Strategic Management
THIRTEENTH EDITION
Strategic Management
CONCEPTS AND CASES
Fred R. David
Francis Marion University Florence, South Carolina
Prentice Hall
Boston Columbus Indianapolis New York San Francisco Upper Saddle River Amsterdam Cape Town Dubai London Madrid Milan Munich Paris Montreal Toronto
Delhi Mexico City Sao Paulo Sydney Hong Kong Seoul Singapore Taipei Tokyo
Strategic Management
CONCEPTS AND CASES
Editorial Director: Sally Yagan Editor in Chief: Eric Svendsen Acquisitions Editor: Kim Norbuta Product Development Manager: Ashley Santora Editorial Project Manager: Claudia Fernandes Editorial Assistant: Meg O'Rourke Director of Marketing: Patrice Lumumba Jones Marketing Manager: Nikki Ayana Jones Marketing Assistant: Ian Gold Senior Managing Editor: Judy Leale Associate Production Project Manager:
Ana Jankowski Operations Specialist: Ilene Kahn Art Director: Steve Frim Text and Cover Designer: Judy Allan
Manager, Visual Research: Beth Brenzel Manager, Rights and Permissions: Zina Arabia Image Permission Coordinator: Cynthia Vincenti Manager, Cover Visual Research & Permissions:
Karen Sanatar Cover Art: Vetta TM Collection Dollar Bin:
istockphoto Editorial Media Project Manager: Ashley Lulling Production Media Project Manager: Lisa Rinaldi Full-Service Project Management: Thistle Hill
Publishing Services, LLC Composition: Integra Software Services, Ltd. Printer/Binder: Courier/Kendallville Cover Printer: Lehigh-Phoenix Color/Hagerstown Text Font: 10/12 Times
Credits and acknowledgments borrowed from other sources and reproduced, with permission, in this textbook appear on appropriate page within text.
Copyright ? 2011, 2009, 2007 by Pearson Education, Inc., publishing as Prentice Hall, One Lake Street, Upper Saddle River, New Jersey 07458. All rights reserved. Manufactured in the United States of America. This publication is protected by Copyright, and permission should be obtained from the publisher prior to any prohibited reproduction, storage in a retrieval system, or transmission in any form or by any means, electronic, mechanical, photocopying, recording, or likewise. To obtain permission(s) to use material from this work, please submit a written request to Pearson Education, Inc., Permissions Department, One Lake Street, Upper Saddle River, New Jersey 07458.
Many of the designations by manufacturers and seller to distinguish their products are claimed as trademarks. Where those designations appear in this book, and the publisher was aware of a trademark claim, the designations have been printed in initial caps or all caps.
Library of Congress Cataloging-in-Publication Data David, Fred R.
Strategic management: concepts and cases / Fred R. David.--13th ed. p. cm.
Includes bibliographical references and index. ISBN-13: 978-0-13-612098-8 (casebound) ISBN-10: 0-13-612098-9 (casebound) 1. Strategic planning. 2. Strategic planning--Case studies. I. Title. HD30.28.D385 2011 658.4'012--dc22
10 9 8 7 6 5 4 3 2
2009052036
ISBN 10: 0-13-612098-9 ISBN 13: 978-0-13-612098-8
To Joy, Forest, Byron, and Meredith-- my wife and children--
for their encouragement and love.
Brief Contents
Preface xvii
Acknowledgments xxiii
About the Author xxvii
Part 1 Overview of Strategic Management 2
Chapter 1 The Nature of Strategic Management 2
THE COHESION CASE: MCDONALD'S -- 2009 27
Part 2 Strategy Formulation 40
Chapter 2 The Business Vision and Mission 40
Chapter 3 The External Assessment 58
Chapter 4 The Internal Assessment 90
Chapter 5 Strategies in Action 130
Chapter 6 Strategy Analysis and Choice 172
Part 3 Strategy Implementation 210
Chapter 7 Implementing Strategies: Management and Operations Issues 210
Chapter 8 Implementing Strategies: Marketing, Finance/ Accounting, R&D, and MIS Issues 250
Part 4 Strategy Evaluation 284
Chapter 9 Strategy Review, Evaluation, and Control 284
Part 5 Key Strategic-Management Topics 308
Chapter 10 Business Ethics/Social Responsibility/ Environmental Sustainability 308
Chapter 11 Global/International Issues 328
Part 6 Strategic-Management Case Analysis 346 How to Prepare and Present a Case Analysis 346
Name Index 359
Subject Index 363
vii
Contents
Preface xvii
Acknowledgments xxiii
About the Author xxvii
Part 1 Overview of Strategic Management 2
Chapter 1 The Nature of Strategic Management 2
MCDONALD'S CORPORATION: DOING GREAT IN A WEAK ECONOMY 4 What Is Strategic Management? 5 Defining Strategic Management 6 & Stages of Strategic Management 6 & Integrating Intuition and Analysis 7 & Adapting to Change 8 Key Terms in Strategic Management 9 Competitive Advantage 9 & Strategists 10 & Vision and Mission Statements 11 & External Opportunities and Threats 11& Internal Strengths and Weaknesses 12 & Long-Term Objectives 13 & Strategies 13 & Annual Objectives 13 & Policies 14 The Strategic-Management Model 14 Benefits of Strategic Management 16 Financial Benefits 17 & Nonfinancial Benefits 18 Why Some Firms Do No Strategic Planning 18 Pitfalls in Strategic Planning 19 Guidelines for Effective Strategic Management 19 Comparing Business and Military Strategy 21 THE COHESION CASE: MCDONALD'S CORPORATION--2009 27 ASSURANCE OF LEARNING EXERCISES 37 Assurance of Learning Exercise 1A: Gathering Strategy Information 37 Assurance of Learning Exercise 1B: Strategic Planning for My University 37 Assurance of Learning Exercise 1C: Strategic Planning at a Local Company 38 Assurance of Learning Exercise 1D: Getting Familiar with SMCO 38
Part 2 Strategy Formulation 40
Chapter 2 The Business Vision and Mission 40
WAL-MART: DOING GREAT IN A WEAK ECONOMY 42 What Do We Want to Become? 43
What Is Our Business? 43 Vision versus Mission 45 & The Process of Developing Vision and Mission Statements 46
Importance (Benefits) of Vision and Mission Statements 47
A Resolution of Divergent Views 48 Characteristics of a Mission Statement 49
A Declaration of Attitude 49 & A Customer Orientation 50 & Mission Statement Components 51 Writing and Evaluating Mission Statements 53
ASSURANCE OF LEARNING EXERCISES 56 Assurance of Learning Exercise 2A: Evaluating Mission Statements 56 Assurance of Learning Exercise 2B: Writing a Vision and Mission Statement for McDonald's Corporation 56 Assurance of Learning Exercise 2C: Writing a Vision and Mission Statement for My University 57 Assurance of Learning Exercise 2D: Conducting Mission Statement Research 57
Chapter 3 The External Assessment 58
DUNKIN' BRANDS, INC.: DOING GREAT IN A WEAK ECONOMY 60 The Nature of an External Audit 61 Key External Forces 61 & The Process of Performing an External Audit 62 The Industrial Organization (I/O) View 63 Economic Forces 63 Social, Cultural, Demographic, and Natural Environment Forces 66 Political, Governmental, and Legal Forces 68 Technological Forces 69 Competitive Forces 71 Competitive Intelligence Programs 72 & Market Commonality and Resource Similarity 74 Competitive Analysis: Porter's Five-Forces Model 74 Rivalry Among Competing Firms 75 & Potential Entry of New Competitors 76 & Potential Development of Substitute Products 77 & Bargaining Power of Suppliers 77 & Bargaining Power of Consumers 77 Sources of External Information 78 Forecasting Tools and Techniques 78 Making Assumptions 79
ix
x CONTENTS
Industry Analysis: The External Factor Evaluation (EFE) Matrix 80 The Competitive Profile Matrix (CPM) 81
ASSURANCE OF LEARNING EXERCISES 86 Assurance of Learning Exercise 3A: Developing an EFE Matrix for McDonald's Corporation 86 Assurance of Learning Exercise 3B: The External Assessment 86 Assurance of Learning Exercise 3C: Developing an EFE Matrix for My University 87 Assurance of Learning Exercise 3D: Developing a Competitive Profile Matrix for McDonald's Corporation 87 Assurance of Learning Exercise 3E: Developing a Competitive Profile Matrix for My University 87
Chapter 4 The Internal Assessment 90
, INC.: DOING GREAT IN A WEAK ECONOMY. HOW? 92 The Nature of an Internal Audit 93 Key Internal Forces 93 & The Process of Performing an Internal Audit 93 The Resource-Based View (RBV) 96 Integrating Strategy and Culture 97 Management 99 Planning 100 & Organizing 100 & Motivating 101 & Staffing 102 & Controlling 102 & Management Audit Checklist of Questions 103 Marketing 103 Customer Analysis 103 & Selling Products/Services 103 & Product and Service Planning 104 & Pricing 105 & Distribution 105 & Marketing Research 106 & Cost/Benefit Analysis 106 & Marketing/Audit Checklist of Questions 106 Finance/Accounting 106 Finance/Accounting Functions 107 & Basic Types of Financial Ratios 108 & Finance/Accounting Audit Checklist 113 Production/Operations 113 Production/Operations Audit Checklist 115 Research and Development 115 Internal and External R&D 116 & Research and Development Audit 117 Management Information Systems 117 Strategic-Planning Software 118 & Management Information Systems Audit 119 Value Chain Analysis (VCA) 119 Benchmarking 120 The Internal Factor Evaluation (IFE) Matrix 122
ASSURANCE OF LEARNING EXERCISES 128 Assurance of Learning Exercise 4A: Performing a Financial Ratio Analysis for McDonald's Corporation (MCD) 128 Assurance of Learning Exercise 4B: Constructing an IFE Matrix for McDonald's Corporation 128 Assurance of Learning Exercise 4C: Constructing an IFE Matrix for My University 128
Chapter 5 Strategies in Action 130
VOLKSWAGEN AG: DOING GREAT IN A WEAK ECONOMY. HOW? 132 Long-Term Objectives 133 The Nature of Long-Term Objectives 133 & Financial versus Strategic Objectives 134 & Not Managing by Objectives 135 The Balanced Scorecard 135 Types of Strategies 136 Levels of Strategies 138 Integration Strategies 139 Forward Integration 139 & Backward Integration 140 & Horizontal Integration 141 Intensive Strategies 141 Market Penetration 141 & Market Development 142 & Product Development 142 Diversification Strategies 143 Related Diversification 144 & Unrelated Diversification 144 Defensive Strategies 146 Retrenchment 146 & Divestiture 148 & Liquidation 149 Michael Porter's Five Generic Strategies 151 Cost Leadership Strategies (Type 1 and Type 2) 152 & Differentiation Strategies (Type 3) 153 & Focus Strategies (Type 4 and Type 5) 154 & Strategies for Competing in Turbulent, High-Velocity Markets 155 Means for Achieving Strategies 155 Cooperation Among Competitors 155 & Joint Venture/ Partnering 156 & Merger/Acquisition 158 & First Mover Advantages 161 & Outsourcing 161 Strategic Management in Nonprofit and Governmental Organizations 162 Educational Institutions 162 & Medical Organizations 163 & Governmental Agencies and Departments 163 Strategic Management in Small Firms 164
ASSURANCE OF LEARNING EXERCISES 168 Assurance of Learning Exercise 5A: What Strategies Should McDonald's Pursue in 2011?2013? 168 Assurance of Learning Exercise 5B: Examining Strategy Articles 168 Assurance of Learning Exercise 5C: Classifying Some Year 2009 Strategies 169 Assurance of Learning Exercise 5D: How Risky Are Various Alternative Strategies? 169 Assurance of Learning Exercise 5E: Developing Alternative Strategies for My University 170 Assurance of Learning Exercise 5F: Lessons in Doing Business Globally 170
Chapter 6 Strategy Analysis and Choice 172
APPLE: DOING GREAT IN A WEAK ECONOMY. HOW? 174 The Nature of Strategy Analysis and Choice 175
The Process of Generating and Selecting Strategies 175
A Comprehensive Strategy-Formulation Framework 176 The Input Stage 177 The Matching Stage 177
The Strengths-Weaknesses-Opportunities-Threats (SMOT) Matrix 178 & The Strategic Position and Action Evaluation (SPACE) Matrix 181 & The Boston Consulting Group (BCG) Matrix 185 & The Internal-External (IE) Matrix 188 & The Grand Strategy Matrix 191 The Decision Stage 192 The Quantitative Strategic Planning Matrix (QSPM) 192 & Positive Features and Limitations of the QSPM 195 Cultural Aspects of Strategy Choice 196 The Politics of Strategy Choice 196 Governance Issues 198
ASSURANCE OF LEARNING EXERCISES 205 Assurance of Learning Exercise 6A: Developing a SWOT Matrix for McDonald's 205 Assurance of Learning Exercise 6B: Developing a SPACE Matrix for McDonald's 205 Assurance of Learning Exercise 6C: Developing a BCG Matrix for McDonald's 205 Assurance of Learning Exercise 6D: Developing a QSPM for McDonald's 206 Assurance of Learning Exercise 6E: Formulating Individual Strategies 206 Assurance of Learning Exercise 6F: The Mach Test 206 Assurance of Learning Exercise 6G: Developing a BCG Matrix for My University 208 Assurance of Learning Exercise 6H: The Role of Boards of Directors 208 Assurance of Learning Exercise 6I: Locating Companies in a Grand Strategy Matrix 209
Part 3 Strategy Implementation 210
Chapter 7 Implementing Strategies: Management and Operations Issues 210
GOOGLE: DOING GREAT IN A WEAK ECONOMY. HOW? 212 The Nature of Strategy Implementation 213 Management Perspectives 214 Annual Objectives 215 Policies 217 Resource Allocation 219 Managing Conflict 220 Matching Structure with Strategy 220 The Functional Structure 222 & The Divisional Structure 222 & The Strategic Business Unit (SBU) Structure 225 & The Matrix Structure 226 & Some Do's and Don'ts in Developing Organizational Charts 228 Restructuring, Reengineering, and E-Engineering 229 Restructuring 230 & Reengineering 231
CONTENTS xi
Linking Performance and Pay to Strategies 231 Managing Resistance to Change 234 Creating a Strategy-Supportive Culture 235 Production/Operations Concerns When Implementing Strategies 236 Human Resource Concerns When Implementing Strategies 237
Employee Stock Ownership Plans (ESOPs) 239 & Balancing Work Life and Home Life 240 & Benefits of a Diverse Workforce 242 & Corporate Wellness Programs 242
ASSURANCE OF LEARNING EXERCISES 248 Assurance of Learning Exercise 7A: Revising McDonald's Organizational Chart 248 Assurance of Learning Exercise 7B: Do Organizations Really Establish Objectives? 248 Assurance of Learning Exercise 7C: Understanding My University's Culture 249
Chapter 8 Implementing Strategies: Marketing, Finance/Accounting, R&D, and MIS Issues 250
The Nature of Strategy Implementation 252
JOHNSON & JOHNSON (J&J): DOING GREAT IN A WEAK ECONOMY. HOW? 252 Current Marketing Issues 253 New Principles of Marketing 254 & Advertising Media 256 & Purpose-Based Marketing 257 Market Segmentation 257 Does the Internet Make Market Segmentation Easier? 259 Product Positioning 260 Finance/Accounting Issues 261 Acquiring Capital to Implement Strategies 262 New Source of Funding 266 & Projected Financial Statements 266 & Projected Financial Statement for Mattel, Inc. 268 & Financial Budgets 271 & Evaluating the Worth of a Business 273 & Deciding Whether to Go Public 275 Research and Development (R&D) Issues 275 Management Information Systems (MIS) Issues 277
ASSURANCE OF LEARNING EXERCISES 282 Assurance of Learning Exercise 8A: Developing a ProductPositioning Map for McDonald's 282 Assurance of Learning Exercise 8B: Performing an EPS/EBIT Analysis for McDonald's 282 Assurance of Learning Exercise 8C: Preparing Projected Financial Statements for McDonald's 282 Assurance of Learning Exercise 8D: Determining the Cash Value of McDonald's 283 Assurance of Learning Exercise 8E: Developing a ProductPositioning Map for My University 283 Assurance of Learning Exercise 8F: Do Banks Require Projected Financial Statements? 283
................
................
In order to avoid copyright disputes, this page is only a partial summary.
To fulfill the demand for quickly locating and searching documents.
It is intelligent file search solution for home and business.
Related download
- the impact of strategic management on organisational
- strategic management book kau
- strategic management
- strategic management hill jones test bank
- what is strategic management really inductive derivation
- strategic management metrics
- strategic management 4e rothaermel chapter 2 strategic
- strategic management a competitive advantage approach
- asp s strategic planning professional spp sample test
- strategic management practice and corporate performance of
Related searches
- strategic management lecture
- strategic management multiple choice questions
- what is strategic management pdf
- strategic management lecture notes pdf
- strategic management lecture notes
- strategic management books pdf
- strategic management notes for mba
- strategic management pdf notes
- strategic management process pdf
- strategic management questions and answers
- download strategic management textboo
- strategic management case study pdf