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    Strategic Change: Implementing Strategies To Build and Develop A Company

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    The document discusses strategic change and how companies can implement strategies to build and develop through internal new ventures, acquisitions, and strategic alliances. It outlines the distinct steps in any change process as determining the need for change, obstacles to change, and managing and evaluating change. Companies identify their core competencies to pursue opportunities and establish a competency agenda to guide strategy implementation.

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    Strategic Change: Implementing Strategies To Build and Develop A Company

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    anon_353784882
    16 views6 pages
    The document discusses strategic change and how companies can implement strategies to build and develop through internal new ventures, acquisitions, and strategic alliances. It outlines the distinct steps in any change process as determining the need for change, obstacles to change, and managing and evaluating change. Companies identify their core competencies to pursue opportunities and establish a competency agenda to guide strategy implementation.

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    Strategic Change

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    The document discusses strategic change and how companies can implement strategies to build and develop through internal new ventures, acquisitions, and strategic alliances. It outlines the distinct steps in any change process as determining the need for change, obstacles to change, and managing and evaluating change. Companies identify their core competencies to pursue opportunities and establish a competency agenda to guide strategy implementation.

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    © All Rights Reserved
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    Download as docx, pdf, or txt
    16 views6 pages

    Strategic Change: Implementing Strategies To Build and Develop A Company

    Uploaded by

    anon_353784882
    The document discusses strategic change and how companies can implement strategies to build and develop through internal new ventures, acquisitions, and strategic alliances. It outlines the distinct steps in any change process as determining the need for change, obstacles to change, and managing and evaluating change. Companies identify their core competencies to pursue opportunities and establish a competency agenda to guide strategy implementation.

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    STRATEGIC CHANGE: IMPLEMENTING STRATEGIES TO BUILD AND

    DEVELOP A COMPANY
    Strategic Change
    The movement of a company away from its present state toward some desired future state to
    increase its competitive advantage and profitability.

    The Change Process


    • Distinct steps of the change process:

    – Determining the need for change


    – Determining the obstacles to change
    – Managing and evaluating change

    Stages in the Change Process

    Another Illustration of the


    Change Process
    Portfolio of Core Competencies

     A core competence is a core skill of a company


     Identifying these central value-creating capabilities tells a company which business
    opportunity to pursue

    Establishing a Competency Agenda

    Strategy Implementation
    • Strategies implemented through:

    – Internal new ventures

    – Acquisitions

    – Strategic alliances
    “Successful organizations understand the importance of implementation, not just strategy, . . . and,
    moreover, recognize the crucial role of their people in the process.”

    - Jeffrey Pfeffer

    Strategic Change: Implementing Strategies to Build and


    Develop a Company

    Internal New Ventures


    • Involve creating the value-chain functions necessary to start a new business from
    scratch

    • Typically used to leverage or recombine valuable competencies to enter a new business


    area

    • Generally science-based companies tend to favor internal new ventures as a strategy


    implementation

    • Although these can be profitable, the reported failure rate is very high

    • Three reasons for failure:

    – Market entry occurs on too small a scale


    – Poor commercialization of the new product

    – Poor corporate management of the venture

    • Ways to limit risk:

    – Adopt a structured approach to managing the venture

    – Foster close links between R&D and marketing

    – Set up project teams

    – Choose ventures with greatest probability of commercial success

    – Monitor projects closely

    Scale of Entry and Profitability

    Acquisitions
    • Involve one company purchasing another company

    • Usually done by a company that:

    – wants to move fast

    – is in a well established industry and has barriers of entry

    • Used in two ways:

    – To strengthen competitive positioning by purchasing a competitor


    – To enter a new business or industry

    Advantages Disadvantages
    thj
    • Faster than building a new business • Often end up dissipating value

    • Less risk than internal new ventures • Often fail to realize anticipated benefits

    • Ability to circumvent most entry • Tend to be expensive


    barriers
    • Difficult to integrate various corporate
    cultures

    • Ways to limit risk:

    – Target identification and pre-acquisition screening

    – Bidding strategy (this works best when the stock market undervalues a company)

    – Integration

    Structuring Alliances to Reduce Opportunism


    Strategic Alliances
    • Cooperative agreements between companies to work together and share resources to
    achieve a common goal

    • Can be informal or short-term agreements

    • Can be joint ventures- a formal type of strategic alliance where two companies create a
    new separate company

    Advantages Disadvantages

    – Facilitate entry into a market – May provide competitors


    with access to valuable
    – Share the fixed costs and
    knowledge
    risks that arise

    – Bring together
    complementary skills and
    assets

    • Ways to limit risk:

    – Careful partner selection

    – Alliance structure

    – Alliance management

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