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This document explores strategic management, outlining key definitions, types, and planning approaches. It covers corporate, business, and functional strategy, emphasizing their impact on organizational success. Various strategic models, including rational and emergent processes, are discussed. The role of management accounting in strategy execution is also highlighted.
Strategy is a long-term direction to achieve organizational objectives.
It involves configuring resources within a changing environment to meet market needs and stakeholder expectations.
Corporate Strategy: Decides which businesses/markets to be in (diversification, acquisitions).
Business Strategy: Defines competitive advantage within chosen markets.
Functional Strategy: Focuses on specific operational areas (HR, marketing, IT, etc.).
Rational Model: A logical step-by-step approach (analyzing circumstances, generating strategies).
Emergent Approach (Mintzberg): Strategy evolves incrementally rather than following a strict process.
Incrementalism & Opportunism: Less formal approaches that adapt to circumstances dynamically.
Traditional Approach: Focuses on shareholder objectives.
Market-Led Approach: Starts with analyzing markets and competitors.
Resource-Based Approach: Focuses on leveraging core competencies for success.
Shift from traditional, internal-focused accounting to strategic management accounting (external-focused, competitor analysis, pricing decisions).
Supports strategic planning, business awareness, and decision-making.
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