PEKING UNIVERSITTY HSBC BUSINESS SCHOOL
Strategic Management
Academic Year: 2011/2012, Module 4
Mondays & Thursdays, 10:30-12:20pm, C214
Dr. Sai Lan
Assistant Professor of Management
Office: C209
Office Hours: Wednesday 3-4pm or by appointment
INTRODUCTION AND COURSE OBJECTIVES
Strategic management deals with decisions that fundamentally influence the direction of the organization and effective implementation of the direction chosen. Strategic management addresses the organizational structure, resources & capabilities, and the strategic positioning of the organization to create, capture and sustain competitive advantage. In addition to economic value creation, management also must make decisions concerning the distribution of this economic value. In this course, you will develop your skills at:
? Understanding how firms gain and sustain competitive advantage;
? Analyzing strategic business situations and formulating strategy; and
? Implementing strategy and organizing the firm for strategic success.
Success ultimately depends not only on the soundness of the formulated strategy, but also on effective implementation through appropriate organizational choices. This capstone business course focuses on strategic decisions, and with both the content of those decisions and the processes by which general managers position the businesses and allocate resources under conditions of both uncertainty and competition. This course utilizes various tools, concepts, and analytical frameworks that enhance our ability to define and analyze strategic problems and to identify sources of competitive advantage from both an industry and firm-level perspective.
This senior-level business course focuses on key issues in formulating and implementing strategies to create and sustain competitive advantage. Focusing on a firm’s strengths and weaknesses, we analyze the impact of change and environmental forces on unfolding opportunities for establishing and sustaining competitive advantage. Emphasis is given to developing pragmatic and action-oriented general management skills. Importantly, extant theory within the disciplines of strategy, accounting, economics, finance, international business, marketing, political science and organization theory have important implications for general management. Thus, this course emphasizes both cases and lecture/ discussion sessions.
This capstone business course has two distinct components. In the first half of the semester, we study the theory and practice of strategic management. In the second half of the semester, case presentations offer simulated real-world experience and practice for integrating material studied in the first half of the semester.
Strategic management deals with the world of experience. The world of experience is not a world of certainty. Thus, within the classroom, reasonable people (with different experiences) will view management differently. Management involves making sense together, and is a creative and subjective process. Conjectures and knowledge based on personal experiences are highly valued within the conversation of this class. Creativity will be rewarded in your participation grade, individual papers, and group projects. This capstone course also rewards the diligent worker who has the ability to listen and think critically.
THE RELATIONSHIP OF STRATEGIC MANAGEMENT TO OTHER BUSINESS COURSES
Up until this time, most of your education within the Business School has emphasized a specialized, functional perspective of business situations. For example, in Accountancy, you have concentrated on how to both identify and produce the information necessary to manage and guide organizations effectively. In Finance, you have been concerned with how capital markets work and, in turn, affect the financing of a company’s on-going operations. In Marketing, the focus has been on how to analyze, shape and respond to the needs of consumers as well as how to manage a company’s marketing efforts. In Operations Management, the focus has been organizing the production activities of a firm so it is able to produce quality goods and services at an attractive price. Finally, courses on Human Resource Management have been concerned with the effective development and management of a company’s human assets. All of these functional disciplines play a critical role in the success of a company, but how do they fit together?
In this capstone business course, we integrate these views together by taking the unique perspective of the situational problems of the general manager. The general manager's primary responsibility is to diagnose the critical factors that require attention in complex business situations and to find workable solutions to strategic and organizational problems. To solve such business problems, the general manager must be capable of understanding and using knowledge from each functional area to provide a "total business" (systems) perspective on issues pertaining to strategic management. The general manager must analyze competitive situations within industries in order to understand the sources of the firm’s competitive advantage. Strategy is enabled and constrained by the economic and political conditions that prevail in an industry or country, as well as by the resources available to management. In today’s increasingly global business environment, whether you are a newly hired employee or the CEO of the company, you must be capable of thinking like a general manager.
TECHNIQUES FOR LEARNING STRATEGIC MANAGEMENT
To accomplish our objectives, we will use a variety of learning techniques: lectures, outside of class assignments, readings, written reports, presentations, and most importantly, class discussion of case studies.
Case Analysis
Strategic thinking and analysis are best learned through practice. The capstone business cases we will study concern real-world business situations. These senior-level business cases are designed to provide you with data on real-life managerial problems, and case analysis is useful as a simulation of actual managerial activity. These integrative, capstone cases provide an opportunity to both apply the concepts that we discuss in class as well as to further develop our ability to think about business strategy. How much you learn from these strategic management cases depend on your preparation and active participation. Each of us will be responsible to be fully prepared for each class, and there will be assignments throughout the term to help focus our preparation. Everyone is expected to participate effectively in each class to comment, question, and analyze.
Objectives of Case Analysis:
? Increase your understanding of what managers should and should not do in guiding business to success;
? Build your skills for conducting strategic analysis and gaining in-depth experience in a variety of industries, competitive situations, and company circumstances;
? Obtain valuable practice in diagnosing strategic issues, evaluating strategic alternatives and formulating workable plans of action; and
? Enhance your sense of business judgment.
Group Work
Discussing cases and preparing analyses outside of class helps to deepen your knowledge about strategic management. Therefore, group work will be essential for weekly case preparation as well as for the major group project. Developing effective group skills is a critical part of the learning process. It is a good idea to have students with different areas of expertise in the group to facilitate the exchange of a variety of managerial viewpoints and to help guard against “groupthink.” To enable an internal balance within each group, I will divide the class into eight cross-functional groups.
Exams
There will be an optional final exam at the end of the semester. The final exam will test both your mastery of the concepts and your ability to apply them.
Individual Participation
Active participation in the class is an essential part of the learning experience. You are expected to contribute both to the case discussion and to discussion during the lecture sessions.
COURSE TEXTS AND CASES
Textbook: Grant, Robert M. Contemporary Strategy Analysis: Concepts, Techniques, and Applications.
Rothaermel, Frank. Strategic Management: Concepts and Cases. International Edition
Reading: Porter, Michael (1996). “What is Strategy?” Harvard Business Review, (November- December): 61-78.
REQUIREMENTS
The course requirements include (1) quality class participation, (2) 3 short writing homework assignments (text no longer than 2 double-spaced pages, 12-point font), (3) a group business strategy case report (text no longer than 10 double-spaced pages, 12-point font) and presentation, and (4) your choice between taking a final exam, or doing an individual report (text no longer than 10 double-spaced pages, 12-point font) and presentation. For the individual report, you may choose one of the public Chinese companies, identify current challenges in its business development, and then conduct (a) industry analysis, (b) business strategy analysis, (c) proposal for how to deal with its business challenges and improve its future business performance.
Students will form their own groups. Attendance in all class periods is required; and students are expected to read the assigned materials beforehand and participate in class discussions, just as they would do when attending a business meeting.
The specific requirements to be evaluated, including course weights, are as follows:
Class participation (including attendance) 20%
Homework 10%
Group case report and presentation 30%
Final exam, or individual report and presentation 40%
EXPECTATONS AND POLICIES
Preparation: I will assume that you have read everything assigned. Even if you are not presenting a case, please be sure to read the case carefully, as it will be the basis of class discussion. It is especially valuable and appreciated when you come to class with questions about the readings. Poor preparation is a disservice to your classmates and will negatively impact your participation grade.
Class Participation: Most of the learning in our class will occur through discussion. Thus, we want everyone’s active participation. Meaningful participation requires having carefully read and thought about the day’s material, but that is not sufficient. You also need to speak and while key insights are appreciated, you can also contribute by asking questions, politely disagreeing with comments, or following up on another student’s comments with further insights or evidence.
Homework: One purpose of homework assignments is to enhance class discussion. Thus, (hard-copy) assignments must be turned in before class begins on the day that they are due. You should bring a copy to class for your own reference during discussion. Assignments placed in my mailbox or under my door will not be accepted. If you are ill I will accept the assignment by e-mail Word attachment if it is received before the beginning of class on the day it is due. There will be no credit provided for late assignments.
Attendance and Punctuality: You cannot contribute to our learning if you are not in class. At the same time, it is understood that you may have other responsibilities and priorities. To balance these considerations, you are allocated two excused allowances. You can use these as you wish (e.g., job interviews, family needs, health days) with no questions asked. On these occasions, you are still responsible for turning in your assignment before the class session that you will miss. Please note that I will not make arrangements for homework after the fact. For each absence beyond these two, 5 points will be deducted from your individual participation grade. If lateness becomes an issue, I reserve the right to treat a class for which you are late as a missed class.
Course Organization: Homework assignments are shown in the schedule attached, and while subject to change, this schedule should guide your work plans. There will be no announcements in class concerning assignments, except those that may alter the attached schedule.
Technology: All mobile phones, PDAs, and other electronic devices should be turned off during class. Please do not leave and re-enter the class. Use of laptops in the class is discouraged, in order to achieve effective classroom learning.
Suggestions: If you have special inquiries or constructive suggestions concerning the progress of the class, please feel free to talk to me. You can make an appointment by telephone, e-mail, or simply leave a message in my mailbox.
CLASS SESSIONS AND ASSIGNMENTS
SESSION #1 Course Introduction
SESSION #2 Concept of Strategy
Read: Grant Chapter 1 “The Concept of Strategy”, Porter (1996) “What is Strategy?”
SESSION #3 Value and Performance
Read: Grant Chapter 2 “Goals, Values, and Performance”
SESSION #4 Strategic Coherence
Read: Case #1 Wal-Mart Stores 2003
SESSION #5 Industry Structure
Read: Grant Chapter 3 “Analyzing the Industry Environment”
SESSION #6 External Analysis - Barriers to Entry
Read: Case #2 RTE Cereal Industry
Homework #1 Due: Provide a Table of the Barriers to Entry to the Industry
SESSION #7 External Analysis – Competitive Forces
Read: Case #3 Cola Wars in China
Homework #2 Due: Provide a 5-Forces Analysis for the Soft-drink Industry
SESSION #8 Internal Analysis – Resources and Capabilities
Read: Grant Chapter 5 “Analyzing Resource and Capabilities”
Read: Case #4 Haier
Homework #3 Due: SWOT Analysis of Haier
SESSION #9 Competitive Strategies
Read: Grant Chapter 8 “Cost Advantage”
Grant Chapter 9 “Differentiation Advantage”
SESSION #10 Organization Structure
Read: Grant Chapter 6 “Organization Structure and Management Systems”
Grant Chapter 16 “Managing the Multi-business Corporation”
SESSION #11 Corporate Strategy – Vertical Integration and Diversification
Read: Grant Chapter 13 “Vertical Integration”
Grant Chapter 15 “Diversification Strategy”
SESSION #12 Corporate Strategy – Merger & Acquisition
Read: Rothaermel Chapter 9 “Acquisitions, Alliances, and Networks”
SESSION #13 Group Case Report Presentation
SESSION #14 Technology and Innovation Management
Read: Grant 11 “The Management of Innovation”
SESSION #15 Risks and Uncertainties
Read: Grant Chapter 4 “Competitive Analysis”
Grant Chapter 7 “Competitive Advantage”
SESSION #16 Global Strategies
Read: Grant Chapter 14 “Global Strategies”
SESSION #17 Individual Report Presentation
SESSION #18 Individual Report Presentation
Final Week Final Exam
