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Business policy lecture slides

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AWENABAH THOMAS
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22 views22 pages

1

Business policy lecture slides

Uploaded by

AWENABAH THOMAS
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Lecture 1, Week 1

1. Definition
2. Samples
3. Merits
4. Demerits
5. Structure and framework
6. Policy decisions and attributes
7. Levels of policy
8. Hierarchy of objectives, strategy and
strategic managers

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Lecture 1, Week 1
1. Definition

The set of a) decisions and b) actions that


result in the c) formulation and d)
implementation (make use of it) of e) plans
designed to achieve a company’s f)
objectives in the g) long-term with h) a
minimum of 3 years

2
Lecture 1, Week 1

2 Alternative names/terms
a) Corporate plan
b) Strategic plan
c) Business plan
d) Business policy

3
Lecture 1, Week 1

3. Samples
a) UGBS’ 5-year (strategic/ corporate)
Medium-Term Plan
b) African Union Agenda 2063
c) University of Ghana’s 10-year
Business/Strategic Plan (2014-2024)

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Lecture 1, Week 1
4. Merits

a)Guide objectives setting


b)Fosters teamwork (shared objectives)
c) Coordinates corporate efforts
d)Justifies budgets
e)Makes management accountable

5
Lecture 1, Week 1
5. Demerits

a)Limited expertise
b)Funding for business policy reports
c) Rapid changing trends in the environments

6
Lecture 1, Week 1

6. Structure/format and framework

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Breakdown of structure
1. Formulate the company’s mission
2. Conduct an internal analysis (what a business
has)
3. Assess the external environment –
competitive and general contexts (outside risk,
business opportunities)
4. Analyze the company’s options by matching
its resources with the external environment
5. Identify the most desirable options in light of
the mission

8
Structure cont’
6. Select a set of long-term objectives and
grand strategies that will achieve the most
desirable options
7. Develop annual objectives and short-
term strategies that are compatible with
long-term objectives and grand strategies
8. Implement the strategic choices
9. Evaluate the success of the strategic
process for future decision making

9
7) Business Policy Decisions
Attribute of policy Decisions
1) require top management decision
2)
3)
4)
5)
6)

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Attributes
1) Strategic issues require top-management team decisions
2)Strategic issues require large amounts of the firm’s resources
3)Strategic issues often affect the firm’s long-term prosperity
Strategic issues are future oriented
4)Strategic issues usually have multifunctional or multibusiness
consequences
5)Strategic issues require considering the firm’s external
environment

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Attributes cont.’
 Strategic issues require top-management
team decisions
 Strategic decisions overarch several areas of
a firm’s operations
 Usually only top management has the
perspective needed to understand their
broad implications
 Usually only top managers have the power to
authorize necessary resource allocations

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Dimensions of Strategic Decisions (contd.)
Strategic issues require large amounts of the firm’s resources
 They involve substantial allocations of people,
physical assets, and money
 Strategic decisions commit the firm to actions
over an extended period
 In highly competitive firms, achieving and
maintaining customer satisfaction frequently
involves commitment from every facet of the
firm

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Attributes Cont
Strategic issues often affect the firm’s long-term
prosperity
 Strategic decisions commit the firm for a long
time, typically 3 years and above ; however
the impact lasts much longer
 Once a firm has committed itself to a
strategy, its image and competitive
advantages are usually tied to that strategy
 Firms become known for what they do and
where they compete. Shifting away from that
can jeopardize their previous gains.

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Attributes Cont.’

Strategic issues are future-oriented


 They are based on what managers forecast,
rather than what they know
 Emphasis is on the development of solid
projections that will enable a firm to seek the
most promising strategic options
 A firm will succeed only if it takes a proactive
(anticipatory) stance toward change in the
enviromment

15
Attributes Cont.’
Strategic issues usually have multifunctional or
multibusiness consequences.
 Strategic decisions have complex implications for
most areas of the firm
 Decisions about customer mix, competitive
emphasis, or organizational structure involve a
number of the firm’s SBUs, divisions, or program
units

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Attributes Cont
• Strategic issues require considering the firm’s
external environment
• All businesses exist in an open system. They
affect and are affected by external
conditions that are largely beyond their
control
• Successful positioning requires that strategic
managers look beyond operations and
consider what relevant others are likely to
do

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8) Levels of policy decisions
Corporate level: board of directors,
CEO & administration [Highest]
Business level: business and
corporate managers [Middle]
Functional level: Product,
geographic, and functional area
managers [Lowest]
Operational level

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Alternative Strategic Management
Ex. 1.2
Structures

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9) Hierarchy of Objectives and Strategy

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State the components of the policy model

Company Mission Internal Analysis


External Analysis Strategic Analysis & Choice
Long-Term Objectives Generic & Grand Strategies
Short-Term Objectives Action Plans & Functional
Tactics
Strategic Control & Continuous
Improvement

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Key Terms
• Adaptive mode • Grand strategies
• Company mission • Long-term objectives
• Continuous improvement • Planning mode
• Dynamic • Policies
• Entrepreneurial mode • Processes
• Feedback • Short-term objectives
• Formality • Stakeholders
• Functional tactics • Strategic control
• Generic strategies • Strategic management
• Strategy

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