SPORTS AND ENTERTAINMENT MANAGEMENT CHAPTER 7 Management Strategies

SPORTS AND ENTERTAINMENT MANAGEMENT CHAPTER 7 Management Strategies 7. 1 The Building Blocks of Strategy 7. 2 The Process of Strategic Management 7. 3 Strategic Planning Tools CHAPTER 7 SLIDE 1 © SOUTHWESTERN/THOMSON

LESSON 7. 1 SPORTS AND ENTERTAINMENT MANAGEMENT THE BUILDING BLOCKS OF STRATEGY GOALS n Describe three levels of strategy. n Discuss the advantages and risks of strategic management. CHAPTER 7 SLIDE 2 © SOUTHWESTERN/THOMSON

SPORTS AND ENTERTAINMENT MANAGEMENT THE ROOTS OF STRATEGY n Strategy refers to the basic steps a manager must take to reach objectives. n Strategic management is a process for identifying and furthering an organization’s mission. CHAPTER 7 SLIDE 3 © SOUTHWESTERN/THOMSON

SPORTS AND ENTERTAINMENT MANAGEMENT THREE LEVELS OF STRATEGY n Corporate strategies – address the broad needs of the organization n These strategies are long-range and formed at the highest level. They control the overall direction of the organization and are tied to the mission statement. n Business strategies n Functional strategies CHAPTER 7 SLIDE 4 © SOUTHWESTERN/THOMSON

SPORTS AND ENTERTAINMENT MANAGEMENT CORPORATE STRATEGIES n Growth strategies n Help the organization decide the amount and direction of growth. n Stability strategies n Used when the organization is satisfied with its performance. n Defensive strategies n Used when the organization feels threatened by risk (usually from competitors). n Combination n Ex: building a new stadium could use growth strategy and defensive at the same time. CHAPTER 7 SLIDE 5 © SOUTHWESTERN/THOMSON

SPORTS AND ENTERTAINMENT MANAGEMENT BUSINESS STRATEGIES n Cost leadership n Deliver the product or service more cheaply than the competitors. n Differentiation n Be unique in product or service. n Focus n Concentrate on a particular market segment and surround it with a quality product or service. CHAPTER 7 SLIDE 6 © SOUTHWESTERN/THOMSON

SPORTS AND ENTERTAINMENT MANAGEMENT FUNCTIONAL STRATEGIES n Day-to-day operations n Operational plan or tactical plans CHAPTER 7 SLIDE 7 © SOUTHWESTERN/THOMSON

SPORTS AND ENTERTAINMENT MANAGEMENT ADVANTAGES OF STRATEGIC MANAGEMENT n Use of strategic management prevents problems before they happen. n Strategic management reinforces the strength of group decision making. n Managers and employees tend to become empowered with decision-making opportunities. n Strategically managed firms usually do not have glaring weaknesses. n The entire organization tends to react more rapidly to new opportunities and environmental changes. CHAPTER 7 SLIDE 8 © SOUTHWESTERN/THOMSON

SPORTS AND ENTERTAINMENT MANAGEMENT RISK OF STRATEGIC MANAGEMENT n The discipline involved in implementing strategic management may not be easy to accomplish. n Strategic managers must be cautious of making extravagant promises. n Managers and employees may expect immediate rewards for their roles in the strategic management process. CHAPTER 7 SLIDE 9 © SOUTHWESTERN/THOMSON

LESSON 7. 2 SPORTS AND ENTERTAINMENT MANAGEMENT THE PROCESS OF STRATEGIC MANAGEMENT GOALS n Identify the steps in strategic management. n Explain the development phase of the strategic management process. n Describe the action and review phases of the strategic management process. CHAPTER 7 SLIDE 10 © SOUTHWESTERN/THOMSON

SPORTS AND ENTERTAINMENT MANAGEMENT HOW DO MANAGERS PLAN? n Formulate the mission n Describe the market n Set objectives n Create and implement strategies n Develop contingency plans CHAPTER 7 SLIDE 11 © SOUTHWESTERN/THOMSON

SPORTS AND ENTERTAINMENT MANAGEMENT MAJOR PHASES OF STRATEGIC MANAGEMENT PROCESS n Development n Action n Review CHAPTER 7 SLIDE 12 © SOUTHWESTERN/THOMSON

SPORTS AND ENTERTAINMENT MANAGEMENT DEVELOPMENT n Initial strategic plan is developed. n The mission of the organization reveals its purposes for being. n Objectives are statements that reveal the priorities of the organization. n Objectives must be consistent with mission. n Objectives often conflict with one another and managers must resolve these conflicts. CHAPTER 7 SLIDE 13 © SOUTHWESTERN/THOMSON

SPORTS AND ENTERTAINMENT MANAGEMENT POLICIES, PROCEDURES, AND RULES n Policies are guidelines established to make decisions regarding specific, recurring situations. (Ex: Title IX) n A procedure is a list of steps to be followed for performing certain work. (Ex: how to run ticket sales) n Rules are a prescribed direction for conduct. (Ex: No jeans in the workplace, No cell phone use, etc. . ) CHAPTER 7 SLIDE 14 © SOUTHWESTERN/THOMSON

SPORTS AND ENTERTAINMENT MANAGEMENT ENVIRONMENTAL ANALYSIS n External environment – everything that lies outside an organization’s control. n Gov’t regulations, economy, competition, technology, global affairs, society at large. n Internal environment – factors that are under the control of the organization. n Internal assessment is often difficult for managers. There may not be a system in place. Reports may not be complete, data may not be collected, falsifications may occur, or employees simply not care. CHAPTER 7 SLIDE 15 © SOUTHWESTERN/THOMSON

SPORTS AND ENTERTAINMENT MANAGEMENT COMPLETING THE DEVELOPMENT PHASE n Formulate the organization’s mission n Reviewing past and present strategies for success and failure n Using strategic tools to assess the organization’s external and internal environments CHAPTER 7 SLIDE 16 © SOUTHWESTERN/THOMSON

SPORTS AND ENTERTAINMENT MANAGEMENT ACTION AND REVIEW n Action n Organizational structure n Short-range goals or objectives n Functional strategies n Review n Evaluation n Control CHAPTER 7 SLIDE 17 © SOUTHWESTERN/THOMSON

SPORTS AND ENTERTAINMENT MANAGEMENT ULTIMATE PURPOSE OF STRATEGIC MANAGEMENT n Continuously evaluate and respond to external and internal environmental changes n Examine strategies for correct direction and successful results n Organize people in the most effective and efficient manner CHAPTER 7 SLIDE 18 © SOUTHWESTERN/THOMSON

LESSON 7. 3 SPORTS AND ENTERTAINMENT MANAGEMENT STRATEGIC PLANNING TOOLS GOALS n Describe the major strategic planning tools available to managers. n Explain how sports and entertainment managers may achieve strategic fit. CHAPTER 7 SLIDE 19 © SOUTHWESTERN/THOMSON

SPORTS AND ENTERTAINMENT MANAGEMENT THE PLANNING TOOL BAG n Environmental scanning n SWOT analysis n Benchmarking n Scenario building CHAPTER 7 SLIDE 20 © SOUTHWESTERN/THOMSON

SPORTS AND ENTERTAINMENT MANAGEMENT ENVIRONMENTAL SCANNING n Six major external environments that might create opportunities or pose threats to future planning: n Demographic trends – Americans are aging, there are more women than men in U. S. , Hispanic-American population has passed African-American population in numbers, people living longer. n Economic trends (economy affects ticket sales, wages) n Political trends (many businesses are regulated) n Competitive trends (who are you competing with ? ) n Technological trends (big screens, instant replay) n Cultural and lifestyle trends (viewers tastes change) CHAPTER 7 SLIDE 21 © SOUTHWESTERN/THOMSON

SPORTS AND ENTERTAINMENT MANAGEMENT SWOT ANALYSIS S Strengths (Player talent, popularity with fans, employee loyalty) W Weaknesses (Personnel problems, falling revenue, poor management decisions) O Opportunities (Internet, global expansion, improved economy) T Threats (Competition, lawsuits, labor troubles, declining popularity) CHAPTER 7 SLIDE 22 © SOUTHWESTERN/THOMSON

SPORTS AND ENTERTAINMENT MANAGEMENT BENCHMARKING n Have a specific problem in mind that should be compared to other organizations. n Make sure that the correct “best practices” or benchmarks are identified. n Do not expect too many answers from sensitive areas such as pricing, revenues, or managerial discipline. n Keep the data received confidential to ensure that strategies can be built upon the information. (Ex: coaches copy plays) CHAPTER 7 SLIDE 23 © SOUTHWESTERN/THOMSON

SPORTS AND ENTERTAINMENT MANAGEMENT SCENARIO BUILDING n Involves creating a hypothetical situation that is then used to aid decision-making efforts (What if? ) n Often reveals alternatives that would have gone unnoticed under other decision-making models. (used by military and law enforcement) Ex: Spring training, “What do you do when…. ” n Tornado drills, fire drills CHAPTER 7 SLIDE 24 © SOUTHWESTERN/THOMSON

SPORTS AND ENTERTAINMENT MANAGEMENT A GOOD FIT n The manager must strive for consistency and continuity in planning and strategic efforts. CHAPTER 7 SLIDE 25 © SOUTHWESTERN/THOMSON

SPORTS AND ENTERTAINMENT MANAGEMENT TYPES OF STRATEGIC FIT n Market-related strategic fit n Operational department fit n Management fit CHAPTER 7 SLIDE 26 © SOUTHWESTERN/THOMSON

SPORTS AND ENTERTAINMENT MANAGEMENT BENEFITS OF STRATEGIC FIT n Reduced conflict between marketing and sales functions n Balance in communication and promotional efforts n Maximum utilization of equipment n Efficient utilization of the workforce n Harmony with suppliers and distributors n Regulation and sequencing of ordering and inventory cycles n Direction for support services CHAPTER 7 SLIDE 27 © SOUTHWESTERN/THOMSON