The Managerial Process of Crafting and Executing Strategy cont.

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The Managerial Process of Crafting and
Executing Strategy (cont.)
Building on Screen graphics created by Jana F.
Kuzmicki, Ph.D. Troy University-Florida Region
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Corporate Governance The Board of Directors

• Directors are the representatives of shareholders
  and meet a few times a year. They have the legal
  obligation to ensure that management is serving
  the interests of
• Shareholders and also
• Stakeholders

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Obligations of a Board of Directors

• Be inquiring critics and overseers of
• senior executives strategy-making and
  strategy-executing skills
• a companys financial accounting and reporting
  practices
• They are also in charge of Instituting a
  compensation plan for top executives rewarding
  them for results that serve interests of
  Shareholders and Stakeholders

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Vision, mission, and slogans
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• Vision (where we are going)
• Mission (who we are)
• Values (moral compass)

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STRATEGIC VISION

• Defining the vision is the first phase of the
  strategy making process
• Defining the vision involves laying out the
  companys strategic course in preparing for the
  future its chosen route to develop and
  strengthen its business.
• Defining the vision involves thinking
  strategically about
• Future direction of company regarding its
  product/ market/ customer/ technology MIX

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Role of a Strategic Vision

• Give the organization a sense of direction, mold
  organizational identity, and create a committed
  enterprise
• Inform company personnel and other stakeholders
  what management wants its business to look like
  and where we are going
• Spur company personnel to action (when translated
  into a powerful slogan)
• Provide managers with a reference point to
• Make strategic decisions
• Translate the vision into hard-edged objectives
  and strategies

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Characteristics of a well worded strategic vision
Common shortcomings in vision statements

• Graphic
• Directional
• Focused
• Flexible
• Feasible
• Desirable
• Easy to communicate

• Vague or incomplete
• Not looking forward
• Too broad
• Bland and uninspiring
• Too reliant on superlatives

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Examples of Strategic Visions
Red Hat To extend our position as the most
trusted Linux and open source provider to the
enterprise. We intend to grow the market for
Linux through a complete range of enterprise Red
Hat Linux software, a powerful Internet
management platform, and associated support and
services.
Does it suggest directions for growth? Does it
say NO to something?
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Examples of Strategic Visions
Wells Fargo We want to satisfy all of our
customers financial needs,help them succeed
financially, be the premier providerof financial
services in every one of our markets, andbe
known as one of Americas great companies.
Does it suggest directions for growth? Does it
say NO to something?
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In addition of a vision, organizations also
define a Mission Statement

• This statement identifies the boundaries of the
  current business and highlights
• Present products and services
• Types of customers served
• Geographic coverage
• Conveys
• Who we are,
• What we do, and
• Why we are here

A well-conceived mission statement distinguishes
a companys business makeup from that of other
profit-seeking enterprises in language specific
enough to give the company its own identify!
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Strategic Vision is different from an
organizations mission statement

• Vision focuses on the future - where we are
  going
• Markets to be pursued
• Future product/market/customer/technology focus
• Kind of company management is trying to create

• Mission focuses on the present who we are and
  what we do
• Current product and service offerings
• Customer needs being served
• Technologicaland businesscapabilities

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A companys mission is not to make a profit! Its
true mission is its answer to What will we do to
make a profit? Making a profit is an objective
or intended outcome!
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Trader Joes Mission Statement
(a unique grocery store chain)
To give our customers the best food and beverage
values that they can find anywhere and to provide
them with the information required for informed
buying decisions. We provide these with a
dedication to the highest quality of customer
satisfaction delivered with a sense of warmth,
friendliness, fun, individual pride, and company
spirit.
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Finally a growing number of companies have a
statement of Company Values

• Statement of values guide a companys pursuit of
  its vision and strategy
• It typically contain four to eight beliefs,
  traits, and behaviors relating to such things as
  Integrity, doing the right thing, product
  quality, customer satisfaction, treatment of
  people,teamwork, operating excellence, giving
  back to the community
• It remains a bunch of nice words until the
  espoused beliefs, traits, and behaviors
• Are incorporated into companys operations and
  work practices
• Are used as the benchmark for job appraisal,
  promotions, and rewards

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Example Company Values
Home Depot
Entrepreneurial spirit
Creating shareholder value
Excellent customer service
Building strong relationships
Giving back to the community
Respect for all people
Taking care of people
Doing the right thing
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Example Company Values
Du Pont