associated with batch production. The production equipment must be stopped, re-configured, and its output tested before the next batch can be produced. Time between batches is known as 'down time'.
Batch production is useful for a factory that makes seasonal items or products for which it is difficult to FORECAST demand.
There are several advantages of batch production; it can reduce initial capital outlay because a single production line can be used to produce several PRODUCTS. As shown in the example, batch production can be useful for small businesses who cannot afford to run continuous production lines. Also, companies can use batch production as a trial run. If a retailer buys a batch of a product that does not sell then the producer can cease production without having to sustain huge losses.
FACTORS CONSIDERED ARE
-seasonal or non seasonal product.
-raw material inventory
-finished good inventory
-time of delivery.
-workers' skills.
-fixed cost of operation
-variable cost of operation.
etc
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B. Show how packaging has an important part to play in marketing.
Packaging is considered as the fifth "P" of the Marketing Mix. What makes it so? Bring
out the strategic importance and relevance as a vital tool of product decisions.
THE MARKETING MIX HAS USUALLY 4 Ps
1.product
2.price
3.promotions
4.place [ distribution]
and now , we have added the fifth
5. PACKAGING.
What is The need for packaging
It is difficult to answer whether products do need packaging, or the consumer does? For whom is the package made? The product, or the consumer? The package is tailor-made for the product, but one shall not forget that all the products are made for consumers.
From the consumer's point of view the package's function is to protect the product. In the case of bulk goods, or if the product cannot be used without the support of the package, the package must help the use of the product. Without the service of packaging, most of the goods, especially food, couldn’t reach the consumer. Living in the countryside, one can buy goods, for example milk directly from the farmer, but a can is needed to carry it home. This can also be considered as a refillable package, with almost an unlimited number of uses. In a city, milk can only be bought from the store, packed in aseptic carton box. It is not possible to avoid it, unless one goes daily to the dairy, and drink from the tap.
From the packager's point of view, the most important function of the packaging is the protection of the usage and aesthetic values of the product from damages, and get the product sold to the consumer. For the producer, the package is also a value-creating media of the product. With the help of the package, the product can be sold to the consumer. For example, a barrel full of toothpaste has almost no purchase value, since who wants to buy 100 litre of toothpaste? Most probably nobody would buy even a handful of it in the grocery, but one certainly does buy 50 grams of toothpaste in a tube.
Modern packagings are an expressive form of the consumer-lifestyle. Over the protective function, packagings are giving character, "personality" to the product. They are following the product to the consumer, giving practical as well as aesthetic value. The proportion of the usage and aesthetic functions is important. The quality of packaging reflects our universal culture. All those products that appear in the shops and offer themselves for purchase, apart of that - with very few exceptions - their usage function is primary, are creating the surrounding material environment.
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WHAT THIS PACKAGING PERFORMS IN THE TOTAL
MARKETING FUNCTION.
Primary packaging is the material the first envelops the product and holds it.
Secondary packaging is outside the primary packaging – perhaps used to group primary packages together.
What is the Role of Packaging
The role of packaging is containment, protection, safety, and display.
If you are selling your product through retail stores, you are trying to use your packaging to :
-Catch the browsers attention
-Create desire
-Inspire confidence
What is the Importance of Packaging
The Importance of Packaging
Let's talk about packaging. Packaging can be thought about in many different ways, but if we think purely about the purpose of packaging first, we find the purpose is to:
Contain the product
Communicate product information
Facilitate product storage and shipment
Reinforce branding
Packaging is important, but you need to determine how critical it is based on your marketing/distribution methods.
The packaging is a type of advertisement – even if it goes through mail order to the customer directly. It will sit on the customer’s shelf for peers to see. These peers are potential customers – and most likely they will have the same needs as the person who already made the purchase.
The package becomes even more critical if you plan to distribute your product through resellers and it will sit on a shelf in a store. There is a lot of competition for the customer’s attention. If you plan to do this, it is probably best to get a graphic designer to help you.
Use descriptive titles for the product - not necessarily creative. Many people go into a retail store looking for products to perform a function, but don't necessarily have a specific product in mind. You need to communicate your function and benefits to them quickly and effectively.
Graphics and slogans on the package should reflect the usage of the product.
Avoid technical jargon except for declaring content requirements.
Resellers are a good source of information for good packaging design. Ask for a reseller's input on a design.
Stickers on a package work very well for attracting attention. In addition, you can use them to your advantage.
Include testimonial from existing users. This will inspire confidence.
Include a sales literature in your packaging for the customer to pass on to their colleagues.
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WHY IS THE PACKAGING SYSTEM AN IMPORTANT ELEMENT
OF THE MARKETING ?
Packaging system is a set of operations that fulfil the function of creating sales units of the product. The operations of the packaging system are the follows: raw material supply, fuel and electricity production, packaging material production, package production, part of product processing that enables or helps the product to be packed, packaging (filling) operation.
Since packages are made exclusively for the product's sake, the packaging system is a part of the product's system. That is why it is very difficult to set the boundaries of the packaging system. To set system boundaries is also a dynamic process, and a basic step if a life-cycle study of the packaging system shall be conducted.
A first evaluation is made in a screening LCA (Life Cycle Assessment) to identify the key processes that have to be studied in more detailed LCA. Three aspects can be distinguished in these consecutive steps:
-boundaries between the packaging system and the environment,
-boundaries between the packaging system and the system of the packed product; and
-the distinction between relevant processes related to the product system under study.
Packaging system is often confused with only the packaging or filling operation. Although it is a very important part, but is only a part of the packaging system. The choice of the packaging operation is a complex decision, and it is based on the following main groups of factors:
-protection of the product,
-available packaging technology,
-economics (costs),
-marketing (especially marketing-communication),
-product's properties,
environmental considerations.
One would consider that the available packaging technology is the most important factor, but it is not so. The history of packaging development showed, that new packaging technologies were found first of all from the wish to improve the protection functions of packaging.
Economics is another important factor, it is crucial for the packager to be profitable, and spend the least possible on packaging the product.
Market considerations are another important factor especially at present level of "supermarket societies". If a producer wants the consumer to choose his product from the wide range of goods available, he has to do a lot more than only produce a good product. The product shall be packed to protect and enhance distribution.
Pleasing, arising attention, image creation, helping the using ease, and most important: information supply, are top functions of packages.
Naturally the package's properties are adjusted to the packed product, but it is not seldom that the product's properties are changed with the purpose of creating more practical package shapes. The motives are primarily economic -- simpler shapes are easier, and more effective to collect into secondary (retail) packages.
Another motive is the environmental concern: simpler shapes use less materials, and more effective collection to secondary packages also means reduced resource exploitation. It is sensible, and legally required that waste management options are considered already at package design. Design for reuse, recovery, or eventually disposal, are newly emerged tools of environmental marketing.
================================
THE SOCIAL IMPORTANCE OF PACKAGING
Packaging as a service
In modern societies, on the present level of economic development, to satisfy our needs, we have to rely on the services of the society. To be able to obtain consumer goods, we need among others the service of packaging. This study is based on the fact that packaging is an important part of our lives. This way the most important ‘impact’ of packaging is that it enables satisfying human needs in an effective way.
Packaging effectivity means that packaging fulfils its function with minimal use of resources and minimal overall wastage. Service means that packaging consumer goods, helps their distribution, and gives an access to goods otherwise not accessible. It is most evident in food packaging. Conserving perishable food prevents early spoilage, invention of aseptic packaging prolongs shelf-life and makes possible distribution also to greater distances. This fact is more and more important in the present way of increasing urbanisation. In such level of urbanisation, distribution of goods, especially food, is crucial, and the role of packaging is enormous.
The role of packaging in waste reduction is the most evident at food packaging. When food is processed and packaged, the food residues are often used as fuel, animal feed or some economically useful by-product. In absence of packaged processed food, the residues become garbage in the household. Another reason why food packaging reduces waste is that it reduces spoilage.
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Q.3
A. What is meant in a company balance sheet by:
(a) the equity of the company;
(b) debenture stock;
(c) preference shares?
1.THE EQUITY OF THE COMPANY.
The accounting definition for "equity" is assets minus liabilities. It is the same as book value.
The share capital is the amount of money that a company has got by issuing its shares.
(The premium over face value goes to "Reserves and Surpluses".
Equity for a company is not important, but what is important is the ROE that the company gets.
Return on Equity (%) = (Net profit / Equity) X 100%.
The more the ROE is, the better. ROE indicates how efficiently the company is using the equity to generate profits.
In certain industries, the initial equity required is very large.
e.g. In oil exploration industry, lot of assets need to be created first and then profits trickle in.
On the other hand, businesses like consulting require minimum assets. Such businesses make profits from the word go.
Hence a consulting business will usually have a much better ROE compared to an oil exploration company.
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2.DEBENTURE STOCK
Debenture stock is a form of investment that is somewhat like preferred stock. With a debenture stock offering, the terms and conditions that govern the stock issue include a schedule for making payments to the investor at regular intervals. From this perspective, debenture stock functions more like any type of debenture rather than like other forms of stock.
One of the keys to understanding how debenture stock functions is to realize that the stock offering is treated as equity rather than debt. This is the factor that tends to make the stock more like other forms of stock and less like a debenture. The classification of debenture stock also establishes a degree of protection for investors in the event the company shuts down and the assets of the COMPANY go through a LIQUIDATION process.
With debenture stock, investors receive payments that are issued on a specific schedule. The schedule remains in effect for as long as the investor holds on to shares of the stock. Depending on the exact terms of the purchase agreement, an investor may receive one last scheduled payment after selling the shares. However, this is not true in most cases. Normally, the next scheduled payment is issued to the new owner of the stocks.
Debenture stock carries a degree of risk, just like any type of stock issue. The advantages of the stock are the fixed payments that take place at regular intervals. This helps to ensure that the investor can anticipate a steady return on the investment at specific times throughout the calendar year. In addition, the terms that govern the return are usually liberal enough to make the stock offering to investors who wish to maintain a high degree of organization with their stocks while minimizing the opportunities for the unexpected to occur.
Debenture stock does provide protection for the investor in the event that the company fails. However, it is important to note that holding the stock does not entitle the investor to receive compensation while the corporation goes through the liquidation process. In most localities, investors have to wait for ACCOUNTS PAYABLE items to be settled before receiving any compensation for the shares in their possession. This applies to debenture stock in a manner similar to many other forms of stock. All outstanding debts are settled before payments on the debenture stock are issued to any of the investors.
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3.PREFERRED SHARES
Preferred stock, also called preferred shares or preference shares, is typically a 'higher ranking' stock than COMMON STOCK, and its terms are negotiated between the corporation and the investor.
Preferred stock usually carries no voting rights, but may carry priority overCOMMON STOCK in the payment of dividends and upon LIQUIDATION . Preferred stock may carry a DIVIDEND that is paid out prior to any dividends being paid to common stock holders. Preferred stock may have a convertibility feature into common stock. Preferred stockholders will be paid out in assets before common stockholders and after debt holders in BANKRUPTCY. Terms of the preferred stock are stated in a "Certificate of Designation".
Rights
Unlike common stock, preferred stock usually has several rights attached to it:
The core right is that of preference in the payment of dividends and upon liquidation of the company. Before a dividend can be declared on the common shares, any dividend obligation to the preferred shares must be satisfied.
The dividend rights are often cumulative, such that if the dividend is not paid it accumulates from year to year. However, the directors must declare a dividend before the preferred shareholder has any right to it. In case of non-cumulative, the dividend right for the year is extinguished if it is not declared for that year.
Preferred stock may or may not have a fixed LIQUIDATION VALUE , associated with it. This represents the amount of capital that was contributed to the corporation when the shares were first issued.
Preferred stock has a claim on LIQUIDATION proceeds of a STOCK COMPANY , equivalent to its par or liquidation value unless otherwise negotiated. This claim is senior to that of common stock .
Almost all preferred shares have a negotiated fixed DIVIDEND amount. The dividend is usually specified as a percentage of the par value or as a fixed amount.
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B. What is meant by ‘leadership style’?
LEADERSHIP
Leaders are often born with certain traits/ personality.
Example
-Drive
-Vision
-Leadership motivation
-Integrity
-Self confidence
-Knowledge in some fields
etc
But this does not ensure success as a leader.
There are other characteristics, that helps to make a
leadership success, like
-group leadership
-organizational talent
-sensitivity
-collaboration
-persuasiveness
-rapport building
Most of these are needed for managing situations and people.
Most leaders are not born with all these factors, but trained
either in classrooms or self taught on jobs.
Most of the above factors are learnable.
Hence leadership is a combination of born talents and
trained skills/ knowledge.
============================================
There are a number of different approaches, or 'styles' to leadership and management that are based on different assumptions and theories. The style that individuals use will be based on a combination of their beliefs, values and preferences, as well as the organizational culture and norms which will encourage some styles and discourage others.
Charismatic Leadership
Participative Leadership
Situational Leadership
Transactional Leadership
Transformational Leadership
The Quiet Leader
Servant Leadership
=======================================================
1.Charismatic Leadership
Style
The Charismatic Leader gathers followers through dint of personality and charm, rather than any form of external power or authority.
It is interesting to watch a Charismatic Leader 'working the room' as they move from person to person. They pay much attention to the person they are talking to at any one moment, making that person feel like they are, for that time, the most important person in the world.
Charismatic Leaders pay a great deal of attention in scanning and reading their environment, and are good at picking up the moods and concerns of both individuals and larger audiences. They then will hone their actions and words to suit the situation.
Charismatic Leaders use a wide range of methods to manage their image and, if they are not naturally charismatic, may practice assiduously at developing their skills. They may engender trust through visible self-sacrifice and taking personal risks in the name of their beliefs. They will show great confidence in their followers. They are very persuasive and make very effective use of body language as well as verbal language.
Deliberate charisma is played out in a theatrical sense, where the leader is 'playing to the house' to create a desired effect. They also make effective use of storytelling, including the use of symbolism and metaphor.
Leading the team
Charismatic Leaders who are building a group, whether it is a political party, a cult or a business team, will often focus strongly on making the group very clear and distinct, separating it from other groups. They will then build the image of the group, in particular in the minds of their followers, as being far superior to all others.
The Charismatic Leader will typically attach themselves firmly to the identify of the group, such that to join the group is to become one with the leader. In doing so, they create an unchallengeable position for themselves.
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2.Participative Leadership
Style
A Participative Leader, rather than taking autocratic decisions, seeks to involve other people in the process, possibly including subordinates, peers, superiors and other stakeholders. Often, however, as it is within the managers' whim to give or deny control to his or her subordinates, most participative activity is within the immediate team. The question of how much influence others are given thus may vary on the manager's preferences and beliefs, and a whole spectrum of participation is possible.
There are many varieties on this spectrum, including stages where the leader sells the idea to the team. Another variant is for the leader to describe the 'what' of objectives or goals and let the team or individuals decide the 'how' of the process by which the 'how' will be achieved (this is often called 'Management by Objectives').
The level of participation may also depend on the type of decision being made. Decisions on how to implement goals may be highly participative, whilst decisions during subordinate performance evaluations are more likely to be taken by the manager.
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3. Situational Leadership
Style
When a decision is needed, an effective leader does not just fall into a single preferred style, such as using transactional or transformational methods. In practice, as they say, things are not that simple.
Factors that affect situational decisions include motivation and capability of followers. This, in turn, is affected by factors within the particular situation. The relationship between followers and the leader may be another factor that affects leader behavior as much as it does follower behavior.
The leaders' perception of the follower and the situation will affect what they do rather than the truth of the situation. The leader's perception of themselves and other factors such as stress and mood will also modify the leaders' behavior.
other approaches and identifies six variables:
Subordinate effort: the motivation and actual effort expended.
Subordinate ability and role clarity: followers knowing what to do and how to do it.
Organization of the work: the structure of the work and utilization of resources.
Cooperation and cohesiveness: of the group in working together.
Resources and support: the availability of tools, materials, people, etc.
External coordination: the need to collaborate with other groups.
Leaders here work on such factors as external relationships, acquisition of resources, managing demands on the group and managing the structures and culture of the group.
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4. Transactional Leadership
Style
The transactional leader works through creating clear structures whereby it is clear what is required of their subordinates, and the rewards that they get for following orders. Punishments are not always mentioned, but they are also well-understood and formal systems of discipline are usually in place.
The early stage of Transactional Leadership is in negotiating the contract whereby the subordinate is given a salary and other benefits, and the company (and by implication the subordinate's manager) gets authority over the subordinate.
When the Transactional Leader allocates work to a subordinate, they are considered to be fully responsible for it, whether or not they have the resources or capability to carry it out. When things go wrong, then the subordinate is considered to be personally at fault, and is punished for their failure (just as they are rewarded for succeeding).
The transactional leader often uses management by exception, working on the principle that if something is operating to defined (and hence expected) performance then it does not need attention. Exceptions to expectation require praise and reward for exceeding expectation, whilst some kind of corrective action is applied for performance below expectation.
Whereas Transformational Leadership has more of a 'selling' style, Transactional Leadership, once the contract is in place, takes a 'telling' style.
===================================================
5. Transformational Leadership
Style
Working for a Transformational Leader can be a wonderful and uplifting experience. They put passion and energy into everything. They care about you and want you to succeed.
Transformational Leadership starts with the development of a vision, a view of the future that will excite and convert potential followers. This vision may be developed by the leader, by the senior team or may emerge from a broad series of discussions. The important factor is the leader buys into it, hook, line and sinker.
The next step, which in fact never stops, is to constantly sell the vision. This takes energy and commitment, as few people will immediately buy into a radical vision, and some will join the show much more slowly than others. The Transformational Leader thus takes every opportunity and will use whatever works to convince others to climb on board the bandwagon.
In order to create followers, the Transformational Leader has to be very careful in creating trust, and their personal integrity is a critical part of the package that they are selling. In effect, they are selling themselves as well as the vision.
In parallel with the selling activity is seeking the way forward. Some Transformational Leaders know the way, and simply want others to follow them. Others do not have a ready strategy, but will happily lead the exploration of possible routes to the promised land.
The route forwards may not be obvious and may not be plotted in details, but with a clear vision, the direction will always be known. Thus finding the way forward can be an ongoing process of course correction, and the Transformational Leader will accept that there will be failures and blind canyons along the way. As long as they feel progress is being made, they will be happy.
The final stage is to remain up-front and central during the action. Transformational Leaders are always visible and will stand up to be counted rather than hide behind their troops. They show by their attitudes and actions how everyone else should behave. They also make continued efforts to motivate and rally their followers, constantly doing the rounds, listening, soothing and enthusing.
It is their unswerving commitment as much as anything else that keeps people going, particularly through the darker times when some may question whether the vision can ever be achieved. If the people do not believe that they can succeed, then their efforts will flag. The Transformational Leader seeks to infect and reinfect their followers with a high level of commitment to the vision.
One of the methods the Transformational Leader uses to sustain motivation is in the use of ceremonies, rituals and other cultural symbolism. Small changes get big hurrahs, pumping up their significance as indicators of real progress.
Overall, they balance their attention between action that creates progress and the mental state of their followers. Perhaps more than other approaches, they are people-oriented and believe that success comes first and last through deep and sustained commitment.
======================================
6. The Quiet Leader
Style
The approach of quiet leaders is the antithesis of the classic charismatic (and often transformational) leaders in that they base their success not on ego and force of character but on their thoughts and actions. Although they are strongly task-focused, they are neither bullies nor unnecessarily unkind and may persuade people through rational argument and a form of benevolent Transactional Leadership.
identified five levels of effectiveness people can take in organizations. At level four is the merely effective leader, whilst at level five the leader who combines professional will with personal humility. The 'professional will' indicates how they are far from being timid wilting flowers and will march against any advice if they believe it is the right thing to do. In 'personal humility' they put the well-being of others before their own personal needs, for example giving others credit after successes but taking personal responsibility for failures.
The quiet leader is not a modern invention .
The very highest is barely known by men,
Then comes that which they know and love,
Then that which is feared,
Then that which is despised.
He who does not trust enough will not be trusted.
When actions are performed
Without unnecessary speech,
People say “We did it!”
Here again, the highest level of leadership is virtually invisible.
=================================================
7. Servant leadership
Style
The servant leader serves others, rather than others serving the leader. Serving others thus comes by helping them to achieve and improve.
There are two criteria of servant leadership:
The people served grow as individuals, becoming 'healthier, wiser, more autonomous and more likely themselves to become servants' .
The extent to which the leadership benefits those who are least advantaged in society (or at least does not disadvantage them).
Principles of servant leadership defined by the Alliance for Servant Leadership are:
Transformation as a vehicle for personal and institutional growth.
Personal growth as a route to better serve others.
Enabling environments that empower and encourage service.
Service as a fundamental goals.
Trusting relationships as a basic platform for collaboration and service.
Creating commitment as a way to collaborative activity.
Community building as a way to create environments in which people can trust each other and work together.
Nurturing the spirit as a way to provide joy and fulfilment in meaningful work.
---- listening, empathy, healing, awareness, persuasion, conceptualization, foresight, stewardship, commitment to growth of people, and building community.
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Q.4
A. How might further advances in computerization affect problems of centralization or decentralization?
B. Do you accept the view that the ultimate test of an organization’s strategy is financial performance?
Yes, it is true, but partially.
sound financial reserve: a) low debt position, b) high cash position
low percentage lay-offs
recovery of stock prize.
BUT THIS SOUND FINANCIAL PERFORMANCE DEPENDS
ON A NUMBER OF OTHER FACTORS, WITHOUT WHICH
THIS SOUND FINANCIAL POSITION CANNOT BE SUSTAINED.
Financial reserves were defined as a low debt position and large amounts of cash on hand. The expectation was that strong financial reserves would muffle the blow of a crisis and that strong financial reserves would thus be associated with resilience. In other words, financial reserves would make it easier to realize a strategy of commitment to employees.
TO ACHIEVE A SOUND FINANCIAL PERFORMANCE,
1.SOUND STRATEGIC PLAN.ut a new product.
ƒÞA well-crafted strategic plan gives one A well-crafted strategic plan gives one
control over the vagaries of the marketplace.control over the vagaries of the marketplace.
ƒÞStrategic management can be defined as the Strategic management can be defined as the
set of decisions and actions resulting in set of decisions and actions resulting in
formulation and implementation of strategies formulation and implementation of strategies
designed to achieve the objectives of the designed to achieve the objectives of the
organization.
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2.SOUND MANAGEMENT CAPABILITIES----
ƒÞThe management capabilities should be The management capabilities should be
aligned with the environment to optimize the aligned with the environment to optimize the
firm ’s success.firm ’s success.
ƒÞInternal capability variables i.e.,cognitive,Internal capability variables i.e.,cognitive,
psychological,political,anthropological and psychological,political,anthropological and
sociological variables,all jointly determine sociological variables,all jointly determine
the firm ’s success.
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3. SSTRONG MANAGEMENT VISION VISION ::
ľIt is a description of what the organization It is a description of what the organization
is trying to do and to become.is trying to do and to become.
ƒæGives a view of an organization ’s future Gives a view of an organization ’s future
direction and course of business activity.direction and course of business activity.
ľA powerful motivator and keeps an A powerful motivator and keeps an
organization moving forward in an intended organization moving forward in an intended
direction.direction.
ľCommunicated through the mission Communicated through the mission
statement.
------------------------------------------------------tatement.
4.FUTURE ORIENTED COMPANY MISSION:COMPANY MISSION:
ľSets a part one compan from other Sets a part one compan from other
companies in the same area of business.companies in the same area of business.
ľIdentifies the scope of the companies Identifies the scope of the companies
operation,describes the companies product,operation,describes the companies product,
market and technological areas of thrust market and technological areas of thrust
and reflects the values and priorities of its and reflects the values and priorities of its
strategic decision makers.strategic decision makers.
ľLooks to an endless future as if the firm was Looks to an endless future as if the firm was
immortal.
----------------------------------------------------
5.DYNAMISM OF THE COMPANY PROFILE:COMPANY PROFILE:
ľDepicts the quantity and quality of the Depicts the quantity and quality of the
compan ’s financial,human and physical compan ’s financial,human and physical
resources.resources.
ľAssesses the strengths and weaknesses of Assesses the strengths and weaknesses of
the company ’s management and the company ’s management and
organizational structure.organizational structure.
ľAnalyses the companies past successes Analyses the companies past successes
and traditional concerns in the context of and traditional concerns in the context of
the companies current capabilities to the companies current capabilities to
identify its future capabilities.
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6.EFFECTIVE MANAGEMENT OF EXTERNAL ENVIRONMENT:EXTERNAL ENVIRONMENT:
ľConsists of all the conditions and forces Consists of all the conditions and forces
that affect an organizations strategic that affect an organizations strategic
options and define its competitive options and define its competitive
situations.situations.
ľConsists of three interactive segments Consists of three interactive segments
namely operating environment,the namely operating environment,the
industry environment and the remote industry environment and the remote
environment.
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7.STRATEGIC ANALYSIS AND CHOICE:STRATEGIC ANALYSIS AND CHOICE:
ľEnables a firm to identify a range of Enables a firm to identify a range of
possible attractive investment attractive investment
opportunities,desired opportunities to opportunities,desired opportunities to
strategic choices.strategic choices.
ľEntire process of strategic choice is to Entire process of strategic choice is to
combine long-term objectives and generic combine long-term objectives and generic
and grand strategies for achievement of and grand strategies for achievement of
the company machine.Ex:core the company machine.Ex:core
competencies,maximization of share competencies,maximization of share
holder value.
-------------------------------------------older value.
8.EFFECTIVE ARTICULATION OF ANNUAL OBJECTIVES:ANNUAL OBJECTIVES:
ľObjectives that the firm seeks to achieve in Objectives that the firm seeks to achieve in
one ear.one ear.
ľShort term objectives-more specific-based Short term objectives-more specific-based
on long term objectives.Ex:cutting on long term objectives.Ex:cutting
manufacturing costs by 20%-4 years-5%manufacturing costs by 20%-4 years-5%
each ear.
------------------------------------------each ear.
9.SETTING LONG-TERM OBJECTIVES:LONG-TERM OBJECTIVES:
ľRefers to those results that an organization Refers to those results that an organization
seeks to achieve over a number of ears.seeks to achieve over a number of ears.
Ex:profitability,ROI,competitive position,Ex:profitability,ROI,competitive position,
technological leadership,productivity,technological leadership,productivity,
employee relations,public responsibility employee relations,public responsibility
and employee development.
--------------------------------------------------
10. SETTING GRAND STRATEGY:GRAND STRATEGY:
ľA statement of means that indicates the A statement of means that indicates the
methods to be used to achieve the methods to be used to achieve the
compan ’s objectives.compan ’s objectives.
ľA unique package of long-term strategies.A unique package of long-term strategies.
ľProvides the frame work for the entire Provides the frame work for the entire
business of the firm.business of the firm.
ľFocuses on market development,product Focuses on market development,product
development,innovation,horizontal development,innovation,horizontal
integration,vertical integration,joint integration,vertical integration,joint
ventures etc.
------------------------------------------------------
11.SETTING MATCHING FUNCTIONAL OR OPERATIONAL FUNCTIONAL OR OPERATIONAL
STRATEGIES:STRATEGIES:
ľThe grand strategy is split into strategies The grand strategy is split into strategies
for each business division or function.for each business division or function.
ľSpecific to the needs of each functional Specific to the needs of each functional
area and prescribe an integrated action area and prescribe an integrated action
plan for every function.plan for every function.
ľProvides the means for achieving annual Provides the means for achieving annual
objectives.
---------------------------------------------- objectives
12. SETTING EFFECTIVE POLICIES:POLICIES:
ľDirectives or guidelines given to managers Directives or guidelines given to managers
and their subordinates as the frame work and their subordinates as the frame work
to guide their thoughts,decisions and to guide their thoughts,decisions and
actions while implementing the actions while implementing the
organization ’ s strategy.organization ’ s strategy.
ľHelp to make the operating processes Help to make the operating processes
(standard operating procedures).Ex:HO to (standard operating procedures).Ex:HO to
authorize every purchase activity,annual authorize every purchase activity,annual
performance review of an employe.
-----------------------------------------------performance review of an emplo ee.
13. EFFECTIVE INSTITUTIONALIZING THE STRATEGY:INSTITUTIONALIZING THE STRATEGY:
ľTranslation of long-term objectives into Translation of long-term objectives into
short-term goals will make the strategy short-term goals will make the strategy
operational.operational.
ľImplementation of strateg must become Implementation of strateg must become
part of day-to-day activities of the part of day-to-day activities of the
compan (institutionalization).compan (institutionalization).
ľStructure,leadership and culture help Structure,leadership and culture help
institutionalize a firm ’ s strategy.
-------------------------------------------------------
14. SETTING EFFECTIVE CONTROL AND EVALUATION:CONTROL AND EVALUATION:
ľAfter a strategy is implemented,it should After a strategy is implemented,it should
be monitored to determine the extent of be monitored to determine the extent of
success.success.
ľStrategic managers should emplo early Strategic managers should emplo early
monitoring and control methods-monitoring and control methods-
modifications.modifications.
ľUltimate test of the strategy is its abilit to Ultimate test of the strategy is its abilit to
achieve the ends.Ex:annual objectives,achieve the ends.Ex:annual objectives,
long-term objectives an company ’ s long-term objectives an company ’ s
mission.
----------------------------------------------------------sion.
15.STAGE 1--SET UP Corporate Level Strategy Corporate Level Strategy This is
formulated by the top management to formulated by the top management to
oversee the interests and operations of an oversee the interests and operations of an
organization made up of more than one organization made up of more than one
line business.
-----------------------------------------------------
16.STAGE 2 ---SET UP Business Unit Level Strategy Business Unit Level Strategy :A single
compan that operates within one industr compan that operates within one industr
is considered as a business unit.For is considered as a business unit.For
instance,an independent company that instance,an independent company that
builds and sells swimming pools is builds and sells swimming pools is
considered as a business unit.
-----------------------------------------------------considered as a business unit.
ľ117. STAGE 3---SET UP Functional Level Strategy:Functional Level Stra egnctional
strategies identify the basic courses of strategies identify the basic courses of
action that each of the department must action that each of the department must
pursue in order to help the business unit to pursue in order to help the business unit to
attain its goals.
---------------------------------------------------
THIS 17 STEPS WILL HELP TO ACHIEVE
A SUSTAINED FINANCIAL PERFORMANCE.in its goals.
