Strategic Thinking B. Sc. Business Administration (External) Degree
Formal Planning • Very analytical • Preservation and rearrangement of established categories • Real strategic change demands? • Inventing new ones……
Strategic Planning • Expected to formulate best strategies • Outlined step by step instructions • Based on the manipulation of number (analysis) • Suppressed manager's creative thinking Thus, it can be conclude that strategic planning is not strategic thinking.
Strategic Planning / Programming Strategic planning as it has been practiced, has really been strategic programming, the articulation and elaboration of strategies, or Vision that already exist.
Strategic Thinking • Strategic thinking is about synthesis • It involves intuition and creativity • The outcome of strategic thinking is an integrated perspective of the enterprise.
Strategic Thinking 1. It generates the creative act of synthesizing experiences in to a new strategy 2. It is about the synthesis of the insight to transform the company.
Strategic Thinking …strategy making process should be capturing what managers learn from all sources and then synthesizing that learning in to a vision of the direction that the business should pursue. Planners can help strategies for strategy processes through formal analyses rather than influencing to discover the one right way…
Strategic Thinking: Emergent Strategies • Strategies evolve through strategic thinking, cannot be emerged on schedule and immaculately convinced. • They must be free to appear at any time and at any place in the organization. • …through messy processes of informal learning at various levels of the organizations…
Pitfalls of Planning • Calculating style of management, not a committing style • To reduce the power of management over strategy making
Fallacies of Strategic Planning • Prediction The world is supposed to stay constant while a plan is being developed and implemented • Detachment Strategies can be detached from the subjects of their strategies • Formalization of strategy making process
Danger of Formalization • It limits the creativity • Systems do not think, when they are used for more than the facilitation of human thinking, they can suppress thinking • Strategic planning has a greater use without arbitrary formalization, and a contribution around the strategy making process.
Strategic Planner is trying to paint the big picture with little strokes who abstracts the daily details (Mintzberg, 1994)
Strategic Thinking If an organization is managed by intuitive geniuses there is no need formal strategic planning. But how many organizations are so blessed? And, if they are, how many times are intuitive correct in their judgment.
Left and Right Handed Planners • Analytical thinkers: is dedicated to bringing the order to the organization • Creative thinkers: seeks to open up strategy making process. As a soft analyst, he/she likes to find strategies in strange places and encourage others to think strategically.
Setting Organizational Direction: Industrial Foresight and Strategic Intent
The Future Today Past cannot change. It already gone. Future cannot predict. It is not happened yet. But, Can handle the present to have a better future. Thus, future means the effects of present decisions.
What is industry foresight? Ability to predict and prepare for the future
How to see the future? Gaining an understanding of the trends and discontinuities of the environment, deeper than the competitors Transform industry boundaries and create a new competitive space
How to see the future? Looking Outward Looking Forward Build a collective view of the future
What it requires? • Creativity and imagination • Unlimited curiosity • Desire to spend greater amount of time on understanding the future • Significant expenditure on intellectual energy • Willingness to move far beyond the issues on which it can claim expert status.
What it requires? • Not being customer - led but be much more than that (Do more than satisfying the customers - amazing them) • Do not take competitors as benchmark/s • Going beyond traditional modes of research/market research
Danger of being customer - led • Customers are notoriously lacking in foresight • Meeting only the articulated needs of customers already served, firm cedes vast opportunities to more farsighted competitors.
Danger of being customer - led C U S T O M E R N E E D S Unarticulated Articulated Today’s Business Served Not served CUSTOMER TYPES
Strategic Fit Vs Strategic Intent
Strategic Fit • Try to create a fit between the available resources of the firm and current environmental opportunities. • This is not enough to build new resources and capabilities to create and exploit future opportunities. • Strategies formulated following this model tend to be more concerned about today's problem than tomorrow's opportunity/ies.
Strategic Intent Strategy formulation must involves setting ambiguous goals, which stretch a company, and then finding ways to build the resources and capabilities need to achieve those goals.
Strategic Intent Strategic intent envisions a desired leadership position and establishes the criterion. Examples: …………. ?
Strategic Intent Strategic intent concept encompasses an active management. How? • Focusing on the essence of winning • Motivating employees by communicating the value of the target • Leaving room for both individual and team contributors • Sustaining enthusiasm • Allocating resources properly
Strategic Fit Vs Strategic Intent Two approaches are not mutually exclusive • Managers have to analyze the external environment and company's resources and capabilities as did in the fit model • But strategic management process starts with high performance, challenging goals. Then find ways to develop resource base and capabilities to achieve those goals. Thus, managers want to follow both approaches at once
Role of the strategic level managers • Create a sense of urgency • Develop a competitive focus • Use competitive intelligence • Continuous training and development to give necessary level of KASA • Give the time to digest one challenge before introducing another challenge