What Is Strategic Management?
INTRODUCTION
We are going to build a little more in this section on the concept of planning and decision making to introduce the concept of strategic management. Strategic Management is the title of our Capstone course at Georgia Southwestern, and I hope I have the opportunity to teach you guys in this course which you will take in a year or two. Strategic Management is a very interesting topic to me because it is all about making your company competitive and successful for the long term. We are not interested in short-term success, we want to build some competitive advantages that the competition can’t match and can’t even figure out how we do what we do. We are looking for sustainable competitive advantage where we have taken our resources and put them together in a way that delivers value to the customer either more cheaply or much more effectively and desirably than any of the competitors. A lot of times an effective strategy revolves around a “niche” or a focused small segment of a larger market where we are able to better serve a group of customers.
DISCUSSION BOARD ASSIGNMENT: Let’s try to think of some companies that have been very strategic in their thinking and have built sustainable competitive advantages: Chik-fil-A has focused on the chicken filet sandwich (and a few other similar products) and built an extremely strong reputation based on very high quality, fantastic customer service, and a reputation for supporting and giving to the community and being good corporate citizens. Wal-Mart has built a very sustainable competitive advantage based on flawless logistics and cost control. Their huge network of stores affords them unmatched buying power but their impressive inventory management and distribution system only builds on this cost advantage. They are able to deliver on their promise of “always the lowest prices.” Rolex has built a sterling reputation of superior quality, timeless styling, flawless design and workmanship, unparalleled service, and a superior dealer network. John Deere has become the leading manufacturer of agricultural machinery and implements based on superior quality, product longevity, outstanding dealers and service after the sale, and legendary reputation. They are very convincing that “nothing runs like a Deere.” Samuel Adams (Boston Beer Company) has originated and perfected the idea of domestic micro-brews which offer much higher quality and variety. They offer a wide array of truly outstanding brews and have developed a reputation as a group of committed brew-masters who only want to make the best beers. They have taken a lot of demand away from the imports but have also made large domestic brewers like Anheuser-Busch take notice (AB is now in the specialty brew business with products like Shock Top). Southwest Airlines has innovated in the airline industry by delivering low-cost, no frills, point-to-point flights