Finance - Strategic Management, Sem 2

STRATEGIC MANAGEMENT Solved Question Paper

1.Explain the evolution, role and importance of business policy and

strategic management. What would be the role of manager in this age?
Introduction
The term strategic management has been traditionally used. New title such as business policy, corporate strategy and policy, corporate policies is essentially and extensively used which means more less the same concept.Evolution of Strategic Management
1) In early 1920’s and 1930’s the managers used day-to-day planning methods to perform any task.
2) To anticipate the future, they tried using tools like preparation of budgets and control systems like capital budgeting and management by objectives.
3) The techniques were unable to emphasize the future adequately.
4) The next step was they tried using long range planning which was replaced by strategic planning and later by strategic management.
5) In mid 1930’s, according to the nature of business the planning was done during Adhoc policy making.
6) As many businesses had just started operations and were mostly in a single product line, there arose a need for policy making.
7) As companies grew they expanded their products and they catered to more customer and which in turn increased their geographical coverage.
8) The expansion brought in complexity and lot of changes in the external environment. Hence there was a need to integrate functional areas.
9) This integration was brought about by framing policies to guide managerial action.
10) Policies helped to have pre-defined set of actions, which helped people to make decision.
11) Policymaking was the owner’s prime responsibility.

Q 2. ROLE OF STRATEGIC MANAGEMENT
1) Due to increase in the competition, in 1960’s there was a demand for critical look at the bane corrupt of business.
2) The environment played an important role in the business.
3) The relationship of business with the environment lead to the concept of strategy.
4) In early sixties, this helped the management to manage between the business and the environment.

Q 3. What is strategy? At what levels is it formulated?
INTRODUCTION
understand the process of strategic management the concept should be understood and controlled. The term strategy is derived from the Greek word “STRATEGOS”
Generalship. The actual direction of military force, as distinct from governing its deployment. The word strategy means “ THE ART OF GENERAL ”. Based on the studies and views by various experts and management gurus Strategy in business has taken various connotations.

Q 4 What is Strategic Management Process? Explain each step briefly.
Here are few definitions of Strategic Management Process.
1) According to Glueck it’s a stream of decisions and actions that lead to the development of an effective strategy/ Strategies to help achieve Corporate Strategies.
2) According to Hofer it’s the process, which deals with fundamental Organisational, renewal & growth with the development of strategies, Structures and Systems necessary to achieve such renewal and growth and with the organizational systems needed to effectively manage the strategy formulation and implementation process.
3) Ansoff defines it as “ The Systematic approach & important responsibility of general management to position and relate the firm to its environment in a way that will assure its Continued Success and make it secure from surprises”.

Q 5 Explain Strategic intent, stretch leverage & Fit.
Introduction: for an effective strategic intent one has to develop effective strategy, rather than focusing at the resourcefulness of Competition & their pace at which they are building competencies one has to focus on existing position.

Q 6. What is Environment ? How is it Changing?Introduction
Environment means the surrounding. It includes both internal and external objects, factors & influences under which someone/something exist.

Q 7. Explain the process of SWOT analysis? Elaborate what you would study in the environment?

INTRODUCTION
The external environment is made of factors, conditions that influences outside the organization. The external environment gives rise to opportunities, which can be accomplished, or it may cause problems to the organization.