Concept of Strategy,

Concept of Strategic Management

and types of Strategy

Meaning of Strategy
The term strategy is derived from the Greek
word strategos, which means, generalship-the
actual direction of military force as distinct from
the policy governing its development. Therefore,
the word strategy literally means the art of the
general. In business parlance, there is no definite
meaning assigned to strategy. It is often used
loosely to mean a number of things.

 STRATEGY : Strategy is the determination of the

long-term goals and objectives of an enterprise and
the adoption of the courses of action and the
allocation of resources necessary for carrying out
these goals.
Strategy isnt the
missionits the
plan that allows
the company to
accomplish the
mission
Strategy is managements game plan for strengthening
the organizations position, pleasing customers, and
achieving performance targets.

Definition
Chandler defined strategy as: "The determination of the
basic long term goals and objectives of an enterprise and
the adoption of the courses of action and the allocation of
resources necessary for carrying out this goals".

Andrews defined strategy as: "The pattern of objectives,

purposes, goals and the major policies and plans for
achieving these goals stated in such a way so as to define
what business the company is in or is to be and the kind
of the company it is or it is to be".

 Glueck define the strategy as: "A unified,

comprehensive, and integrated plan designed to assume
that the basic objectives of the enterprise are achieved"

Nature of Strategy

Grand plan
Competitive
Long term goal
Pro-active
Major course of action
Future Oriented
Dependent on system

Element of Strategy

Goals
Scope
Competitive Advantage
Logic

STRATEGIC MANAGEMENT
Strategic management is defined as the art and science of
formulating, implementing, and evaluating crossfunctional decisions that enable the organization to
achieve its objectives." Generally, strategic management
is not only related to a single specialization but covers
cross-functional or overall organization.

 Strategic management is a comprehensive area that

covers almost all the functional areas of the
organization. It is an umbrella concept management
that comprises all such functional areas as marketing,
finance & account, human resource, and production
& operation into a top level management discipline.
Therefore, strategic management has an importance
in the organizational success and failure than any
specific functional areas.
Strategic management deals with organizational level
and top level issues whereas functional or operational
level management deals with the specific areas of the
business.

 Top-level managers such as Chairman, Managing

Director, and corporate level planners involve more in
strategic management process.
Strategic management relates to setting vision,
mission, objectives, and strategies that can be the
guideline to design functional strategies in other
functional areas
Therefore, it is top-level management that paves the
way for other functional or operational management
in an organization

Definition
Glueck Strategic Management can be defined as a
set of decisions, actions resulting in formulations &
implementation of strategies designed to achieve the
objectives of enterprise.
Chandler - The determination of the basic long-term
goals & objectives of an enterprise and the adoption of
the course of action and the allocation of resources
necessary for carrying out these goals.

Nature of SM

Long term Issues

Competitive Advantage
Effect on Operations
Uncertain
Complex
Organization-wide
Long term Implication

Types Of Strategy
Corporate Strategy
Business Strategy
Functional Strategy

Corporate strategy:
Corporate strategy is one, which decides what business
the organization should be in, and how the overall group
of activities should be structured and managed. Porter has
described it as the overall plan for a diversified business.
The strategies are then evolved for each strategic business
unit and strategic business area.

Business Strategic
As the number and diversity of products increases the
structure is likely to be centered upon division called
Strategic Business Unit (SBU). SBU are responsible
individually for developing, manufacturing and
marketing their own product or group of products.

Strategic Business Area (SBA):

SBA is a distinctive segment of the environment in
which the firm does want to do business. A company
instead of trying to compete in all the area, it selects the
area of its competitive advantage and invest its money
and strategies in that area. This helps the company to
concentrate its strategies in a particular area and to
reduce the unnecessary expenses in non-profitable area.

Functional Strategy:
Strategy that is related to each functional area of business
such as production, marketing and personnel is called
functional strategy. It is designed and managed in a
coordinated way so that they interrelate with each other
and at the same time collectively allow the competitive
strategy to be implemented properly.

Thank You.