Strategic Management

Preface
Chapter 1 Introduction to Strategic Leadership
  1.1 What Is Strategy? 
     1.1.1 Strategy Versus Operational Effectiveness
     1.1.2 The Three Central Questions of Strategy 
  1.2 The Purpose of the Firm: A Foundational Debate
    1.2.1 The Shareholder Primacy View
    1.2.2 The Stakeholder View
    1.2.3 The Contemporary Synthesis
  1.3 Historical Evolution of Strategic Management 
    1.3.1 Phase1: Budgeting and Financial Control(1950s) 
    1.3.2 Phase2: Corporate Planning (1960s)
    1.3.3 Phase3: Industry and Competitive Analysis (1970s–1980s) 
    1.3.4 Phase4: The Resource-Based View (1990s)
    1.3.5 Phase5: Dynamic Capabilities and Disruption (2000s–present) 
  1.4 Sustainable Competitive Advantage
  1.5 The Role of Leadership in Strategy 
Exercises 
Reflection Questions 
Chapter Summary
References
Chapter 2 Vision and Mission
  2.1 Why Vision and Mission Matter 
  2.2 The Vision Statement 
    2.2.1 Characteristics of Effective Vision Statements
    2.2.2 Examples and Analysis
  2.3 The Mission Statement
    2.3.1 Characteristics of Effective Mission Statements
    2.3.2 Examples and Analysis
  2.4 The Relationship Between Vision, Mission, andStrategy 
  2.5 Communicating and Implementing Vision and Mission
    2.5.1 Common Failure Modes
    2.5.2 Implementation Best Practices
Key Terms
Exercises
Reflection Questions
Chapter Summary
References
Chapter 3 Industry Analysis: PESTEL and the Macro Environment 
  3.1 Why Analyze the Environment?
  3.2 The PESTEL Framework
    3.2.1 Political Factors
    3.2.2 Economic Factors 
    3.2.3 Social/Sociocultural Factors 
    3.2.4 Technological Factors
    3.2.5 Environmental/Ecological Factors
    3.2.6 Legal Factors
  3.3 Conducting a PESTEL Analysis: A Process
  3.4 Army Core Values (LDRSHIP) and Ethical Environmental Scanning 
  3.5 Industry Attractiveness
Key Terms
Exercises
Reflection Questions 
Chapter Summary
References
Chapter 4 Industry Analysis: Porter’s Five Forces and Competitive Dynamics
  4.1 From Macroto Industry: Why Industry Structure Matters
  4.2 Porter’s Five Forces 
    4.2.1 Force1: Threat of New Entrants
    4.2.2 Force2: Bargaining Power of Suppliers
    4.2.3 Force3: Bargaining Power of Buyers
    4.2.4 Force4: Threat of Substitute Productsor Services 
    4.2.5 Force5: Rivalry Among Existing Competitors
  4.3 Applying the Five Forces: A Scoring Approach 
  4.4 Limitations of the Five Forces Model
  4.5 Competitor Analysis
    4.5.1 Competitor Identification
    4.5.2 Competitor Objectives
    4.5.3 Competitor Assumptions
    4.5.4 Competitor Strategy 
    4.5.5 Competitor Capabilities 
    4.5.6 Competitor Response Profile
  4.6 Strategic Groups
  4.7 Comparative Competitive Strength Assessment 
    4.7.1 Conceptual Foundation
    4.7.2 Identifying Key Success Factors 
    4.7.3 Constructing the Weighted Assessment Matrix
    4.7.4 A Template for the Weighted Assessment 
    4.7.5 An Illustrative Application: Global Smartphone Industry 
    4.7.6 Interpreting the Results
    4.7.7 Common Analytical Errors and How to Avoid Them
    4.7.8 Connecting to Strategy Formulation
  4.8 Industry Evolution and Dynamic Analysis 
Exercises 
Reflection Questions 
Chapter Summary
Recommended References
Chapter 5 Firm Analysis: VRIO framework and Internal Assessment 
  5.1 From Outside -In to Inside- Out 
  5.2 Resources, Capabilities, and Competencies
  5.3 The VRIO Framework
    5.3.1 Valuable (V)
    5.3.2 Rare(R)
    5.3.3 Inimitable(I) 
    5.3.4 Organized to Capture Value (O) 
    5.3.5 VRIO Outcomes
  5.4 Strengths and Weaknesses Assessment 
    5.4.1 Functional Area Analysis
  5.5 The Value Chain
  5.6 Integrating Internal Analysis with Values - Driven Leadership
Exercises 
Reflection Questions
Chapter Summary
Recommended References
Chapter 6 Firm Analysis: Resource-Based View and Core Competencies
  6.1 TheResource-BasedView:TheoreticalFoundations
    6.1.1 KeyAssumptionsoftheRBV
    6.1.2 TheVRIOFramework 
  6.2 DynamicCapabilities
  6.3 CoreCompetencies
    6.3.1 ThreeTestsforCoreCompetencies 
    6.3.2 TheCompetencyTree
  6.4 CompetitiveStrengthsAssessment
    6.4.1 StepsinCompetitiveStrengthsAssessment
  6.5 BuildingandProtectingStrategicResources
    6.5.1 TypesofCompetitiveMoats 
    6.5.2 MoatErosionandRenewal
Exercises 
ReflectionQuestions 
ChapterSummary
References
Chapter 7 International Expansion
  7.1 WhyGoInternational?
  7.2 TheCAGEFramework 
  7.3 EntryModes 
    7.3.1 TheEntryModeSpectrum
    7.3.2 Exporting
    7.3.3 LicensingandFranchising
    7.3.4 StrategicAlliancesandJointVentures 
    7.3.5 WhollyOwnedSubsidiaries
  7.4 GlobalIntegrationVersusLocalResponsiveness 
  7.5 Cross-CulturalManagement 
    7.5.1 Hofstede’sCulturalDimensions
    7.5.2 CulturalIntelligenceinPractice 
  7.6 ManagingInternationalOperations 
    7.6.1 InstitutionalVoids
    7.6.2 PoliticalRiskandGeopolitics 
    7.6.3 KnowledgeTransferAcrossBorders 
Key Terms
Exercises 
Reflection Questions 
Chapter Summary
References
Chapter 8 Evaluation: Performance Metrics and the Balanced Scorecard
  8.1 WhyMeasurementMatters
  8.2 Key Performance Indicators (KPIs) 
    8.2.1 Characteristics of EffectiveKPIs (SMART)
    8.2.2 Types of KPIs: Leading and Lagging Indicators 
  8.3 The Balanced Scorecard 
    8.3.1 Perspective1: Financial 
    8.3.2 Perspective2: Customer
    8.3.3 Perspective3: Internal Business Processes
    8.3.4 Perspective4: Learning and Growth
  8.4 The Strategy Map
  8.5 Military Connections: MDMP and LDRSHIP in Performance Measurement 
    8.5.1 The MDMP and Assessment
    8.5.2 From Battle field to Boardroom: The MDMP–BSC Parallel
  8.6 Designing and Implementing a Balanced Scorecard
    8.6.1 Step1: Clarify the Strategy 
    8.6.2 Step2: Build the Strategy Map
    8.6.3 Step3: Select KPIs for Each Objective
    8.6.4 Step4: Set Targets and Initiatives
    8.6.5 Step5: Cascade and Communicate
    8.6.6 Step6: Review, Learn, and Adapt 
  8.7 Limitations and Extensions 
Exercises 
Reflection Questions 
Chapter Summary
References
Chapter 9 Strategic Choice: Generic Strategies and Blue Ocean 
  9.1 The Logic of Strategic Choice
  9.2 Porter’s Generic Strategies
    9.2.1 Strategy1: Cost Leadership
    9.2.2 Strategy2: Differentiation 
    9.2.3 Strategy3: Focus
    9.2.4 The “Stuck in the Middle” Trap

  9.3 Blue Ocean Strategy
    9.3.1 The Value Innovation Logic
    9.3.2 The Four Actions Framework (ERRCGrid) 
    9.3.3 The Strategy Canvas 
  9.4 LDRSHIP Values and Strategic Choice 
  9.5 The Military Decision-Making Process and Strategic Positioning
  9.6 Real Options Analysis 
    9.6.1 Types of Real Options
  9.7 Integrating the Frameworks
Key Terms
Exercises 
Reflection Questions 
Chapter Summary
References
Chapter 10 Issues Identification and Strategic Recommendations 
  10.1 From Analysis to Action
  10.2 The SWOT Synthesis
    10.2.1 SWOT as a Synthesis Tool
  10.3 Industry Attractiveness, Competitive Strength, and the Nine-Cell Matrix
    10.3.1 Step1: Assessing Industry Attractiveness 
    10.3.2 Step2: Assessing Competitive Strength
    10.3.3 Step3: Constructing the Nine-Cell Matrix
    10.3.4 Reading and Interpreting the Matrix
    10.3.5 Worked Example: Applied Technology Holdings 
    10.3.6 Strengths and Limitations of the Nine-Cell Matrix
    10.3.7 Integrating the Nine-Cell Matrix with SWOT and Issue Identification
    10.3.8 Criteria for Strategic Issues
    10.3.9 Issue Identification Techniques 
  10.4 Problem-Solving Frameworks
    10.4.1 The McKinsey Problem-Solving Approach
    10.4.2 The MECE Principle
  10.5 Developing Strategic Recommendations
    10.5.1 Characteristics of Strong Recommendations 
    10.5.2 The Recommendation Pyramid
  10.6 Communicating Strategic Recommendations
    10.6.1 Principles of Executive Communication
    10.6.2 The Strategic Recommendation Memo Format 
  10.7 Implementation and Anticipating Resistance 
    10.7.1 Anticipating Resistance 
    10.7.2 The Premortem Technique
Key Terms
Exercises 
Reflection Questions 
Chapter Summary
References
Chapter 11 ESG, CSR, and Ethical Decision-Making 
  11.1 The Rise of ESG
  11.2 The Three Dimensions of ESG
    11.2.1 Environmental (E)
    11.2.2 Social (S)
    11.2.3 Governance (G)
  11.3 Corporate Social Responsibility (CSR)
    11.3.1 Carroll’s CSR Pyramid (1991)
    11.3.2 The Business Case for CSR
  11.4 Ethical Decision-Making in Strategic Management 
    11.4.1 Classical Ethical Frameworks 
    11.4.2 The Army Valuesasan Ethical Framework
    11.4.3 The MDMP Applied to ESG
    11.4.4 A Practical Framework for Ethical Decision-Making
  11.5 ESG Integrationin Strategy
    11.5.1 The Materiality Matrix
    11.5.2 ESG and Long-Term Value Creation
  11.6 ESG Measurement and the Ratings Challenge 
  11.7 The ESG Backlash: Navigating Political and Social Controversy
Exercises 
Chapter Summary
References
Chapter 12 Strategic Planning and Implementation
  12.1 From Strategy to Execution
  12.2 The Strategic Plan
  12.3Aligning Strategy with Structure
    12.3.1 Common OrganizationalS tructures 
    12.3.2 The McKinsey 7-S Framework 
  12.4 Strategy and Culture
    12.4.1 Culture as a Strategic Asset 
    12.4.2 Culture as a Strategic Liability 
    12.4.3 Changing Culture 
  12.5 Change Management 
    12.5.1 Kotter’s 8-Step Change Model
    12.5.2 Sources of Resistance to Change
    12.5.3 Overcoming Resistance 
  12.6 The Implementation Roadmap
    12.6.1 Components of an Implementation Roadmap 
  12.7 Monitoring, Adaptation, and Strategic Control
    12.7.1 The Balanced Scorecard as a Control Tool
    12.7.2 Strategic Reviews 
Exercises 
Reflection Questions
Chapter Summary
References
Appendix A Industrial Structure and Business Strategy 
  A.1 The Structure–Conduct–Performance Framework 
    A.1.1 Market Structures at a Glance 
  A.2 Oligopoly: The Strategically Interesting Case
  A.3 Cournot Competition: Rivals Choose Quantities
    A.3.1 Origins and Logic 
    A.3.2 Formal Development
    A.3.3 Convergence to Equilibrium 
    A.3.4 The Effectof Market Concentration 
  A.4 Bertr and Competition: Rivals Choose Prices
    A.4.1 The Bertr and Paradox
    A.4.2 Bertr and Competition with Product Differentiation 
  A.5 Strategic Implications
Recommended References
Appendix B EconomicValueAdded (EVA®)
Learning Goals and Objectives
  B.1 Concepts and Foundations
    B.1.1 The Core EVA Formula 
    B.1.2 Computing the WACC
    B.1.3 Interpreting EVA: Three Strategic Regions 
  B.2 EVA and Market Value Added (MVA)
  B.3 Relationship Between EVA and Other Management Indicators 
    B.3.1 EVA and ROI
    B.3.2 EVA and Share Price
    B.3.3 EVA as a Corporate Control Instrument 
    B.3.4 EVA as a Strategic Decision and Incentive Tool 
  B.4 Strategic Implications for Managers
Recommended References
Appendix C Structured Decision Analysis for Strategic Leaders: Analytic Hierarchy Process and Analytic Network Process
Learning Goals and Objectives
  C.1 Purpose of This Appendix
  C.2 Why Structured Decision Analysis?
  C.3 The Analytic Hierarchy Process 
    C.3.1 The AHP Structure 
    C.3.2 Pairwise Comparison and the Saaty Scale 
    C.3.3 Building and Solving the Comparison Matrix
    C.3.4 The Consistency Ratio: Validating Your Judgments 
  C.4 Applied AHP—Strategic Leadership Selection
    C.4.1 Step1: Criteria Pairwise Comparison
    C.4.2 Step2: Alternative Comparison by Criterion
    C.4.3 Step3: Global Priority Synthesis
  C.5 The Analytic Network Process 
    C.5.1 The ANP Network Structure 
    C.5.2 The Supermatrix
    C.5.3 When to Use ANP Versus AHP
  C.6 AHP/ANP and the Strategy Frameworks of This Book 
  C.7 A Complete AHP Worked Example: Strategic Initiative Prioritization 
  C.8 Practical Implementation Guide
    C.8.1 Software Tools
    C.8.2 The 10-Step AHP Process for Leadership Teams 
  C.9 Classroom Exercises
    C.9.1 Individual AHP: Career Strategy
    C.9.2 Group AHP: Strategic Market Entry
    C.9.3 ANP Design: Dynamic Capability Interdependencies
    C.9.4 AHP Sensitivity Analysis: Stress-Testing a Strategic Recommendation 
References
Index