Strategic Management Essay

681 words - 3 pages

SUMMARY
1. Firms use SMP to achieve strategic competitiveness(SC) & earn above average returns(AAR).
-SC is achieved when firms develops & implements a value-creating strategy.
-AAR provide the foundation needed in order to satisfy all of the firm’s stakeholders.
2. Since the nature of competition is different in the current competitive landscape, those making strategic decisions must adopt a different mind-set, which allows them to learn how to compete in highly turbulent & chaotic(disorganized) environments that produce a great deal of uncertainty. The globalization of industries in their markets and rapid & significant technological changes are the two primary factors ...view middle of the document...

Thus, firms wants to use their unique resources, capabilities and core competencies that allow them to effectively compete against rival.
4. Vision & mission are formed to guide the selection of strategies based on information from analyses of the firm’s internal & external environments.
- vision is a picture of what the firm wants to be , and, in broad terms, what it wants to ultimate achieve.
- flowing from the vision, the mission specifies the business or businesses in which the firm intends to compete and the customers it intends to serve.
- both provide direction to the firm & signal important descriptive information to stakeholders.
5. Stakeholders are those who can affect, and affected by, a firm’s strategic outcomes.
- Firm is independent on the continuing support of stakeholders (shareholders, customers, suppliers, employees, etc), they have enforceable claims on the company’s performance.
- When earning AAR, a firm has the resources it need to at minimum simultaneously satisfy the interest of all stakeholders.
- However, when earning only average returns, the firm must carefully manage its stakeholders in order to retain their support.
- a firm earning below average returns...

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