The Managerial Process of Crafting and Executing a Company’s Strategy
Section A: Introduction and Overview
Crafting and executing strategy are the heart and soul of managing a business enterprise. But exactly what is involved in developing a strategy and executing it proficiently? What are the various components of the strategy-making, strategy-executing process and to what extent are company personnel—aside from senior management—involved in the process? This chapter presents an overview of the ins and outs of crafting and executing company strategies. Special attention will be given to management’s direction-setting responsibilities—charting a strategic course, setting performance targets, and choosing a strategy capable of producing the desired outcomes. We will also explain why strategy making is a task for a company’s entire management team and discuss which kinds of strategic decisions tend to be made at which levels of management. The chapter concludes with a look at the roles and responsibilities of a company’s board of directors and how good corporate governance protects shareholder interests and promotes good management.
WHAT DOES THE STRATEGY-MAKING, STRATEGY-EXECUTING PROCESS ENTAIL?
The managerial process of crafting and executing a company’s strategy consists of five integrated stages: 1. Developing a strategic vision that charts the company’s long-term direction, a mission statement that describes the company’s business, and a set of core values to guide the pursuit of the strategic vision and mission. 2. Setting objectives for measuring the company’s performance and tracking its progress in moving in the intended long-term direction. 3. Crafting a strategy for advancing the company along the path to management’s envisioned future and achieving its performance objectives. 4. Implementing and executing the chosen strategy efficiently and effectively.
Z
FIGURE 2.1
The Strategy-Making, Strategy-Executing Process
External and Internal Factors Shaping Strategic and Operating Decisions
Stage 1
Crafting and executing strategy are the heart and soul of managing a business enterprise. But exactly what is involved in developing a strategy and executing it proficiently? What are the various components of the strategy-making, strategy-executing process and to what extent are company personnel—aside from senior management—involved in the process? This chapter presents an overview of the ins and outs of crafting and executing company strategies. Special attention will be given to management’s direction-setting responsibilities—charting a strategic course, setting performance targets, and choosing a strategy capable of producing the desired outcomes. We will also explain why strategy making is a task for a company’s entire management team and discuss which kinds of strategic decisions tend to be made at which levels of management. The chapter concludes with a look at the roles and responsibilities of a company’s board of directors and how good corporate governance protects shareholder interests and promotes good management.
WHAT DOES THE STRATEGY-MAKING, STRATEGY-EXECUTING PROCESS ENTAIL?
The managerial process of crafting and executing a company’s strategy consists of five integrated stages: 1. Developing a strategic vision that charts the company’s long-term direction, a mission statement that describes the company’s business, and a set of core values to guide the pursuit of the strategic vision and mission. 2. Setting objectives for measuring the company’s performance and tracking its progress in moving in the intended long-term direction. 3. Crafting a strategy for advancing the company along the path to management’s envisioned future and achieving its performance objectives. 4. Implementing and executing the chosen strategy efficiently and effectively.
Z
FIGURE 2.1
The Strategy-Making, Strategy-Executing Process
External and Internal Factors Shaping Strategic and Operating Decisions
Stage 1