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K.Viswanathan
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concerned with uncertainties, competitive situations, risks etc. which are likely to decide / bring changes in the course of action in future.
Tactics: Tactics are the methods to implement strategies. They are sub-strategies. Tactics are adopted so that the firm can face competition effectively. For ex. Introduction of new products, processes, proper promotion mix etc can become tactics to increase sales, which by itself can be a strategy.
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Approach to Management Control Systems: (MCS) Management control lies between strategy formulation and operational control. MCS has boundaries which distinguish it from other planning and control systems- strategy formulation, operational control and financial control. Strategy formulation is concerned with long term planning and therefore is the least systematic. Planning is the key here Operational control is concerned with short term planning and is therefore most systematic. Control is the key here. Management control falls between them. Both planning and control are required. (a) Strategy formulation : This is a planning process used by firms for deciding on the goals of the organisation and the strategies to be used for achieving them. Strategies establish advantages over competitors. The need for changing a strategy might arise in case of any threat not visulised 4/24/2013 14 earlier. Formulation of strategy involves:
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Either human beings are not Managers interact involved at all or interaction managers. is between a manager and non-manager.
Focus is on specific tasks Focus is on organisational units performed by the organisational unit Concerned with specific Concerned with broadly defined tasks requiring little or no activities of managers deciding judgment to perform what is to be done within the general constraints of strategies.
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Strategic Alternatives: ( Contd) (i) Stability Strategy: Firm has to hold its current position in the product market and has to stabilise its market share. Really speaking, these firms need no growth. But in practice all firms opt for better growth. (i) Growth Strategy: Significant incremental level of achievement in growth is targeted. Efforts are made to enter new markets, bring in new product lines and create an entry in additional market segments. Both internal and external growth strategies are attempted. The objectives of growth are: a. To ensure survival in the long run b. To achieve economies of scales c. To build corporate image d. To survive during tough times like recession e. To encourage innovativeness on the part of management
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