What is Strategic Management?

You have to have one hand in the future and one hand in the present. Two hands in either place, and you’ll get into trouble. -Bob Iger

Strategic Management is the art and science of moving an enterprise from its current state (here) to a more desirable future state (there). It is about envisioning possible futures, creating roadmaps of how to get from here to there and implementing plans to get there.  It therefore, of necessity, requires an enterprise to know what  its current state (here) is, the desired future state (there), and a way to get from here to there in a prescribed time-frame.

Do not mistake EXECUTION for STRATEGY. “Tactics tell you what to execute. They’re important, but dwarfed by strategy. Strategy determines which tactics might work.”

Strategic Management Visualized
Strategic Management Visualized

There are three key elements to Strategic Management:

1)Knowing what the “HERE” is, that is, have a realistic view of the current state of the business–the external environment, the industry structure, the competition, internal resources and capabilities.

2)Envisioning a “THERE” for the business, that is, figure out where the business should be in 3-5 years. What will its sustainable competitive advantage be ?

3)Developing a path (the business model) to get from here to there. The business model describes the key activities that create the company’s unique value proposition, which activities within the firm create the value proposition and what resources are needed to support these value creating activities . The business model is the guide for making critical choices. Strategy is as much about deciding what not to do, as about what to do. It gives a company its focus.

And, continually monitoring progress, making course corrections based on feedback and results, and building a culture that learns from market feedback.

Business Model translated into Business Plan
Business Model translated into Business Plan

Click here for a detailed explanation of the image above.

Do you need a business plan if you are a sole owner, solopreneur, of a small business ?

So, how does a CEO and the leadership team accomplish all of this? What knowledge and skills are required to be a good strategist?

This course is designed to answer these questions. What you will learn in this course are tools, techniques, ways of thinking that will prepare you to have a clear-eyed view of the “here” of a business, ways of envisioning a “there” for the business, and a means of building a path from here to there. Your take-aways from this course will be tools and techniques and ways of thinking that apply equally  to for- profit or non-profits, big or large businesses, start-ups or Fortune 500. You will acquire these tools through class lectures and discussions; from reading and analyzing cases and in-class team presentations of business cases; from guest speakers who are successful business people; from individual assignments and importantly from actively engaging in this blog, through comments and discussions here.

The more you participate in-class and on this blog the more you will get out of this course. This course is tailored to meet each of your individual learning needs through social media tools such as this blog, Twitter and yes, emails, but it requires for you to engage with me by using these tools to your advantage.

Strategy Analysis Framework
Strategy Analysis Framework

Articles and commentaries worth reading:

Jump Associates is a business strategy consulting firm. This web site gives a good overview of what business strategy is and the processes involved in creating business growth strategies. Worth spending time on this site.

Business model describes a business in very simple terms. This helps in communicating the vision, mission and direction, getting teams to collaborate and have a shared vision and sense of purpose. It gets everyone involved and on the “same page”.

How to get from \”here\” to \”there” with a start-up.

Writing business plans that get funded.

Excellent slide presentation on designing business models for profits and non-profits.

A brilliant analysis by Umair Haque on the 21st Century model for creating value. He posits that businesses that create “thick value” will prevail over those that create “thin value”.

Watch Jeff Bezos, Founder and CEO of Amazon, talk about his strategy, his lessons and his reasons for acquiring Zappos.

10 things MBA programs (excepting this one) will not teach you!

Strategy is also about telling credible and believable stories. CEO as the storyteller-in-chief worth reading article.

dschool+bschool this is a new form of strategy consulting very different from traditional Mckinsey consulting model.

Fred Wilson\’s (VC) suggestion for a new business model for the newspaper industry-monetize the audience and not the content. Very smart. What do you think?

What is the difference between strategy and tactics ?

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