STRATEGY & POLICY

Strategy
• Strategy is an action that managers take to attain one or more of the organization's goals.
Strategy can also be defined as “A general direction set for the company and its various
components to achieve a desired state in the future. Strategy results from the detailed strategic
planning process”.

Policy
• Policies simply guide our actions. Policies can be guidelines, rules, regulations, laws, principles,
or directions. They say what is to be done, who is to do it, how it is to be done and for (or to)
whom it is to be done.
What policies do ...
Outline rules
Provide principles that guide actions
Set roles and responsibilities
Reflect values and beliefs
State an intention to do something

Key Terms in Strategic Management
1. Strategists
2. Vision & Mission Statement
3. External Opportunities & Threats
4. Internal Strengths & Weaknesses
5. Long Term Objectives
6. Strategies
7. Annual Objectives
8. Policies,

BASIC MODEL OF STRATEGIC
MANAGEMENT
Strategic management consists of four basic elements:
• Environmental scanning
• Strategy formulation
• Strategy implementation
• Evaluation and control

Benefit & Importance of Strategic
Movement
• A distinguishing characteristic of strategic management is its emphasis on strategic decision
making. As organizations grow larger and more complex, with more uncertain environments,
decisions become increasingly complicated and difficult to make. In agreement with the
strategic choice perspective mentioned earlier, this book proposes a strategic decision-making
framework that can help people make these decisions regardless of their level and function in
the corporation
• Unlike many other decisions, strategic decisions deal with the long-term future of an entire
organization and have three characteristics:
• Rare: Strategic decisions are unusual and typically have no precedent to follow.
• Consequential: Strategic decisions commit substantial resources and demand a great deal of
commitment from people at all levels.
• Directive: Strategic decisions set precedents for lesser decisions and future actions throughout
an organization.

Benefit & Importance of Strategic
Movement
• Good arguments can be made for using the entrepreneurial, adaptive modes, or logical incrementalism approaches in certain specific
situations.63 This book proposes, however, that in most situations the planning mode, which includes the basic elements of the
strategic management process, is a more rational, better tested, and more complete method for making strategic decisions. Research
indicates that the planning mode is not only more analytical and less political than are the other modes, but it is also more appropriate
for dealing with complex, changing environments.
• Evaluate current performance results in terms of (a) return on investment, profitability, and so forth, and (b) the current mission,
objectives, strategies, and policies.
• Review corporate governance—that is, the performance of the firm’s board of directors and top management.
• Scan and assess the external environment to determine the strategic factors that pose opportunities and threats.
• Scan and assess the internal corporate environment to determine the strategic factors that are strengths (especially core competencies)
and weaknesses.
• Analyze strategic factors to (a) pinpoint problem areas and (b) review and revise the corporate mission and objectives, as necessary.
• Generate, evaluate, and select the best alternative strategies in light of the analysis conducted in the previous step.
• Implement selected strategies via programs, budgets, and procedures.
• Evaluate implemented strategies via feedback systems, and the control of activities to ensure their minimum deviation from plans

Guidelines for Effective Strategy
Management
• Strategy formulation is the process of investigation, analysis, and decision making that provides
the company with the criteria for attaining a competitive advantage. It includes defining the
competitive advantages of the business, identifying weaknesses that are impacting the
company’s ability to grow, crafting the corporate mission, specifying achievable objectives, and
setting policy guidelines.
• Mission: Stating Purpose
• Objectives: Listing Expected Results
• Strategy: Defining the Competitive Advantages
• Policies: Setting Guidelines
• Strategy Implementation
• Evaluation & Control
• Feedback/Learning Process

Guidelines for Effective Strategy
Management
• 1. It should be a people process more than a paper process.
2. It should be a learning process for all managers and employees.
3. It should be words supported by numbers rather than numbers supported by words.
4. It should be simple and nonroutine.
5. It should vary assignments, team memberships, meeting formats, and even the planning calendar.
6. It should challenge the assumptions underlying the current corporate strategy.
7. It should welcome bad news.
8. It should welcome open-mindness and a spirit of inquiry and learning.
9. It should not be a bureaucratic mechanism.
10. It should not become ritualistic, stilted, or orchestrated.
11. It should not be too formal, predictable, or rigid.
12. It should not contain jargon or arcane planning language.
13. It should not be a formal system for control.
14. It should not disregard qualitative information.
15. It should not be controlled by “technicians.”
16. Do not pursue too many strategies at once.
17. Continually strengthen the “good ethics is good business” policy.

Strategic Management
Versus
Strategic Planning

Features of Successful Strategic
Management
• Has support of organization’s executive officer.
• Is user friendly.
• Is participatory, not left to planners.
• Is flexible.
• Leads to resources decisions.
• Engages and motivates all staff.
• Is fresh and continuous, not static and stale.
• Is Proactive
• Not a Quick Fix
• Part of Quality Management
• Payoffs Increase over Time

Lessons Learned About Strategic Planning
• Plans must be tailored to organization.
• No one size ‘fits’ all.
• Time to complete takes longer – expect 50% more than planned.
• Process needs a shepherd.
• Visionaries needed at beginning and detail types thereafter.

VISION
Vision without Action is a Daydream
Action without Vision is a Nightmare
• Not Optional
• Stretch – 30+ Years
• 8-10 Words in length
• Future State
• Brief and Memorable

VISION (Continued)
• Inspiring and Challenging
• Descriptive of the Ideal

Vision Examples
• “Light the Fire Within”
• “A Safer Future for All Communities”
• “See the Mountains – Breathe Freely”
• To Be the Happiest Place on Earth
• To Be the World’s Best Quick Service Restaurant

Vision Levels of People
• Some people never see it. (Wanderers)
• Some people see it but never pursue it on their own.
(Followers)
• Some people see it and pursue it. (Achievers)
• Some people see it and pursue it and help others see it.
(Leaders)
John Maxwell, Developing The Leader Within You, 1993.

Mission Statement
In the absence of a clearly defined direction one is forced to concentrate on confusion that will
ultimately consume you.

MISSION
• What is our purpose?
• Describes current state
• Timeline is 3-5 Years
• Builds on our distinctive competencies
• Tends to focus on Core Business
• 30-35 Words in length

Mission Examples
• “To Lead All Communities in Disaster Preparedness,
Mitigation, and Recovery by Maximizing Assistance and
Support.”
• “Caltrans Improves Mobility Across California.”
• To produce superior financial returns for our shareholders as
we serve our customers with the highest quality
transportation, logistics, and e-commerce.

Importance of Vision & Mission
 Above everything else, vision and mission statements provide unanimity of purpose to organizations and imbue the employees with a sense of
belonging and identity. Indeed, vision and mission statements are embodiments of organizational identity and carry the organizations creed and
motto. For this purpose, they are also called as statements of creed.
 Vision and mission statements spell out the context in which the organization operates and provides the employees with a tone that is to be followed
in the organizational climate. Since they define the reason for existence of the organization, they are indicators of the direction in which the
organization must move to actualize the goals in the vision and mission statements.
 The vision and mission statements serve as focal points for individuals to identify themselves with the organizational processes and to give them a
sense of direction while at the same time deterring those who do not wish to follow them from participating in the organization’s activities.
 The vision and mission statements help to translate the objectives of the organization into work structures and to assign tasks to the elements in the
organization that are responsible for actualizing them in practice.
 To specify the core structure on which the organizational edifice stands and to help in the translation of objectives into actionable cost, performance,
and time related measures.
 Finally, vision and mission statements provide a philosophy of existence to the employees, which is very crucial because as humans, we need
meaning from the work to do and the vision and mission statements provide the necessary meaning for working in a particular organization.

Characteristics & Components of Vision
• .
• Future Oriented. What will the organization look like, feel like, think and say in the future? ...
• Inspiring and Challenging. What vivid and energizing image do you want to create for people
about your desired outcomes and goals? ...
• Motivating and Memorable. ...
• Purpose-driven. ...
• Unique.
•

Characteristics & Components of
Mission
• customers,
• products / services,
• markets,
• technology,
• concern for survival,
• philosophy,
• self-concept,
• concern for public image,
• concern for employees.

Characteristics & Components of
Mission
• Element #1 Simplicity
• Keep it simple. Take out all unnecessary words, and don’t overcomplicate it. Use common language and word it using a casual, conversational tone. Ask
yourself if it’s something people can relate to.
• Be clear in your purpose. Don’t make it overly broad or try to cover too many bases. If there are many facets to your nonprofit organization’s work,
incorporate all of them under an umbrella statement.
• Element #2 Captivating
• Don’t be boring. Powerfully state your purpose using the present tense.
• Ask yourself if it’s a statement that will build an emotional connection with people. Your mission statement should be relatable to your target audience.
• Give your mission statement a little edge and personality. Is it something people can aspire to? Think along the lines of a statement that is inspiring,
energizing, and memorable. Does it compel others to utilize your services or contribute to them?
• Element #3 Measurable
• You’ll know if you’re succeeding in your mission if you craft it in a way that allows you to measure the results. That said, veer away from statements that are
hard to quantify.
• For example, boards can easily quantify a mission statement that declares a goal of being customer-centric by surveying the stakeholders.
• Element #4 Relevancy
• Your target audience should believe that your mission statement is relevant to them. After reading it the first time or many times, your mission statement
should leave them with a feeling that resonates with them and carries meaning.
• Element #5 Longevity
• Evaluate whether your mission statement will continue to be valid as your nonprofit grows. Take a hint from the long-term goals you set in your annual
strategic plan. Forecast whether your mission statement will still be relevant when you get down to tackling those future goals.

A Vision statement vs. a Mission
Statement
• The main difference between a vision and a mission statement is that a vision statement looks
toward the future while a mission statement describes the present. A vision statement explains
what an organization hopes to accomplish, aimed at inspiring its employees. A mission
statement outlines the purpose of the organization's day-to-day operations to both internal
and external stakeholders. While a vision statement defines goals, the mission statement can
help explain how the organization will achieve those goals.

How to write a Mission/Vision Statement
• A vision statement denotes “where” a business wants to go while the mission statement explains
the “why.” Many organizations combine elements of each to concisely state who they are, what
they hope to accomplish and the mark they wish to leave on the world. Developing a statement
for your business is important because:
• It inspires and unifies employees under one goal for the organization.
• It tells a broader story and can provide more inspiration for the members of an organization.
• It provides a foundation for strategic decision-making.
• It informs investors, stakeholders and the public of your intentions.

How to write a Mission/Vision Statement
An effective vision and mission statement has core elements that drive a company’s success. It
should function as the central focus of your efforts. Developing the right statement for your
business may require a few brainstorming sessions and adjustments over time. You want it to be
specific to the ideal future of your business and a distinct reflection of your company’s values.
• The following steps will help you create a vision and mission statement for your business:
1.Identify your company’s strengths.
2.Determine your organization’s purpose.
3.Visualize where your business will be in five to 10 years.
4.Shape your statement.

How to write a Mission/Vision Statement
• Project five to 10 years into the future.
• Dream big, and focus on success.
• Use the present tense.
• Use clear, concise, jargon-free language.
• Infuse it with passion, and make it inspiring.
• Align it with your business values and goals.
• Create a plan to communicate your vision statement to your employees.
• Prepare to commit time and resources to the vision you establish.

What to avoid when writing a vision
statement
• Don’t mix up your mission statement and vision statement. Mission statements are
generally easier to write because they reflect what you’re doing now. Remember, a mission
statement is what you are working to accomplish today, while a vision statement is what you
want to accomplish in the future.
• Don’t overthink your wording. One of the hardest parts of creating a vision statement is
coming up with the right wording. You may find yourself endlessly rewriting and fretting about
getting it right. Does this sentence or two define your values and shine a light on your corporate
identity without sounding too vague? Don’t get lost in the pressure of perfect wording; a specific
and unique vision statement is a good place to begin distinguishing your business from the rest
of the industry.

Examples
IKEA: “To create a better everyday life for the many people.”
Intel: “If it’s smart and connected, it’s best with Intel.”
Samsung: “Shape the future with innovation and intelligence.
Google: “To provide access to the world’s information in one click.”
Amazon: “Our vision is to be earth’s most customer-centric company; to build a place where
people can come to find and discover anything they might want to buy online.”
Ben & Jerry’s: “Making the best ice cream in the nicest possible way.”

Case Study

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