Chapter 2: Developing Missions and Strategies

Mission

statements that tell an organization where its going

Strategy

A plan for achieving organizational goals and tells the organization how to get where it plans to go

mission: live a good life

strategy: obtain a college education

Rita is a high school student in southern Cali. She would like to have a career in business, have a good job, earn a good income to live comfortably.

the mission and strategy to achieve her goal might look like this

Organization Strategy

Overall strategies that relate to the entire organization and they support the achievement of organizational goals and mission

Functional Strategy

Strategies that relate to each of the functional areas and that support achievement of the organizational strategy

1. organizations purpose for being

2. answers “what do we contribute to society?”

3. provides boundaries and focus

What are things to know about Mission?

1. Differentiation

2. Cost leadership

3. Response

What are the 3 strategies for competitive advantage

Differentation

better or at least different

Cost leadership

cheaper

Response

more responsive

SWOT analysis

analysis of strengths, weaknesses, opportunities, and threats

strengths and weaknesses

Which aspects of the SWOT Analysis are internal?

opportunities and threats

Which aspects of the SWOT analysis are external?

1. Analyze the environment

2. Determine the corporate mission

3. Form a Strategy

What are the steps in the Strategy Development Process?

Analyze the environment

conduct a SWOT analysis and understand the environment, customers, industry, and competitors

Determine the Corporate Mission

State the reason for the firm’s existence and identify the value it wishes to create

Form a Strategy

Build a competitive advantage such as low price, design, or volume flexibility, quality, quick delivery, dependability, after-sale service, broad product lines

Core competencies

The special attributes or abilities that give an organization a competitive edge

order qualifiers and order winners

Successful strategy formulation also requires taking into account

Order qualifiers

characteristics that customers perceive as minimum standards of acceptability for a product or service to be considered as a potential for purchase

order winners

characteristics of an organization’s goods or services that cause it to be perceived as better than the competition