SOUTHERN TAIWAN UNIVERSITY MECHANICAL ENGINEERING DEPARTMENT

Group 5: 1) Nguyen Van Minh 2) Nguyen Chi Thanh 3) Taiwanese Student M981Y209 M981Y202

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PROBLEM

How is the idea of strategic intent different from models of strategy that emphasize achieving a fit between the firms strategies and its current strengths, weaknesses, opportunities and threats (SWOT)?

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Figure 1: Alternative Models of Strategy STRATEGIC PLAN STRATEGIC ISSUE STRATEGIC INTENT

Standardize Operating Procedures/Financial Objectives

Organizational Consistency

Allegiance to Strategic Intent and Intermediate Term Goals

Allocate by Common Product/Markets

Investment Allocation

Invest in Core Competencies

Balance Cash Consumers with Cash Producers

Risk Reduction with Balance of Scope

Build Broad Portfolio of Balanced Advantages

Search for Market Niches

Competition with Large Competitors

Devalue Competitors Advantages

Search for Attainable Advantages

Competitive Advantage = Profitability

Accelerate Learning to Build New Advantages

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Limited Resources

Leverage Resources to Meet Ambitions 3

The strategic plan (also called Western model) centers on balancing the fit between current resources and opportunities The strategic intent (Asian model) leverages available resources to achieve nearly unattainable goals

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The strategic planning approach to corporate strategy was focused on resource management and incremental improvements in operating efficiencies in an effort to beat competition The strategic intent looks for way to build new competitive advantages

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The Strategic planning model is tends to be reactionary and is the strategic application of tactics The strategic intent model is more proactive and is the tactical application of strategy

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The strategic planning process typically focuses attention on available resources and the feasibility of alternative strategies in utilizing existing resources. Strategic intent captures the essence of winning, is stable over time, and sets goals that deserve personal effort and commitment
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Strategic plans focus on means to the end (how to achieve the objectives) Strategic intent is focused on the ends, while the means are left to be flexible. The objective of strategic intent is to provide the company a focus for developing strategic plans. Strategic intent leaves room for improvisation and opens innovation opportunities
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Implementing strategic intent requires a firm to stretch capabilities and resources to meet and win corporate challenges A firm that sets its strategic intent to be a global market leader may soon find it does not have the resources or capabilities to meet its objective This requires the organization to increase learning, build new advantages, and become more inventive in the utilization of resources in order to compete against current market leaders

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For corporate challenges to lead to competitive advantage, top management must:

Create a sense of urgency point out environmental

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signals to stress the need for change and improvement Develop a competitor focus at every level through widespread use of competitive intelligence Provide employees with the skills they need to work effectively Give the organization time to digest one challenge before launching another Establish clear milestones and review mechanisms
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